BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                            



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                                    THIRD READING


          Bill No:  AB 98
          Author:   Assembly Budget Committee
          Amended:  6/11/13 in Senate
          Vote:     27 - Urgency

           
           ASSEMBLY FLOOR  :  Not relevant


           SUBJECT :    Property insurance:  Seismic Safety Account

           SOURCE  :     Author


           DIGEST  :    This bill makes statutory changes necessary for the  
          continued funding of the Seismic Safety Commission.

           ANALYSIS  :    

          This bill:

          1.Creates the Seismic Safety Account within the Insurance Fund.

          2.Requires the Department of Insurance to calculate an annual  
            assessment, not to exceed $0.15 per property exposure, to be  
            charged to each commercial and residential property exposure  
            based on specified factors.

          3.Requires the insurer to collect the assessment and remit it to  
            the Department of Insurance unless the insurer elects to pay  
            the assessment on the insured's behalf. 

           Background
                                                                CONTINUED





                                                                     AB 98
                                                                     Page  
          2

           
          The passage of the Seismic Safety Act in 1975 established the  
          Seismic Safety Commission.  The Commission was established to  
          advise the Governor, the Legislature, and local governments on  
          risk mitigation in the event of an earthquake.  Subsequent  
          legislation (Chapter 532, Statutes of 2006) renamed the  
          commission the Alfred E. Alquist Seismic Safety Commission,  
          moved the commission under the California State and Consumer  
          Services Agency, and added an additional three members to the  
          commission. Currently, the commission is comprised of twenty  
          commissioners. 

           FISCAL EFFECT  :    Appropriation:  No   Fiscal Com.:  Yes    
          Local:  No

          According to the Senate Budget and Fiscal Review Committee, the  
          2013 Budget Act includes a General Fund loan of $1.12 million to  
          the Insurance Fund.  The General Loan will be made to the  
          Insurance Fund in order to finance operations of the Commission  
          for Fiscal Year 2013-14.  The loan to the Insurance Fund is  
          expected to be repaid once sufficient funds for repayment have  
          been allocated to the Seismic Safety Account.  


          AL:nl  6/13/13   Senate Floor Analyses 

                         SUPPORT/OPPOSITION:  NONE RECEIVED

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