Substitute For

HOUSE BILL NO. 4281

A bill to make appropriations for the department of insurance and financial services for the fiscal year ending September 30, 2024; and to provide for the expenditure of the appropriations.

the people of the state of michigan enact:


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part 1

line-item appropriations

Sec. 101. There is appropriated for the department of insurance and financial services for the fiscal year ending September 30, 2024, from the following funds:

DEPARTMENT OF INSURANCE AND FINANCIAL SERVICES

 

 

 

APPROPRIATION SUMMARY

 

 

 

Full-time equated unclassified positions

6.0

 

 

Full-time equated classified positions

384.5

 

 


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GROSS APPROPRIATION

 

$

74,647,900

Interdepartmental grant revenues:

 

 

 

Total interdepartmental grants and intradepartmental transfers

 

 

732,100

ADJUSTED GROSS APPROPRIATION

 

$

73,915,800

Federal revenues:

 

 

 

Total federal revenues

 

 

1,017,100

Special revenue funds:

 

 

 

Total local revenues

 

 

0

Total private revenues

 

 

0

Total other state restricted revenues

 

 

72,398,700

State general fund/general purpose

 

$

500,000

Sec. 102. DEPARTMENTAL ADMINISTRATION AND SUPPORT

 

 

 

Full-time equated unclassified positions

6.0

 

 

Full-time equated classified positions

23.5

 

 

Unclassified salaries--FTEs

6.0

$

910,000

Administrative hearings

 

 

173,700

Department services--FTEs

20.0

 

4,065,300

Executive director programs--FTEs

3.5

 

912,400

Property management

 

 

1,348,100

Worker's compensation

 

 

1,300

GROSS APPROPRIATION

 

$

7,410,800

Appropriated from:

 

 

 

Interdepartmental grant revenues:

 

 

 

IDG from LARA, debt management

 

 

70,600

Special revenue funds:

 

 

 

Bank fees

 

 

585,400


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Captive insurance regulatory and supervision fund

 

 

56,000

Consumer finance fees

 

 

285,100

Credit union fees

 

 

967,400

Deferred presentment service transaction fees

 

 

260,300

Insurance bureau fund

 

 

2,365,300

Insurance continuing education fees

 

 

67,500

Insurance licensing and regulation fees

 

 

1,992,300

MBLSLA fund

 

 

759,600

Multiple employer welfare arrangement

 

 

1,300

State general fund/general purpose

 

$

0

Sec. 103. INSURANCE AND FINANCIAL SERVICES REGULATION

 

 

 

Full-time equated classified positions

361.0

 

 

Consumer services and protection--FTEs

91.0

$

13,329,100

Financial institutions evaluation--FTEs

137.0

 

25,720,300

Insurance evaluation--FTEs

133.0

 

25,343,400

GROSS APPROPRIATION

 

$

64,392,800

Appropriated from:

 

 

 

Interdepartmental grant revenues:

 

 

 

IDG from LARA, debt management

 

 

636,300

Federal revenues:

 

 

 

Federal revenues

 

 

1,017,100

Special revenue funds:

 

 

 

Bank fees

 

 

6,234,800

Captive insurance regulatory and supervision fund

 

 

770,900

Consumer finance fees

 

 

3,035,700


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Credit union fees

 

 

9,315,900

Deferred presentment service transaction fees

 

 

2,350,200

Insurance bureau fund

 

 

22,478,900

Insurance continuing education fees

 

 

1,309,600

Insurance licensing and regulation fees

 

 

10,249,000

MBLSLA fund

 

 

6,906,100

Multiple employer welfare arrangement

 

 

88,300

State general fund/general purpose

 

$

0

Sec. 104. INFORMATION TECHNOLOGY

 

 

 

Information technology services and projects

 

$

2,344,300

GROSS APPROPRIATION

 

$

2,344,300

Appropriated from:

 

 

 

Interdepartmental grant revenues:

 

 

 

IDG from LARA, debt management

 

 

25,200

Special revenue funds:

 

 

 

Bank fees

 

 

145,500

Captive insurance regulatory and supervision fund

 

 

13,500

Consumer finance fees

 

 

72,000

Credit union fees

 

 

246,000

Deferred presentment service transaction fees

 

 

49,500

Insurance bureau fund

 

 

459,000

Insurance continuing education fees

 

 

9,000

Insurance licensing and regulation fees

 

 

1,135,300

MBLSLA fund

 

 

189,300

State general fund/general purpose

 

$

0

Sec. 105. ONE-TIME APPROPRIATIONS

 

 

 

Insulin prescription drug market study

 

$

500,000


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GROSS APPROPRIATION

 

$

500,000

Appropriated from:

 

 

 

State general fund/general purpose

 

$

500,000

 

part 2

provisions concerning appropriations

for fiscal year 2023-2024

general sections

Sec. 201. Pursuant to section 30 of article IX of the state constitution of 1963, total state spending from state sources under part 1 for fiscal year 2023-2024 is $72,898,700.00 and state spending from state sources to be paid to local units of government for fiscal year 2023-2024 is $0.00.

