BILL NUMBER: SB 1513 AMENDED
BILL TEXT
AMENDED IN ASSEMBLY JUNE 27, 2012
AMENDED IN SENATE APRIL 16, 2012
AMENDED IN SENATE MARCH 29, 2012
INTRODUCED BY Senator Negrete McLeod
FEBRUARY 24, 2012
An act to amend , repeal, and add Section 11797 of the
Insurance Code, relating to the State Compensation Insurance Fund.
LEGISLATIVE COUNSEL'S DIGEST
SB 1513, as amended, Negrete McLeod. State Compensation Insurance
Fund: investments.
Existing law requires the board of directors of the State
Compensation Insurance Fund to invest and reinvest, from time to
time, all moneys in the State Compensation Insurance Fund in excess
of current requirements in the same manner as is authorized in
certain provisions applicable to private insurance carriers. Existing
law prohibits the board from investing or reinvesting in certain
investments, including real estate and call options on common stock.
This bill would authorize , only until January 1, 2025,
the board to invest or reinvest, an aggregated maximum of 20% of the
moneys that are in excess of the admitted assets over the
liabilities and required reserves, in specified investments,
including the stock of certain corporations, specified
mortgage-related investment instruments, and in the stock of a
federal home loan bank. The bill would require the Department of
Insurance to submit to the Legislature by January 31, 2019, a report
that assesses the benefit and risk of the State Compensation
Insurance Fund's equities investment history by measuring the
volatility and total return of the fund's investment portfolio, as
specified.
Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 11797 of the Insurance Code is amended to read:
11797. (a) The board of directors shall cause all moneys in the
State Compensation Insurance Fund that are in excess of current
requirements to be invested and reinvested, from time to time, in the
same manner as provided for private insurance carriers pursuant to
Article 3 (commencing with Section 1170) and Article 4 (commencing
with Section 1190) of Chapter 2 of Part 2 of Division 1, but
excluding Sections 1191, 1191.1, 1191.5, 1192.2, 1192.4, 1192.6,
1192.7, 1192.9, 1192.95, 1192.10, 1194.7, 1194.8, 1194.81, 1194.82,
1194.85, 1198, and 1199. Notwithstanding the foregoing, the State
Compensation Insurance Fund may invest or reinvest an aggregated
maximum of 20 percent of moneys that are in excess of the admitted
assets over the liabilities and required reserves in the investments
allowed pursuant to Sections 1191, 1192.4, 1192.6, 1192.10, 1194.7,
and 1198.
(b) (1) (A) Notwithstanding any other law, the State Compensation
Insurance Fund may purchase general obligation bonds or other
evidence of indebtedness issued by the state, including, but not
limited to, warrants issued pursuant to Part 4 (commencing with
Section 17000) of Division 4 of Title 2 of the Government Code or
notes issued pursuant to Part 5 (commencing with Section 17300) of
Division 4 of Title 2 of the Government Code, in any amount and to
enter into purchase contracts with the state for this purpose.
(B) Notwithstanding any other law, the State Compensation
Insurance Fund may purchase Property Assessed Clean Energy (PACE)
bonds, as defined in Section 26104 of the Public Resources Code.
(2) The bonds or other evidence of indebtedness specified in
paragraph (1), upon delivery to the State Compensation Insurance
Fund, shall, for all purposes, be valid and binding obligations of
the issuer thereof, be validly issued and outstanding in accordance
with their stated terms, and not be deemed to be owned by or on
behalf of the issuer thereof.
(c) The Department of Insurance shall submit to the Legislature by
January 31, 2019, a report that assesses the benefit and risk of the
State Compensation Insurance Fund's equities investment history by
measuring the volatility and total return of the State Compensation
Insurance Fund's investment portfolio with and without equities. The
report shall be submitted pursuant to Section 9795 of the Government
Code.
(d) This section shall remain in effect only until January 1,
2025, and as of that date is repealed, unless a later enacted
statute, that is enacted before January 1, 2025, deletes or extends
that date.
SEC. 2. Section 11797 is added to the
Insurance Code , to read:
11797. (a) The board of directors shall cause all moneys in the
State Compensation Insurance Fund that are in excess of current
requirements to be invested and reinvested, from time to time, in the
same manner as provided for private insurance carriers pursuant to
Article 3 (commencing with Section 1170) and Article 4 (commencing
with Section 1190) of Chapter 2 of Part 2 of Division 1, but
excluding Sections 1191, 1191.1, 1191.5, 1192.2, 1192.4, 1192.6,
1192.7, 1192.9, 1192.95, 1192.10, 1194.7, 1194.8, 1194.81, 1194.82,
1194.85, 1198, and 1199.
(b) (1) (A) Notwithstanding any other law, the State Compensation
Insurance Fund may purchase general obligation bonds or other
evidence of indebtedness issued by the state, including, but not
limited to, notes issued pursuant to Part 5 (commencing with Section
17300) of Division 4 of Title 2 of the Government Code or warrants
issued pursuant to Part 4 (commencing with Section 17000) of Division
4 of Title 2 of the Government Code, in any amount and to enter into
purchase contracts with the state for this purpose.
(B) Notwithstanding any other law, the State Compensation
Insurance Fund may purchase Property Assessed Clean Energy (PACE)
bonds, as defined in Section 26104 of the Public Resources Code.
(2) The bonds or other evidence of indebtedness specified in
paragraph (1), upon delivery to the State Compensation Insurance
Fund, shall, for all purposes, be valid and binding obligations of
the issuer thereof, be validly issued and outstanding in accordance
with their stated terms, and not be deemed to be owned by or on
behalf of the issuer thereof.
(c) This section shall become operative on January 1, 2025.