[This Page Intentionally Left Blank]The commissioner of insurance is the chief executive of the...

Request for

Legislative Appropriations For Fiscal Years 2022 and 2023 Submitted to the Governor’s Office Budget Division and the Legislative Budget Board by the

Texas Department of Insurance October 9, 2020

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TEXAS DEPARTMENT OF INSURANCE REQUEST FOR LEGISLATIVE APPROPRIATIONS

FISCAL YEARS 2022 AND 2023

ADMINISTRATOR’S STATEMENT………………………………………………………………………………………… 1 ORGANIZATIONAL CHART………………………………………………………………………………………………… 1.A. CERTIFICATE OF DUAL SUBMISSION.…………………………………………………………………………………… 1.B. SUMMARIES OF REQUEST…………………………………………………………………………………………………. 2

Budget Overview……………………………………………………………………………………………………… 2

Summary of Base Request by Strategy…………………………………………………………………………….. ….. 2.A.

Summary of Base Request by Method of Finance……………………………………………………………………... 2.B.

Summary of Base Request by Object of Expense…………………………………………………………………........ 2.C.

Summary of Base Request by Objective Outcomes……………………………………………………………………. 2.D.

Summary of Exceptional Items Request…..……………………………………………………………………………. 2.E.

Summary of Total Request by Strategy….…………………………………………………………………………....... 2.F.

Summary of Total Request Objective Outcomes………………………………………………………………………. 2.G.

STRATEGY REQUESTS………………………………………………………………………………………………………. 3.A.

Program Level Request…………………..……………………………………………………………………………. 3.A.1

RIDER REVISIONS AND ADDITIONS REQUEST……………………………………………………………………....... 3.B.

EXCEPTIONAL ITEM REQUEST………………………………………………………………………………………..…. 4

Exceptional Item Request Schedule…………………………………………………………………………………… 4.A.

Exceptional Items Strategy Allocation Schedule……………………………………………………………………… 4.B.

Exceptional Items Strategy Request…………………………………………………………………………………… 4.C.

TEXAS DEPARTMENT OF INSURANCE REQUEST FOR LEGISLATIVE APPROPRIATIONS

FISCAL YEARS 2022 AND 2023

CAPITAL BUDGET………………………………………………………………………………………………………….. 5

Capital Budget Project Schedule…………………………………………………………………………………........ 5.A.

Capital Budget Project Information…………………………………………………………………………………… 5.B.

SUPPORTING SCHEDULES………………………………………………………………………………………………..... 6

Historically Underutilized Business Supporting Schedule…………………………………………………………….. 6.A.

Current Biennium Onetime Expenditure Schedule……………………………………………………………………. 6.B.

Federal Funds Supporting Schedule…………………………………………………………………………………… 6.C.

Estimated Revenue Collections Supporting Schedule…..…………………………………………………………….. 6.E.

Estimated Total of All Funds Outside the GAA Bill Pattern……………………………………………………… ..... 6.H.

Budgetary Impacts Related to Recently Enacted State Legislation …………………………………………………… 6.K.

Document Production Standards……………………....…………………………………………………………… ….. 6.L.

1. ADMINISTRATOR’S STATEMENT

Automated Budget and Evaluation System of Texas (ABEST)

10/6/2020 10:30:41AM

454 Department of Insurance

87th Regular Session, Agency Submission, Version 1

Administrator's Statement

GOVERNANCE: TDI COMMISSIONERS

The commissioner of insurance is the chief executive of the Texas Department of Insurance (TDI), and the commissioner of workers’ compensation serves as the chief

executive for TDI’s Division of Workers’ Compensation (DWC). The governor appoints both commissioners subject to Senate confirmation. The commissioner of

insurance and commissioner of workers’ compensation regulate the Texas insurance industry and workers’ compensation system, respectively, by administering and

enforcing applicable laws. The Texas Insurance and Labor Codes define TDI’s regulatory authority, and the agency’s regulatory rules are contained within the Texas

Administrative Code.

COMMISSIONER OF INSURANCE UPDATE

TDI’s mission is to protect millions of Texas insurance consumers by regulating the industry fairly and diligently , promoting a stable and competitive market, and

providing information that helps consumers. In 2020, the mission was fulfilled during the COVID-19 pandemic while seamlessly transitioning all but a handful of

employees to working from home.

With more than $180 billion of premiums written in 2018, Texas ranks as the nation’s second largest insurance market and the seventh largest in the world. The agency

regulates approximately 2,800 companies and more than 700,000 agents and adjusters. The agency is the primary financial regulator for 205 insurers that do business

across the United States and another 49 that do business around the world.

Over the past three years, TDI has undertaken a major modernization push to keep pace with rising demand and improve customer service by optimizing its use of existing

resources. Insurance premiums written in Texas increased 21% from 2015-2019 while claim payments increased 31%, indicators of the fast-growing market TDI regulates.

This results in a higher demand for many TDI services. TDI saw a 30% increase in new agent and adjuster licenses from 2016-2020, and renewals doubled over that period.

Consumer complaints increased 24% over that five years.

TDI’s modernization efforts have allowed the agency to improve services within its existing budget and more effectively respond to a growing market :

• Agent and adjuster licenses now take one day to process, down from 31 days in 2018. And the average wait time for a caller is less than one minute today, down from

30 minutes or more in 2018.

• Our complaint process returned almost $55 million to consumers in fiscal year 2020, a 49% increase over 2016.

• Collection of administrative penalties and prompt payment fines increased 32% from 2016-2020.

• We designed fully functional mediation and arbitration systems to implement Senate Bill 1264, which protects consumers from balance billing in an emergency or

when they don’t have a choice of doctors.

• We launched an artificial intelligence project to modernize policy filing reviews, a groundbreaking use of technology expected to improve reviews by ensuring faster

identification of issues meriting close attention.

We’ve made these improvements within our existing budget and staffing levels, and we’ve been able to maintain our improved customer service standards while moving

to a remote-work environment.

COMMISSIONER OF WORKERS' COMPENSATION UPDATE

The Division of Workers’ Compensation’s mission is to regulate Texas workers’ compensation efficiently , educate participants, and achieve a balanced system in which

everyone is treated fairly with dignity and respect.

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The Division of Workers’ Compensation (DWC) administers the workers’ compensation system, enforces the Texas Workers’ Compensation Act and rules, administers

the certified self-insurance program for individual employers, and resolves claim-level disputes about medical and income benefits.

The Texas workers’ compensation system has undergone significant changes since the passage of House Bill 7 in 2005. Since 2005, DWC has implemented several

initiatives to reduce and stabilize claim costs and improve injured employee outcomes (such as quality of care, access to care, and return-to-work outcomes).

These initiatives include:

• Adopting evidence-based treatment and return-to-work guidelines.

• Adopting a closed pharmacy formulary – one of the first in the nation for workers’ compensation .

• Implementing a new workers’ compensation fraud investigative unit and enforcement function within DWC to consolidate existing resources and increase agency

efforts to detect noncompliance and combat fraud.

• Implementing changes to income benefits, including new work-search requirements for employees eligible for supplemental income benefits.

• Streamlining dispute resolution processes and reducing the amount of time it takes to resolve income, medical fee, and medical necessity disputes.

• Developing a performance-based oversight program to monitor health care providers and insurance carriers on key performance measures.

• Implementing Medicare-based fee guidelines for professional services, inpatient and outpatient hospital services, and ambulatory surgical center services.

• Implementing a return-to-work reimbursement program for Texas employers.

As a result, Texas employers now have lower workers’ compensation insurance rates, stabilized claims costs, and better return-to-work outcomes. Texas employees have

improved access to quality medical care that helps them return to work quickly and safely. Additionally, DWC’s implementation of a closed pharmacy formulary has

significantly reduced the use of opioids and other addictive prescription drugs for injured employees in Texas . Several states have either adopted or are seriously

considering adoption of a closed pharmacy formulary to reduce prescription drug abuse among injured employees. These include Oklahoma, Tennessee, California,

Louisiana, Maine, Michigan, and Arkansas.

Although the 2005 legislative reforms have resulted in significant improvement to the Texas workers’ compensation system, DWC continues to work to increase

efficiencies, improve stakeholder outreach, and maximize limited resources. These efforts include the automation of certain agency functions, reducing paper records, and

enhancing information security. Additionally, DWC has launched initiatives to develop a recruitment plan for designated doctors in underserved areas and specialties,

streamline recertification training for designated doctors, and increase the use of video conferencing for dispute resolution proceedings when appropriate.

RESPONDING TO THE PANDEMIC

TDI began providing guidance to help health insurers prepare for the pandemic in late February. Over the next several months, the agency published emergency rules,

issued bulletins to the insurance industry, maintained its customer service standards for processing licenses and helping consumers, and produced information to help

consumers with COVID-related questions – all while most of the agency’s staff worked remotely.

Highlights of the agency’s response include:

• Filing an emergency rule requiring insurers to pay the same amount for telemedicine services, including covered mental health services, as they do for in-person

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services. The rule, which applied to in-network services for state-regulated health plans, was later extended through September 12.

• Obtaining approval from Governor Greg Abbott to waive certain licensing requirements to ensure agents and adjusters could continue to get licenses and provide

services to their customers.

• Filing an emergency rule to make it easier for Texans with TDI-regulated health insurance to get early refills and to get prescriptions at more locations, including by

home delivery.

• Issuing 21 bulletins to the insurance industry on a number of topics, including coverage for COVID-19 testing and treatment, grace periods for consumer payments,

appropriate use of credit scores, and use of electronic signatures.

• Tracking and publishing information from auto insurers and health plans about their actions to help consumers during the pandemic .

• Producing videos and information for consumers about mental health services, use of telemedicine and other care options, scam alerts, and more.

DWC'S RESPONSE TO THE PANDEMIC

As the pandemic began, DWC started adapting processes to ensure the safety of stakeholders and staff. DWC transitioned staff to work from home and began issuing

guidance to those who participate in the Texas workers’ compensation system through a series of bulletins and memos . Throughout the months that followed, this action

enabled DWC to continue its core mission to provide customer service to injured employees, oversee dispute resolution, and regulate the system as a whole.

Highlights of DWC’s response include:

• Creating a coronavirus web page to provide workers’ compensation system stakeholders with state and federal resources related to COVID-19.

• Filing an emergency rule expanding the use of telemedicine in the workers’ compensation system.

• Moving all dispute proceedings, designated doctor instruction, workplace safety consultations, and OSHA trainings to a virtual or telephonic format.

• Establishing secure file transfer protocol boxes to allow documents to be shared securely and requiring electronic exchange of documents for dispute proceedings.

• Issuing a data call to workers’ compensation insurance carriers with the highest number of COVID-19 related claims to gain a better understanding of the impact to

the system.

• Obtaining approval from Governor Abbott to waive certain requirements that restricted first responders from getting workers’ compensation benefits if specific

conditions were not met.

• Temporarily suspending certain billing requirements for medical providers to ensure their focus could remain on their practice and their COVID -19 response.

SPECIAL NOTE ON TDI'S FUNDING

TDI is funded primarily by maintenance taxes and fees paid by the insurance industry, consistent with the principle that a regulated industry should bear the cost of its

regulation.

TDI’s operating account is a “self-leveling” dedicated fund. Under state law, the agency adjusts the maintenance tax rates on premiums each year to cover the fund’s

appropriations. That means cutting TDI’s appropriations also triggers a reduction in revenue collected and will not create savings for general revenue .

LEGISLATIVE APPROPRIATIONS REQEST FOR FISCAL 2022-23

As directed by the state’s leadership, TDI is submitting a baseline funding request of $233,381,325 and 1,210 FTEs for the fiscal 2022-23 biennium. This baseline budget

complies with the approved funding provided by the Legislative Budget Board and will enable the department to maintain and build on the service improvements made

over the past two years. These include:

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• Improving complaint processes to keep up with demand. A reorganization and other reforms have enabled us to double the number of cases resolved each month.

More gains are expected.

• Stepping up the use of technology to enhance efficiency in taking and reviewing applications for licenses .

• Implementing artificial intelligence to modernize policy filing reviews, a groundbreaking use of technology expected to improve reviews by ensuring faster

identification of issues meriting close attention and consistent results.

• Moving agent and adjuster as well as State Fire Marshal’s Office licensing applications and renewals online.

• Implementing Senate Bill 1264 to protect consumers from medical balance billing. The new mediation and arbitration systems received almost 18,000 requests from

January 1, 2020, through the end of fiscal year 2020.

EXCEPTIONAL ITEM REQUESTS

TDI respectfully requests restoration of the Regulatory Response Rider. This funding will only be used for a significant natural disaster or emergency response. The rider

enables TDI to respond quickly to large scale emergency situations. The requested item totals $4.4 million and 40 FTEs over the FY 2020-21 biennium levels. TDI activated

this rider to respond to the aftermath of Hurricane Harvey. Versions of this rider have been included in TDI’s budget every biennium since 2012.

BACKGROUND CHECKS

TDI is authorized by law to deny a license application if the applicant fails to provide a complete set of fingerprints. The agency also is authorized to access an applicant's

criminal history information from the Texas Department of Public Safety and the Federal Bureau of Investigations .

TDI has policies and procedures for conducting criminal background checks and has a memorandum of understanding with the TxDPS on staff training , requesting

information, and the handling of confidential criminal histories. These protocols establish guidelines for conducting criminal background checks on applicants for licenses

administered by TDI.

TDI staff approved by TxDPS may perform criminal background checks:

• To determine whether to grant a license to insurance agents, claims adjusters, and proposed officers and directors of applicants for insurance company licenses.

• To determine whether to hire external applicants or allow internal applicants to move into higher level positions .

NEW HEADQUARTERS

TDI is working with the Texas Facilities Commission (TFC) on the move to a new headquarters at 1601 Congress Avenue in 2022. TFC will present an exceptional item in its

legislative appropriations request that will cover the additional one-time costs associated with the new building. These costs include network wiring and equipment,

flooring, cubicles, and moving costs. TDI also anticipates some one-time expenses related to the move and can absorb these costs with existing resources.

Page 4 of 4

1.A. ORGANIZATIONAL CHART

TDI functional organizational chart Commissioner of Insurance

2 FTEs

General Counsel 43.5 FTEs

Internal Audit Director

8 FTEs

Administrative Operations Chief of Staff

177.5 FTEs

Chief Deputy Commissioner

Agency Affairs Deputy Commissioner

7 FTEs

Public Affairs Deputy Commissioner

14 FTEs

Customer Operations Deputy Commissioner

128 FTEs

Financial Regulation Deputy Commissioner

70.4 FTEs Budgeted 140.8 FTEs Outside Appropriations

Enforcement Deputy Commissioner

37 FTEs

Property & Casualty Deputy Commissioner

99.8 FTEs

SFMO State Fire Marshal

67 FTEs

Commissioner of Workers’ Compensation 5 FTEs

Policy & Customer Services Deputy Commissioner

103.1 FTEs

Health and Safety Deputy Commissioner

85.5 FTEs

Hearings Deputy Commissioner

100.3 FTEs

Appeals Panel Director

7 FTEs

Legal Services Deputy Commissioner

12 FTEs

Business Processes Deputy Commissioner

74.9 FTEs

Compliance & Investigations Deputy Commissioner

52 FTEs

Insurance Fraud Unit Associate Commissioner/

Chief Investigator 43 FTEs

Life & Health Deputy Commissioner

72 FTEs

1.B. CERTIFICATE OF DUAL SUBMISSION

Agency Name: Texas Department of Insurance

CERTIFICATE

This is to certify that the information contained in the agency Legislative Appropriation Request filed with the Legislative Budget Board (LBB)and the Governor’s Office Budget Division (Governor’s Office) is accurate to the best of my knowledge and that the electronic submission to theLBB via the Automated Budget and Evaluation System of Texas (ABEST) and the PDF tile submitted via the LBB Document Submissionapplication are identical.

Additionally, should it become likely at any time that unexpended balances will accrue for any account, the LBB and the Governor’s Office willbe notified in writing in accordance with Article IX, Section 7.01 (2020—21 GAA).

Chiecxecutive 0 i or Presiding Judge

Signattirs

Doug SlapePrinted Name

Chief Deputy CommissionerTitle

October 9. 2020Date

Anthony I nfantiniPrinted Name

Chief Financial OfficerTitle

October 9. 2020Date

l.A. Page I 01 I

2. SUMMARIES OF REQUEST

Budget Overview - Biennial Amounts




Appropriation Years: 2022-23

ALL FUNDS

2020-21 2022-23 2020-21 2020-21 2020-21 2020-212022-23 2022-23 2022-23 2022-23 2022-23

EXCEPTIONAL

ITEM

FUNDSGENERAL REVENUE FUNDS GR DEDICATED FEDERAL FUNDS OTHER FUNDS

Goal: 1. Protect and Ensure the Fair

Treatment of Consumers

1.1.1. Consumer Education And Outreach 3,845,372 3,726,406 1,509,740 1,524,384 10,374,885 10,343,954 15,729,997 15,594,744

1.1.2. Customer Operations 8,760,189 7,838,096 4,706,608 5,623,178 4,999 13,471,796 13,461,274

1.1.3. Texas.Gov 10,800 10,800 788,500 787,000 799,300 797,800

12,616,361 11,575,302 7,004,848 7,934,562 10,379,884 10,343,954 Total, Goal 30,001,093 29,853,818

Goal: 2. A Competitive and Stable

Insurance Market

2.1.1. Industry Solvency Regulation 7,981,383 7,799,320 2,851,513 3,190,514 234,602 11,067,498 10,989,834

2.2.1. Property & Casualty Regulation 9,949,735 9,686,758 3,531,569 3,962,620 13,481,304 13,649,378

2.2.2. Life & Health Regulation 6,496,477 7,653,982 3,684,149 3,131,060 10,180,626 10,785,042

2.3.1. Legal Review & Enforcement 9,469,517 9,376,074 3,605,736 3,835,526 8,600 13,075,253 13,220,200

2.3.2. Insurance Fraud 5,647,616 5,633,284 2,015,011 2,304,442 3,538 7,666,165 7,937,726

2.4.1. Three-Share Programs 91,999 91,266 32,148 37,334 6,390,564 6,514,711 128,600

39,636,727 40,240,684 15,720,126 16,461,496 6,628,704 8,600 Total, Goal 61,985,557 56,710,780

Goal: 3. Reduce Loss of Life & Property

Due to Fire

3.1.1. Fire Marshal 7,084,792 6,835,740 2,524,734 2,796,338 9,609,526 9,632,078

7,084,792 6,835,740 2,524,734 2,796,338 Total, Goal 9,609,526 9,632,078

Goal: 4. Effectively Regulate the Texas

Workers' Compensation System

4.1.1. Oversight And Compliance 14,522,240 15,530,278 113,438 120,000 14,635,678 15,650,278

4.1.2. Dispute Resolution 19,505,153 19,080,901 333,041 94,000 19,838,194 19,174,901

4.1.3. Subsequent Injury Fund Admin 16,315,695 15,715,288 16,315,695 15,715,288

4.1.4. Workers Compensation Fraud 2,151,293 2,105,401 2,151,293 2,105,401

4.2.1. Health And Safety Services 3,394,198 3,167,837 4,455,186 4,511,586 15,462 7,864,846 7,679,423

4.2.2. Customer Service & Information

Mgmt

17,322,274 17,253,727 75,604 134,000 17,397,878 17,387,727

73,210,853 72,853,432 4,455,186 4,511,586 537,545 348,000 Total, Goal 78,203,584 77,713,018

Page 1 of 2

Budget Overview - Biennial Amounts




Appropriation Years: 2022-23

ALL FUNDS

2020-21 2022-23 2020-21 2020-21 2020-21 2020-212022-23 2022-23 2022-23 2022-23 2022-23

EXCEPTIONAL

ITEM

FUNDSGENERAL REVENUE FUNDS GR DEDICATED FEDERAL FUNDS OTHER FUNDS

Goal: 5. Indirect Administration

5.1.1. Central Administration 6,083,409 6,570,214 8,990,634 8,389,142 1,457 15,075,500 14,959,356

5.1.2. Information Resources 13,127,785 13,082,698 19,835,824 19,858,785 32,963,609 32,941,483

5.1.3. Other Support Services 3,639,912 3,884,348 7,502,935 7,686,444 11,142,847 11,570,792

22,851,106 23,537,260 36,329,393 35,934,371 1,457 Total, Goal 59,181,956 59,471,631

Goal: 6. Regulatory Response

6.1.1. Contingency Regulatory Response 500,000 500,000 4,400,000

500,000 Total, Goal 500,000 4,400,000

Goal: 7. Health Insurance Risk Pool

7.1.1. Contingency Health Ins Risk Pool 1,774,953 41,052,524 42,827,477

1,774,953 41,052,524 Total, Goal 42,827,477

Total, Agency 82,688,986 82,188,986 136,564,907 135,980,199 4,455,186 4,511,586 58,600,114 10,700,554 282,309,193 233,381,325 4,400,000

1,231.2 1,210.0 Total FTEs 40.0

Page 2 of 2


Goal / Objective / STRATEGY Exp 2019 Est 2020 Bud 2021 Req 2022 Req 2023


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2.A. Summary of Base Request by Strategy

1 Protect and Ensure the Fair Treatment of Consumers

1 High-Quality Information and Services to Stake Holders

7,797,372 7,797,372 7,889,204 7,840,793 9,395,3191 CONSUMER EDUCATION AND OUTREACH

6,730,637 6,730,637 5,446,450 8,025,346 6,511,5012 CUSTOMER OPERATIONS

398,900 398,900 391,000 408,300 600,2253 TEXAS.GOV

$16,507,045TOTAL, GOAL 1 $16,274,439 $13,726,654 $14,926,909 $14,926,909

2 A Competitive and Stable Insurance Market

1 Regulate Insurance Industry Solvency

5,494,917 5,494,917 5,921,456 5,146,042 5,383,8201 INDUSTRY SOLVENCY REGULATION

2 Efficiently Regulate P&c/l&h Rates, Forms, Programs, And Networks

6,824,689 6,824,689 7,293,524 6,187,780 6,286,6051 PROPERTY & CASUALTY REGULATION

5,392,521 5,392,521 5,392,520 4,788,106 4,117,4712 LIFE & HEALTH REGULATION

3 Compliance with Statutes and Rules

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6,610,100 6,610,100 6,864,356 6,210,897 6,129,6451 LEGAL REVIEW & ENFORCEMENT

3,968,863 3,968,863 3,965,773 3,700,392 3,305,3162 INSURANCE FRAUD

4 Administrative Innovative Insurance Initiatives

64,300 64,300 4,357,586 2,157,125 2,013,7931 THREE-SHARE PROGRAMS

$27,236,650TOTAL, GOAL 2 $28,190,342 $33,795,215 $28,355,390 $28,355,390

3 Reduce Loss of Life & Property Due to Fire

1 Protect the Public from Loss of Life and Property due to fire

4,816,039 4,816,039 4,858,094 4,751,432 4,827,8891 FIRE MARSHAL

$4,827,889TOTAL, GOAL 3 $4,751,432 $4,858,094 $4,816,039 $4,816,039

4 Effectively Regulate the Texas Workers' Compensation System

1 Ensure Appropriate Delivery of Workers' Compensation Benefits

7,501,971 8,148,307 8,203,530 6,432,148 6,600,3791 OVERSIGHT AND COMPLIANCE

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9,373,681 9,801,220 10,549,600 9,288,594 9,212,1932 DISPUTE RESOLUTION

7,857,644 7,857,644 6,745,875 9,569,820 18,111,4163 SUBSEQUENT INJURY FUND ADMIN

1,022,162 1,083,239 1,122,577 1,028,716 807,4424 WORKERS COMPENSATION FRAUD

2 Ensure Workers' Comp System Participants are Educated and Informed

3,717,557 3,961,866 3,933,992 3,930,854 3,772,9691 HEALTH AND SAFETY SERVICES

8,551,350 8,836,377 9,270,640 8,127,238 8,116,1352 CUSTOMER SERVICE & INFORMATION MGMT

$46,620,534TOTAL, GOAL 4 $38,377,370 $39,826,214 $39,688,653 $38,024,365

5 Indirect Administration


7,306,626 7,652,730 7,827,339 7,248,161 6,627,1181 CENTRAL ADMINISTRATION

16,508,305 16,433,178 16,212,729 16,750,880 15,572,4852 INFORMATION RESOURCES

4,943,981 6,626,811 5,602,340 5,540,507 5,746,9973 OTHER SUPPORT SERVICES

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10/6/2020 10:30:44AM



$27,946,600TOTAL, GOAL 5 $29,539,548 $29,642,408 $30,712,719 $28,758,912

6 Regulatory Response


0 0 500,000 0 01 CONTINGENCY REGULATORY RESPONSE

$0TOTAL, GOAL 6 $0 $500,000 $0 $0

7 Health Insurance Risk Pool


0 0 42,827,477 0 01 CONTINGENCY HEALTH INS RISK POOL

$0TOTAL, GOAL 7 $0 $42,827,477 $0 $0

$123,138,718TOTAL, AGENCY STRATEGY REQUEST $117,133,131 $165,176,062 $118,499,710 $114,881,615

GRAND TOTAL, AGENCY REQUEST

TOTAL, AGENCY RIDER APPROPRIATIONS REQUEST* $0 $0

$114,881,615$118,499,710$123,138,718 $117,133,131 $165,176,062

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10/6/2020 10:30:44AM



METHOD OF FINANCING:

General Revenue Funds:

1 General Revenue Fund 230,206 229,406 229,806 229,806 276,973

8042 Insurance Maint Tax Fees 39,972,044 42,257,330 41,185,301 40,544,073 39,466,333

$40,202,250 $42,486,736 $41,415,107 $40,773,879 $39,743,306 SUBTOTAL

General Revenue Dedicated Funds:

36 Dept Ins Operating Acct 57,514,773 63,120,042 61,805,841 58,828,974 54,636,125

5101 Subsequent Injury Fund 9,378,628 6,551,464 7,672,692 7,672,692 17,912,134

$66,893,401 $69,671,506 $69,478,533 $66,501,666 $72,548,259 SUBTOTAL

Federal Funds:

555 Federal Funds 2,227,593 2,227,593 2,255,793 2,255,793 2,840,222

$2,227,593 $2,227,593 $2,255,793 $2,255,793 $2,840,222 SUBTOTAL

Other Funds:

161 TexasSure Fund 5,073,752 5,073,752 5,073,752 5,073,752 7,054,759

329 Healthy TX Sm Emp Prem Stabil. Fund 0 41,052,524 0 0 0

666 Appropriated Receipts 2,736,135 4,663,951 276,525 276,525 952,172

$7,809,887 $50,790,227 $5,350,277 $5,350,277 $8,006,931 SUBTOTAL

TOTAL, METHOD OF FINANCING $123,138,718 $117,133,131 $165,176,062 $118,499,710 $114,881,615

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*Rider appropriations for the historical years are included in the strategy amounts.

