SB 20 — Requiring funding for increased costs to volunteer fire departments and EMS units

(c) The State Fire Commission may promulgate emergency rules and shall propose legislative rules for promulgation in accordance with §29A-3-1 et seq.

as may be necessary to 5 CS for SB 20 implement and comply with the provisions of this section.

(d) The Legislative Auditor shall notify the State Fire Marshal of any volunteer or part- volunteer fire company or department that is ineligible to receive grant funds due to the company's or department's failure to file required bank statements or financial reports or failure to comply with an audit or review by the Legislative Auditor.

A volunteer or part-volunteer fire company or department reported by the Legislative Auditor shall be ineligible to receive funds under this section until the Legislative Auditor notifies the State Fire Marshal that the company or department has come into compliance.

(e) For the purpose of this section:

"Length of Service Award Program" means a program to provide paid length of service awards to eligible volunteers.

"Eligible volunteer" means a bona fide volunteer who is an active part-time or on-call member of a volunteer fire department or a volunteer firefighter.

(a) There is continued in the State Treasury a special revenue fund to be known as the Intr SB 20 2025R1998 Emergency Medical Services Equipment and Training Fund.

Any balance remaining in the 6 CS for SB 20 fund at the end of any fiscal year does not revert to the General Revenue Fund but remains in the special revenue fund.

NOTE:CHAPTER 33.

TheINSURANCE. purpose of this bill is to require the State Fire Commission and the Commissioner of the Bureau for Public Health, respectively, to fund volunteer fire departments and emergency medical services units for any increased costs or expenditures that result from the implementation of a state legislative rule.

Strike-throughsARTICLE indicate3. language that would be stricken from a heading or the present law and underscoring indicates new language that would be added.

LICENSING, FEES, AND TAXATION OF INSURERS.

§33-3-33.

Surcharge on fire and casualty insurance policies to benefit volunteer and part- volunteer fire departments;

Public Employees Insurance Agency and municipal pension plans;

special fund created;

allocation of proceeds;

effective date.

(a)(1) For the purpose of providing additional revenue for volunteer fire departments, part- volunteer fire departments and certain retired teachers and the Teachers Retirement Reserve Fund, there is hereby authorized and imposed on and after July 1, 1992, on the policyholder of any fire insurance policy or casualty insurance policy issued by any insurer, authorized or unauthorized, or by any risk retention group, a policy surcharge equal to one percent of the taxable premium for each such policy.

After June 30, 2005, the surcharge shall be imposed as specified in subdivisions (2) and (3) of this subsection.

(2) After June 30, 2005, through December 31, 2005, for the purpose of providing 7 CS for SB 20 additional revenue for volunteer fire departments, part-volunteer fire departments and to provide additional revenue to the Public Employees Insurance Agency and municipal pension plans, there is hereby authorized and imposed on and after July 1, 2005, on the policyholder of any fire insurance policy or casualty insurance policy issued by any insurer, authorized or unauthorized, or by any risk retention group, a policy surcharge equal to one percent of the taxable premium for each such policy.

(3) (a) After December 31, 2005 December 31, 2025, for the purpose of providing additional revenue for volunteer fire departments and part-volunteer fire departments, there is hereby authorized and imposed on the policyholder of any fire insurance policy or casualty insurance policy issued by any insurer, authorized or unauthorized, or by any risk retention group, a policy surcharge equal to fifty-five one hundredths of one percent of the taxable premium for each such policy.

(4) (b) For purposes of this section, casualty insurance may not include insurance on the life of a debtor pursuant to or in connection with a specific loan or other credit transaction or insurance on a debtor to provide indemnity for payments becoming due on a specific loan or other credit transaction while the debtor is disabled as defined in the policy.

The policy surcharge may not be subject to premium taxes, agent commissions, or any other assessment against premiums.

(b) (c) The policy surcharge shall be collected and remitted to the commissioner by the insurer, or in the case of surplus lines coverage, by the surplus lines licensee, or if the policy is issued by a risk retention group, by the risk retention group.

The amount required to be collected under this section shall be remitted to the commissioner on a quarterly basis on or before the twenty-fifth day of the month succeeding the end of the quarter in which they are collected, except for the fourth quarter for which the surcharge shall be remitted on or before March 1 of the succeeding year.

(c) (d) Any person failing or refusing to collect and remit to the commissioner any policy surcharge and whose surcharge payments are not postmarked by the due dates for quarterly filing 8 CS for SB 20 is liable for a civil penalty of up to $100 for each day of delinquency, to be assessed by the commissioner.

The commissioner may suspend the insurer, broker, or risk retention group until all surcharge payments and penalties are remitted in full to the commissioner.

(d) (e) (1) All money from the policy surcharge shall be collected by the Commissioner who shall disburse the money received from the surcharge into a special account in the State Treasury, designated the Fire Protection Fund.

