28 Tex. Admin. Code § 181.1 - Bylaws of the Texas Certified Self-Insurer Guaranty Association
(a) The membership of the Texas Certified
Self-Insurer Guaranty Association (the Association) shall consist of all
certified self-insurers (members) that hold a certificate of authority to
self-insure issued by the Commissioner of Workers' Compensation of the Texas
Department of Insurance, Division of Workers' Compensation (the Commissioner).
Only certified self-insurers may be members of the Association.
(1) Membership shall begin on the date the
certificate of authority to self-insure takes effect and each member shall
designate a representative to receive notices from the association.
(2) The members of the Association shall meet
annually at a place and time designated by the Board of Directors. At the
Annual Meeting, the members shall conduct any necessary and proper
business.
(3) The association shall
have a president and vice-president and may have other officers as necessary to
conduct the business of the association.
(4) Special meetings of the association may
be called by the president of the association on 30 days notice to the members
of the association.
(5) A majority
of the members present either in person or by proxy at any meeting of the
association shall constitute a quorum.
(b) The business of the Association shall be
managed by the Board of Directors (the Board).
(1) The Board shall consist of three members
of the Association, one member designated by the Commissioner, and the Public
Insurance Counsel. The members of the Board shall hereinafter be referred to as
Directors. Each Director representing members of the Association must be a
current employee of a member of the Association.
(2) A quorum of the board is three voting
directors. No business may be conducted by the board unless a quorum of its
members is present at the meeting. An action by the board requires the
concurring vote of three directors. A motion to recommend an application for
certification that fails to receive the concurring vote of three directors
constitutes disapproval of the application.
(3) The board shall elect a chair and
vice-chair annually. The chair and vice-chair must be voting members of the
board of directors. The board may also elect other officers. The chair shall
preside at all meetings of the board. In the absence of the chair, the
vice-chair shall preside at the meeting.
(4) The board shall meet at least once during
each calendar quarter. Additional meetings may be held as necessary to conduct
the business of the association. Meetings shall be held at the call of the
chair or upon written request to the chair by any three directors of the
board.
(5) The board shall have the
authority to hire an executive director to conduct the day-to-day operations of
the association. The board may also authorize the hiring of additional staff as
necessary. The executive director serves at the pleasure of the board. The
employment or removal of an executive director requires the affirmative vote of
at least three members of the board. The salaries of the executive director and
staff shall be set by the board and be commensurate with the salaries paid by
state agencies.
(6) The board shall
have the authority to contract with others for any services necessary for the
operation of the association, including administration of the trust fund and
administration of claims of impaired self-insurers.
(7) A director shall abstain from voting on
any matter in which he or she has, directly or indirectly, a personal, private,
or business interest. As used in this rule, personal, private, or business
interest includes being an officer, director, or affiliate of a person or
entity subject to an action by the board, or directly or indirectly having a
material financial interest in a matter before the board.
(8) The directors shall serve without
compensation. But, the directors shall be reimbursed for any reasonable
expenses incurred in carrying out the duties of the board.
(c) The members of the Association shall
elect directors to represent the Association and shall elect officers of the
Association annually. The terms for the elected directors will begin on January
1 of each year. The Association shall annually elect one director for a term of
three years. Directors may serve consecutive terms on the Board.
(1) Prior to the election, the President
shall appoint from the membership of the Association a Nominations Committee of
at least three members, which shall be responsible for nominating Officers and
Directors to be elected by the Association. The Board shall provide a method by
which nominations may also be made by members of the Association. Any nominee
must be a current employee of a member of the Association.
(2) Each member of the association may cast
one vote for each director or officer to be elected by the
association.
(3) If a vacancy
occurs in any office elected by the association, including a director
representing the members of the association (by death, resignation, or
otherwise), the president, or in the event of a vacancy in the office of the
president, the vice president, shall appoint a committee of at least three
members which shall select a successor to fill the vacancy for the unexpired
term. A vacancy occurs when a term expires, a director resigns, dies, is
adjudicated mentally incompetent, or is convicted of a felony. If a director is
convicted of a felony, and cannot be removed by statute, the director is
prohibited from voting on any matter before the board.
(d) The Board shall levy assessments against
each member necessary to create and maintain the Texas Certified Self-Insurer
Guaranty Trust Fund (the Trust Fund). Assessments shall be levied in amounts
that will provide at least $1 million, but not more than $2 million. For
purposes of assessments, "payments" means all income benefits paid in the
preceding reported calendar year pursuant to obligations as a certified
self-insurer, or in the case of a first-year member of the Association, made by
the member's carrier on behalf of the member, pursuant to the Texas Workers'
Compensation Act. All earned income of the trust fund is retained by the trust
fund and may be used by the Board of Directors as provided in subsection (f)(1)
of these Bylaws.
(1) The amount assessed
against each individual member shall be based on the ratio of the payments made
by the member to the total payments made by or on behalf of all certified
self-insurers.