2.A. Page 6 of 6

Department of Insurance


Agency code: Agency name:454

METHOD OF FINANCING Exp 2019 Est 2020 Bud 2021 Req 2022 Req 2023


2.B. Summary of Base Request by Method of Finance 10/6/2020 10:30:44AM

GENERAL REVENUE

1 General Revenue Fund

REGULAR APPROPRIATIONS

Regular Appropriations from MOF Table (2018-19 GAA)

$230,926 $0 $0 $0 $0


$0 $230,926 $230,926 $0 $0


$0 $0 $0 $229,806 $229,806

RIDER APPROPRIATION

Art IX, Sec 13.11, Earned Federal Funds (2018-19 GAA)

$46,759 $0 $0 $0 $0

LAPSED APPROPRIATIONS

Article VIII, Spec Provisions, Sec. 4, Texas.gov Appropriation (2018-19 GAA)

$(712) $0 $0 $0 $0

Article VIII, Spec Provisions, Sec. 4, Texas.gov Appropriation (2020-21 GAA)

2.B. Page 1 of 18







GENERAL REVENUE

$0 $(720) $(1,520) $0 $0

Comments: Projected undercollection of subscription fees

General Revenue FundTOTAL,

$229,806 $229,806 $229,406 $230,206 $276,973

8042 General Revenue - Insurance Companies Maintenance Tax and Insurance Department Fees Account No. 8042



$42,298,112 $0 $0 $0 $0


$0 $42,958,467 $42,981,711 $0 $0


$0 $0 $0 $41,185,301 $40,544,073

RIDER APPROPRIATION

Art VIII, p. VIII-21 Rider 11, Appropriation of Unexpended Balances

(2018-2019 GAA)

$845,330 $0 $0 $0 $0

2.B. Page 2 of 18







GENERAL REVENUE

Art IX, Sec 14.03(i), Capital Budget UB (2018-19 GAA)

$976,953 $0 $0 $0 $0

Art IX, Sec 18.59, Contingency for SB 1584 (2020-21 GAA)

$0 $96,098 $93,098 $0 $0

Art VIII, p. VIII-19 Rider 11, Appropriation of Unexpended Balances (2020-21 GAA)

$0 $(1,069,856) $1,069,856 $0 $0

TRANSFERS

Art IX, Sec 14.04, Disaster Related Transfer Authority (2020-21 GAA)

$0 $187,335 $(187,335) $0 $0

Comments: Shift authority from 2021 to 2020 as outlined in March 17, 2020 letter.



$(2,454,062) $0 $0 $0 $0

Art VIII, pp VIII-22-23 Rider 19, Contingency Appropriation: State Regulatory Response

(2018-19 GAA)

$(2,200,000) $0 $0 $0 $0

2.B. Page 3 of 18







GENERAL REVENUE

Art VIII, pp VIII-21 Rider 19, Contingency Appropriation: State Regulatory Response

(2020-21 GAA)

$0 $(2,200,000) $(1,700,000) $0 $0

Comments: Rider not expected to be activated in 2020. If needed in 2021, would

only activate limited amount based on Harvey response to minimize state

expenditures.

General Revenue - Insurance Companies Maintenance Tax and Insurance Department Fees Account No. 8042TOTAL,

$41,185,301 $40,544,073 $42,257,330 $39,972,044 $39,466,333

$39,743,306

TOTAL, ALL GENERAL REVENUE

$40,202,250 $42,486,736 $41,415,107 $40,773,879

GENERAL REVENUE FUND - DEDICATED

36 GR Dedicated - Texas Department of Insurance Operating Fund Account No. 036



$55,243,392 $0 $0 $0 $0


$0 $57,539,484 $56,213,338 $0 $0

2.B. Page 4 of 18









$0 $0 $0 $61,805,841 $58,828,974

RIDER APPROPRIATION


$1,455,492 $0 $0 $0 $0

Art VIII, p. VIII-21 Rider 11, Appropriation of Unexpended Balances

(2018-2019 GAA)

$2,391,804 $0 $0 $0 $0

Art VIII, p. VIII-22 Rider 16, Medical Fee Disputes - (2018-2019 GAA)

$962,960 $0 $0 $0 $0

Art IX, Sec 9.05, Texas.gov Project: Occupational Licenses (2018-19 GAA)

$220,937 $0 $0 $0 $0

Art IX, Sec 9.05, Texas.gov Project: Occupational Licenses (2020-21 GAA)

$0 $29,020 $12,520 $0 $0

Comments: Subsscription fees based on revenue estimates as of May 31, 2020.

2.B. Page 5 of 18









$933,351 $0 $0 $0 $0


$0 $841,602 $933,351 $0 $0


$0 $(2,362,433) $2,362,433 $0 $0

Art VIII, p VIII-20 Rider 16, Medical Fee Disputes (2020-21)

$0 $(1,022,132) $1,022,132 $0 $0

Art. VIII, Rider 22(b), Contingency Appropriation: Health Insurance Pool (2020-21 GAA)

$0 $(841,602) $841,602 $0 $0

Comments: Rider allows authority to move across years in biennium

Art. VIII, Rider 21, Agent and Adjuster Licensing Fee Collections (2020-21 GAA)

$0 $3,057,000 $2,008,500 $0 $0

Comments: Amounts based on revenue estimates as of May 31, 2020.

2.B. Page 6 of 18








TRANSFERS

Art IX, Sec 14.04, Disaster Related Transfer Authority (2020-21 GAA)

$0 $273,834 $(273,834) $0 $0

Comments: Shift authority from 2021 to 2020 as outlined in March 17, 2020 letter.



$(5,638,460) $0 $0 $0 $0


$(933,351) $0 $0 $0 $0

GR Dedicated - Texas Department of Insurance Operating Fund Account No. 036TOTAL,

$61,805,841 $58,828,974 $63,120,042 $57,514,773 $54,636,125

5101 GR Dedicated - Subsequent Injury Account No. 5101



$7,716,556 $0 $0 $0 $0


2.B. Page 7 of 18








$0 $6,551,464 $6,551,464 $0 $0


$0 $0 $0 $7,672,692 $7,672,692

RIDER APPROPRIATION

Art VIII, p. VIII-21 Rider 12, Subsequent Injury Fund

(2018-2019 GAA)

$10,539,101 $0 $0 $0 $0

Comments: Finding of fact dated June 20, 2019 from CPA.


$385,828 $0 $0 $0 $0

Art VIII, p. VIII-19 Rider 12, Subsequent Injury Fund (2020-21 GAA)

$0 $2,827,164 $0 $0 $0

Comments: Finding of fact dated April 28, 2020 from CPA.


Art VIII, p. VIII-21 Rider 12, Subsequent Injury Fund

(2018-2019 GAA)

2.B. Page 8 of 18








$(729,351) $0 $0 $0 $0

Comments: Ultimate payments in fiscal year less than anticipated when seeking

finding of fact.

GR Dedicated - Subsequent Injury Account No. 5101TOTAL,

$7,672,692 $7,672,692 $6,551,464 $9,378,628 $17,912,134

$72,548,259

TOTAL, ALL GENERAL REVENUE FUND - DEDICATED

$66,893,401 $69,671,506 $69,478,533 $66,501,666

GR & GR-DEDICATED FUNDSTOTAL,

$112,291,565 $107,095,651 $112,158,242 $110,893,640 $107,275,545

FEDERAL FUNDS

555 Federal Funds



$2,190,259 $0 $0 $0 $0


$0 $2,227,593 $2,227,593 $0 $0


$0 $0 $0 $2,255,793 $2,255,793

2.B. Page 9 of 18







FEDERAL FUNDS

RIDER APPROPRIATION

Art IX, Sec 13.01, Federal Funds/Block Grants (2018-19 GAA)

$579,618 $0 $0 $0 $0

Comments: ACA Cycle III grant award. No cost extension of prior award. Final

spending of money.

Art IX, Sec 13.01, Federal Funds/Block Grants (2018-19 GAA)

$70,842 $0 $0 $0 $0

Comments: OSHA- Workplace safety grant spending in state fiscal year above

estimated appropriation amount.



$(497) $0 $0 $0 $0

Comments: Underspending of BLS grant in fiscal year compared to

appropriation.

Federal FundsTOTAL,

$2,255,793 $2,255,793 $2,227,593 $2,227,593 $2,840,222

$2,840,222

TOTAL, ALL FEDERAL FUNDS

$2,227,593 $2,227,593 $2,255,793 $2,255,793

2.B. Page 10 of 18







OTHER FUNDS

161 TexasSure Fund No. 161



$5,073,752 $0 $0 $0 $0


$0 $5,073,752 $5,073,752 $0 $0


$0 $0 $0 $5,073,752 $5,073,752

RIDER APPROPRIATION


$1,981,007 $0 $0 $0 $0

TexasSure Fund No. 161TOTAL,

$5,073,752 $5,073,752 $5,073,752 $5,073,752 $7,054,759

329 Healthy Texas Small Employer Premium Stabilization Fund

RIDER APPROPRIATION

Art IX, Sec. 18.48- Contingency for SB 2087 (2018-19 GAA)

2.B. Page 11 of 18







OTHER FUNDS

$28,312,222 $0 $0 $0 $0


$0 $12,000,000 $29,052,524 $0 $0

Art. VIII, Rider 22(b), Contingency Appropriation: Health Insurance Pool (2020-21 GAA)

$0 $(12,000,000) $12,000,000 $0 $0

Comments: Rider allows authority to move across years in biennium



$(28,312,222) $0 $0 $0 $0

Healthy Texas Small Employer Premium Stabilization FundTOTAL,

$0 $0 $41,052,524 $0 $0

666 Appropriated Receipts



$343,030 $0 $0 $0 $0

2.B. Page 12 of 18







OTHER FUNDS


$0 $362,130 $362,130 $0 $0


$0 $0 $0 $276,525 $276,525

RIDER APPROPRIATION

Art IX, Sec 8.02, Reimbursements and Payments (2018-19 GAA)

$55,134 $0 $0 $0 $0

Art IX, Sec 8.02, Reimbursements and Payments (2020-21 GAA)

$0 $260,500 $7,526 $0 $0

Comments: 2020 collections as of May 31, 2020. 2021 estimate based on TWIA

COAST program budget compared to appropriations.

Art IX, Sec 8.03, Surplus Property (2018-19 GAA)

$8 $0 $0 $0 $0

Art IX, Sec 8.03, Surplus Property (2020-21 GAA)

$0 $4 $0 $0 $0

2.B. Page 13 of 18







OTHER FUNDS

Art IX, Sec 8.07, Seminars and Conferences (2018-19 GAA)

$269,895 $0 $0 $0 $0

Comments: Collections in FY 2019


$218,401 $0 $0 $0 $0

Comments: Rollover from 2018 to 2019


$(218,563) $218,563 $0 $0 $0



$0 $132,529 $0 $0 $0

Comments: Collections in FY 2020 as of May 31, 2020


$0 $(170,907) $170,907 $0 $0

Comments: Estimated rollover from 2020 to 2021

2.B. Page 14 of 18







OTHER FUNDS

Art VIII, p. VIII-21 Rider 13- Three Share Premium Assistance Programs - (2018-19 GAA)

$3,079,328 $0 $0 $0 $0


Art VIII, p. VIII-21 Rider 13- Three Share Premium Assistance Programs - (2018-19 GAA)

$1,500,000 $0 $0 $0 $0

Comments: Appropriations in fiscal year

Art VIII, p. VIII-20 Rider 13- Three Share Premium Assistance Programs (2020-21 GAA)

$(4,140,564) $4,140,564 $0 $0 $0



$0 $2,250,000 $0 $0 $0

Comments: Appropriations in fiscal year


$0 $(4,290,218) $4,290,218 $0 $0

Comments: Estimated rollover form 2020 to 2021

2.B. Page 15 of 18







OTHER FUNDS



$(154,497) $0 $0 $0 $0


$0 $(167,030) $(166,830) $0 $0

Comments: Estimated undercollections of amounts in budget based on revenue

forecast as of May 31, 2020

Appropriated ReceiptsTOTAL,

$276,525 $276,525 $4,663,951 $2,736,135 $952,172

$8,006,931

TOTAL, ALL OTHER FUNDS

$7,809,887 $50,790,227 $5,350,277 $5,350,277

$123,138,718 GRAND TOTAL $117,133,131 $165,176,062 $118,499,710 $114,881,615

2.B. Page 16 of 18







FULL-TIME-EQUIVALENT POSITIONS


Regular Appropriations from MOF Table

(2018-19 GAA)

1,363.7 0.0 0.0 0.0 0.0


(2020-21 GAA)

0.0 1,337.7 0.0 0.0 1,337.7


(2022-23 GAA)

0.0 0.0 1,210.0 1,210.0 0.0

RIDER APPROPRIATION

Art IX, Sec 18.48, Contingency for SB

2087 (2018-19 GAA)

12.0 0.0 0.0 0.0 0.0


1584 (2020-21 GAA)

0.0 2.0 0.0 0.0 2.0


1940 (2020-21 GAA)

0.0 12.0 0.0 0.0 10.5


1940 (2020-21 GAA)

0.0 0.0 0.0 0.0 (10.5)



2087 (2018-19 GAA)

(12.0) 0.0 0.0 0.0 0.0

Art VIII, pp VIII 22-23 Rider 19,

Contingency Appropriation: State

Regulatory Response (2018-19 GAA)

(40.0) 0.0 0.0 0.0 0.0

2.B. Page 17 of 18







Art VIII, p VIII 21 Rider 19, Contingency

Appropriation: State Regulatory

Response (2020-21 GAA)

0.0 (40.0) 0.0 0.0 (40.0)

Comments: Rider not expected to be activated in 2020. If needed in 2021,

would only activate limited amount based on Harvey response & use

existing FTEs.

UNAUTHORIZED NUMBER OVER (BELOW) CAP


(2018-19 GAA)

(167.4) 0.0 0.0 0.0 0.0


(2020-21 GAA)

0.0 (80.5) 0.0 0.0 (171.9)

1,156.3 1,127.8 1,231.2 1,210.0 1,210.0 TOTAL, ADJUSTED FTES

0.0 0.0 0.0 0.0 0.0 NUMBER OF 100% FEDERALLY FUNDED

FTEs

2.B. Page 18 of 18


OBJECT OF EXPENSE Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023


2.C. Summary of Base Request by Object of Expense 10/6/2020 10:30:44AM


$68,506,639 $68,656,216 $77,620,323 $75,907,945 $75,907,945 1001 SALARIES AND WAGES

$3,065,410 $2,355,753 $1,895,057 $1,890,494 $1,890,494 1002 OTHER PERSONNEL COSTS

$9,524,923 $13,596,984 $16,293,923 $13,969,220 $14,014,569 2001 PROFESSIONAL FEES AND SERVICES

$116,170 $113,000 $115,100 $115,100 $113,100 2002 FUELS AND LUBRICANTS

$296,270 $377,837 $457,407 $448,956 $333,797 2003 CONSUMABLE SUPPLIES

$514,758 $684,146 $618,552 $635,371 $485,931 2004 UTILITIES

$1,035,762 $771,561 $1,141,832 $1,131,832 $1,131,832 2005 TRAVEL

$3,650,699 $3,843,058 $3,834,433 $3,934,433 $2,220,618 2006 RENT - BUILDING

$504,433 $552,930 $552,902 $546,805 $286,800 2007 RENT - MACHINE AND OTHER

$28,766,336 $21,726,115 $58,204,203 $19,485,054 $17,951,729 2009 OTHER OPERATING EXPENSE

$1,957,575 $2,100,346 $4,290,218 $0 $0 4000 GRANTS

$5,199,743 $2,355,185 $152,112 $434,500 $544,800 5000 CAPITAL EXPENDITURES

OOE Total (Excluding Riders) $123,138,718 $117,133,131 $165,176,062 $118,499,710 $114,881,615

OOE Total (Riders)

Grand Total $123,138,718 $117,133,131 $165,176,062 $118,499,710 $114,881,615

2.C. Page 1 of 1

Automated Budget and Evaluation system of Texas (ABEST)


Goal/ Objective / Outcome


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023

2.D. Summary of Base Request Objective Outcomes 10/6/2020 10:30:45AM



1 % of Calls Answered by the TDI Consumer Help Line Call CenterKEY

94.00 94.00 95.00 95.00 95.00% % % % %

2 Average Number of Dollars Returned to Consumers, Per Complaint

1,641.00 2,047.00 1,900.00 1,500.00 1,500.00

3 Percent of Continuing Education Filings Completed within 10 DaysKEY

48.00 97.00 98.00 95.00 95.00% % % % %

4 Percent of Agent and Adjuster Applications Completed within 7 DaysKEY

74.00 87.00 95.00 93.00 93.00% % % % %

5 Percent of Licensees Who Renew Online

98.00 99.00 99.00 95.00 95.00% % % % %



1 Percent of Identified Companies Reviewed

100.00 100.00 98.00 98.00 98.00% % % % %

2 Percent of Company, TPA and PF License Apps Completed within 60 Days

100.00 96.00 99.00 98.00 98.00% % % % %


1 Percent of Statutory Rate and Form Filings Completed within 90 DaysKEY

88.00 85.00 87.00 87.00 87.00% % % % %

2 Percent Personal Auto/Res Property Form Filings Completed in 60 DaysKEY

80.00 80.00 81.00 87.00 87.00% % % % %

3 % Autos w/Personal or Comm. Liability InsuranceKEY

90.00 91.00 85.00 85.00 85.00% % % % %


1 Percent of Enforcement Cases Concluded with Action within 365 Days

68.00 61.00 60.00 60.00 60.00% % % % %

2.D. Page 1 of 2





Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023

2.D. Summary of Base Request Objective Outcomes 10/6/2020 10:30:45AM



2 % of Fire Sfty Registrations, Licenses, Permits Issued w/in 20 DaysKEY

65.00 97.00 99.00 99.00 99.00% % % % %



1 % of WC Enforcement Cases Concluded within 365 Days

75.00 90.00 70.00 70.00 70.00% % % % %

2 % of Med Fee Disputes Resolved or Upheld Upon AppealKEY

100.00 100.00 100.00 95.00 95.00% % % % %

3 Percent of Workers’ Comp Insurance Fraud Cases Resolved

7.00 10.00 5.00 5.00 5.00% % % % %


1 Percent of TIBs Recipients Released to Work Within 90 Days of InjuryKEY

59.00 58.00 54.00 54.00 54.00% % % % %

2.D. Page 2 of 2

Priority GR/GR Dedicated All Funds GR Dedicated All FundsFTEs FTEs All FundsGR DedicatedItem

2022 2023 Biennium

GR and GR andGR and

Agency code: 454 Agency name: Department of Insurance



DATE: 10/6/2020

TIME : 10:30:45AM

2.E. Summary of Exceptional Items Request

1 Regulatory Response Rider $2,200,000 $2,200,000 $2,200,000 40.0 40.0 $4,400,000 $4,400,000 $2,200,000

$2,200,000 $2,200,000 40.0 $2,200,000 $2,200,000 40.0 $4,400,000 $4,400,000 Total, Exceptional Items Request

Method of Financing

General Revenue $2,200,000 $2,200,000 $2,200,000 $2,200,000 $4,400,000 $4,400,000