The net proceeds of this portion of the tax and the interest thereon, after appropriation by the Legislature, shall be distributed quarterly on the first day of the months of January, April, July, and October to each volunteer fire company or department on an equal share basis by the State Treasurer.

After June 30, 2005, the money received from the surcharge shall be distributed as specified in subdivisions (2) and (3) of this subsection.

(2)(A) After June 30, 2005, through December 31, 2005, all money from the policy surcharge shall be collected by the commissioner who shall disburse one half of the money received from the surcharge into the Fire Protection Fund for distribution as provided in subdivision (1) of this subsection.

(B) The remaining portion of moneys collected shall be transferred into the fund in the State Treasury of the Public Employees Insurance Agency into which are deposited the proportionate shares made by agencies of this state of the Public Employees Insurance Agency costs of those agencies, until November 1, 2005.

After October 31, 2005, through December 31, 2005, the remain portion shall be transferred to the special account in the state Treasury, known as the Municipal Pensions and Protection Fund (3) (2) After December 31, 2005 2025, all money from the policy surcharge shall be collected by the Commissioner who shall disburse all of the money received from the surcharge into the Fire Protection Fund for distribution as provided in subdivision (1) of this subsection.as follows:

(A) Sixty-four percent into the Fire Protection Fund for distribution as provided in subdivision (1) of this subsection;

9 CS for SB 20 (B) Twenty-two percent into the Fire Service Equipment and Training Fund established by §15A-11-11;

and (C) Fourteen percent into the Fire Service Recruitment and Retention Fund established by §15A-11-11a.

(4) (3) Before each distribution date to volunteer fire companies or departments, the State Fire Marshal shall report to the state Treasurer:

(A) The names and addresses of all volunteer and part-volunteer fire companies and departments within the state which meet the eligibility requirements established in §8-15-8a of this code during the preceding quarter;

(B) The number of volunteer firefighters and the number of full-time paid members providing services to each volunteer and part-volunteer fire company and department during the preceding quarter;

(C) A full accounting of each volunteer and part-volunteer fire company and department eligible to receive a distribution under this section’s revenues and expenditures for the last two calendar years;

and (D) A list of each volunteer and part-volunteer fire company and department has implemented the State Auditor’s West Virginia Checkbook fiscal reporting system on or before January 1, 2027.

(e) (f) Notwithstanding any other provision of this subsection, each volunteer and part- volunteer fire company and department shall implement the State Auditor’s West Virginia Checkbook fiscal reporting system on or before January 1, 2026 2027, in order to remain eligible to receive any funds pursuant to this section;

and (f) (g) The allocation, distribution, and use of revenues provided in the Fire Protection Fund are subject to the provisions of §8-15-8a and §8-15-8b of this code.

ARTICLE 12C.

SURPLUS LINE.

§33-12C-7.

Surplus lines tax.

10 CS for SB 20 (a) In addition to the full amount of gross premiums charged by the insurer for the insurance, every person licensed pursuant to §33-12C-8 of this code shall collect and pay to the commissioner a sum equal to four and fifty-five one-hundredths five percent of the gross premiums and gross fees charged, less any return premiums, for surplus lines insurance provided by the licensee pursuant to the license.

Where the insurance covers properties, risks or exposures located or to be performed both in and out of this state and this state is the insured's home state, the sum payable shall be computed on that portion of the gross premiums allocated to this state, plus an amount equal to the portion of the gross premiums allocated to other states or territories on the basis of the tax rates and fees applicable to properties, risks or exposures located or to be performed outside of this state, and less the amount of gross premiums allocated to this state and returned to the insured due to cancellation of policy:

Provided, That the surcharge imposed by §33-3-3 of this code on surplus lines policies shall no longer be effective with respect to premium attributable to coverage under such policies for periods after June 30, 2011:

Provided, however, That twelve 20 per cent percent of taxes collected under this subsection with respect to premium attributable to coverage under such policies after June 30, 2011, shall be disbursed and distributed in accordance with §33-3-33(d) of this code and eighty-eight 80 per cent percent in accordance with subdivision two, subsection (f) of this section.

The tax on any portion of the premium unearned at termination of insurance having been credited by the state to the licensee shall be returned to the policyholder directly by the surplus lines licensee or through the producing broker, if any.

(b) The individual insurance producer may not:

(1) Pay directly or indirectly the tax or any portion thereof, either as an inducement to the policyholder to purchase the insurance or for any other reason;

or (2) Rebate all or part of the tax or the surplus lines licensee's commission, either as an inducement to the policyholder to purchase the insurance or for any reason.

(c) The surplus lines licensee may charge the prospective policyholder a fee for the cost of 11 CS for SB 20 underwriting, issuing, processing, inspecting, service or auditing the policy for placement with the surplus lines insurer if:

(1) The service is required by the surplus lines insurer;

(2) The service is actually provided by the individual insurance producer or the cost of the service is actually incurred by the surplus lines licensee;

and (3) The provision or cost of the service is reasonable, documented, and verifiable.