(2) If the security
deposit of an impaired certified self-insurer (or former self-insurer) is not
adequate to cover its self-insured liabilities for workers' compensation
benefits, the funds required to pay the additional benefits shall be paid from
the Trust Fund and reimbursed to the Trust Fund through assessment. The Board
shall assess those currently unimpaired self-insurers and former self-insurers
that were members of the Association for any time during the five years
immediately preceding the date of assessment (the "members subject to
assessment"), in accordance with this section. The Board shall provide for the
calculation of the estimated total amount necessary to pay all benefits and to
reimburse the Trust Fund (the "estimated total assessment"). The estimated
total assessment shall be assessed by the Board. The amount assessed against
each of the members subject to assessment shall be based on the ratio of
payments by a member to total payments.
(3) When all liabilities of an impaired
certified self-insurer (or former self-insurer) have been paid, and the trust
fund has been reimbursed, excess funds may be held in lieu of or in reduction
of an Administrative Fee, paid to the Division of Workers' Compensation in lieu
of or in reduction of a regulatory fee, used by the Board to pay administrative
expenses of the Association, or otherwise used for the benefit of the members
of the Association.
(4) The Board
of Directors shall have the authority to collect from the impaired certified
self-insurer (or former self-insurer) any amount that has been assessed against
other self-insurers to pay the liabilities of the impaired certified
self-insurer (or former self-insurer). The board may use any appropriate means
for collection of the assessment up to and including filing suit against the
impaired member or former member. Continued failure to pay the assessment may
result in a recommendation to the Commissioner that the member's certificate of
self-insurance be revoked.
(5) If
the Trust Fund is terminated for any reason, the funds then held in the Trust
Fund shall be paid to the Division of Workers' Compensation to be used for the
administration of the Workers' Compensation Act.
(e) The association shall mail notice of any
assessment to the designated representative of each member or former member of
the association. Each member or former member shall pay all assessments not
later than 30 days after it is notified of the assessment. Late payments shall
accrue interest at the rate of 1.5% per month on any unpaid balance. The board
may use any appropriate means for collection of the assessment up to and
including filing suit against the member or former member and continued failure
to pay the assessment may result in a recommendation to the Commissioner that
the member's certificate of self-insurance be revoked.
(f) The board of directors shall approve a
budget for the operating expenses for the succeeding year not later than
December 31 of each year.
(1) Income earned
from the investment of the trust fund shall be used for expenses of
administration of the association and of the trust fund.
(2) The board may assess an administrative
fee against members only when trust fund income is insufficient to pay the
costs of administering the trust fund, operations of the association, and
administering the claims of impaired members or former members.
(g) If the Commissioner declares
that a certified self-insurer (or former self-insurer) is impaired and
determines that the payment of benefits and claims administration shall be made
through the association, the board shall provide for the administration and
payment of claims on behalf of the impaired certified self-insurer (or former
self-insurer) in accordance with the Texas Workers' Compensation Act. The board
shall provide for the creation of a separate account for the administration of
each impaired certified self-insurer (or former self-insurer) and for the
payment from the trust fund to the separate account if the Commissioner advises
the board that additional funds are needed to supplement the security
deposit.
(h) The association shall
indemnify, or pay in advance, any present or former director, officer,
appointee, committee member, person serving in any appointed or elected
capacity, or employee for expenses, or other loss in connection with any
proceeding in which such a person is made a party because of the position they
hold for the association to the full extent of the law.
(1) The association may purchase insurance
for any present or former director, officer, appointee, committee member,
person serving in any appointed or elected capacity, or employee of the
association against any liability arising out of the position they hold for the
association, whether or not the association would have the power to indemnify
him or her against liability.
(2)
The protection and indemnification provided in this article shall be in
addition to any other right to which a director, officer, appointee, committee
member, person serving in any appointed or elected capacity, or employee may be
entitled.
(i) The board
shall adopt and amend rules, including these bylaws, in accordance with the
Administrative Procedure Act, Government Code, Chapter 2001. After proposing,
publishing, and receiving comments on rules, the board shall meet and vote on a
final version. Adoption of rules must be made contingent on approval by the
Commissioner and ratification by the association. The rules so adopted shall be
sent to the Commissioner. Upon approval by the Commissioner, and ratification
by the association, the rules shall be filed with the Texas Register and shall
become effective in accord with the provisions of the Administrative Procedure
Act. Failure to obtain ratification by the members will result in the board
reconsidering the rule and voting on a revised version.
(1) Rules shall be ratified by a majority
vote of the members of the association after adoption by the board. The
president may choose to conduct the ratification vote by mail-in ballot. Notice
of rulemaking actions by the board must be given in the manner provided by this
rule.
(2) Any notice required or
allowed by this rule shall be in writing and delivered by the United States
Postal Service or private delivery service, return receipt requested. In the
case of notice to a member of the association, notice shall be made to the
designated representative of the member. In the absence of a return receipt,
notice shall be deemed to be given five days after deposit with the United
States Postal Service or private delivery service, postage prepaid. Failure of
a member to actually receive a notice shall not invalidate any action that may
have been taken by the association or the board.
(j) The fiscal year of the association shall
be January 1 through December 31 of each year.
(k) The board shall keep books and records of
accounts, minutes of meetings of directors, and a record of members. All
records of the association will be open to review by any member at a time and
place convenient to the member and association staff. The financial records of
the association shall be audited annually by an independent auditor.
(l) All meetings of the association and the
board of directors shall be conducted in accordance with the most current
edition of Roberts Rules of Order, except when in conflict with the Texas
Workers' Compensation Act, these rules, and any other applicable statute
including the Texas Open Meetings Act.
Notes
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