General Revenue - Dedicated

Federal Funds

Other Funds

$2,200,000 $2,200,000 $2,200,000 $2,200,000 $4,400,000 $4,400,000

Full Time Equivalent Positions 40.0 40.0

0.0 0.0 Number of 100% Federally Funded FTEs

2.E. Page 1 of 1

Automated Budget and Evaluation System of Texas (ABEST)TIME : 10:30:45AM

DATE : 10/6/2020


2.F. Summary of Total Request by Strategy


Base Base Exceptional Exceptional Total Request Total Request

2022 2023 2022 2023 2022 2023Goal/Objective/STRATEGY



$7,797,372 $7,797,372 $0 $0 $7,797,372 $7,797,372 1 CONSUMER EDUCATION AND OUTREACH

6,730,637 6,730,637 0 0 6,730,637 6,730,637 2 CUSTOMER OPERATIONS

398,900 398,900 0 0 398,900 398,900 3 TEXAS.GOV

$14,926,909 $14,926,909 $0 $0 $14,926,909 $14,926,909 TOTAL, GOAL 1



5,494,917 5,494,917 0 0 5,494,917 5,494,917 1 INDUSTRY SOLVENCY REGULATION

2 Efficiently Regulate P&c/l&h Rates, Forms, Programs, And Network

6,824,689 6,824,689 0 0 6,824,689 6,824,689 1 PROPERTY & CASUALTY REGULATION

5,392,521 5,392,521 0 0 5,392,521 5,392,521 2 LIFE & HEALTH REGULATION


6,610,100 6,610,100 0 0 6,610,100 6,610,100 1 LEGAL REVIEW & ENFORCEMENT

3,968,863 3,968,863 0 0 3,968,863 3,968,863 2 INSURANCE FRAUD

4 Administrative Innovative Insurance Initiatives

64,300 64,300 0 0 64,300 64,300 1 THREE-SHARE PROGRAMS

$28,355,390 $28,355,390 $0 $0 $28,355,390 $28,355,390 TOTAL, GOAL 2



4,816,039 4,816,039 0 0 4,816,039 4,816,039 1 FIRE MARSHAL

$4,816,039 $4,816,039 $0 $0 $4,816,039 $4,816,039 TOTAL, GOAL 3

2.F. Page 1 of 4


DATE : 10/6/2020








$7,501,971 $8,148,307 $0 $0 $8,148,307 $7,501,971 1 OVERSIGHT AND COMPLIANCE

9,373,681 9,801,220 0 0 9,801,220 9,373,681 2 DISPUTE RESOLUTION

7,857,644 7,857,644 0 0 7,857,644 7,857,644 3 SUBSEQUENT INJURY FUND ADMIN

1,022,162 1,083,239 0 0 1,083,239 1,022,162 4 WORKERS COMPENSATION FRAUD

2 Ensure Workers' Comp System Participants are Educated and Inform

3,717,557 3,961,866 0 0 3,961,866 3,717,557 1 HEALTH AND SAFETY SERVICES

8,551,350 8,836,377 0 0 8,836,377 8,551,350 2 CUSTOMER SERVICE & INFORMATION MGMT

$39,688,653 $38,024,365 $0 $0 $39,688,653 $38,024,365 TOTAL, GOAL 4



7,306,626 7,652,730 0 0 7,652,730 7,306,626 1 CENTRAL ADMINISTRATION

16,508,305 16,433,178 0 0 16,433,178 16,508,305 2 INFORMATION RESOURCES

4,943,981 6,626,811 0 0 6,626,811 4,943,981 3 OTHER SUPPORT SERVICES

$30,712,719 $28,758,912 $0 $0 $30,712,719 $28,758,912 TOTAL, GOAL 5



2,200,000 2,200,000 2,200,000 2,200,000 0 0 1 CONTINGENCY REGULATORY RESPONSE

$0 $0 $2,200,000 $2,200,000 $2,200,000 $2,200,000 TOTAL, GOAL 6

2.F. Page 2 of 4


DATE : 10/6/2020








$0 $0 $0 $0 $0 $0 1 CONTINGENCY HEALTH INS RISK POOL

$0 $0 $0 $0 $0 $0 TOTAL, GOAL 7

$114,881,615 $2,200,000 $2,200,000 $120,699,710 $117,081,615 $118,499,710

TOTAL, AGENCY

STRATEGY REQUEST

TOTAL, AGENCY RIDER

APPROPRIATIONS REQUEST

$118,499,710 $114,881,615 $2,200,000 $2,200,000 $120,699,710 $117,081,615 GRAND TOTAL, AGENCY REQUEST

2.F. Page 3 of 4


DATE : 10/6/2020






General Revenue Funds:

$229,806 $229,806 $0 $0 1 General Revenue Fund $229,806 $229,806

41,185,301 40,544,073 2,200,000 2,200,000 8042 Insurance Maint Tax Fees 43,385,301 42,744,073

$41,415,107 $40,773,879 $2,200,000 $2,200,000 $43,615,107 $42,973,879

General Revenue Dedicated Funds:

61,805,841 58,828,974 0 0 36 Dept Ins Operating Acct 61,805,841 58,828,974

7,672,692 7,672,692 0 0 5101 Subsequent Injury Fund 7,672,692 7,672,692

$69,478,533 $66,501,666 $0 $0 $69,478,533 $66,501,666

Federal Funds:

2,255,793 2,255,793 0 0 555 Federal Funds 2,255,793 2,255,793

$2,255,793 $2,255,793 $0 $0 $2,255,793 $2,255,793

Other Funds:

5,073,752 5,073,752 0 0 161 TexasSure Fund 5,073,752 5,073,752

0 0 0 0 329 Healthy TX Sm Emp Prem Stabil. Fund 0 0

276,525 276,525 0 0 666 Appropriated Receipts 276,525 276,525

$5,350,277 $5,350,277 $0 $0 $5,350,277 $5,350,277

$118,499,710 $114,881,615 $2,200,000 $2,200,000 TOTAL, METHOD OF FINANCING $120,699,710 $117,081,615

1,210.0 1,210.0 40.0 40.0 1,250.0 1,250.0FULL TIME EQUIVALENT POSITIONS

2.F. Page 4 of 4



Date : 10/6/2020

Time: 10:30:46AM



BL

2022

BL

2023

Excp

2022

Excp

2023

Total

Request

2023

Total

Request

2022

2.G. Summary of Total Request Objective Outcomes



KEY 1 % of Calls Answered by the TDI Consumer Help Line Call Center

% 95.00 95.00% 95.00 95.00% %

2 Average Number of Dollars Returned to Consumers, Per Complaint

1,500.00 1,500.00 1,500.00 1,500.00

KEY 3 Percent of Continuing Education Filings Completed within 10 Days

% 95.00 95.00% 95.00 95.00% %

KEY 4 Percent of Agent and Adjuster Applications Completed within 7 Days

% 93.00 93.00% 93.00 93.00% %

5 Percent of Licensees Who Renew Online

% 95.00 95.00% 95.00 95.00% %



1 Percent of Identified Companies Reviewed

% 98.00 98.00% 98.00 98.00% %

2 Percent of Company, TPA and PF License Apps Completed within 60 Days

% 98.00 98.00% 98.00 98.00% %


2.G. Page 1 of 3



Date : 10/6/2020

Time: 10:30:46AM



BL

2022

BL

2023

Excp

2022

Excp

2023

Total

Request

2023

Total

Request

2022


KEY 1 Percent of Statutory Rate and Form Filings Completed within 90 Days

% 87.00 87.00% 87.00 87.00% %

KEY 2 Percent Personal Auto/Res Property Form Filings Completed in 60 Days

% 87.00 87.00% 87.00 87.00% %

KEY 3 % Autos w/Personal or Comm. Liability Insurance

% 85.00 85.00% 85.00 85.00% %


1 Percent of Enforcement Cases Concluded with Action within 365 Days

% 60.00 60.00% 60.00 60.00% %



KEY 2 % of Fire Sfty Registrations, Licenses, Permits Issued w/in 20 Days

% 99.00 99.00% 99.00 99.00% %



1 % of WC Enforcement Cases Concluded within 365 Days

% 70.00 70.00% 70.00 70.00% %

KEY 2 % of Med Fee Disputes Resolved or Upheld Upon Appeal

% 95.00 95.00% 95.00 95.00% %

2.G. Page 2 of 3



Date : 10/6/2020

Time: 10:30:46AM



BL

2022

BL

2023

Excp

2022

Excp

2023

Total

Request

2023

Total

Request

2022


3 Percent of Workers’ Comp Insurance Fraud Cases Resolved

% 5.00 5.00% 5.00 5.00% %


KEY 1 Percent of TIBs Recipients Released to Work Within 90 Days of Injury

% 54.00 54.00% 54.00 54.00% %

2.G. Page 3 of 3

3. STRATEGY REQUESTS



10/6/2020 10:30:46AM3.A. Strategy Request

1STRATEGY:

1 High-Quality Information and Services to Stake HoldersOBJECTIVE:

1 Protect and Ensure the Fair Treatment of ConsumersGOAL:

CODE DESCRIPTION

17 A.2 B.3

Service Categories:

Service: Age:Income:

Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023


Provide Information to Help Consumers Make Informed Decisions

Explanatory/Input Measures:

151,009.00 144,154.00 146,000.00 150,000.00 150,000.00 1 Number of Inquiries ReceivedKEY

Objects of Expense:

1001 SALARIES AND WAGES $2,353,642 $2,353,642 $2,353,643 $1,382,067 $1,946,166

1002 OTHER PERSONNEL COSTS $53,239 $53,239 $53,239 $46,025 $47,878

2001 PROFESSIONAL FEES AND SERVICES $4,395,252 $4,395,252 $4,395,252 $3,165,258 $3,346,422

2003 CONSUMABLE SUPPLIES $1,500 $1,500 $1,500 $10 $1,500

2004 UTILITIES $8,162 $8,162 $8,162 $570 $6,289

2005 TRAVEL $14,445 $14,445 $14,445 $16,803 $13,545

2006 RENT - BUILDING $1,500 $1,500 $1,500 $450 $1,500

2007 RENT - MACHINE AND OTHER $0 $0 $6,097 $0 $0

2009 OTHER OPERATING EXPENSE $969,632 $969,632 $1,055,366 $391,396 $401,714

5000 CAPITAL EXPENDITURES $0 $0 $0 $4,392,740 $2,075,779

$7,840,793 $9,395,319 TOTAL, OBJECT OF EXPENSE $7,797,372 $7,797,372 $7,889,204

Method of Financing:

Insurance Maint Tax Fees 8042 $1,183,154 $1,941,076 $1,904,296 $1,863,203 $1,863,203

3.A. Page 1 of 84




1STRATEGY:



CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023



$1,941,076 $1,183,154 SUBTOTAL, MOF (GENERAL REVENUE FUNDS) $1,863,203 $1,863,203 $1,904,296


36 Dept Ins Operating Acct $473,552 $723,829 $785,911 $762,192 $762,192

$723,829 $473,552 SUBTOTAL, MOF (GENERAL REVENUE FUNDS - DEDICATED) $762,192 $762,192 $785,911


555 Federal Funds

ACA-Grnts St Hlth Ins Premium Revw $0 $0 $0 $0 93.511.000 $579,618

CFDA Subtotal, Fund 555 $0 $0 $0 $0 $579,618

$0 $579,618 SUBTOTAL, MOF (FEDERAL FUNDS) $0 $0 $0


161 TexasSure Fund $7,054,759 $5,073,752 $5,073,752 $5,073,752 $5,073,752

666 Appropriated Receipts $104,236 $102,136 $125,245 $98,225 $98,225

$5,175,888 $7,158,995 SUBTOTAL, MOF (OTHER FUNDS) $5,171,977 $5,171,977 $5,198,997

3.A. Page 2 of 84




1STRATEGY:



CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023



TOTAL, METHOD OF FINANCE (INCLUDING RIDERS)

$9,395,319 $7,840,793 $7,889,204

$7,797,372 $7,797,372

FULL TIME EQUIVALENT POSITIONS: 26.3 29.2 42.0 42.0 42.0

TOTAL, METHOD OF FINANCE (EXCLUDING RIDERS) $7,797,372 $7,797,372

STRATEGY DESCRIPTION AND JUSTIFICATION:

3.A. Page 3 of 84




1STRATEGY:



CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023



The Texas Insurance Code directs the Texas Department of Insurance (TDI) to operate and raise awareness of the agency’s Consumer Help Line (TIC Ch 521), develop an

educational program on health insurance (TIC Ch 524), and maintain and publicize a website to help consumers make informed decisions for home and auto insurance (TIC

Sec 32.102-103). TDI maintains a consumer section on its websites, develops content and videos, and conducts outreach through media outlets and social media. TDI

maintains HelpInsure.com which allows consumers to compare home and auto rates.

The TWIA Ombudsman runs the COAST program as directed by TIC Sec 2210.582. The work involves planning and conducting educational and outreach events;

responding to consumers; and post-disaster response.

TexasSure is the vehicle insurance verification system that allows law enforcement and county tax officials to confirm a vehicle has required personal auto liability insurance

coverage. The TexasSure program is mandated by Texas Transportation Code Chapter 601, Subchapter N, which requires TDI, in consultation with the departments of Public

Safety, Motor Vehicles, and Information Resources to select a vendor to develop and maintain a program to reduce the number of uninsured motorists. TDI maintains a

website to provide consumers and industry information about the program and vehicle statistics.

This strategy coordinates with strategies 1.1.2 and 2.2.1 and contributes to statewide goal 07 and benchmark 01 by helping consumers with purchasing decisions and

providing stakeholders with information.

EXTERNAL/INTERNAL FACTORS IMPACTING STRATEGY:

3.A. Page 4 of 84




1STRATEGY:



CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023



Legislation, market trends, population and demographic changes, and the information needs of stakeholders affect this strategy. Changes in state or federal laws may

expand or decrease regulation. As product variety continues to increase and market conditions change, both policymakers and consumers face greater challenges.

Policymakers, whose decisions affect available products, need data and analysis for public policy decisions. Consumers, who face challenges in selecting policies that most

cost-effectively meet their needs, benefit from TDI’s educational material on products, coverage, and companies. As the population ages and becomes more diverse, TDI

will make its information available in appropriate formats and languages.

Internal factors include the increased degree of automation and the need to use technology compatible with what the industry, consumers, and others use. Market

conditions may change rapidly, and TDI must balance the need to provide comprehensive data with the need to provide it quickly. Changing market conditions also require

TDI to manage resources to ensure that data collected, analyzed, and distributed reflects the information needs of consumers, legislators, and other interested parties.

STRATEGY BIENNIAL TOTAL - ALL FUNDS

Base Spending (Est 2020 + Bud 2021) Baseline Request (BL 2022 + BL 2023)

BIENNIAL

CHANGE

EXPLANATION OF BIENNIAL CHANGE

$ Amount Explanation(s) of Amount (must specify MOFs and FTEs)

EXPLANATION OF BIENNIAL CHANGE (includes Rider amounts):

$15,729,997 $15,594,744 $(135,253) $(30,931) Net adjustment for budgeted appropriated receipts for

2022-23 relative to 2020-21 forecasted collections.

$(104,322) Budget realignments and adjustments for one-time

spending in 2020-21 relative to amount of current budget

request.

Total of Explanation of Biennial Change $(135,253)

3.A. Page 5 of 84




2STRATEGY:



CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023


Resolve Consumer Complaints And License Agents

Output Measures:

32,249.00 26,843.00 20,000.00 20,000.00 20,000.00 1 Number of Complaints ResolvedKEY

Efficiency Measures:

212.00 163.00 60.00 40.00 40.00 1 Average Response Time (in DAYS) to ComplainsKEY

Objects of Expense:



2001 PROFESSIONAL FEES AND SERVICES $8,838 $8,838 $6,878 $479,986 $863,861

2003 CONSUMABLE SUPPLIES $1,500 $1,500 $1,655 $218 $420

2004 UTILITIES $2,189 $2,189 $2,189 $3,098 $2,628

2005 TRAVEL $10,720 $10,720 $10,720 $37,776 $7,663

2006 RENT - BUILDING $1,500 $1,500 $1,500 $5,107 $700

2009 OTHER OPERATING EXPENSE $1,583,825 $1,583,825 $301,436 $275,077 $1,883,830




3.A. Page 6 of 84




2STRATEGY:



CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023





36 Dept Ins Operating Acct $1,861,101 $3,367,174 $1,339,434 $2,811,589 $2,811,589

$3,367,174 $1,861,101 SUBTOTAL, MOF (GENERAL REVENUE FUNDS - DEDICATED) $2,811,589 $2,811,589 $1,339,434


666 Appropriated Receipts $500 $4,999 $0 $0 $0

$4,999 $500 SUBTOTAL, MOF (OTHER FUNDS) $0 $0 $0


$6,511,501 $8,025,346 $5,446,450

$6,730,637 $6,730,637




3.A. Page 7 of 84




2STRATEGY:



CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023



The Texas Department of Insurance (TDI) is directed by statute to facilitate the resolution of consumer complaints and help consumers recover valid claims (Tex. Ins. Code §

§521.002, 843.282,1467.151, 1811.204). The agency has a complaint resolution process to resolve complaints from the public and, while doing so, to educate consumers about

insurance coverages and policies. The Agency developed a system to provide mediation or arbitration for disputes between providers or facilities and health plans or

insurance carriers.

TDI also reviews/approves applications and renewals for agents and adjusters (Tex. Ins. Code Ch. 4001-4004, 4101).

Changes in the economy, natural disasters or other catastrophes, market changes, industry compliance, and publicity about insurance issues may lead to increased

consumer complaints. TDI has seen a recent trend of fewer complaints. This downward trend is related to the creation of the independent dispute resolution process in the

Texas Insurance Code, Chapter 1467 that provided an option for health care providers to seek a resolution for payment disputes against health plans outside of the

complaint system. At the same time, TDI is receiving more complex consumer complaints, reflecting the development of new and more sophisticated insurance products.


3.A. Page 8 of 84




2STRATEGY:



CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023





BIENNIAL

CHANGE




$13,471,796 $13,461,274 $(10,522) $(5,523) Net impact of funding in 2020 for independent dispute

resolution implementation shifting to other strategies

relative to 2022-23 request.

$(4,999) Appropriated receipt for reimbursment not part of

2022-23 budget request.


3.A. Page 9 of 84




3STRATEGY:



CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023


Texas.gov. Estimated and Nontransferable

Objects of Expense:

2009 OTHER OPERATING EXPENSE $398,900 $398,900 $391,000 $600,225 $408,300

$408,300 $600,225 TOTAL, OBJECT OF EXPENSE $398,900 $398,900 $391,000


General Revenue Fund 1 $5,808 $5,800 $5,000 $5,400 $5,400

$5,800 $5,808 SUBTOTAL, MOF (GENERAL REVENUE FUNDS) $5,400 $5,400 $5,000





$600,225 $408,300 $391,000

$398,900 $398,900

FULL TIME EQUIVALENT POSITIONS:

TOTAL, METHOD OF FINANCE (EXCLUDING RIDERS) $398,900 $398,900

3.A. Page 10 of 84




3STRATEGY:



CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023



This Texas e-government initiative (Gov. Code, Ch.2054, Subchapter I) was established to provide the citizens of Texas access to Texas governmental services 24 hours a

day, seven days a week, and 365 days a year.

Licensees have the option to renew their license(s) online by submitting payment through a third-party system, including, but not limited to Texas.Gov, Sircon, and the

National Insurance Producer Registry.

Strategy 1.1.3 provides information to support strategy 1.1.2 Customer Operations. This strategy contributes to statewide goal 07 and benchmark 07 by providing on-line

access for professional license renewals.


Online services increase customer convenience, access to government services, and allows for automated error-checking. The number of licensees renewing online is hard

to predict due to many external factors. However, the continued growth in Texas’ population, the number of agents remaining active in the insurance industry, the steady

recruitment of new agents, and the continued evolution of the online service industry are contributing factors. This development provides an infrastructure upon which

subsequent programs and services can be added so TDI can continue to progress in the online technology era and be a positive change in the way government does

business in Texas.


3.A. Page 11 of 84




3STRATEGY:



CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023





BIENNIAL

CHANGE




$799,300 $797,800 $(1,500) $(1,500) Adjust fund 36 Texas.Gov collections based on revenue

projections.


3.A. Page 12 of 84




1STRATEGY:

1 Regulate Insurance Industry SolvencyOBJECTIVE:

2 A Competitive and Stable Insurance MarketGOAL:

CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023


Analyze the Financial Condition of Insurers and Take Solvency Action


1.00 2.00 3.00 3.00 2.00 1 Number of Insurance Company Insolvencies

1.00 3.00 4.00 4.00 4.00 2 Number of Entities Receiving TDI Solvency-related

Intervention

Objects of Expense:



2001 PROFESSIONAL FEES AND SERVICES $0 $0 $0 $11,883 $119,040

2003 CONSUMABLE SUPPLIES $500 $500 $500 $143 $1,520

2004 UTILITIES $8,820 $8,820 $8,820 $10,049 $9,265

2005 TRAVEL $52,625 $52,625 $62,625 $26,461 $37,203

2006 RENT - BUILDING $118,003 $118,003 $118,003 $89,321 $92,209






3.A. Page 13 of 84




1STRATEGY:



CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023







666 Appropriated Receipts $5,984 $234,602 $0 $0 $0

$234,602 $5,984 SUBTOTAL, MOF (OTHER FUNDS) $0 $0 $0


$5,383,820 $5,146,042 $5,921,456

$5,494,917 $5,494,917




3.A. Page 14 of 84




1STRATEGY:



CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023



TDI is directed by statute to form and license insurers (Texas Insurance Code (TIC) §§801.051, 822.051, 822.101, 841.051, 841.101, 843.071). TDI is also directed by statute to

monitor the financial stability of insurers by analyzing their financial statement filings (§§401.051, 401.002, 404.001 and 802.001), reviewing actuarial opinions, providing

actuarial expertise and reserve analysis (TIC §§404.001, 425.055, 425.054 and 802.002), reviewing holding company transactions and risk sharing contracts (TIC Ch 823,

§493.002). This is also supported by on-site examinations (TIC §401.051, §751.152).

TDI uses various intervention strategies to address insurers with financial problems including holding informal management conferences, requiring insurers to file corrective

business plans, placing insurers under oversight, and taking formal administrative action to rehabilitate troubled companies such as issuing orders that place companies in

conservation (TIC §§401.051, 404.001, 443.001 and 441.001). TDI conducts follow-up monitoring of companies released from rehabilitation. When rehabilitation is not

possible, TDI appoints Special Deputy Receivers (SDRs) to liquidate insolvent companies. TDI analyzes the business plans, budgets, and expenses of all SDRs to assure

that they appropriately manage the estates (TIC §443.001). TDI also monitors the guaranty associations to ascertain that claims are paid in a timely manner (TIC, Ch. 2602,

and §§462.001 and 463.001).

This strategy contributes to the statewide goal 07 and benchmark 01 by encouraging the financial health of the industry.

Changes in federal legislation may preempt state regulations and TDI’s ability to regulate certain segments of the insurance industry . Many external factors affect insurers

including the general health of the economy, changes in investment yields and the volatility of financial markets, adverse trends in claims due to catastrophic or unexpected

losses, and an increasing number of acquisitions, mergers and reorganizations. These factors affect the complexity of TDI’s analysis as well as the amount of time required

to perform that analysis. The health of the economy also affects TDI’s ability to carry out this strategy as recruitment/retention of qualified staff replacements can be

difficult. Adequate computer resources are critical to the success of this strategy. The automation of data and the development of automated programs, as well as access to

the NAIC database, will continue to be important to the financial analysis process.


3.A. Page 15 of 84




1STRATEGY:



CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023





BIENNIAL

CHANGE




$11,067,498 $10,989,834 $(77,664) $(234,602) Appropriated receipts from company rehabilitations not

part of 2022-23 budget request.

$156,938 Net impact of 2020 vacancies forecasted to be filled and

increases in rent and software costs for financial

examiners fully realized in 2022-23 biennium.


3.A. Page 16 of 84




1STRATEGY:

2 Efficiently Regulate P&c/l&h Rates, Forms, Programs, And NetworksOBJECTIVE:


CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023


Efficiently Regulate P&C Rates, Forms, And Programs

Output Measures:

4,050.00 3,352.00 4,000.00 4,000.00 4,000.00 1 Number of Windstorm Inspections

26,744.00 28,526.00 31,000.00 31,000.00 31,000.00 2 Number of Property and Casualty Filings Completed

Objects of Expense:




2003 CONSUMABLE SUPPLIES $4,291 $4,291 $4,291 $1,172 $4,441

2004 UTILITIES $24,778 $24,778 $24,778 $20,527 $25,108

2005 TRAVEL $123,458 $123,458 $123,458 $101,113 $57,588

2006 RENT - BUILDING $100,212 $100,212 $100,212 $95,233 $103,069






3.A. Page 17 of 84




1STRATEGY:



CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023







$6,286,605 $6,187,780 $7,293,524

$6,824,689 $6,824,689




3.A. Page 18 of 84




1STRATEGY:



CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023



The property & casualty division reviews rate and policy form filings for property and casualty coverages (TIC Ch. 706, 1805, 1811, 1901, 1951, 1952, 2052, 2053, 2151, 2210,

2211, 2251, 2301, 3501, 3502). This strategy also collects data through agency statistical plans and data calls. TIC Title 11 requires TDI to regulate title insurance by adopting

rates, rules, and forms.