(d) The surplus lines licensee shall make a clear and conspicuous written disclosure to the policyholder of:

(1) The total amount of premium for the policy;

(2) Any fee charged;

(3) The total amount of any fee charged;

and (4) The total amount of tax on the premium and fee.

(e) The clear and conspicuous written disclosure required by subdivision (4) of this subsection is subject to the record maintenance requirements of §33-12C-8 of this code.

(f)(1) This tax is imposed for the purpose of providing additional revenue for municipal policemen's and firemen's pension and relief funds and additional revenue for volunteer and part- volunteer fire companies and departments.

This tax is required to be paid and remitted, on a calendar year basis and in quarterly estimated installments due and payable on or before the twenty-fifth day of the month succeeding the close of the quarter in which they accrued, except for the fourth quarter, in respect of which taxes shall be due and payable and final computation of actual total liability for the prior calendar year shall be made, less credit for the three quarterly estimated payments prior previously made, and filed with the annual return to be made on or before March 1 of the succeeding year.

Provisions of this chapter relating to the levy, imposition, and collection of the regular premium tax are applicable to the levy, imposition, and collection of this tax to the extent that the provisions are not in conflict with this section.

(2) Except as provided in subsection (a) of this section, all taxes remitted to the 12 CS for SB 20 commissioner pursuant to subdivision one of this subsection shall be paid by him or her into a special account in the State Treasury, designated Municipal Pensions and Protection Fund, or pursuant to §8-22-18b of this code, the Municipal Pensions Security Fund, and after appropriation by the Legislature, shall be distributed in accordance with the provisions of §33-3-14d(c) of this code.

The surplus lines licensee shall return to the policyholder the tax on any unearned portion of the premium returned to the policyholder because of cancellation of policy.

(g) In determining the amount of gross premiums taxable in this state for a placement of surplus lines insurance covering properties, risks or exposures only partially located or to be performed in this state, the tax due shall be computed on the portions of the premiums which are attributable to properties, risks or exposures located or to be performed in this state and which relates to the kinds of insurance being placed as determined by reference to an appropriate allocation table.

(1) If a policy covers more than one classification:

(A) For any portion of the coverage identified by a classification on the allocation schedule, the tax shall be computed by using the allocation schedule for the corresponding portion of the premium;

(B) For any portion of the coverage not identified by a classification on the allocation schedule, the tax shall be computed by using an alternative equitable method of allocation for the property or risk;

(C) For any portion of the coverage where the premium is indivisible, the tax shall be computed by using the method of allocation which pertains to the classification describing the predominant coverage.

(2) If the information provided by the surplus lines licensee is insufficient to substantiate the method of allocation used by the surplus lines licensee, or if the commissioner determines that the licensee's method is incorrect, the commissioner shall determine the equitable and appropriate amount of tax due to this state as follows:

13 CS for SB 20 (A) By use of the allocation schedule where the risk is appropriately identified in the schedule;

(B) Where the allocation schedule does not identify a classification appropriate to the coverage, the commissioner may give significant weight to documented evidence of the underwriting bases and other criteria used by the insurer.

The commissioner may also consider other available information to the extent sufficient and relevant, including the percentage of the insured's physical assets in this state, the percentage of the insured's sales in this state, the percentage of income or resources derived from this state, and the amount of premium tax paid to another jurisdiction for the policy.

(h) The commissioner is authorized to participate in a clearinghouse established through NIMA or in a similar allocation procedure for the purpose of collecting and disbursing to signatory states any funds collected pursuant to this section that are allocable to properties, risks or exposures located or to be performed outside of this state:

Provided, That twelve 20 per cent percent of any moneys received from a clearinghouse or through a similar allocation procedure is subject to the provisions of §33-3-33(d) of this code and eighty-eight 80 per cent percent of such moneys is subject to the provisions of subdivision (2), subsection (f) of this section:

Provided, however, That to the extent other states where portions of the properties, risks, or exposures reside have failed to enter into NIMA or a similar allocation procedure with this state, the net premium tax collected shall be retained by this state and shall be disbursed and distributed in the same manner as moneys received through a clearinghouse or similar allocation procedure.

(i) Collection of tax.

If the tax owed by a surplus lines licensee under this section has been collected and is not paid within the time prescribed, the same shall be recoverable in a suit brought by the commissioner against the surplus lines licensee.

The commissioner may charge interest for any unpaid tax, fee, financial assessment or penalty, or portion thereof:

Provided, That interest may not be charged on interest.

Interest shall be calculated using the annual rates which are 14 CS for SB 20 established by the Tax Commissioner pursuant to §11-10-17a of this code and shall accrue daily.

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