Sec. 202. The appropriations authorized under this part and part 1 are subject to the management and budget act, 1984 PA 431, MCL 18.1101 to 18.1594.

Sec. 203. As used in this part and part 1:

(a) "Department" means the department of insurance and financial services.

(b) "Director" means the director of the department.

(c) "FTE" means full-time equated.

(d) "IDG" means interdepartmental grant.

(e) "LARA" means the department of licensing and regulatory affairs.

(f) "MBLSLA fund" means the restricted account established under section 8 of the mortgage brokers, lenders, and servicers licensing act, 1987 PA 173, MCL 445.1658.

(g) "Subcommittees" means the subcommittees of the house of representatives and senate appropriations committees with


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jurisdiction over the budget for the department.

Sec. 204. The department shall use the internet to fulfill the reporting requirements of this part. This requirement shall include transmission of reports via email to the recipients identified for each reporting requirement and it shall include placement of reports on an internet site.

Sec. 205. Except as otherwise provided in this part, all reports required under this part shall be submitted to the subcommittees, the senate and house fiscal agencies, the senate and house policy offices, and the state budget office.

Sec. 206. To the extent permissible under section 261 of the management and budget act, 1984 PA 431, MCL 18.1261, all of the following apply to funds appropriated in part 1:

(a) The funds must not be used for the purchase of foreign goods or services, or both, if competitively priced and of comparable quality American goods or services, or both, are available.

(b) Preference must be given to goods or services, or both, manufactured or provided by Michigan businesses, if they are competitively priced and of comparable quality.

(c) Preference must be given to goods or services, or both, that are manufactured or provided by Michigan businesses owned and operated by veterans, if they are competitively priced and of comparable quality.

Sec. 207. The department shall not take disciplinary action against an employee of the department in the state classified civil service because the employee communicates with a member of the legislature or a member's staff, unless the communication is prohibited by law and the department is exercising its authority as


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provided by law.

Sec. 208. The department shall prepare a report on outofstate travel expenses not later than January 1 of each year. The travel report shall be a listing of all travel by classified and unclassified employees outside this state in the immediately preceding fiscal year that was funded in whole or in part with funds appropriated in the department's budget. The report shall be submitted to the senate and house appropriations committees. The report shall include the following information:

(a) The dates of each travel occurrence.

(b) The total transportation and related costs of each travel occurrence, including the proportion funded with state general fund/general purpose revenues, the proportion funded with state restricted revenues, the proportion funded with federal revenues, and the proportion funded with other revenues.

Sec. 209. Funds appropriated in this part and part 1 must not be used by the department to hire a person to provide legal services that are the responsibility of the attorney general. This prohibition does not apply to legal services for bonding activities and for those outside services that the attorney general authorizes.

Sec. 210. Not later than December 15, the state budget office shall prepare and transmit a report that provides estimates of the total general fund/general purpose appropriation lapses at the close of the prior fiscal year. This report must summarize the projected year-end general fund/general purpose appropriation lapses by major departmental program or program areas. The state budget office shall transmit the report to the chairpersons of the senate and house appropriations committees.


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Sec. 211. (1) In addition to the funds appropriated in part 1, there is appropriated an amount not to exceed $1,000,000.00 for federal contingency authorization. Authorized funds are not available for expenditure until they have been transferred to another line item in part 1 under section 393(2) of the management and budget act, 1984 PA 431, MCL 18.1393.

(2) In addition to the funds appropriated in part 1, there is appropriated an amount not to exceed $5,000,000.00 for state restricted contingency authorization. Authorized funds are not available for expenditure until they have been transferred to another line item in part 1 under section 393(2) of the management and budget act, 1984 PA 431, MCL 18.1393.

Sec. 212. The department shall cooperate with the department of technology, management, and budget to maintain a searchable website accessible by the public at no cost that includes, but is not limited to, all of the following for the department:

(a) Fiscal-year-to-date expenditures by category.

(b) Fiscal-year-to-date expenditures by appropriation unit.

(c) Fiscal-year-to-date payments to a selected vendor, including the vendor name, payment date, payment amount, and payment description.

(d) The number of active department employees by job classification.

(e) Job specifications and wage rates.

Sec. 213. Within 14 days after the release of the executive budget recommendation, the department shall cooperate with the state budget office to provide the chairpersons of the senate and house appropriations committees with an annual report on estimated state restricted fund balances, state restricted fund projected


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revenues, and state restricted fund expenditures for the prior 2 fiscal years.

Sec. 214. The department shall maintain, on a publicly accessible website, a department scorecard that identifies, tracks, and regularly updates key metrics that are used to monitor and improve the department's performance.

Sec. 215. To the extent permissible under the management and budget act, 1984 PA 431, MCL 18.1101 to 18.1594, the director shall take all reasonable steps to ensure that geographically disadvantaged business enterprises compete for and perform contracts to provide services or supplies, or both. The director shall strongly encourage firms with which the department contracts to subcontract with geographically disadvantaged business enterprises for services, supplies, or both.