TDI oversees several residual markets for insurance: Texas Windstorm Insurance Association (TIC Ch. 2210), Texas FAIR Plan Association (TIC Ch. 2211), Texas Automobile

Insurance Plan Association (TIC Ch. 2151), and the Texas Medical Liability Underwriting Association (TIC Ch. 2203).

Programs managed in this strategy include:

• windstorm inspection for coastal structures (TIC Ch. 2210)

• oversight of non-TDI inspectors who perform windstorm inspections (TIC Ch. 2210)

• training and education on windstorm building code requirements (TIC Ch. 2210)

• enforcement of amusement ride inspections (Tx. Occ. Code, §§2151.001-2151.153), and

• certification of inspectors for the Voluntary Inspection Program (VIP) (TIC Ch. 2003, Subch. C).

This strategy contributes to statewide goal 07 and benchmark 01 and strategies 1.1.1 Consumer Education and Outreach and 2.3.1 Legal Review and Enforcement by

regulating the industry and examining rates and policy forms for appropriateness. This strategy also supports 1.1.1 by managing the TexasSure project.


3.A. Page 19 of 84




1STRATEGY:



CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023



In response to changes in the economy and market trends, insurers have developed more complex products and rating plans. Changes in market conditions can also affect

the type of coverages offered and the rates charged. Since the adoption of the International Residential Code and International Building Code as the standards for

windstorm certification, TDI has provided training for engineers, builders, architects, and homeowners to promote compliance with building code requirements. Population

growth and coastal development have increased the number of insured residences in windstorm-prone areas.

The market generally reflects decreasing requests for TDI inspections in favor of non-TDI inspections, except after significant weather events such as hurricanes or large

hailstorms. As a result, TDI has increased its emphasis on oversight of non-TDI inspections and expanded training related to building code requirements for property

owners and building trade professionals.

Internal factors affecting this strategy include the increased degree of automation necessary to track and review filings. Due to the variety of lines of insurance, as well as

the variety of coverages offered within these lines of insurance, the cost-effective use of staff resources requires significant cross-training to ensure timely processing of

filings. In addition, competitive private sector salaries and local increases to the cost of living affect the agency’s ability to attract and retain qualified actuaries and policy

form contract analysts.

3.A. Page 20 of 84




1STRATEGY:



CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023





BIENNIAL

CHANGE




$13,481,304 $13,649,378 $168,074 $65,870 Underspending of travel in 2020, primarily in windstorm

inspections, due to Covid forecasted to return to higher

levels.

$102,204 Net impact of vacancies in 2020-21 biennium shifted to

fund needs other strategies, assumed to be filled in

2022-23.

Total of Explanation of Biennial Change $168,074

3.A. Page 21 of 84




2STRATEGY:



CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023


Efficiently Regulate L&H Rates, Forms, and Networks

Output Measures:

16,561.00 13,995.00 18,000.00 18,000.00 18,000.00 1 Number of Life and Health Filings Completed

Objects of Expense:




2004 UTILITIES $500 $500 $500 $0 $456

2005 TRAVEL $7,500 $7,500 $7,500 $8,962 $4,104









3.A. Page 22 of 84




2STRATEGY:



CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023




$4,117,471 $4,788,106 $5,392,520

$5,392,521 $5,392,521




3.A. Page 23 of 84




2STRATEGY:



CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023



The life & health division reviews rate and policy form filings for life, annuity, credit, accident and health, and HMO coverages. TDI also reviews filings for association

group eligibility, health group cooperatives and coalitions, MEWAs, and the modification/discontinuation of coverage under a health benefit plan (TIC Ch. 843, 846, 1131,

1251, 1271, 1111A, 1153, 1369, 1501, 1651, 1652, 1701).

This strategy reviews provider contracts and delegation agreements for HMO plans, and network adequacy for HMO, PPBP, EPBP, and workers’ compensation plans.

Network adequacy reviews include annual reports, configuration changes, and service area expansions/reductions. TDI registers network contracting entities and affiliates

(TIC Ch. 843, 1272, 1301, 1305, 1369, 1458).

TDI also reviews and approves applications for utilization review agents, independent review organizations, and certified workers’ compensation health care networks (TIC

Ch 1305, 1369, 4201, 4202). After licensure, TDI reviews filings for service area expansions or reductions; changes or updates to return to work or utilization review policies

for certified workers’ compensation healthcare networks, updates and renewals for utilization review agents and independent review organizations. TDI also collects prompt

pay claims data and prompt pay penalty reports. (TIC Ch. 843, 1301)

This strategy contributes to statewide goal 07 and benchmark 01 and strategies 1.1.1 Consumer Education and Outreach and 2.3.1 Legal Review and Enforcement by

regulating the industry and examining rates and policy forms for appropriateness.


3.A. Page 24 of 84




2STRATEGY:



CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023



State and federal legislation, changes in the economy, and market trends impact this strategy. Federal health care reform legislation impacted the number and types of filings

reviewed. State legislation has provided carriers the opportunity to design new health coverages.

In response to changes in the economy, market trends, and state statutes, insurers have developed more complex products. Changes in market conditions can also affect the

type of coverages offered and the rates charged. Mergers and consolidations, particularly in the HMO market, have resulted in fewer form filings. Economic conditions,

including costs of medical services and other cost factors associated with claims also affect the type of coverages offered and the rates charged.

Internal factors affecting this strategy include the increased degree of automation necessary to track and review filings. Due to the variety of lines of insurance, as well as

the variety of coverages offered within individual lines, the cost-effective use of staff resources requires significant cross-training to ensure timely processing of filings. In

addition, competitive private sector salaries and local increases to the cost of living affect the agency’s ability to attract and retain qualified actuaries and contract analysts .



BIENNIAL

CHANGE




$10,180,626 $10,785,042 $604,416 $604,416 Net impact of budget alignment from other strategies and

vacancies in 2020-21 biennium assumed to be filled in

2022-23.


3.A. Page 25 of 84




1STRATEGY:

3 Compliance with Statutes and RulesOBJECTIVE:


CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023


Review Compliance and Bring Enforcement Actions as Needed

Objects of Expense:





2004 UTILITIES $3,644 $3,644 $3,644 $3,015 $4,149

2005 TRAVEL $14,960 $14,960 $14,960 $14,361 $8,622










3.A. Page 26 of 84




1STRATEGY:



CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023



666 Appropriated Receipts $0 $0 $0 $4,300 $4,300

$0 $0 SUBTOTAL, MOF (OTHER FUNDS) $4,300 $4,300 $0


$6,129,645 $6,210,897 $6,864,356

$6,610,100 $6,610,100




3.A. Page 27 of 84




1STRATEGY:



CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023



The General Counsel division of TDI performs the following legal duties: advise TDI staff on a broad range of legal issues; perform legal reviews and analyses; draft

Commissioner orders, public notices, data collections, bulletins, briefings, legislation, pleadings, and other documents; draft administrative rules, including requests for

informal stakeholder input, formal proposals, rule hearings, adoption orders, and emergency rules; provide editorial review of rule documents; coordinate with the Office of

the Attorney General to represent TDI in lawsuits, receiverships, and subpoenas; advise on Enforcement referrals; and process all public information requests received by

TDI in accordance with the Public Information Act (PIA).

TDI is directed by statute (Tex. Ins. Code §31.002; and Ch. 82, Subchapter B, Chapter 83, and Chapter 101) to ensure compliance with insurance laws and rules. TDI

investigates and takes action against entities engaged in unfair, fraudulent, and other illegal practices. Many investigations are resolved via informal settlements, including

consent orders. Alleged violations are also resolved through contested case proceedings before the State Office of Administrative Hearings (SOAH). The commissioner

enters a final order based on the proposal of the SOAH administrative law judge.

This strategy contributes to the statewide goal 07 and benchmark 01 by investigating and enforcing Texas statutes, which supports fair rates and practices by insurance

companies and other regulated entities.


3.A. Page 28 of 84




1STRATEGY:



CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023



External factors that impact legal support to agency divisions include legislation (federal and state), economic changes, and market forces. These external forces may result

in a shift in agency priorities and strategies and affect legal support. Examples of shifting priorities include increased solvency or compliance issues due to the economy.

New legislation may require implementation through rules and require additional assistance to program areas which may be required to add to or refocus agency functions

and change internal processes.

Internal factors that impact rules, orders, bulletins, legal analyses, and other documents and legal support provided include the availability of program division resources,

effective and efficient internal processes, and the availability and retention of quality staff.

Changes in economy or market forces may also lead to increased enforcement activity. For example, high reinsurance rates and weather concerns could result in companies

restricting their writing insurance policies, and TDI is required to monitor those practices to ensure compliance with Texas law. New legislation may create additional

industry requirements, which invoke TDI’s compliance and enforcement duties. Internal factors affecting this strategy include agency practices to achieve swift and

efficient resolution of compliance issues. Opportunity for informal resolution of actions, and concern for particular issues, such as availability of insurance at reasonable

rates, non-discrimination, and unauthorized insurance activities, affects TDI’s enforcement efforts.

3.A. Page 29 of 84




1STRATEGY:



CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023





BIENNIAL

CHANGE




$13,075,253 $13,220,200 $144,947 $8,600 Budgeted appropriated receipts relating to open records

requests.

$136,347 Vacancies in 2020-21 biennium shifted to fund needs

other strategies, assumed to be filled in 2022-23.


3.A. Page 30 of 84




2STRATEGY:



CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023


Investigate Insurance Fraud and Refer Violations for Prosecution

Output Measures:

456.00 413.00 325.00 325.00 325.00 1 Number of Insurance Fraud Suspects Investigated and

Resolved

KEY


67.00 54.00 60.00 60.00 60.00 %1 Percent of Investigations of Fraud Suspects Resolved

within Two Years

%%%%


14,465.00 14,180.00 14,000.00 14,000.00 14,000.00 1 Number of Insurance-related Fraud Reports Received

Objects of Expense:





2004 UTILITIES $23,300 $23,300 $23,300 $18,337 $26,093

2005 TRAVEL $82,890 $82,890 $82,890 $72,556 $80,771

2006 RENT - BUILDING $58,213 $58,213 $58,213 $39,193 $57,972

2007 RENT - MACHINE AND OTHER $0 $0 $0 $0 $836


3.A. Page 31 of 84




2STRATEGY:



CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023



5000 CAPITAL EXPENDITURES $0 $0 $0 $24,995 $0






36 Dept Ins Operating Acct $941,674 $1,004,123 $1,010,888 $1,152,221 $1,152,221

$1,004,123 $941,674 SUBTOTAL, MOF (GENERAL REVENUE FUNDS - DEDICATED) $1,152,221 $1,152,221 $1,010,888


666 Appropriated Receipts $10,902 $3,538 $0 $0 $0

$3,538 $10,902 SUBTOTAL, MOF (OTHER FUNDS) $0 $0 $0


$3,305,316 $3,700,392 $3,965,773

$3,968,863 $3,968,863



3.A. Page 32 of 84




2STRATEGY:



CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023



Statutes (Tex. Ins. Code, §701, Subchapter C) directs TDI to investigate cases involving fraud committed by insurers, providers, consumers, and those conducting

unauthorized business of insurance, and, to initiate or make referrals for criminal prosecutions as needed. TDI evaluates and investigates potentially fraudulent activities

reported by staff, the public, the insurance industry, and other regulatory or law enforcement agencies. The TDI Fraud Unit is a law enforcement agency employing licensed

peace officers (Tex. Code of Crim. Proc., Art. 2.12(27)). Fraud Unit peace officers may make arrests, execute search warrants and subpoenas, refer cases to district attorneys,

and participate in state and federal criminal investigation task forces.

This strategy protects consumers, the insurance market, and ensures that the insurance industry maintains integrity in its business practices. The Fraud Unit works with

strategy 1.1.1 Consumer Education and Outreach to provide information, tools and resources to consumers and governmental officials to reduce fraud. One example of this

effort is the deployment of a team to areas impacted by major catastrophes to educate victims and the local community on steps to avoid being further victimized by fraud .

This strategy contributes to statewide goal 07 and benchmark 01. Eliminating and deterring fraud reduces unfair and illegal practices, which encourages fair competition in

the insurance industry. It protects consumers’ insurance assets from financial loss related to the purchase of fraudulent products .



3.A. Page 33 of 84




2STRATEGY:



CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023



Fraud victimizes insurance consumers when agents convert premiums, unauthorized insurers sell fake coverage, or company employees use company assets for personal

gain, causing a company to fail. Conversely, consumers defraud insurance companies through material misrepresentations and misstatements, which cause insurance

companies to lose money and increase premium rates for all consumers. State and federal legislation affects this strategy. The Fraud Unit also supports a governor’s

executive order to prevent and eliminate fraud, waste, and abuse.

Economic trends affect the amount and type of fraudulent activities occurring in the state. The regulatory climate may lead to voids in the marketplace, which are filled by

fraudulent operators. The Fraud Unit participates on the Texas Committee on Insurance Fraud to enhance fraud awareness. Memorandums of understanding with district

attorney offices for Bexar, Dallas, Harris, Tarrant, and Travis counties allow TDI to support special prosecutors and investigators in insurance fraud investigations and

prosecutions.

Continued funding for access to national and statewide insurer databases, as well as maintenance, enhancement, and expanded use of existing TDI databases and case

management systems are essential. The National Association of Insurance Commissioners develops model laws relating to insurance fraud and as those models are

updated, Texas may need to consider changes to existing fraud statutes. As states enact tougher fraud laws, insurance consumers and taxpayers will benefit.

3.A. Page 34 of 84




2STRATEGY:



CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023





BIENNIAL

CHANGE




$7,666,165 $7,937,726 $271,561 $(3,538) 2020 appropriated receipts for reimbursements not part of

2022-23 request.

$275,099 Net impact of budget realignments, ongoing fraud

software needs, and projected Schedule C personnel

costs for Insurance Fraud Unit for 2022-23 biennium.


3.A. Page 35 of 84




1STRATEGY:

4 Administrative Innovative Insurance InitiativesOBJECTIVE:


CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023


Administer Three-Share Grant Program

Objects of Expense:

1001 SALARIES AND WAGES $60,000 $60,000 $60,000 $52,000 $52,000


2009 OTHER OPERATING EXPENSE $600 $600 $3,668 $598 $1,139

4000 GRANTS $0 $0 $4,290,218 $1,957,575 $2,100,346

$2,157,125 $2,013,793 TOTAL, OBJECT OF EXPENSE $64,300 $64,300 $4,357,586


Insurance Maint Tax Fees 8042 $1,124,823 $41,357 $50,642 $45,633 $45,633

$41,357 $1,124,823 SUBTOTAL, MOF (GENERAL REVENUE FUNDS) $45,633 $45,633 $50,642





666 Appropriated Receipts $438,764 $2,100,346 $4,290,218 $0 $0

$2,100,346 $438,764 SUBTOTAL, MOF (OTHER FUNDS) $0 $0 $4,290,218

3.A. Page 36 of 84




1STRATEGY:



CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023




$2,013,793 $2,157,125 $4,357,586

$64,300 $64,300


TOTAL, METHOD OF FINANCE (EXCLUDING RIDERS) $64,300 $64,300

The agency is directed by the General Appropriations Act to award through a competitive application process, grants to local government entities for the research, planning,

and development of three-share premium assistance programs. TDI provides technical assistance and project oversight to grantees, with the long-term goal of increasing

access to private healthcare coverage for the uninsured through the provisions of affordable benefit plans . The three-share programs use a combination of employer,

employee, and public funds with each participant contributing one-third of the premium.

This strategy supports strategy 1.1.1 Consumer Education and Outreach by issuing a competitive Request for Applications before each new biennium and awarding the

three-share premium assistance grant funds to a consortium of local government entities. TDI provides on-going technical assistance to grantees and oversees project

activities to ensure the grantees comply with the contractual requirements.

This strategy contributes to statewide goal 07 and benchmark 0.



3.A. Page 37 of 84




1STRATEGY:



CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023



Tex. Health and Safety Code Ch. 75 authorizes the establishment of regional or local health care programs for employees of small employers and states that a governing

body operating the health care program is not an insurer or health maintenance organization and is not subject to regulation by the Texas Department of Insurance .

Since the 80th Legislature directed TDI to administer grants for these programs, four of the six three-share programs have ended operations. One of the two remaining

terminated coverage in June 2013 and completely restructured its program for the 2014-2015 Biennium.

Changes in the health insurance marketplace under the Patient Protection and Affordable Care Act have created uncertainty. The remaining two have kept a steady

enrollment but have been unable to increase enrollment due to limited grant funds.

As directed by the Legislature, TDI has administered grants for appropriated funds to qualified programs.



BIENNIAL

CHANGE




$6,514,711 $128,600 $(6,386,111) $(6,390,564) Three-Share rider appropriations in 2020-21 biennium.

2022-23 appropriation amounts would be based on

approved rider language.

$4,453 Net impact of salary and operating budget changes fully

realized in 2022-23 biennium.

Total of Explanation of Biennial Change $(6,386,111)

3.A. Page 38 of 84




1STRATEGY:

1 Protect the Public from Loss of Life and Property due to fireOBJECTIVE:

3 Reduce Loss of Life & Property Due to FireGOAL:

CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023


Investigate Suspected Arson, Fire Safety Inspections and Licensing

Output Measures:

561.00 404.00 500.00 500.00 500.00 2 Number of Investigations Initiated by State Fire Marshal's

Office

14,532.00 14,489.00 13,500.00 13,500.00 13,500.00 4 Number of SFMO Registrations, Licenses, & Permits IssuedKEY

494.00 225.00 450.00 450.00 450.00 5 Number of Licensing Investigations or Inspections

Conducted

5,451.00 3,766.00 4,000.00 4,000.00 4,000.00 6 Number of Buildings Inspected or Reinspected for Fire

Safety Hazards

Objects of Expense:




2002 FUELS AND LUBRICANTS $104,500 $104,500 $104,500 $111,701 $106,000


2004 UTILITIES $43,437 $43,437 $43,437 $31,274 $40,605

2005 TRAVEL $182,654 $182,654 $182,654 $134,106 $127,935



5000 CAPITAL EXPENDITURES $12,000 $12,000 $12,000 $99,408 $198,689

3.A. Page 39 of 84




1STRATEGY:



CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023











$4,827,889 $4,751,432 $4,858,094

$4,816,039 $4,816,039




3.A. Page 40 of 84




1STRATEGY:



CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023



State Fire Marshal’s Office (SFMO) is directed by statute (Tex. Ins. Code, Ch. 6001-03, and Occupations Code, Title 13, Subtitle D, Ch. 2154) to license companies and

individuals and enforce regulations pertaining to the sales, service, and installation of fire alarms, extinguishers, sprinklers, and the sales, storage and public display of

fireworks. SFMO inspects fire standard compliant cigarettes and responds to related complaints (Health and Safety Code, Ch. 796).

SFMO conducts fire safety inspections of public buildings (Tex. Gov. Code, §417.008), state owned and leased (Tex. Gov. Code, §417.0081), and if requested, inspections of

retail service stations for violations of flammable liquid storage tanks (Tex. Health & Safety Code, Ch. 753). Upon request, SFMO investigates fires and assists the

prosecution of related criminal offenses (Tex. Gov. Code, Ch. 417.006-07). Statute (Tex. Gov. Code, §417.004) authorizes TDI to provide engineering assistance to local

governments and investigate firefighter line-of-duty deaths (Tex. Gov. Code, §417.0075). Statute (Tex. Gov. Code, §§417.0051-52) authorizes SFMO to provide fire prevention

education to Texans and maintain Texas Fire Incident Reporting System.

Strategy 3.1.1 contributes to the statewide goal 07 and benchmark 01 by helping lower insurance premiums through the reduction of risks associated with fire.

SFMO is impacted by external factors such as demographic changes and the capabilities of local jurisdictions. The delivery of fire prevention, investigation, inspection, and

education services continues to be impacted by increases in the state population and its demographic composition. Increases in population and the growth of cities and

local municipalities not only exposes more people to the risk of preventable fires but could redefine the types of services currently required of the SFMO. The State Fire

Marshal continually assesses its service delivery plan to ensure that it remains an effective fire prevention resource for Texas . A key component of inspections and

investigations is the need for reliable state-owned vehicles for transport of equipment and personnel to perform mission critical functions, as well as professional training as

recommended by the Texas Forensic Science Commission. In addition, SFMO will work to implement a systematic method whereby its resources are leveraged in a manner

designed to enhance local official’s ability to provide needed services in their communities. The SFMO continues to work with local communities to provide training and

assist in enforcing laws and regulations.


3.A. Page 41 of 84




1STRATEGY:



CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023





BIENNIAL

CHANGE




$9,609,526 $9,632,078 $22,552 $22,552 Net budget alignments for 2022-23 reflecting request

levels compared to forecasted 2020-21 spending.


3.A. Page 42 of 84




1STRATEGY:

1 Ensure Appropriate Delivery of Workers' Compensation BenefitsOBJECTIVE:

4 Effectively Regulate the Texas Workers' Compensation SystemGOAL:

CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023


Oversee Activities of System Participants and Ensure Compliance

Output Measures:

384.00 607.00 200.00 200.00 200.00 1 # of Workers' Compensation Enforcement Cases Concluded

with Action

272.00 422.00 200.00 200.00 200.00 2 Number of Quality of Care Reviews CompletedKEY

6,812.00 3,050.00 3,000.00 3,000.00 3,000.00 3 # of Complaints Closed Involving WC System Participants

59.00 59.00 62.00 62.00 62.00 4 Number of Performance Reviews Completed


25.00 124.00 180.00 180.00 180.00 1 AVG # Days Per Q of C Reviews of Provider

Carriers/URAS/IROS Completed

179.00 96.00 110.00 110.00 110.00 2 AVG # of Days to Close a Complaint Involving WC SystemKEY

151.00 173.00 180.00 180.00 180.00 3 Average Number of Days to Complete a Performance

Review


8.00 8.00 8.00 8.00 8.00 %1 % Market Share of Self-insurance to Total WC Insurance

Market

%%%%

99.00 98.00 98.00 98.00 98.00 %2 Percent of Medical Bills Processed TimelyKEY %%%%

Objects of Expense:


3.A. Page 43 of 84




1STRATEGY:



CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023




2001 PROFESSIONAL FEES AND SERVICES $1,491,125 $1,608,125 $1,209,397 $699,079 $658,748


2004 UTILITIES $8,383 $47,303 $47,303 $45,792 $46,058

2005 TRAVEL $63,647 $63,647 $63,647 $38,304 $31,111

2006 RENT - BUILDING $44,583 $534,999 $534,999 $581,481 $540,799








$59,438 $15,649 SUBTOTAL, MOF (OTHER FUNDS) $60,000 $60,000 $54,000

3.A. Page 44 of 84




1STRATEGY:



CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023




$6,600,379 $6,432,148 $8,203,530

$8,148,307 $7,501,971




3.A. Page 45 of 84




1STRATEGY:



CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023



The Division of Workers’ Compensation (DWC) regulates and monitors the performance of the Texas workers’ compensation system and all system participants (injured

employees, employers, carriers, attorneys, & providers). DWC oversees the compliance of system participants with the Texas Workers’ Compensation Act and rules.

DWC monitors participants for compliance with rules related to health care and medical treatment & fee guidelines. Quality medical care delivery is mandated by policies

and rules relating to payment of medical services & delivery of medical benefits. DWC performs medical quality reviews of providers, carriers, peer review medical

professionals, designated doctors, & IROs. DWC approves doctors who qualify to determine maximum medical improvement and impairment rating, and maintains the

Designated Doctor List.

DWC uses data to conduct performance reviews and investigations, identify outreach opportunities, place carriers and providers into performance tiers, and examine

agency records to identify carriers and health providers who adversely impact the system.

