Program A: Administration/Fiscal

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Program A: Administration/Fiscal

Program Authorization: Louisiana Constitution of 1974, Article IV, Section 11; Title 36, chapter 17 of the Louisiana Revised Statutes; Title 22 of the Louisiana Revised Statutes; Act 83 of 1977 (Reorganization Act); Act 477 of 1992 (Reorganization Act); Act 850 of 1984 (Equal Opportunity in Insurance Act); and Act 517 of 1992 (Operations of Louisiana Insurance Guaranty Association with the Department of Insurance)

PROGRAM DESCRIPTION

The mission of the Administrative/Fiscal Program is to promote effective and efficient administration of resources and functions of the Department of Insurance through proper human resource management, information management, fiscal management including insurance premium tax audit and program evaluation. Additionally, the Administrative/Fiscal Program serves the public through the dissemination of information and through the final distribution of the assets of insurance companies placed in receivership.

The goals of the Administrative/Fiscal Program are:

Enforce the existing laws and propose new laws that promote the protection of the public related to matters involving insurance.

Better meet the needs of the public and improve customer services by increasing efficiency, fairness, consistency, and timeliness in the enforcement of applicable laws and regulations.

Maintain and expand the knowledge of staff and the technological infrastructure to respond to current and future consumer and industry needs.

The Administration/Fiscal Program is organizationally comprised of three offices: Office of the Commissioner, Office of Management and Finance, and Office of Receiverships.

The Office of the Commissioner must fulfill the duties of administering and enforcing the provisions of the Louisiana Insurance Code (Title 22 of the Louisiana Revised Statutes of 1950, as amended), by providing management oversight and administrative support to the programs making up the Department of Insurance. This includes internal audits of those programs and setting policies and procedures in order to help and protect policyholders of Louisiana. This office also provides a liaison function with the Louisiana Insurance Guaranty Funds and works to inform and educate the Louisiana public in matters related to insurance.

The Office of Management and Finance administers the following areas: revenue collection and auditing, including premium taxes, assessments, fees, and penalties; human resource management; management information system; administrative services; fiscal affairs, including payroll, purchasing, accounts payable, appropriations, financial reporting, property control, professional services contracts, and program evaluations. The department is the fourth largest revenue collector in the state.

The Office of Receiverships provides effective and efficient management of all insurance companies placed in receivership to assure that all company assets and liabilities are accounted for and liquidated in accordance with all applicable laws, rules, and regulations.

OBJECTIVES AND PERFORMANCE INDICATORS

Unless otherwise indicated, all objectives are to be accomplished during or by the end of FY 1999-2000. Performance indicators are made up of two parts: name and value. The indicator name describes what is being measured. The indicator value is the numeric value or level achieved within a given measurement period. For budgeting purposes, performance indicator values are shown for the prior fiscal year, the current fiscal year, and alternative funding scenarios (continuation budget level and Executive Budget recommendation level) for the ensuing fiscal year (the fiscal year of the budget document).

RESOURCE ALLOCATION FOR THE PROGRAM

SOURCE OF FUNDING

This program is funded from Fees and Self-generated Revenues. These funds are derived from various fees and licenses authorized by R.S. 22:1078; auditing fees collected from insurance companies audited; and a charge against the Insurance Rating Commission Program for 40% of the expenditures of the Administrative/Fiscal Program.

ANALYSIS OF RECOMMENDATION

GENERAL FUND	TOTAL	T.O.	DESCRIPTION

$0	$11,979,950	89	ACT 19 FISCAL YEAR 1998-1999

			BA-7 TRANSACTIONS:
$0	$111,893	0	BA-7 approved for Administrative Law Judges

$0	$12,091,843	89	EXISTING OPERATING BUDGET – November 20, 1998

$0	$25,993	0	Annualization of FY 1998 – 1999 Classified State Employees Merit Increase
$0	$25,320	0	Classified State Employees Merit Increases for FY 1999 – 2000
$0	($1,419,093)	0	Risk Management Adjustment
$0	$34,300	0	Acquisitions and Major Repairs
$0	($318,000)	0	Nonrecurring Acquisitions and Major Repairs
$0	$11,265	0	Legislative Auditor Fees
$0	$321	0	UPS Fees
$0	($45,016)	0	Attrition Adjustment
$0	($6,105)	0	Salary Funding from Other Line Items
$0	$410	0	Civil Service Fees
$0	$1,315,425	0	Other Adjustments – Funding to Estimated Amounts to be Collected for Bail Bond Fees
$0	$47,551	0	Other Adjustments – Additional funding for Y2K Software
$0	($7,740)	0	Other Adjustments – Reduction of required Professional Services
$0	$5,364	0	Other Adjustments – Adjustment for transfers to Department of Justice for legal services
$0	$174,729	5	Other Technical Adjustments - Transfer of the Fraud Unit from the Market Compliance Program to the Administrative/ Fiscal Program to correctly align the unit with the Legal Division of the Department

$0	$11,936,157	94	TOTAL RECOMMENDED

$0	($155,276)	5	DIFFERENCE (TOTAL RECOMMENDED AND EXISTING OPERATING BUDGET)

The total means of financing for this program is recommended at 98.8% of the existing operating budget. It represents 89.9% of the total request ($13,220,005) for this program. The net decrease in funding provided for this Program is primarily due to the increase in estimated amounts collected for Bail Bonds, and the transfer of the Fraud Unit from the Market Compliance Program, offset by reductions in Risk Management premiums. (Note: Based upon Act 834 of the 1993 Regular Session and Act 824 of the 1997 Regular Session, all funds collected in conjunction with the Bail Bond fees are forwarded to the designated Parish District Attorneys and the 24^th Judicial District).

PROFESSIONAL SERVICES

$25,300		Management consulting for software maintenance
$48,456		Management consulting for Y2K compliance
$3,000		On-site training

$76,756		TOTAL PROFESSIONAL SERVICES

OTHER CHARGES

$107,746		Legislative Auditor expenses
$8,023,925		Bail bond fee remitted to the District Attorney in each parish except Orleans for indigent defense. In New Orleans, the payment is remitted to the Judicial Administrator for the Orleans Parish Criminal District Court.
$500		Senate Subscriber Service

$8,132,171		TOTAL OTHER CHARGES

		Interagency Transfers:
$2,685		Department of Treasury
$4,929		Department of Civil Service
$1,800		Office of Information Services
$131,543		Office of the Attorney General for legal services
$111,893		Division of Administrative Law
$1,800		Uniform Payroll System charges
$500		State archives

$255,150		TOTAL INTERAGENCY TRANSFERS

ACQUISITIONS AND MAJOR REPAIRS

$32,000		Replacement of broken/obsolete computer equipment, two Laptop computers, three NT Servers, three tape drives, and four printers
$2,300		Replacement of broken office equipment

$34,300		TOTAL ACQUISITIONS AND MAJOR REPAIRS

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