Sec. 216. On a quarterly basis, the department shall submit to the senate and house appropriations committees and the recipients required under section 205 of this part a comparison by line item of the number of FTEs authorized from funds appropriated in part 1 to the actual number of FTEs employed by the department at the end of the reporting period.

Sec. 217. Appropriations in part 1 shall, to the extent possible by the department, not be expended until all existing work project authorization available for the same purposes is exhausted.

Sec. 218. The department shall receive and retain copies of all reports funded from appropriations in part 1. Federal and state guidelines for short-term and long-term retention of records shall be followed. The department may electronically retain copies of reports unless otherwise required by federal or state guidelines.

Sec. 219. Not later than April 1, the department shall report


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on each specific policy change made to implement a public act affecting the department that took effect during the prior calendar year to the senate and house appropriations committees and the joint committee on administrative rules.

Sec. 220. (1) From the funds appropriated in part 1, the department shall do all of the following:

(a) Report to the senate and house appropriations committees any amounts of severance pay for a department director, deputy director, or other high-ranking department official not later than 14 days after a severance agreement with the director or official is signed. The name of the director or official and the amount of severance pay must be included in the report required by this subdivision.

(b) By February 1, report on the total amount of severance pay remitted to former department employees during the fiscal year ending September 30, 2023, and the number of former department employees that were remitted severance pay during the fiscal year ending September 30, 2023.

(2) As used in this section, "severance pay" means compensation that is both payable or paid upon the termination of employment and in addition to either wages or benefits earned during the course of employment or generally applicable retirement benefits.

Sec. 221. It is the intent of the legislature that the department maximize the efficiency of the state workforce and, where possible, prioritize in-person work. The department must post its in-person, remote, or hybrid work policy on its website.

Sec. 222. (1) No funding appropriated in part 1 shall be used to restrict or interfere with actions related to diversity, equity,


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and inclusion (DEI); to restrict or impede a marginalized community's access to government resources, programs, or facilities; or to diminish, interfere with, or restrict an individual's ability to exercise the right to reproductive freedom.

(2) From the funds appropriated in part 1, local governments shall report any action or policy that attempts to restrict or interfere with the duties of the local health officer.

Sec. 223. Unless prohibited by law, the department may accept credit card or other electronic means of payment for licenses, fees, or permits.

Sec. 224. From the funds appropriated in part 1 from the insurance bureau fund, funds may be expended to support legislative participation in insurance activities coordinated by insurance and legislative associations, in accordance with section 225 of the insurance code of 1956, 1956 PA 218, MCL 500.225.

 

INSURANCE AND FINANCIAL SERVICES REGULATION

Sec. 301. The department shall provide a report by September 30 based on the annual rate filings from health insurance issuers that includes all of the following:

(a) The number that are approved by the department.

(b) The number that are denied by the department.

(c) The percentage of rate filings processed within the applicable statutory time frames.

(d) The average number of calendar days to process rate filings.

Sec. 302. In addition to the funds appropriated in part 1, the funds collected by the department in connection with a conservatorship under section 32 of the mortgage brokers, lenders,


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and servicers licensing act, 1987 PA 173, MCL 445.1682, and funds collected by the department from corporations being liquidated under the insurance code of 1956, 1956 PA 218, MCL 500.100 to 500.8302, must be appropriated for all expenses necessary to provide for the required services. Funds are available for expenditure when they are received by the department of treasury and must not lapse to the general fund at the end of the fiscal year. The total amount appropriated under this section and section 303 must not exceed $1,000,000.00.

Sec. 303. The department may make available to interested entities customized listings of nonconfidential information in its possession. The department may establish and collect a reasonable charge to provide this service. The revenue from this service is appropriated when received and must be used to offset expenses to provide the service. Any balance of this revenue collected and unexpended at the end of the fiscal year must lapse to the appropriate restricted fund. The total amount appropriated under this section and section 302 must not exceed $1,000,000.00.

Sec. 304. The department must electronically transmit the annual report prepared pursuant to section 238 of the insurance code of 1956, 1956 PA 218, MCL 500.238, and section 2108 of the banking code of 1999, 1999 PA 276, MCL 487.12108, at the time of the publication of the report.

Sec. 305. The department must update examination manuals and letters of guidance to state-chartered financial institutions as necessary to reflect how the department will evaluate institutions that provide banking or other financial services to marijuana-related businesses or businesses that transport, test, grow, process, or sell marijuana, based on the most recent state laws and


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guidance. The department may also include guidance or information on how federal law and regulations may impact state-chartered institutions.

 

ONE-TIME APPROPRIATIONS

Sec. 401. From the funds appropriated in part 1 for the insulin prescription drug market study, the department must conduct a study of the insulin market in this state and submit recommendations to the legislature to lower the price of insulin for individuals. The study must include information and data regarding insurers, pharmacy benefit managers, pharmacies, insulin consumers, and any other relevant stakeholders when creating recommendations to lower the price of insulin for individuals.