The Research and Evaluation Group generates reports based on data analysis and surveys of system participants. For private employers in Texas that qualify, DWC grants

certificates of authority to self-insure workers’ compensation. Self-insurance allows an employer to pay its own workers’ compensation losses rather than buy an insurance

policy.

Strategy 4.1.1 contributes to statewide goal 07, benchmark 01 by ensuring regulatory compliance, and benchmark 05 by ensuring timely access to quality care.


3.A. Page 46 of 84




1STRATEGY:



CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023



Future court decisions could affect the activities performed in this strategy. Additionally, changes in the reimbursement methodology for medical care at the federal level

may impact DWC’s policies relating to payment of medical services and delivery of medical benefits. Increased use of technology for data collection and analysis continues

to be important to the medical quality review process and compliance monitoring processes. The availability and quality of data provided to DWC may affect monitoring and

enforcement actions. Internal factors impacting this strategy include the availability of resources to monitor and assess compliance trends and initiate enforcement actions

when noncompliance is detected, including the use of automation to collect, analyze, and disseminate performance information and to conduct investigations.

Research and products of the Research and Evaluation Group are highly dependent on the accuracy and thoroughness of the claim data submitted to DWC by system

participants.

Concerning activities related to self-insurance regulation, private employers may voluntarily seek a self-insurance certification from DWC. The volume of activity in this

strategy related to self-insurance is dependent on the volume of companies that seek self-insured status and the rate of withdraw from self-insurance status.

3.A. Page 47 of 84




1STRATEGY:



CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023





BIENNIAL

CHANGE




$14,635,678 $15,650,278 $1,014,600 $6,562 Undercollection of 2020-2021 appropriated receipts

compared to 2022-23 budget.

$1,008,038 Net funding for workers' compensation system

modernization efforts realized from rent savings due to

ending DWC Metro building lease in 2022-23 biennium.

Total of Explanation of Biennial Change $1,014,600

3.A. Page 48 of 84




2STRATEGY:



CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023


Resolve Indemnity, Medical Fee and Medical Necessity Disputes

Output Measures:

11,565.00 10,554.00 10,754.00 15,900.00 15,900.00 1 Number of Benefit Review Conferences Held

5,594.00 4,670.00 4,688.00 7,500.00 7,500.00 2 Number of Contested Case Hearings Held

2,435.00 2,021.00 2,000.00 2,000.00 2,000.00 3 Number of Appellate Decisions Issued


81.00 101.00 125.00 200.00 200.00 1 Average Number of Days to Resolve a Medical Fee DisputeKEY

110.00 115.00 135.00 135.00 135.00 2 Avg # of Days to Resolve Indemnity Disputes Via

Resolution Proceedings

KEY


5,382.00 3,029.00 3,400.00 4,100.00 4,100.00 1 Number of Medical Fee Disputes Received

Objects of Expense:





2004 UTILITIES $4,478 $35,913 $49,801 $32,589 $35,913

2005 TRAVEL $201,400 $201,400 $201,400 $169,878 $97,031

2006 RENT - BUILDING $38,610 $434,714 $434,714 $421,081 $436,914

3.A. Page 49 of 84




2STRATEGY:



CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023



2007 RENT - MACHINE AND OTHER $2,800 $2,800 $2,800 $30,145 $2,800










$9,212,193 $9,288,594 $10,549,600

$9,801,220 $9,373,681




3.A. Page 50 of 84




2STRATEGY:



CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023



The Division of Workers’ Compensation (DWC) provides dispute resolution services relating to indemnity, medical fee, and medical necessity disputes, to system

participants including injured employees, insurance carriers, health care providers, employers, pharmacy processing agents, and sub-claimants. For indemnity disputes,

DWC provides a multi-tiered administrative system consisting of benefit review conferences (BRC), contested case hearings (CCH), and appeals panel reviews. As part of

the indemnity dispute process, DWC may issue interlocutory orders for the payment of benefits and reviews and approves agreements and settlements. For medical fee

disputes involving care provided outside of workers’ compensation health care networks, DWC provides informal dispute resolution, conducts BRCs, and provides for

appeals through the State Office of Administrative Hearings (SOAH). For medical necessity disputes, DWC conducts CCHs as an appeal process for Independent Review

Organization decisions.

This strategy coordinates with agency strategies 4.1.1 Oversight and Compliance, 4.1.3 Subsequent Injury Fund Administration, and 4.2.2 Customer Service and Information

Management. Strategy 4.1.2 contributes to the statewide goal 07 and benchmark 05 by resolving disputes effectively and efficiently.

The volume of DWC’s dispute resolution services depends on the number of claims filed by injured employees and the number of claims or issues disputed . Additionally,

changes in the reimbursement methodology for medical care at the federal level may impact DWC’s policies relating to payment of medical services and delivery of medical

benefits. Changes in agency rules, statutory changes, participation in workers’ compensation health care networks, and future court decisions may also affect this strategy.


3.A. Page 51 of 84




2STRATEGY:



CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023





BIENNIAL

CHANGE




$19,838,194 $19,174,901 $(663,293) $(239,041) Net change in 2020-21 appropriated receipts from

designated doctor conferences not budgeted for 2022-23

biennium.

$(424,252) Net impact of budget realignments and rent savings from

Metro building shifting to strategy 4.1.1 for workers'

compensation system modernization efforts.


3.A. Page 52 of 84




3STRATEGY:



CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023


Administer Subsequent Injury Fund


69.00 19.00 21.00 62.00 62.00 1 Avg Days from Receipt of SIF Request for Reimbursement

to Payment


26.00 25.00 24.00 24.00 24.00 1 # of Injured Workers Receiving Lifetime Income Benefits

through SIF

KEY

Objects of Expense:





2009 OTHER OPERATING EXPENSE $7,674,711 $7,674,711 $6,562,942 $17,914,521 $9,381,832




5101 Subsequent Injury Fund $17,912,134 $9,378,628 $6,551,464 $7,672,692 $7,672,692


3.A. Page 53 of 84




3STRATEGY:



CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023




$18,111,416 $9,569,820 $6,745,875

$7,857,644 $7,857,644



The Subsequent Injury Fund (SIF) is a statutorily created dedicated account in the general revenue fund. The commissioner of workers’ compensation is required by statute

to appoint an administrator for the SIF. Under defined circumstances, the SIF is responsible for the timely payment of lifetime income benefits to qualified recipients.

Additionally, the SIF is directed to reimburse insurance carrier overpayments produced in defined cases: payments made pursuant to a DWC interlocutory order or decision

that is later reversed or modified, multiple employment claim payments, certain pharmaceutical claim payments, and overpayment of benefits made due to designated doctor

opinions which are reversed or modified by final arbitration or final order or decision.

This strategy coordinates with agency strategies 4.1.1 Oversight and Compliance and 4.1.2 Dispute Resolution and contributes to statewide goal 07 and benchmark 05 by

ensuring eligible injured employees receive lifetime income benefits in accordance with the Texas Labor Code and by effectively distributing reimbursements to eligible

insurance carriers for overpayment of benefits and other authorized reimbursements.



3.A. Page 54 of 84




3STRATEGY:



CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023



The SIF was created by the Texas Legislature in 1947 to facilitate employment of individuals with disabilities including a large number of disabled veterans . If an employee

with an existing disability sustained a work related injury and it resulted in certain permanent disabilities such as loss of sight in both eyes or loss of both limbs, the injured

employee would be entitled to lifetime income benefits but insurance carriers pay only for the second work related injury and the SIF pays the balance of lifetime income

benefits.

The SIF is funded by death benefits paid into it by insurance carriers when a compensable death occurs and there is no legal beneficiary or when beneficiary status ends

prior to an established date.

The SIF’s annual lifetime income benefits payments and claim reimbursement payments vary from year to year. The aggregate amount of lifetime income benefits and

overpayment reimbursements to be paid by the SIF annually is dependent on the number and values of eligible claims submitted. The financial condition of the SIF may be

affected by changes in statute regarding the types of direct payments and carrier reimbursements that may be made from the SIF, the number and types of reimbursement

requests the SIF receives annually, and by the number and amount of death benefits insurance carriers pay to the SIF when they are unable to identify an eligible

beneficiary.

3.A. Page 55 of 84




3STRATEGY:



CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023





BIENNIAL

CHANGE




$16,315,695 $15,715,288 $(600,407) $(584,707) 2020-21 budget reduction for fund 5101 implemented

after base reconciliation.

$(15,700) Decreased personnel and operating costs in current

biennium realized fully in 2022-23 biennium.


3.A. Page 56 of 84




4STRATEGY:



CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023


Investigate Workers' Comp Fraud & Refer Violations for Prosecution

Output Measures:

146.00 174.00 85.00 85.00 85.00 1 Number Workers' Comp Fraud Cases Resolved

8.00 10.00 10.00 10.00 10.00 2 # of Prosecutions for Workers' Comp Fraud Cases


83.00 81.00 60.00 60.00 60.00 %1 % of Workers' Compensation Fraud Cases Resolved within

365 Days

%%%%


2,078.00 1,584.00 1,300.00 1,300.00 1,300.00 1 Number of Reports of WC Insurance Fraud Received

Objects of Expense:





2004 UTILITIES $4,889 $9,379 $9,379 $6,886 $9,595

2005 TRAVEL $16,663 $16,663 $16,663 $2,303 $7,968

2006 RENT - BUILDING $5,144 $61,731 $61,731 $39,826 $61,731


3.A. Page 57 of 84




4STRATEGY:



CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023



$1,028,716 $807,442 TOTAL, OBJECT OF EXPENSE $1,083,239 $1,022,162 $1,122,577


36 Dept Ins Operating Acct $807,442 $1,028,716 $1,122,577 $1,083,239 $1,022,162

$1,028,716 $807,442 SUBTOTAL, MOF (GENERAL REVENUE FUNDS - DEDICATED) $1,083,239 $1,022,162 $1,122,577


$807,442 $1,028,716 $1,122,577

$1,083,239 $1,022,162




3.A. Page 58 of 84




4STRATEGY:



CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023



The Division of Workers’ Compensation (DWC) is directed by statute to maintain an investigation unit to conduct investigations relating to alleged violations of the Texas

Labor Code, commissioner rules, or a commissioner order or decision, with particular emphasis on violations of Texas Labor Code Chapters 402, 403, 406-414, and 418.

DWC’s Fraud Unit receives, evaluates, and investigates reports of fraud from the industry, public, regulatory, and law enforcement agencies. The DWC Fraud Unit refers

cases to district attorneys and federal prosecutors and provides technical assistance to the industry and prosecutors on fraud cases. The DWC Prosecution Unit,

embedded in the Travis County District Attorney’s Office, accepts cases from the DWC Fraud unit for prosecution. Workers’ compensation fraud is an offense that is

costly to insurance carriers and consumers alike. This strategy ensures that the insurance industry has effective antifraud business practices.

This strategy supports agency strategy 4.1.1 Oversight and Compliance. This strategy contributes to the statewide goal 07 and benchmark 01 by eliminating or deterring

fraud; it also reduces unfair and illegal practices and decreases workers’ compensation claim costs and insurance premiums.


3.A. Page 59 of 84




4STRATEGY:



CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023



State and federal legislation affects this strategy. The DWC Fraud Unit investigates fraud impacting the workers’ compensation system of the State of Texas. System

participants, such as injured employees, employers, attorneys, health care providers, and insurance carriers can be subjects of these investigations. Referrals can be

reported via the National Insurance Crime Bureau, the National Health Care Anti-Fraud Association, and other anti-fraud organizations. Changes in the economy and the

volume of work-related claims reported have an effect on the volume of fraudulent activities since a downturn in the economy and a tight market creates an incentive for

fraudulent activity.

DWC Fraud Unit works with DWC Prosecution Unit and other Texas Department of Insurance (TDI) embedded prosecutors to process workers’ compensation fraud

referrals. Memorandums of understanding with district attorney’s offices for Bexar, Dallas, Harris, Tarrant, and Travis counties allow TDI and DWC to support special

prosecutors and investigators and assist in investigations and prosecution of workers’ compensation fraud . Continued funding for and access to national and statewide

databases as well as the availability of resources to collect, analyze, and evaluate data to identify potentially fraudulent activity is essential to this strategy. The

maintenance, enhancement, and expanded use of existing databases and case management systems are also essential to the success of this strategy.



BIENNIAL

CHANGE




$2,151,293 $2,105,401 $(45,892) $(45,892) Net impact of budget realignments and rent savings from




3.A. Page 60 of 84




1STRATEGY:

2 Ensure Workers' Comp System Participants are Educated and InformedOBJECTIVE:


CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023


Provide Educational Services&WPS Consultations to System Participants

Output Measures:

3,058.00 2,652.00 3,000.00 3,000.00 3,000.00 1 Number of Consultations and Inspections Provided to

Employers

KEY

535,556.00 506,206.00 400,000.00 400,000.00 400,000.00 3 # RTW, Provider, WPS Educational Products & Services

20,781.00 22,043.00 20,000.00 20,000.00 20,000.00 4 Number of WC Income Benefit Recipients Referred to TWC


2.20 2.00 2.00 2.00 2.00 1 Incidence of Injuries/Illness per 100 FTEs in the Private

Sector

Objects of Expense:



2001 PROFESSIONAL FEES AND SERVICES $0 $0 $0 $6,121 $0


2004 UTILITIES $2,093 $20,056 $20,056 $24,106 $21,376

2005 TRAVEL $214,951 $214,951 $214,951 $245,447 $201,609

2006 RENT - BUILDING $123,552 $349,898 $349,898 $319,360 $349,898



3.A. Page 61 of 84




1STRATEGY:



CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023









555 Federal Funds

OSHA BUREAU OF LABOR STATISTICS $197,136 $197,136 $225,336 $225,336 17.005.001 $189,719

OSHA Consultation Agreements $2,030,457 $2,030,457 $2,030,457 $2,030,457 17.504.001 $2,070,885

CFDA Subtotal, Fund 555 $2,227,593 $2,227,593 $2,255,793 $2,255,793 $2,260,604

$2,227,593 $2,260,604 SUBTOTAL, MOF (FEDERAL FUNDS) $2,255,793 $2,255,793 $2,227,593


666 Appropriated Receipts $33,459 $14,366 $1,096 $0 $0

$14,366 $33,459 SUBTOTAL, MOF (OTHER FUNDS) $0 $0 $1,096

3.A. Page 62 of 84




1STRATEGY:



CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023




$3,772,969 $3,930,854 $3,933,992

$3,961,866 $3,717,557



The Division of Workers’ Compensation (DWC) is directed by statute to promote safe and healthy workplaces and help employees return to work (RTW). DWC conducts

outreach to increase awareness and improve effectiveness of employer health and safety programs. DWC provides consultations, safety training, and educational resources

to Texas employers and insurance companies to help develop effective health and safety programs, identify and control workplace hazards, and understand state and federal

regulations. DWC compiles and analyzes data on occupational injuries, illnesses and fatalities by industry, case characteristics, and demographics.

DWC provides outreach to system participants to encourage the safe and timely return of injured employees to productive roles in the workplace. DWC assists injured

employees to RTW by making referrals to the Texas Workforce Commission for vocational rehabilitation services. DWC’s policies include RTW guidelines that provide

benchmarks for expected lost time durations for injuries and illnesses.

This strategy coordinates with strategies 4.1.1 Oversight and Compliance, 4.1.2 Dispute Resolution, and 4.2.2 Customer Service and Information Management. Strategy 4.2.1

contributes to statewide goal 07 and benchmark 05 by assisting employers and employees in providing safe workplaces, reducing workplace injuries, and establishing clear

standards for expected lost time durations.


3.A. Page 63 of 84




1STRATEGY:



CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023



The agency’s ability to appropriately focus its safety and RTW education and outreach efforts depends on the receipt of accurate injury and employment data . Safety

consultations and safety training services are dependent on a number of external factors including the number of insurance companies writing workers’ compensation

insurance, the number of employers in the Rejected Risk program, and the number of employers requesting Occupational Safety and Health Consultation (OSHCON)

services. The number and scope of consultations and safety training services is dependent on voluntary participation by employers, which can affect the number of hazards

identified during those activities. Changes to state and federal laws, court rulings, and federal funding of grant programs may require program adjustments.




BIENNIAL

CHANGE




$7,864,846 $7,679,423 $(185,423) $(15,462) Appropriated receipt collections for conferences not part

of 2022-23 baseline request.

$56,400 Increase in federal funds for 2022-23 due to additional

award received for BLS grants.





3.A. Page 64 of 84




2STRATEGY:



CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023


Provide Customer Assistance & Information Management

Objects of Expense:





2004 UTILITIES $36,079 $57,036 $57,036 $45,325 $91,190

2005 TRAVEL $83,000 $83,000 $83,000 $98,597 $44,432

2006 RENT - BUILDING $64,006 $328,076 $328,076 $335,146 $343,076









3.A. Page 65 of 84




2STRATEGY:



CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023





$8,116,135 $8,127,238 $9,270,640

$8,836,377 $8,551,350



The Department of Insurance, Division of Workers’ Compensation (DWC) is directed by statute to receive, collect, and maintain information on every compensable injury

that is reported to DWC and to establish a single point of contact for injured employees receiving services from the division. DWC also provides information and reports to

qualified individuals, insurance carriers, and employers. The information received is maintained in microfiche, microfilm, and electronic format and as required by records

retention schedules established under the Texas Government Code.

DWC is charged with educating system participants regarding their rights and responsibilities , how to interact within the workers’ compensation system, and best practices

for return-to-work and workplace safety programs. DWC also has a duty to provide education to health care providers about rules and procedures. DWC provides

educational and training materials through various methods, including making the materials available on its website.

This strategy supports agency strategies 4.1.1 Oversight and Compliance, 4.1.2 Dispute Resolution, 4.1.3 Subsequent Injury Fund Administration, and 4.2.1 Health and

Safety Services. Strategy 4.2.2 contributes to statewide goal 07 and benchmark 05 by efficiently maintaining records and effectively educating system participants regarding

the workers’ compensation system.


3.A. Page 66 of 84




2STRATEGY:



CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023



DWC provides customer service through a statewide call center to injured employees and other system participants. Although insurance carriers are primarily responsible

for adjusting and paying workers’ compensation claims, by statute, certain specific claims decisions such as requests to change a treating doctor, initial requests for

supplemental income benefits, and requests for a required medical examination are made by DWC.

Legislative changes and information needs of system participants impact this strategy. Changes in state law and agency rules may expand or decrease the functions

performed under this strategy, based on the information required to be received and maintained by the agency, and based on the effect that rule and policy changes have on

system participants. Additionally, the number of claims filed by injured employees directly affects the volume of records reported and the frequency of customer service

inquiries reported to DWC. The use of technology can have a major impact on this strategy. Increasing the ability to process and store information electronically is a key

goal for the agency. Identifying and implementing alternate methods of providing educational materials and training to system participants through technology can also

augment the agency’s ability to inform the public.


3.A. Page 67 of 84




2STRATEGY:



CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023





BIENNIAL

CHANGE




$17,397,878 $17,387,727 $(10,151) $58,396 Undercollection of 2020-2021 appropriated receipts

compared to 2022-23 budget.





3.A. Page 68 of 84




1STRATEGY:

1 Indirect AdministrationOBJECTIVE:

5 Indirect AdministrationGOAL:

CODE DESCRIPTION

09 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023


Central Administration

Objects of Expense:




2003 CONSUMABLE SUPPLIES $852 $852 $852 $564 $3,141

2004 UTILITIES $12,435 $37,883 $37,883 $30,577 $39,608

2005 TRAVEL $38,249 $38,249 $38,249 $41,065 $29,633

2006 RENT - BUILDING $129,651 $450,307 $350,307 $298,697 $350,307




General Revenue Fund 1 $271,165 $24,406 $24,406 $24,406 $24,406





3.A. Page 69 of 84




1STRATEGY:



CODE DESCRIPTION

09 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023





666 Appropriated Receipts $0 $1,457 $0 $0 $0

$1,457 $0 SUBTOTAL, MOF (OTHER FUNDS) $0 $0 $0


$6,627,118 $7,248,161 $7,827,339

$7,652,730 $7,306,626




3.A. Page 70 of 84




1STRATEGY:



CODE DESCRIPTION

09 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023



Central Administration ensures activities are compliant with all statutory and regulatory requirements as well as consistent with TDI goals , objectives, purpose, and policies.

These activities include but are not limited to:

• agency executive leadership and coordination;

• ensures agency accountability and integrity;

• manages agency-wide budget including the LAR, the operating budget, and performance measures;

• performs all accounting functions and financial reporting;

• monitors the agency’s compliance with certain Article IX provisions of the General Appropriations Act;

• provides administrative support to the Office of Injured Employee Counsel;

• monitors and oversees the agency’s information security;

• ensures compliance with employment laws, implements professional development training, maintains payroll records, and manages other personnel activities; and

• leads the agency’s recruitment and succession planning activities and promotes a positive working environment .

TDI strives to maintain a highly serviceable Central Administration to better allow agency programs time to focus on the effective and efficient regulation of the Texas

insurance market and workers’ compensation system.

As TDI services expand to meet the insurance and workers’ compensation needs of Texans, administrative resources are critical for communicating direction and policy,

establishing new programs, recruiting and hiring additional employees, and managing budgetary and planning activities.


3.A. Page 71 of 84




1STRATEGY:



CODE DESCRIPTION

09 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023





BIENNIAL

CHANGE




$15,075,500 $14,959,356 $(116,144) $(1,457) Appropriated receipts from reimbursements in 2020 not

part of 2022-23 request.

$(114,687) Net impact of budget realignments due to 2020 vacancies

and rent savings from Metro building shifting to strategy

4.1.1 for workers' compensation system modernization

efforts.


3.A. Page 72 of 84




2STRATEGY:



CODE DESCRIPTION

09 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023


Information Resources

Objects of Expense:



2001 PROFESSIONAL FEES AND SERVICES $7,457,998 $7,295,649 $7,578,609 $4,326,305 $7,469,121


2004 UTILITIES $246,215 $250,705 $219,498 $198,007 $257,183

2005 TRAVEL $17,500 $17,500 $17,500 $15,692 $11,066

2006 RENT - BUILDING $5,144 $61,731 $61,731 $59,739 $61,731

2009 OTHER OPERATING EXPENSE $2,671,302 $2,807,747 $2,485,684 $5,116,944 $3,915,810

5000 CAPITAL EXPENDITURES $532,800 $422,500 $140,112 $608,783 $80,717







3.A. Page 73 of 84




2STRATEGY:



CODE DESCRIPTION

09 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023





$15,572,485 $16,750,880 $16,212,729

$16,433,178 $16,508,305



Information Technology Services (ITS) provides automation and computer support for all TDI agency programs as well as for the Office of Injured Employee Counsel (OIEC)

and ensures the agency’s infrastructure and networked computer systems are fully operational. ITS responsibilities include application development, quality assurance,

direct customer support, project management, systems analysis, planning and monitoring of the operational budget, data center services, desk side software support, office

automation support, and telephone systems support. These responsibilities are performed for headquarters as well as mobile workers, and multiple field and support office

locations across the state.

Technology capital projects including the replacement of computers, hardware and software, and payments made under the Data Center Services contract with the

Department of Information Resources are managed in this strategy.




3.A. Page 74 of 84




2STRATEGY:



CODE DESCRIPTION

09 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023



Innovations in hardware, software, and the increased need to provide around the clock access to agency information, data, and systems to the public may affect this

strategy.

TDI agency programs and OIEC recognize the evolution of the workforce and constituents. TDI’s hardware, software, and applications must meet the needs of agency staff

and the public. TDI must ensure security of the agency’s data and systems. The introduction of new technologies may require training and hiring additional resources with

new skill sets to develop, maintain, and support TDI’s systems.



BIENNIAL

CHANGE




$32,963,609 $32,941,483 $(22,126) $(22,126) Net change of vacancies assumed to be filled in

biennium and funding alignments from information

technology projects expenses completed in 2020-21.


3.A. Page 75 of 84




3STRATEGY:



CODE DESCRIPTION

09 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023


Other Support Services

Objects of Expense:




2002 FUELS AND LUBRICANTS $8,600 $10,600 $10,600 $4,469 $7,000


2004 UTILITIES $56,529 $62,266 $62,266 $44,606 $68,630

2005 TRAVEL $7,170 $7,170 $7,170 $12,338 $11,280

2006 RENT - BUILDING $1,530,500 $1,433,549 $1,433,549 $1,366,065 $1,443,152


2009 OTHER OPERATING EXPENSE $762,656 $2,159,536 $1,135,065 $1,617,724 $1,315,133




General Revenue Fund 1 $0 $200,000 $200,000 $200,000 $200,000


3.A. Page 76 of 84




3STRATEGY:



CODE DESCRIPTION

09 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023








666 Appropriated Receipts $8 $0 $0 $0 $0

$0 $8 SUBTOTAL, MOF (OTHER FUNDS) $0 $0 $0


$5,746,997 $5,540,507 $5,602,340

$6,626,811 $4,943,981




3.A. Page 77 of 84




3STRATEGY:



CODE DESCRIPTION

09 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023



This strategy consists of the Procurement and General Services Office. The Purchasing and Contract Administration section of this office processes all agency purchasing

and contracting transactions, coordinates the agency’s Historically Underutilized Business (HUB) program and is responsible for the administration of all agency contracts.

The Staff Services sections of the office provide and coordinate facility-related and operational support consisting of seven primary functions: Facilities Management, Mail

Services, Copy Center Services, Records Retention, Property Management, Warehouse Services, and Safety and Risk Management. Agency leases and the lease

management of agency multi-functional devices (printing, copying, scanning) are primarily funded by this strategy.


The projected headquarters move (Austin Hobby Building and Austin Metro Building) to the capitol complex in late summer of 2022 will have a significant one-time impact

on workload for staff services. This work started in FY 2020 and will continue until the move is completed and agency staff are settled in FY 2023.




BIENNIAL

CHANGE




$11,142,847 $11,570,792 $427,945 $427,945 Net impact of TDI costs associated with move to capitol

complex building in 2022-23 biennium. Increases offset

by savings within strategy realized from building

consolidation.


3.A. Page 78 of 84




1STRATEGY:

1 Regulatory ResponseOBJECTIVE:

6 Regulatory ResponseGOAL:

CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023


Contingency Regulatory Response

Objects of Expense:

1001 SALARIES AND WAGES $0 $0 $500,000 $0 $0

2005 TRAVEL $0 $0 $0 $0 $0

$0 $0 TOTAL, OBJECT OF EXPENSE $0 $0 $500,000


Insurance Maint Tax Fees 8042 $0 $0 $500,000 $0 $0

$0 $0 SUBTOTAL, MOF (GENERAL REVENUE FUNDS) $0 $0 $500,000


$0 $0 $500,000

$0 $0


TOTAL, METHOD OF FINANCE (EXCLUDING RIDERS) $0 $0


3.A. Page 79 of 84




1STRATEGY:

1 Regulatory ResponseOBJECTIVE:

6 Regulatory ResponseGOAL:

CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023


Contingency Regulatory Response

State Regulatory Response Contingency Strategy allows TDI to respond to the following regulatory issues : a significant change in insurance regulatory environment,

demands for federal healthcare reform implementation, a weather related disaster in the state of Texas, a public health crisis, such as a pandemic, a fire that has been declared

as a disaster situation in the State of Texas, and non-weather related disasters.


The Regulatory Response Rider will only be activated if there is a natural or health disaster or if there are significant changes to the regulatory environment such as new

legislation or economic changes.




BIENNIAL

CHANGE




$500,000 $0 $(500,000) $(500,000) Adjusted 2021 appropriation in base reconciliation but

was part of 2020-21 reduction plan. Base funds not part

of appropriation request.


3.A. Page 80 of 84




1STRATEGY:

1 Health Insurance Risk PoolOBJECTIVE:

7 Health Insurance Risk PoolGOAL:

CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023


Contingency Health Insurance Risk Pool.

Objects of Expense:

1001 SALARIES AND WAGES $0 $0 $904,779 $0 $0

1002 OTHER PERSONNEL COSTS $0 $0 $4,524 $0 $0

2001 PROFESSIONAL FEES AND SERVICES $0 $0 $2,000,000 $0 $0

2003 CONSUMABLE SUPPLIES $0 $0 $7,200 $0 $0

2004 UTILITIES $0 $0 $500 $0 $0

2009 OTHER OPERATING EXPENSE $0 $0 $39,910,474 $0 $0

$0 $0 TOTAL, OBJECT OF EXPENSE $0 $0 $42,827,477


36 Dept Ins Operating Acct $0 $0 $1,774,953 $0 $0

$0 $0 SUBTOTAL, MOF (GENERAL REVENUE FUNDS - DEDICATED) $0 $0 $1,774,953


329 Healthy TX Sm Emp Prem Stabil. Fund $0 $0 $41,052,524 $0 $0

$0 $0 SUBTOTAL, MOF (OTHER FUNDS) $0 $0 $41,052,524

3.A. Page 81 of 84




1STRATEGY:



CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023




$0 $0 $42,827,477

$0 $0


TOTAL, METHOD OF FINANCE (EXCLUDING RIDERS) $0 $0

Texas Insurance Code Subtitle G Chapter 1510 establishes a health insurance risk pool to provide a temporary mechanism for maximizing available federal funding to assist

residents of this state in obtaining access to quality health care. The Commissioner of Insurance is authorized to use pool funds to provide health insurance coverage,

provide funding to insurers for lower enrollee premium rates, or provide a reinsurance program for insurers in exchange for lower enrollee premium rates. Funds appropriated

to TDI are allowed to be used to apply for federal funding and grants and administer the chapter and develop and implement public education , outreach, and facilitated

enrollment strategies.



Appropriated funds may only be expended upon submission of a finding of fact by the Commissioner of Insurance in response to changes in federal legislation.

Texas Insurance Code Chapter 1510 expires August 31, 2021.


3.A. Page 82 of 84




1STRATEGY:



CODE DESCRIPTION

17 A.2 B.3

Service Categories:


Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023





BIENNIAL

CHANGE




$42,827,477 $0 $(42,827,477) $(42,827,477) Legislation authorizing program and FTEs expires

August 2021. Appropriated funds not part of 2022-23

request.

Total of Explanation of Biennial Change $(42,827,477)

3.A. Page 83 of 84




$165,176,062 $117,133,131 $123,138,718 METHODS OF FINANCE (EXCLUDING RIDERS):

$114,881,615 $118,499,710 $165,176,062 $117,133,131 $123,138,718 OBJECTS OF EXPENSE:

$114,881,615 $118,499,710

FULL TIME EQUIVALENT POSITIONS:

SUMMARY TOTALS:

METHODS OF FINANCE (INCLUDING RIDERS): $118,499,710 $114,881,615

1,210.0 1,210.0 1,231.2 1,127.8 1,156.3

3.A. Page 84 of 84

3.A.1. PROGRAM-LEVEL REQUEST SCHEDULE87th Regular Session, Agency Submission, Version 1

Prepared By: Anthony Infantini

Date: October 5, 2020Strategy Strategy Name $ %

A11 Consumer Education & Outreach 1 Customer Operations TX Ins Code 32.102, 32.013, 521, 524, 843, 1467, 1811.204, 2210.582, 4001-4004, 4101 $5,582,493 $2,723,620 $2,723,620 $5,447,240 ($135,253) -2.4%

A11 Consumer Education & Outreach 13 TexasSure TX Transportation Code Ch. 601 Subchapter N $10,147,504 $5,073,752 $5,073,752 $10,147,504 $0 0.0%

A12 Customer Operations 1 Customer Operations TX Ins Code 32.102, 32.013, 521, 524, 843, 1467, 1811.204, 2210.582, 4001-4004, 4101 $13,471,796 $6,730,637 $6,730,637 $13,461,274 ($10,522) -0.1%

A13 Texas.Gov 10 Administration & Support Gov. Code, Ch.2054, Subchapter I $799,300 $398,900 $398,900 $797,800 ($1,500) -0.2%

B11 Financial Solvency Regulation 2 Financial Regulation TX Ins Code, Ch. 401-494, 751, 801-888, 911-984, 1111A, 2551, 4001-4102, 4151, 7001 $11,067,498 $5,494,917 $5,494,917 $10,989,834 ($77,664) -0.7%

B21 Property & Casualty Regulation 4 Property & CasualtyTX Ins Code Ch. 706, 1805, 1811, 1901, 1951, 1952, 2052, 2053, 2151, 2210, 2211, 2251, 2301, 3501, 3502

$13,481,304 $6,824,689 $6,824,689 $13,649,378 $168,074 1.2%

B22 Life & Health Regulation 5 Life & HealthTX Ins Code Ch. 843, 1271, 1272, 1301, 1305, 1111A, 1153, 1369, 1458, 1651, 1652, 1701, 4201, 4202

$10,180,626 $5,392,521 $5,392,521 $10,785,042 $604,416 5.9%

B31 Legal Review & Enforcement 6 Legal & Enforcement Tex. Ins. Code Ch. 31-40, Ch. 82, Subchapter B, Ch 83-86, 101 $13,075,253 $6,610,100 $6,610,100 $13,220,200 $144,947 1.1%

B32 Insurance Fraud 7 Insurance Fraud TX Ins Code, Ch. 701, Tex. Code of Crim. Proc., Art. 2.12(27) $7,666,165 $3,968,863 $3,968,863 $7,937,726 $271,561 3.5%

B41 Three-Share 14 Three-Share Health & Safety Code Ch. 75, General Appropriations Act $6,514,711 $64,300 $64,300 $128,600 ($6,386,111) -98.0%

C11 Fire Marshal 8 State Fire Marshal's OfficeTX Ins. Code, Ch. 6001-6003; Occ. Code, Ch. 2154; Gov't, Ch. 417; Health & Safety Code, Ch. 753, 756, 791, 792, 796

$9,609,526 $4,816,039 $4,816,039 $9,632,078 $22,552 0.2%

D11 System Oversight & Compliance 3 Workers' Compensation Labor Code, Ch. 402, 403, 405-415, 418; Insurance Code, Ch. 1305 $13,480,765 $7,570,850 $7,453,850 $15,024,700 $1,543,935 11.5%

D11 System Oversight & Compliance 10 Administration & Support

TX Ins. Code; Labor Code, Ch. 402, 403, 405-415, 418; Government Code, Ch. 2001; Occupations Code; Human Resources Code, Ch. 32

$1,154,913 $577,457 $48,121 $625,578 ($529,335) -45.8%

D12 Dispute Resolution 3 Workers' Compensation Labor Code, Ch. 402, 403, 405-415, 418; Insurance Code, Ch. 1305 $18,905,382 $9,334,813 $9,334,813 $18,669,626 ($235,756) -1.2%

D12 Dispute Resolution 10 Administration & Support


$932,812 $466,407 $38,868 $505,275 ($427,537) -45.8%

D13 Subsequent Injury Fund 9 Subsequent Injury Fund Labor Code, Ch. 403, 408, 413 $16,315,695 $7,857,644 $7,857,644 $15,715,288 ($600,407) -3.7%

D14 Workers' Compensation Fraud 3 Workers' Compensation Labor Code, Ch. 402, 403, 405-415, 418; Insurance Code, Ch. 1305 $2,018,034 $1,016,609 $1,016,609 $2,033,218 $15,184 0.8%

D14 Workers' Compensation Fraud 10 Administration & Support


$133,259 $66,630 $5,553 $72,183 ($61,076) -45.8%

D21 Health & Safety 3 Workers' Compensation Labor Code, Ch. 402, 403, 405-415, 418; Insurance Code, Ch. 1305 $7,331,806 $3,695,347 $3,695,347 $7,390,694 $58,888 0.8%

D21 Health & Safety 10 Administration & Support


$533,040 $266,519 $22,210 $288,729 ($244,311) -45.8%

Agency Code: 454 Agency: Texas Department of Insurance

Program Priority Program Name Legal Authority 2020-21 Base

Requested2022

Requested 2023

Biennial Total 2022-23

Biennial Difference

3.A.1. Page 1 of 2

3.A.1. PROGRAM-LEVEL REQUEST SCHEDULE87th Regular Session, Agency Submission, Version 1

Prepared By: Anthony Infantini

Date: October 5, 2020Strategy Strategy Name $ %

Agency Code: 454 Agency: Texas Department of Insurance

Program Priority Program Name Legal Authority 2020-21 Base

Requested2022

Requested 2023

Biennial Total 2022-23

Biennial Difference

D22 Customer Service & Information Management 3 Workers' Compensation Labor Code, Ch. 402, 403, 405-415, 418; Insurance Code, Ch. 1305 $16,776,002 $8,525,439 $8,525,439 $17,050,878 $274,876 1.6%

D22 Customer Service & Information Management 10 Administration & Support


$621,876 $310,938 $25,911 $336,849 ($285,027) -45.8%

E11 Central Administration 3 Workers' Compensation Labor Code, Ch. 402, 403, 405-415, 418; Insurance Code, Ch. 1305 $1,505,809 $719,456 $719,456 $1,438,912 ($66,897) -4.4%

E11 Central Administration 10 Administration & Support


$13,569,691 $6,933,274 $6,587,170 $13,520,444 ($49,247) -0.4%

E12 Information Technology 10 Administration & Support


$32,963,609 $16,433,178 $16,508,305 $32,941,483 ($22,126) -0.1%

E13 Other Support & Services 10 Administration & Support


$11,142,847 $6,626,811 $4,943,981 $11,570,792 $427,945 3.8%

F11 Contingent Regulatory Response 12 Contingency Regulatory Response General Appropriations Act, Rider 19 (p. VIII-22) $500,000 $0 $0 $0 ($500,000) -100.0%

G11 Contingent Health Risk Pool 11 Contingency Health Insurance Risk Pool TX Ins. Code Ch. 1510 $42,827,477 $0 $0 $0 ($42,827,477) -100.0%

Prioritization was based on a review of agency programs and how closely they tied to the agency's statutory duties as outlined by Texas Insurance Code Section 31.002. Programs were further analyzed for direct public impacts and the magnitude of those impacts in determining a final priority ranking.

Program Prioritization: Indicate the methodology or approach taken by the agency, court, or institution to determine the ranking of each program by priority.

3.A.1. Page 2 of 2

3.B. RIDER REVISIONS AND ADDITIONS REQUEST

3.B. Rider Revisions and Additions Request

3.B. Page 1 of 8

Agency Code:

454

Agency Name:

Texas Department of Insurance

Prepared By:

Anthony Infantini

Date:

October 5, 2020

Request Level:

Baseline Current

Rider Number

Page Number in 2020-21 GAA Proposed Rider Language

2 VIII-20 Capital Budget. None of the funds appropriated above may be expended for capital budget items except as listed below. The amounts shown below shall be expended only for the purposes shown and are not available for expenditure for other purposes. Amounts appropriated above and identified in this provision as appropriations either for "Lease Payments to the Master Lease Purchase Program" or for items with a "(MLPP)" notation shall be expended only for the purpose of making lease-purchase payments to the Texas Public Finance Authority pursuant to the provisions of Government Code § 1232.103. Upon approval from the Legislative Budget Board, capital budgeted funds listed below under "Acquisition of Information Resource Technologies" may be used to lease information resources hardware and/or software, if determined by agency management to be in the best interest of the State of Texas. 2020 2022 2021 2023 a. Acquisition of Information Resource Technologies (1) Obsolescence Hardware and Software Replacement and Network Security $ 455,976 437,565 $ 455,976 301,120 (2) TexasSure Vehicle Insurance Verification 5,073,752 5,073,752 (3) PC Replacement 461,169 469,920 461,169 469,920 (4) Support for Document Management System 316,943 323,198 316,943 323,198 Total, Acquisition of Information Resource Technologies $ 6,307,840 6,304,435 $ 6,307,840 6,167,990 b. Data Center Consolidation (1) Data Center Consolidation $ 6,509,521 7,283,659 $ 6,566,619 7,446,008 c. Cybersecurity (1) Cybersecurity Enhancements $ 140,112 422,500 $ 140,112 532,800 Total, Capital Budget $ 12,957,473 14,010,594 $ 13,014,571 14,146,798 Method of Financing (Capital Budget): General Revenue - Insurance Companies Maintenance Tax and Insurance Department Fees $ 3,419,746 3,591,504 $ 3,442,990 3,644,668 GR Dedicated - Texas Department of Insurance Operating Fund Account No. 036 4,463,975 5,345,338 4,497,829 5,428,378 Texas Sure Fund 161 5,073,752 5,073,752 Total, Method of Financing $ 12,957,473 14,010,594 $ 13,014,571 14,146,798 Updated reallocation of base request to Data Center and Cybersecurity projects based on agency needs and technology demands. Fiscal years updated and modified the split between 2022 & 2023 along with the method of finance (MOF).


3.B. Page 2 of 8

3 VIII-20

Appropriation Source, Rehabilitation of Insurance Companies. Of the amounts appropriated above, $0 each year of the biennium is from fees that the Department of Insurance shall collect from companies that are successfully rehabilitated by the department. Fees collected and appropriated above shall be in amounts sufficient to cover, yet not exceed, costs of rehabilitating those companies. Any such fees collected in excess of $0 each year of the biennium are also hereby appropriated for the biennium beginning September 1, 20192021, for the sole purpose of the rehabilitation of other insurance companies pursuant to 441.203 of the Texas Insurance Code (estimated to be $0). Updated fiscal years.

4 VIII-21 State Support for NAIC Activities. The agency is prohibited from using resources in support of the National Association of Insurance Commissioners in the absence of NAIC accreditation of the Department of Insurance for compliance with NAIC Financial Regulation Standards. The prohibition would be effective immediately upon loss of accreditation. The only exceptions to this prohibition shall be limited to expenditures necessary for (1) continued departmental use of the NAIC database for monitoring financial solvency of companies doing business in Texas; (2) solvency-related training; and (3) efforts to regain accreditation. The prohibition on using resources does not apply in the event that the Commissioner voluntarily determines not to participate in the state insurance department accreditation program.

No changes.

5

VIII-21 Liquidation Oversight and Title Examiner Full-Time-Equivalent Positions. In addition to the "Number of Full-Time-Equivalents (FTE)" positions authorized above, an additional 38.5 FTE positions are authorized for each year of the 2020-21 2022-23 biennium to support liquidation oversight and title examiner activities. These positions are excluded from the FTE cap. Updated fiscal years.

6

VIII-21 Appropriations Limited to Revenue Collections. The application of special provisions limiting appropriations to revenue collections elsewhere in this Article shall be consistent with relevant statutory provisions governing the agency's assessment of tax rates and fees. As provided by the Texas Insurance Code and the Texas Labor Code, the Commissioners shall take into account unexpended funds in the preceding year when adjusting rates of assessment necessary to pay all expenses of regulating insurance and conducting the operations of the State Fire Marshal and the Office of Injured Employee Counsel during the succeeding year. No changes.

7

VIII-21 State Support for NCOIL Activities. Funds appropriated above include funds from the General Revenue - Insurance Companies Maintenance Tax, Insurance Department Fees and General Revenue Fund-Dedicated for payment of state dues for the National Conference of Insurance Legislators. No changes.

8 VIII-21 Crash Records Information System. Included in Strategy C.2.1, Traffic Safety, at the Department of Transportation is $730,218 for fiscal year 2020 2022 and $730,218 for fiscal year 2021 2023 from General Revenue - Insurance Companies Maintenance Tax and Insurance Department Fees for on-going maintenance of the Crash Records Information System. Updated fiscal years.


3.B. Page 3 of 8

9 VIII-21 Increase Consumer Choice. Out of amounts appropriated above, the Department of Insurance shall contract with the Office of Public Insurance Counsel in the amount of $191,670 each fiscal year from the GR Dedicated-Texas Department of Insurance Operating Fund Account No. 036 to provide consumers with insurance information to make informed decisions. No changes.

10 VIII-21 Consumer Information Report. The Department of Insurance shall submit a report annually to the Legislature and the public no later than April 1 on the following information for each insurer that writes property and casualty insurance, including workers' compensation insurance, in the state: market share, profits and losses, average rate, and average loss ratio. The report shall include the change in rate over the previous 12, 24, and 36 months. No changes.

11 VIII-21 Appropriation of Unexpended Balances. Any unexpended balances as of August 31, 2020 2022, not to exceed 5 percent for any item of appropriation above unless otherwise granted by the provisions of Article IX, §14.05, are hereby appropriated for the same purposes, in the same strategies, for the fiscal year beginning September 1, 2020 2022. Updated fiscal years.

12

VIII-21 Subsequent Injury Fund. Amounts appropriated above in Strategy D.1.3, Subsequent Injury Fund Administration, include an estimated $6,551,464 7,672,692 in fiscal year 2020 2022 and $6,551,464 7,672,692 in fiscal year 2021 2023 out of the GR Dedicated - Subsequent Injury Account No. 5101 for payment of liabilities pursuant to Labor Code, Chapter 403. In the event that actual liabilities exceed the estimated amounts, the Division of Workers' Compensation shall furnish information supporting the estimated additional liabilities to the Comptroller of Public Accounts. If the Comptroller finds that there are sufficient balances in the GR Dedicated - Subsequent Injury Account No. 5101 to support the payment of projected liabilities, a finding of fact to that effect shall be issued and a contingent appropriation shall be made available for the intended purposes. Updated fiscal years and dollars based on approved baseline amounts.


3.B. Page 4 of 8

13

VIII-21-22 Three-Share Premium Assistance Programs. a. Amounts appropriated above to the Department of Insurance of $64,847 64,300 in fiscal year 2020 2022 and $64,847 64,300 in fiscal year 2021 2023 in General Revenue - Insurance Companies Maintenance Tax and Insurance Department Fees in Strategy A.4.1B.4.1, Three-Share Assistance Programs, and 1.0 Full-Time-Equivalents (FTE) position each fiscal year included above in the "Number of Full-Time-Equivalents (FTE)" is for the purpose of awarding, through a competitive application process, grants to local government entities for the research, planning, development, and continuation of "three-share" premium assistance programs to increase access to private healthcare coverage for the uninsured, and providing technical assistance to grant recipients. The agency shall consider the following factors in selecting recipients of grant funds: (1) proposals to match grant awards with local funds (2) percentage of uninsured in the applicable area (3) existing efforts in pursuing "three-share" premium assistance programs (4) healthcare use and delivery factors affecting the area's healthcare infrastructure and capacity. b. In addition to amounts appropriated above, out of funds collected from regulated entities except for workers’ compensation for fines, penalties, and sanctions (revenue object codes 3221 or 3222) and deposited to General Revenue, the Texas Department of Insurance is appropriated, out of amounts collected in excess of those contained in the Comptroller's Biennial Revenue Estimate (estimated to be $0), an amount not to exceed $2,250,000 in each year of the biennium for the Three Share Premium Assistance Program. Any unexpended and unobligated balances of appropriations for the fiscal year ending August 31, 20192021, (estimated to be $0) are appropriated to the agency for the same purposes for the fiscal year beginning September 1, 20192021. In addition, any unexpended and unobligated balances of appropriations for the fiscal year ending August 31, 20202022, are appropriated to the agency for the same purposes for the fiscal year beginning September 1, 20202022. The agency shall spend any unexpended and unobligated balances that are appropriated to it for the same purposes to the extent necessary to maintain the agency's approved enrollment levels for that biennium for each Three-Share Premium Assistance program. The agency shall report a summary of the grants awarded to local government entities to the Legislative Budget Board and the Governor no later than January 1, 2021 2023. Updated fiscal years, strategy, and amounts. Added language from technical correction in fiscal size-up of prior budget.

14 VIII-22 Division of Workers' Compensation Reporting Requirement. The Division of Workers' Compensation shall include information collected about on-the-job injuries and occupational diseases, compliance with notice requirements regarding whether employers carry workers' compensation insurance from non-subscribing employers and administrative penalties levied against non-complying employers under the provisions of the Labor Code § 411.032 and Texas Administrative Code, Title 28, Insurance §§ 110.103, 110.101, and 160.2 in its biennial report submitted to the Legislature. No changes.

15

VIII-22 TexasSure. Amounts appropriated above in Strategy A.1.1, Consumer Education and Outreach, include $5,073,752, in fiscal year 2020 2022 and $5,073,752 in fiscal year 2021 2023 out of the TexasSure Fund for the purpose of on-going maintenance of the TexasSure Motor Vehicle Financial Responsibility Verification program from fees collected pursuant to Transportation Code §502.357. Updated fiscal years.


3.B. Page 5 of 8

16 VIII-22 Medical Fee Disputes. Out of the amounts appropriated above to the Department of Insurance, $1,360,000 for fiscal year 2020 in Goal D, Regulate Workers' Comp System, out of General Revenue - Dedicated Fund 36 is appropriated for the purpose of financing the cost of appeals of medical disputes, and the cost of conducting medical quality review cases pursuant to Labor Code Chapter 413, Subchapter E, including financing the cost of appeals for those cases. The Department of Insurance shall allocate $760,000 for Strategy D.1.1, Oversight and Enforcement and $600,000 for Strategy D.1.2, Dispute Resolution. Any unexpended balance as of August 31, 2020, is hereby appropriated for the same purpose, for the fiscal year beginning September 1, 2020. Request to delete rider. The medical fee dispute rider is no longer necessary as expenditures for the programs included in this rider are now incorporated in the budgets for each program area. The costs for these activities are predictable and spread evenly throughout the biennium. DWC can better project the number of appealed medical dispute cases in coordination with the State Office of Administrative Hearings (SOAH). The billed amount from SOAH is generated from a rolling multi-year average of referred cases, which allows for greater predictability for budgeting purposes. Additionally, costs for the appeal of medical disputes have steadily decreased since the rider's implementation. Expenditures for the medical quality review panel are now incorporated into DWC's operations and the activities maintain a steady biennial cost. As these expenditures are now incorporated in the budgets for this program area, and costs for these programs are predictable, a specific rider is no longer necessary.

17 VIII-22 Administrative Attachment Budget. The amounts included above in Strategy E.1.1, Central Administration, include $915,000 each year of the biennium in General Revenue-Dedicated Texas Department of Insurance Operating Fund 36 for the costs of rental space, equipment, postage, and supplies associated with the administrative attachment costs for the Office of Injured Employee Counsel (OIEC). OIEC may not exceed projected expenditures in the above mentioned categories by more than ten percent without prior written approval from the Legislative Budget Board (LBB). Request to delete rider. TDI and OIEC have established a Roles and Responsibilities agreement identifying the types of services and costs TDI is to provide in support of OIEC. Furthermore, with the upcoming headquarter consolidation in the 2022-23 biennium, agency staff will share office space, equipment, and supplies which will reduce the usefulness of any costs measured for this rider.

18 VIII-22 Appropriation of Amusement Ride Fee Collections and Reporting Requirements. Included in the amounts appropriated above in Strategy A.5.1, Loss Control Programs B.2.2, Property and Casualty Regulation, an amount not to exceed $193,000 each year from revenue object code 3149 contained in the Comptroller of Public Accounts 2020-21 22-23 Biennial Revenue Estimate for General Revenue-Dedicated Texas Department of Insurance (TDI) Operating Fund Account No. 36, shall be used for the purpose of administering and enforcing the Amusement Ride Safety Inspection and Insurance Act (Texas Occupations Code, Chapter 2151). TDI shall request monthly a report of the amusement ride operators who apply for a sales tax license and a report of amusement ride operators paying sales tax from the Comptroller of Public Accounts. TDI shall reconcile the reports with their records of registered amusement ride operators and investigate the need for registration of any operator not in their records. TDI shall report biennially to the Legislature on: (1) efforts to bring all amusement ride operators into compliance; and (2) the result of those efforts. Request to remove appropriation limitation amount. The rider amount was set in 2015 and is difficult to administer as staff working on the chapter noted by this rider also may work on other efforts in the Property and Casualty division.


3.B. Page 6 of 8

19

VIII-23 Contingency Appropriation: State Regulatory Response. a. Amounts appropriated above to the Department of Insurance not to exceed $2,200,000 in General Revenue-Insurance Companies Maintenance Tax and Insurance Department Fees each year in Strategy F.1.1, Contingency Regulatory Response, and 40.0 Full-Time-Equivalents (FTE) positions each fiscal year included above in the "Number of Full-Time-Equivalents (FTE)" are contingent upon a finding of fact by the Commissioner of Insurance that additional resources are needed by the Department of Insurance due to: (1) a significant change in insurance regulatory environment, demands for federal healthcare reform implementation, a weather related disaster in the state of Texas, a public health crisis, such as a pandemic, a fire that has been declared as a disaster situation in the State of Texas, and non-weather related disasters. b. None of the funds appropriated above in Strategy F.1.1, Contingency Regulatory Response, may be expended and none of the 40.0 Full-Time-Equivalents (FTE) positions each fiscal year included above in the "Number of Full-Time-Equivalents (FTE)" may be used by the Department of Insurance unless the Commissioner of Insurance files a finding of fact with the Governor and the Legislative Budget Board and neither the Governor nor the Legislative Budget Board issues a written disapproval not later than: (1) the 10th day after the date the staff of the Legislative Budget Board concludes its review of the findings of fact and forwards those findings of fact along with the conclusions or comments of the Legislative Budget Board staff to the Chair of the House Appropriations Committee, Chair of the Senate Finance Committee, Speaker of the House, and Lieutenant Governor; and (2) within 10 business days of the receipt of the finding of fact by the Governor. c. The appropriations above in Strategy F.1.1, Contingency Regulatory Response, and 40.0 Full-Time-Equivalents (FTE) positions each fiscal year included above in the "Number of Full-Time-Equivalents (FTE)" are also contingent upon the Department of Insurance maintaining a sufficient fund balance in General Revenue-Dedicated Fund 36 to cover these contingency appropriations and related employee benefits, and providing such information as may be deemed necessary by the Comptroller of Public Accounts to issue a finding of fact that the revenues are/will be available to fund the increased appropriations. d. Funds appropriated above in Strategy F.1.1, Contingency Regulatory Response, and 40.0 Full-Time-Equivalents FTE) positions each fiscal year included above in the "Number of Full-Time-Equivalents (FTE)" may only be used to address issues included in the finding of fact submitted to the Governor and the Legislative Budget Board pursuant to subsection (b) above, and apply only to the 2020-2021 biennium unless otherwise appropriated. It is the intent of the Legislature that these funds not be included in base level funding requests for the 2022-2023 biennium. e. Notwithstanding transfer limits under Section 14.01, Article IX of this Act, at the discretion of the agency, amounts appropriated above may be transferred to another appropriation item in an amount not to exceed $2,200,000 in General Revenue-Insurance Companies Maintenance Tax and Insurance Department Fees each year in Strategy F.1.1, Contingency Regulatory Response. The agency will request restoration of this rider via an exceptional item request.


3.B. Page 7 of 8

20 VIII-23 Workers’ Compensation Fraud Prosecution. Out of the amounts appropriated above in Strategy A.2.4, Workers Compensation Fraud, $337,913 in fiscal year 2020 and $337,913 in fiscal year 2021 in General Revenue-Dedicated Texas Department of Insurance Operating Fund 36 is for the purpose of workers' compensation fraud prosecution in cooperation with the Travis County District Attorney's Office. Request to delete rider. As a part of the 85th legislative session, the responsibility to investigate workers’ compensation fraud was transferred from TDI Fraud to the Division of Workers’ Compensation (DWC). This allow experienced DWC staff to better monitor and investigate fraud specific to the workers’ compensation system. At the same time, there was a unique funding agreement that allowed Texas Mutual Insurance Company (TMI) to directly fund a workers’ compensation fraud prosecutor in the Travis County District Attorney’s office. In order to address the issue of funding for the DWC fraud unit and remove the appearance of impropriety of the TMI and Travis County District Attorney agreement, DWC worked with Senator Watson to secure this rider specifically designating funding for the new DWC fraud prosecution unit. The DWC fraud prosecution unit is now fully integrated within DWC's operations, so a specific rider is no longer necessary. Costs for the DWC fraud program are spread evenly throughout the biennium like most agency costs.

21 VIII-23 Appropriation: Agent and Adjuster Licensing Fee Collections. In addition to amounts appropriated above, out of funds collected from agent and adjuster licensing fees (comp object 3210) deposited to GR Dedicated - Texas Department of Insurance Operating Fund 36, the Department of Insurance is appropriated, all amounts collected in excess of those contained in the Comptroller's January 201921 Biennial Revenue Estimate (estimated to be $0) to support strategy A.3.1. Process Rates, Forms, and LicensesA.1.2. Customer Operations. Any unexpended and unobligated balances of appropriations for the fiscal year ending August 31, 2021, (estimated to be $0) are appropriated to the agency for the same purposes for the fiscal year beginning September 1, 2021. In addition, Any any unexpended and unobligated balances of appropriations for the fiscal year ending August 31, 20202, (estimated to be $0) are appropriated to the agency for the same purposes for the fiscal year beginning September 1, 20202. Update for new budget structure and fiscal years for unexpended balance. Add language for unexpended balance in second year of current biennium similar to what exists for the prior year. This is needed due to the timing of the appropriation made by the rider. Since the revenue estimate would only be exceeded at the end of a fiscal year, it is difficult to spend this money in the year of collection.


3.B. Page 8 of 8

22 VIII-24 Contingency Appropriation: Health Insurance Risk Pool. (a) Contingent on enactment of Senate Bill 1940, or similar legislation relating to the administration of a temporary health insurance risk pool, by the Eighty-sixth Legislature, Regular Session, included in amounts appropriated above in Strategy G.1.1, Contingency Health Insurance Risk Pool, is $841,602 in fiscal year 2020 and $933,351 in fiscal year 2021 in General Revenue-Dedicated Texas Department of Insurance Operating Fund 36; and $12,000,000 in fiscal year 2020 and $29,052,524 in fiscal year 2021 in Premium Stabilization Fund 329 to implement the provisions of the legislation. In addition, included in the “Number of Full-Time-Equivalents (FTE)” above is 10.5 FTEs in fiscal year 2020 and 12.0 FTEs in fiscal year 2021. (b) None of the funds appropriated above in Strategy G.1.1, Contingency Health Insurance Risk Pool, may be expended and none of the 10.5 Full-Time-Equivalents (FTE) in fiscal year 2020 and 12.0 FTEs in fiscal year 2021 included above in the "Number of Full-TimeEquivalents (FTE)" may be used by the Department of Insurance (TDI) unless the Commissioner of Insurance files a finding of fact with the Governor and the Legislative Budget Board (LBB) and neither the Governor nor the LBB issues a written disapproval not later than:

(1) the 10th day after the date the staff of the LBB concludes its review of the findings of fact and forwards those findings of fact along with the conclusions or comments of the LBB staff to the Chair of the House Appropriations Committee, Chair of the Senate Finance Committee, Speaker of the House, and Lieutenant Governor; and (2) within 10 business days of the receipt of the finding of fact by the Governor. Any requests for additional information made by the LBB shall suspend the counting of the 10 business days.

(c) Any unexpended balances as of August 31, 2020 in appropriations in Strategy G.1.1, Contingency Health Insurance Risk Pool, made to TDI are appropriated for the same purposes for the fiscal year beginning September 1, 2020. Delete contingency rider from prior GAA. Authorizing statute expires August 31, 2021.

4. EXCEPTIONAL ITEM REQUEST

454

Excp 2022 Excp 2023


CODE DESCRIPTION

Agency code: Agency name:

10/6/2020DATE:

TIME: 10:31:09AM



4.A. Exceptional Item Request Schedule

Item Name: Restore contingency appropriation State Regulatory Response

Item Priority: 1

NoIT Component:

Anticipated Out-year Costs:

Involve Contracts > $50,000:

No

No

06-01-01 Contingency Regulatory ResponseIncludes Funding for the Following Strategy or Strategies:

OBJECTS OF EXPENSE:

SALARIES AND WAGES 1001 2,000,000 2,000,000

TRAVEL 2005 200,000 200,000

TOTAL, OBJECT OF EXPENSE $2,200,000 $2,200,000


8042 Insurance Maint Tax Fees 2,200,000 2,200,000

$2,200,000 $2,200,000TOTAL, METHOD OF FINANCING

DESCRIPTION / JUSTIFICATION:

The TX Dept. of Ins. (TDI) is requesting restoration of the State Regulatory Response Contingency Rider. Approval of this item will allow TDI to respond to the following

regulatory issues: a significant change in insurance regulatory environment, demands for federal healthcare reform implementation, weather related disasters in Texas, a public

health or insurance crisis, a fire declared as a disaster situation in Texas, and non-weather related disasters.

TDI is requesting $2,200,000 for FY 22 from GR-Ins. Companies Maint. Tax and Ins. Dept. Fees and $2,200,000 for FY 23 from GR-Ins. Companies Maint. Tax and Ins. Dept. Fees

and 40 Full-Time-Equivalents (FTEs). TDI is requesting the appropriations be restored to the Strategy F.1.1, Contingency Regulatory Response.

The agency is requesting the funds and FTEs to be used with the following conditions:

a. A finding of fact by the Commissioner of Insurance (COI) declares that additional resources are needed by TDI for reasons stated above.

b. None of the funds appropriated above in Strategy F.1.1, may be expended and none of the 40.0 FTEs each fiscal year included above may be used by TDI unless the COI

files a finding of fact with the Governor and the Legislative Budget Board (LBB) and neither the Governor nor the LBB issues a written disapproval not later than:

a. the 10th day after the date the staff of the LBB concludes its review of the findings of fact and forwards those findings of fact along with the conclusions or comments of

the LBB staff to the Chair of the House Appropriations Comm., Chair of the Senate Finance Comm., Speaker of the House, and Lt. Governor; and

b. within 10 business days of the receipt of the finding of fact by the Governor.

c. Notwithstanding transfer limits of the GAA, at the discretion of the agency, amounts appropriated above may be transferred to another appropriation item in an amount

not to exceed $2,200,000 in each year in Strategy F.1.1, Contingency Regulatory Response.

40.00 40.00FULL-TIME EQUIVALENT POSITIONS (FTE):

4.A. Page 1 of 2

454

Excp 2022 Excp 2023


CODE DESCRIPTION

Agency code: Agency name:

10/6/2020DATE:

TIME: 10:31:09AM



4.A. Exceptional Item Request Schedule

EXTERNAL/INTERNAL FACTORS:

The rider will only be activated if there is a significant change in insurance regulatory environment, demands for federal healthcare reform implementation, a weather related

disaster in Texas, a public health or insurance crisis, a fire that has been declared as a disaster situation in Texas, and non-weather related disasters.

The appropriations above in Strategy F.1.1, Contingency Regulatory Response, and 40.0 Full-Time-Equivalents (FTE) positions each fiscal year included above in the

"Number of Full-Time-Equivalents (FTE)" are also contingent upon the Department of Insurance maintaining a sufficient fund balance in the TDI operating account fund 36 to

cover these contingency appropriations and related employee benefits, and providing such information as may be deemed necessary by the Comptroller of Public Accounts to

issue a finding of fact that the revenues are/will be available to fund the increased appropriations.

PCLS TRACKING KEY:

4.A. Page 2 of 2


10:31:09AMTIME:

10/6/2020DATE:

Agency name:Agency code: 454 Department of Insurance

Excp 2022 Excp 2023


Code Description

4.B. Exceptional Items Strategy Allocation Schedule

Item Name: Restore contingency appropriation State Regulatory Response

Allocation to Strategy: Contingency Regulatory Response6-1-1

OBJECTS OF EXPENSE:

SALARIES AND WAGES 1001 2,000,000 2,000,000

TRAVEL 2005 200,000 200,000

$2,200,000$2,200,000TOTAL, OBJECT OF EXPENSE


Insurance Maint Tax Fees 8042 2,200,000 2,200,000

$2,200,000$2,200,000TOTAL, METHOD OF FINANCING

FULL-TIME EQUIVALENT POSITIONS (FTE): 40.0 40.0

4.B. Page 1 of 1

CODE DESCRIPTION

STRATEGY:

OBJECTIVE:

GOAL:

1 Contingency Regulatory Response



Agency Code: 454

Excp 2023Excp 2022

Agency name: Department of Insurance


B.3A.217

DATE: 10/6/2020

TIME: 10:31:09AM

Service Categories:

Service: Income: Age:

87th Regular Session, Agency Submission, Version 1 4.C. Exceptional Items Strategy Request

OBJECTS OF EXPENSE:

1001 SALARIES AND WAGES 2,000,000 2,000,000

2005 TRAVEL 200,000 200,000

Total, Objects of Expense $2,200,000 $2,200,000


8042 Insurance Maint Tax Fees 2,200,000 2,200,000

Total, Method of Finance $2,200,000 $2,200,000

FULL-TIME EQUIVALENT POSITIONS (FTE): 40.0 40.0

EXCEPTIONAL ITEM(S) INCLUDED IN STRATEGY:

Restore contingency appropriation State Regulatory Response

4.C. Page 1 of 1

5. CAPITAL BUDGET

Category Code / Category Name

Project Sequence/Project Id/ Name

OOE / TOF / MOF CODE

87th Regular Session, Agency Submission, Version 1Automated Budget and Evaluation System of Texas (ABEST)

Agency code: Agency name: Department of Insurance454

DATE:

TIME :

10/6/2020

10:31:10AM

Est 2020 Bud 2021 BL 2022 BL 2023

5.A. Capital Budget Project Schedule

5005 Acquisition of Information Resource Technologies

3/3 Obsolescence Hardware and Software

Replacement and Network Security

OBJECTS OF EXPENSE

Capital

$375,259 $455,976 $437,565 $301,120 General 2009 OTHER OPERATING EXPENSE

$80,717 $0 $0 $0 General 5000 CAPITAL EXPENDITURES

Capital Subtotal OOE, Project $455,976 3 $455,976 $437,565 $301,120

Subtotal OOE, Project $455,976 $455,976 $437,565 $301,120 3

TYPE OF FINANCING

Capital

CA 36 Dept Ins Operating Acct $266,742 $269,044 $266,772 $183,585 General

CA 8042 Insurance Maint Tax Fees $189,234 $186,932 $170,793 $117,535 General

Capital Subtotal TOF, Project $455,976 3 $455,976 $437,565 $301,120

Subtotal TOF, Project $455,976 $455,976 $437,565 $301,120 3

4/4 Texassure Vehicle Insurance Verification

OBJECTS OF EXPENSE

Capital

$2,890,753 $4,393,752 $4,393,752 $4,393,752 General 2001 PROFESSIONAL FEES AND SERVICES

$3,218 $5,000 $5,000 $5,000 General 2004 UTILITIES


$2,075,779 $0 $0 $0 General 5000 CAPITAL EXPENDITURES

Capital Subtotal OOE, Project $5,073,752 4 $5,073,752 $5,073,752 $5,073,752

5.A. Page 1 of 6






DATE:

TIME :

10/6/2020

10:31:10AM

Est 2020 Bud 2021 BL 2022 BL 2023


Subtotal OOE, Project $5,073,752 $5,073,752 $5,073,752 $5,073,752 4

TYPE OF FINANCING

Capital

CA 161 TexasSure Fund $5,073,752 $5,073,752 $5,073,752 $5,073,752 General

Capital Subtotal TOF, Project $5,073,752 4 $5,073,752 $5,073,752 $5,073,752

Subtotal TOF, Project $5,073,752 $5,073,752 $5,073,752 $5,073,752 4

5/5 PC Replacement

OBJECTS OF EXPENSE

Capital

$1,037,469 $114,233 $469,920 $469,920 General 2009 OTHER OPERATING EXPENSE

Capital Subtotal OOE, Project $1,037,469 5 $114,233 $469,920 $469,920

Subtotal OOE, Project $1,037,469 $114,233 $469,920 $469,920 5

TYPE OF FINANCING

Capital



Capital Subtotal TOF, Project $1,037,469 5 $114,233 $469,920 $469,920

Subtotal TOF, Project $1,037,469 $114,233 $469,920 $469,920 5

6/6 Support for Document Management System

OBJECTS OF EXPENSE

Capital


5.A. Page 2 of 6






DATE:

TIME :

10/6/2020

10:31:10AM

Est 2020 Bud 2021 BL 2022 BL 2023




TYPE OF FINANCING

Capital





$6,167,990 $6,304,435 $5,960,904 $6,884,140 5005Total, Category

Informational Subtotal, Category

Capital Subtotal, Category

5005

5005 $6,884,140 $6,167,990

$6,304,435 $5,960,904

5006 Transportation Items

7/7 Purchase of Transportation Items

OBJECTS OF EXPENSE

Capital

$2,300 $0 $0 $0 General 2009 OTHER OPERATING EXPENSE

$143,005 $0 $0 $0 General 5000 CAPITAL EXPENDITURES

Capital Subtotal OOE, Project $145,305 7 $0 $0 $0

Subtotal OOE, Project $145,305 $0 $0 $0 7

TYPE OF FINANCING

Capital

CA 36 Dept Ins Operating Acct $39,467 $0 $0 $0 General

5.A. Page 3 of 6






DATE:

TIME :

10/6/2020

10:31:10AM

Est 2020 Bud 2021 BL 2022 BL 2023


CA 8042 Insurance Maint Tax Fees $105,838 $0 $0 $0 General

Capital Subtotal TOF, Project $145,305 7 $0 $0 $0

Subtotal TOF, Project $145,305 $0 $0 $0 7

$0 $0 $0 $145,305 5006Total, Category



5006

5006 $145,305 $0

$0 $0

7000 Data Center Consolidation

1/1 Data Center Consolidation

OBJECTS OF EXPENSE

Capital

$7,259,521 $7,566,619 $7,283,659 $7,446,008 General 2001 PROFESSIONAL FEES AND SERVICES

Capital Subtotal OOE, Project $7,259,521 1 $7,566,619 $7,283,659 $7,446,008

Subtotal OOE, Project $7,259,521 $7,566,619 $7,283,659 $7,446,008 1

TYPE OF FINANCING

Capital

CA 36 Dept Ins Operating Acct $4,661,765 $4,874,565 $4,440,652 $4,539,632 General

CA 8042 Insurance Maint Tax Fees $2,597,756 $2,692,054 $2,843,007 $2,906,376 General

Capital Subtotal TOF, Project $7,259,521 1 $7,566,619 $7,283,659 $7,446,008

Subtotal TOF, Project $7,259,521 $7,566,619 $7,283,659 $7,446,008 1

5.A. Page 4 of 6






DATE:

TIME :

10/6/2020

10:31:10AM

Est 2020 Bud 2021 BL 2022 BL 2023


$7,446,008 $7,283,659 $7,566,619 $7,259,521 7000Total, Category



7000

7000 $7,259,521 $7,446,008

$7,283,659 $7,566,619

9000 Cybersecurity

2/2 Cybersecurity Enhancements

OBJECTS OF EXPENSE

Capital

$175,140 $0 $0 $0 General 2009 OTHER OPERATING EXPENSE

$0 $140,112 $422,500 $532,800 General 5000 CAPITAL EXPENDITURES



TYPE OF FINANCING

Capital





$532,800 $422,500 $140,112 $175,140 9000Total, Category



9000

9000 $175,140 $532,800

$422,500 $140,112

5.A. Page 5 of 6






DATE:

TIME :

10/6/2020

10:31:10AM

Est 2020 Bud 2021 BL 2022 BL 2023


$13,667,635 $14,010,594 $14,146,798

AGENCY TOTAL $14,464,106

AGENCY TOTAL -INFORMATIONAL

AGENCY TOTAL -CAPITAL $14,464,106 $14,146,798 $14,010,594 $13,667,635


Capital

$5,763,425 $5,374,473 $5,345,338 $5,428,378 36 Dept Ins Operating AcctGeneral

$5,073,752 $5,073,752 $5,073,752 $5,073,752 161 TexasSure FundGeneral

$3,626,929 $3,219,410 $3,591,504 $3,644,668 8042 Insurance Maint Tax FeesGeneral

$14,464,106 $13,667,635 $14,010,594 $14,146,798 Total, Method of Financing-Capital

$14,464,106 $14,146,798 $14,010,594 $13,667,635 Total, Method of Financing

TYPE OF FINANCING:

Capital

$14,464,106 $13,667,635 $14,010,594 $14,146,798 CURRENT APPROPRIATIONSCAGeneral

$14,464,106 $13,667,635 $14,010,594 $14,146,798 Total, Type of Financing-Capital

Total,Type of Financing $14,464,106 $13,667,635 $14,010,594 $14,146,798

5.A. Page 6 of 6


10:31:10AMTIME:

10/6/2020DATE:

87th Regular Session, Agency Submission, Version 15.B. Capital Budget Project Information

Agency name:Agency Code:

Category Number:

Project number:

454

7000 1

Category Name:Project Name:


Data Center ConsolidationData Center Consolidation

In accordance with, HB 1516, 79th Leg. Regular Session; TDI, is one of the 89 state agencies, universities and local governments

participating in the data center services.

TDI resources monitor contractor’s level of support and ensure that contractor and TDI’s responsibilities are met , in accordance

with the contract and the Service Responsibility Matrices.

General Information

PROJECT DESCRIPTION

Number of Units / Average Unit Cost N/A

Estimated Completion Date ongoing

PLCS Tracking Key N/A

0 0

Additional Capital Expenditure Amounts Required 2024 2025

Type of Financing CURRENT APPROPRIATIONSCA

Projected Useful Life N/A

Estimated/Actual Project Cost $0

Length of Financing/ Lease Period N/A

ESTIMATED/ACTUAL DEBT OBLIGATION PAYMENTS

0 0 0 0

Total over

project life

0

2022 2023 2024 2025

REVENUE GENERATION / COST SAVINGS

AVERAGE_AMOUNTMOF_CODEREVENUE_COST_FLAG

Explanation: The Data Center Services contract provides TDI, as a participating agency, data center (server operations), data management, cloud and shared

services, disaster recovery, and bulk print and mail services.

Project Location: Austin & San Angelo Data Center, the Texas State Data Center government cloud and TDI & OIEC headquarters and field offices.

Beneficiaries: TDI & OIEC staff and stakeholders

Frequency of Use and External Factors Affecting Use:

Daily

5.B. Page 1 of 7


10:31:10AMTIME:

10/6/2020DATE:



Category Number:

Project number:

454

9000 2



CybersecurityCybersecurity Enhancements

Security and privacy of information has remained a priority for TDI. In addition to ensuring compliance with state and federal

regulations, the agency strives to meet the highest level of security possible. Recent Security Assessments to TDI’s security

posture were conducted, and recommendations, highlighting key initiatives, will help the agency align with best practice

standards.

These assessments, along with internal risk assessments performed by staff, have provided TDI with new initiatives to include

in its cyber security plan that will help upgrade the agency’s overall cyber security program.

General Information

PROJECT DESCRIPTION



PLCS Tracking Key PCLS_87R_454_592495

0 0



Projected Useful Life Varies




0 0 0 0

Total over

project life

0

2022 2023 2024 2025



Explanation: External security assessments and internal risk assessments performed by staff, provided TDI with new initiatives to include in its cyber security plan

that will improve the agency’s overall cyber security program.

As a result of security assessments, TDI continues to work toward:

•Improving areas in data governance and oversight processes;

•Maturing security and privacy in the cloud;

•Enhancing data loss prevention tools and methods.

Project Location: Texas data centers, government cloud, TDI & OIEC headquarters and field offices.

Beneficiaries: TDI, OIEC, and stakeholders

5.B. Page 2 of 7


10:31:10AMTIME:

10/6/2020DATE:



Daily

5.B. Page 3 of 7


10:31:10AMTIME:

10/6/2020DATE:



Category Number:

Project number:

454

5005 3



ACQUISITN INFO RES TECH.Obsolescence and Network Security

The Technology Obsolescence project encompasses the replacement of obsolete hardware for all aspects of the agency's

technical infrastructure, including LAN servers and network printers.

Upgraded equipment and software maximizes staff performance and requires fewer repairs. Network infrastructure must be kept

current to meet agency business needs. Essential functions of the agency require access to the agency network and servers,

and the Internet. To ensure reliability, it is imperative the agency maintains newer equipment and updated software that is

supported by the manufacturer.

General Information

PROJECT DESCRIPTION




0 0







0 0 0 0

Total over

project life

0

2022 2023 2024 2025



Explanation: Obsolete network servers and other infrastructure hardware will be replaced on a regular basis, to ensure an effective infrastructure is in place to

support the work of the agency. Software will be upgraded to ensure manufacturer support is available.

Project Location: Austin & San Angelo Data Center, TDI & OIEC headquarters and field offices.

Beneficiaries: TDI & OIEC staff and other Stakeholders


Daily

5.B. Page 4 of 7


10:31:10AMTIME:

10/6/2020DATE:



Category Number:

Project number:

454

5005 4



ACQUISITN INFO RES TECH.Texassure Vehicle Ins Verification

TexasSure is the vehicle insurance verification system that allows law enforcement and county tax officials to confirm whether a

vehicle in Texas has required personal auto liability insurance coverage

General Information

PROJECT DESCRIPTION




0 0







0 0 0 0

Total over

project life

0

2022 2023 2024 2025



Explanation: The TexasSure program is mandated by Texas Transportation Code Chapter 601, Subchapter N, which requires TDI, in consultation with the

departments of Public Safety, Motor Vehicles, and Information Resources to select a vendor to develop and maintain a program to reduce the number of

uninsured motorists. The contract term may not exceed five years.

Project Location: Austin & San Angelo Data Center, with eventual migration to Texas State Data Center government cloud.

Beneficiaries: TDI staff, Law Enforcement and other Stakeholders


Daily

5.B. Page 5 of 7


10:31:10AMTIME:

10/6/2020DATE:



Category Number:

Project number:

454

5005 5



ACQUISITN INFO RES TECH.PC Replacement

TDI will continue to follow the agency obsolescence plan to maintain computers that are under warranty. To employ a more

mobile staff, TDI shifted all new computer purchases to laptops during the 2020-21 biennium.

General Information

PROJECT DESCRIPTION




0 0







0 0 0 0

Total over

project life

0

2022 2023 2024 2025



Explanation: Information Technology Services monitors agency technology and resources for performance and evaluates the feasibility of improvements within

resource constraints. Upgrading computers regularly, through a scheduled plan of obsolescence, enables staff to perform their increasingly automated

jobs more efficiently.

The percentage of agency computers under warranty indicates the number of the replacements for obsolete personal computing equipment needed

annually.

Project Location: TDI & OIEC headquarters and field offices.

Beneficiaries: TDI and OIEC staff and stakeholders.


Daily

5.B. Page 6 of 7


10:31:10AMTIME:

10/6/2020DATE:



Category Number:

Project number:

454

5005 6



ACQUISITN INFO RES TECH.Document Management System

The document management project replaces an obsolete imaging and workflow application with an enterprise system. Moving

to this solution will enhance the integrity of the information the agency is required to maintain. This solution also ensures that

the changing business needs are met through business process workflows.

General Information

PROJECT DESCRIPTION




0 0







0 0 0 0

Total over

project life

0

2022 2023 2024 2025



Explanation: TDI has a business need to secure an enterprise-wide document management solution which includes electronic imaging and workflow functionality.

This less paper intensive environment will improve efficiencies, increase data integrity of stored documents, replace paper forms and improve customer

service.

Project Location: Austin & San Angelo Data Center, or the Texas State Data Center government cloud.

Beneficiaries: TDI & OIEC staff and other Stakeholders


Daily

5.B. Page 7 of 7

6. SUPPORTING SCHEDULES


Date:

Time: 10:31:10AM

10/6/2020


Department of InsuranceAgency: 454Agency Code:

6.A. Historically Underutilized Business Supporting Schedule

COMPARISON TO STATEWIDE HUB PROCUREMENT GOALS

Statewide

HUB Goals

Procurement

Category

Total

Expenditures

FY 2019

HUB Expenditures FY 2019

Total

Expenditures

FY 2018

HUB Expenditures FY 2018

A. Fiscal Year - HUB Expenditure Information

% Goal % Actual Actual $ Actual $% Actual% Goal DiffDiff

$0$0$0$0Heavy Construction11.2% 0.0% 0.0% 0.0 % 0.0 % 0.0% 0.0%

$0$0$129,776$0Building Construction21.1% 0.0% 0.0% 0.0 % 0.0 % 0.0% 0.0%

$8,865$1,133$3,060$707Special Trade32.9% 23.1% 12.8% 0.0 % 0.0 % 12.8% 23.1%

$327,577$0$189,684$0Professional Services23.7% 0.0% 0.0% 0.8 % 5.0 % -5.0%-0.8%

$5,489,828$563,792$5,387,506$393,484Other Services26.0% 7.3% 10.3% 18.6 % 15.0 % -4.7%-11.3%

$6,038,005$1,647,747$4,529,194$380,944Commodities21.1% 8.4% 27.3% 21.1 % 21.1 % 6.2%-12.7%

Total Expenditures $775,135 $10,239,220 $2,212,672 $11,864,275

Attainment:

The agency exceeded its HUB procurment goal for Commodities in FY 2019, and increased HUB expenditures overall from 2018 to 2019.

B. Assessment of Fiscal Year - Efforts to Meet HUB Procurement Goals

7.6% 18.6%

TDI's functions do not include construction, therefore “Heavy Construction,” “Building Construction,” and “Special Trade Construction” categories are not applicable

to the agency. However, TDI did incur incidental construction expenses associated with building maintenance through the building construction and special trade

categories, and a portion of these procurements were awarded to HUBs. Consequently, TDI exceeded its HUB goal for Special Trade Construction in FY 2018 and FY

2019.

Applicability:

Professional Services: Many of the contracts established under the professional service category were for actuarial service contracts. TDI continues to competitively

bid these services, but has found that there are few HUB actuarial firms certified in Texas that can provide the specialized services required by the agency.

Other Services: Several of the contracts established under the “Other Services” category were specialized contracts with low HUB participation, such as proprietary

maintenance contracts.

Note: In the past, TDI HUB figures routinely included amounts awarded to HUBs for TDI's Special Deputy Receiver (SDR) process that require TDI to use HUB

requirements. This is no longer the case as the SAO determined that the funds should not be included in TDI 's HUB results. These figures have been reported as part

of TDI's Supplemental HUB report. As a result TDI's reported HUB figures have decreased over the past several fiscal years. TDI will continue to look for additional

Factors Affecting Attainment:

6.A. Page 1 of 2


Date:

Time: 10:31:10AM

10/6/2020


Department of InsuranceAgency: 454Agency Code:

6.A. Historically Underutilized Business Supporting Schedule

opportunities to increase HUB participation.

TDI made the following good faith efforts in FY 2018 and FY 2019:

- participated in several HUB forums sponsored by organizations, businesses, and governmental entities to locate businesses that would provide goods and services

for the agency;

- attended quarterly HUB Discussion Group meetings;

- ensured that contract specifications, terms, and conditions reflected the agency's actual requirements, were clearly stated, and did not impose unreasonable or

unnecessary contract requirements;

- prepared and distributed information on procurement procedures in a manner that encouraged participation in agency contracts by all businesses;

- in accordance with Section 2161.252 of the Texas Government Code, required respondents to solicitations with an expected value over $100,000 to complete and

submit a HUB Subcontracting Plan; and

- requested and encouraged respondents to solicitations with an expected value under $100,000 to complete and submit a HUB Subcontracting Plan.

"Good-Faith" Efforts:

6.A. Page 2 of 2

Agency Name:Texas Department of Insurance

Estimated Budgeted Requested Requested2020 2021 2022 2023

$0 $42,827,477 $1,292,535 $482,418$0 $42,827,477 $1,292,535 $482,418Total, All Projects

6.B. Current Biennium Onetime Expenditure Schedule Summary of Onetime Expenditures

Agency Code: Prepared By: Date:454 Anthony Infantini October 5, 2020

Projects

Temporary Health Risk Pool


Temporary Health Risk Pool PROJECT:

Strategy OOE/MOF Estimated Budgeted Requested RequestedCode Code Strategy Allocation 2020 2021 2022 2023

Object of Expense:G.1.1. 1001 Salaries and Wages $0 $904,779 $0 $0G.1.1. 1002 Other Personnel Costs $0 $4,524G.1.1. 2001 Professional Fees and Services $0 $2,000,000G.1.1. 2003 Consumable Supplies $0 $7,200G.1.1. 2004 Utilities $0 $500G.1.1. 2009 Other Operating Expenses $0 $39,910,474E.1.2. 5000 Capital Expenditures $282,388 $392,688E.1.3. 2009 Other Operating Expenses $1,010,147 $89,730

Total, Object of Expense $0 $42,827,477 $1,292,535 $482,418

Method of Financing:G.1.1. 0036 Texas Department of Insurance Operating Fund $0 $1,774,953 $0 $0G.1.1. 0329 Healthy Texas Small Employer Premium Stabilization Fund $0 $41,052,524E.1.2. 0036 Texas Department of Insurance Operating Fund $282,388 $392,688E.1.3. 0036 Texas Department of Insurance Operating Fund $1,010,147 $89,730

Total, Method of Financing $0 $42,827,477 $1,292,535 $482,418

Agency Code:454

6.B. Current Biennium Onetime Expenditure Schedule Strategy Allocation from 2020-21 Biennium to 2022-23 Biennium

Prepared By: Date:Anthony Infantini October 5, 2020

Project Description for the 2020-21 Biennium:SB 1940 from the 86th Legislative Session added Chapter 1510 to the Texas Insurance Code to provide a temporary mechanism to authorize the creation of a health insurance risk pool and TDI received appropriations for these purposes. The statute authorizing health risk pool activities expires August 31, 2021 and no funds are to be requested for this activity without statutory change.

Project Description and Allocation Purpose for the 2022-23 Biennum:TDI allocated amounts appropriated from fund 36 in 2020-21 to increase the agency's cybersecurity budget for the 2022-23 biennium and to fund agency costs such as furniture and equipment associated with moving to the Capitol Complex in the 2022-23 biennium.

2020-21 2022-23PROJECT: Cybersecurity, Capitol Complex BuildingALLOCATION TO STRATEGY: G.1.1. ALLOCATION TO STRATEGY: E.1.2 & E.1.3.

Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023



CFDA NUMBER/ STRATEGY


10/6/2020 10:31:11AM6.C. Federal Funds Supporting Schedule

OSHA BUREAU OF LABOR STATISTICS17.005.001

1 4 2 HEALTH AND SAFETY SERVICES 189,719 197,136 197,136 225,336- - 225,336

$189,719 $197,136 $197,136 $225,336 $225,336TOTAL, ALL STRATEGIES

TOTAL, FEDERAL FUNDS

ADDL GR FOR EMPL BENEFITS

$189,719 $197,136 $225,336 $225,336$197,136

ADDL FED FNDS FOR EMPL BENEFITS 0 0 0 0 0

$0 $0 $0 $0 $0

OSHA Consultation Agreements17.504.001

1 4 2 HEALTH AND SAFETY SERVICES 2,070,885 2,030,457 2,030,457 2,030,457- - 2,030,457

$2,070,885 $2,030,457 $2,030,457 $2,030,457 $2,030,457TOTAL, ALL STRATEGIES



$2,070,885 $2,030,457 $2,030,457 $2,030,457$2,030,457


$0 $0 $0 $0 $0

ACA-Grnts St Hlth Ins Premium Revw93.511.000

1 1 1 CONSUMER EDUCATION AND OUTREACH 579,618 0 0 0- - 0

$579,618 $0 $0 $0 $0TOTAL, ALL STRATEGIES



$579,618 $0 $0 $0$0


$0 $0 $0 $0 $0

6.C. Page 1 of 2

Exp 2019 Est 2020 Bud 2021 BL 2022 BL 2023



CFDA NUMBER/ STRATEGY


10/6/2020 10:31:11AM6.C. Federal Funds Supporting Schedule

SUMMARY LISTING OF FEDERAL PROGRAM AMOUNTS

17.005.001 189,719 197,136 197,136 225,336 225,336OSHA BUREAU OF LABOR STATISTICS

17.504.001 2,070,885 2,030,457 2,030,457 2,030,457 2,030,457OSHA Consultation Agreements

93.511.000 579,618 0 0 0 0ACA-Grnts St Hlth Ins Premium Revw

$2,840,222

0

$2,840,222

$2,227,593TOTAL, ALL STRATEGIES

TOTAL , ADDL FED FUNDS FOR EMPL BENEFITS


0

$2,227,593 $2,227,593 $2,255,793 $2,255,793

$2,227,593

0 0

$2,255,793 $2,255,793

0

$0 $0 $0 $0 $0TOTAL, ADDL GR FOR EMPL BENEFITS

SUMMARY OF SPECIAL CONCERNS/ISSUES

Assumptions and Methodology:

Potential Loss:

6.C. Page 2 of 2



Agency Code: Agency name:454 Department of Insurance

Act 2019FUND/ACCOUNT Exp 2020 Est 2021 Est 2022 Est 2023

6.E. Estimated Revenue Collections Supporting Schedule

$0 Beginning Balance (Unencumbered):General Revenue Fund 1

$0 $0 $0 $0

Estimated Revenue:

63,122 3175 Professional Fees 56,445 66,300 66,400 66,500

103,970 3206 Insurance Companies Fees 102,380 114,700 125,400 137,600

683,907 3210 Insurance Agents Licenses 595,801 674,800 703,200 734,500

36,207,660 3221 Unauthorized Insurance Penalty 51,788,553 44,745,400 44,745,400 44,745,400

5,961,334 3222 Ins Penalty Lieu of Suspension 13,574,893 7,545,000 8,935,300 8,935,300

28,321 3557 Health Care Facilities Fees 33,680 30,100 29,700 29,200

314,965 3727 Fees - Administrative Services 268,885 268,800 253,100 238,400

794,739 3733 Workers Compensation Penalties 984,690 848,500 848,500 848,500

1,175 3775 Returned Check Fees 420 0 0 0

18 3839 Sale of Motor Vehicle/Boat/Aircraft 6,904 0 0 0

247 3852 Interest on Local Deposits-St Agy 156 0 0 0

Subtotal: Actual/Estimated Revenue

Total Available

44,159,458 67,412,807 54,293,600 55,707,000 55,735,400

$44,159,458 $67,412,807 $54,293,600 $55,707,000 $55,735,400

DEDUCTIONS:

Expended/Budgeted/Requested (5,808) (5,800) (5,000) (5,400) (5,400)

Other (balances swept by Agency 902) (44,153,650) (67,407,007) (54,288,600) (55,701,600) (55,730,000)

Total, Deductions $(44,159,458) $(67,412,807) $(54,293,600) $(55,707,000) $(55,735,400)

Ending Fund/Account Balance $0 $0 $0 $0 $0

REVENUE ASSUMPTIONS:

The Department assumes fee rates will remain the same. COBJ 3221, 3222, and 3733 estimates based on 36 month average of revenue collections.

CONTACT PERSON:

Robert Palm

6.E. Page 1 of 11






$135,545,951 Beginning Balance (Unencumbered):Dept Ins Operating Acct 36

$149,698,225 $158,353,774 $146,165,837 $140,474,234

Estimated Revenue:

393,078 3149 Amusement Ride Inspection 257,288 246,200 209,800 178,700

3,224,799 3175 Professional Fees 3,196,010 3,292,400 3,346,400 3,403,100

381,007 3206 Insurance Companies Fees 337,740 338,600 321,400 306,300

24,947,397 3210 Insurance Agents Licenses 27,188,923 24,259,500 25,125,700 25,113,100

569,596 3212 Tx Work Comp Self - Ins Reg Fees 583,037 521,500 481,900 445,300

615 3213 Catastrophe Prop Ins Pool Fees 380 500 500 500

59,747,777 3214 Insur Maint Tax/Fee Coll-Comptrollr 57,350,244 48,747,700 51,185,100 53,744,300

965,077 3215 Insurance Dept Fees - Misc 785,102 804,600 787,100 771,500

4,965,218 3216 Insurance Dept Exam/Audit Fees 4,647,859 3,362,000 4,345,800 4,345,800

1,180,597 3219 Workers Comp Comm-Ins Co Maint Tax 1,049,449 1,050,000 1,161,900 1,050,600

24,719 3220 W/C Res & Oversight CNCL/Maint Tax 17,862 11,000 22,200 22,200

109,000 3727 Fees - Administrative Services 59,250 64,900 55,000 46,500

14,504,343 3968 Transfers 15,042,010 12,769,605 13,795,938 14,113,330


Total Available

111,013,223 110,515,154 95,468,505 100,838,738 103,541,230

$246,559,174 $260,213,379 $253,822,279 $247,004,575 $244,015,464

DEDUCTIONS:

Expended/Budgeted/Requested (54,636,125) (57,514,773) (63,120,042) (61,805,841) (58,828,974)

Transfer- Benefit Replacement Pay (145,698) (110,068) (93,600) (79,500) (67,600)

Transfer- Employee Benefits (OASI, Ret, Ins) (29,720,411) (31,570,087) (31,771,400) (31,972,700) (31,972,700)

Fund 36 Transfer to Comptroller (TIC Art. 201.052) (14,219) (14,416) (14,900) (15,800) (15,400)

Unemployment Reimbursement (GAA) (11,916) (14,189) (13,100) (13,100) (13,100)

Statewide Cost Allocation Plan payment to GR (232,729) (256,732) (256,700) (256,700) (256,700)

TFC- Texas Facilities Commission (Bldg Maint.) (1,030,083) (1,030,083) (1,030,100) (1,030,100) (1,030,100)

OIEC- Office of Injured Employee Counsel (11,069,768) (11,053,314) (11,086,600) (11,086,600) (11,086,600)

Art V - Department of Public Safety 0 (295,943) (270,000) (270,000) (270,000)


6.E. Page 2 of 11






Ending Fund/Account Balance $149,698,225 $158,353,774 $146,165,837 $140,474,234 $140,474,290


The Department assumes there will not be changes to the current fee rate structure. COBJ 3210 estimates based on 36 month average of revenue collections. In setting the

assessment rates, the Department takes into consideration appropriations, other revenue sources and fund balance. The estimate for 3214 for all years shown uses a 15%

reduction in tax base related to COVID-19 for 2021, followed by 5% annual increases in tax base. Object code 3968 represents balance in ABEST fund 8042 after considering

revenue and expenses in fiscal year to determine fund 36 balance at end of each year.

CONTACT PERSON:

Robert Palm

6.E. Page 3 of 11






$2,161,398 Beginning Balance (Unencumbered):TexasSure Fund 161

$0 $0 $0 $0

Estimated Revenue:

4,893,361 3972 Other Cash Transfers Between Funds 5,073,752 5,073,752 5,073,752 5,073,752


Total Available

4,893,361 5,073,752 5,073,752 5,073,752 5,073,752

$7,054,759 $5,073,752 $5,073,752 $5,073,752 $5,073,752

DEDUCTIONS:





$1 motor vehicle registration fee up to the amount appropriated to the TexasSure fund (Transportation Code 502.357)

CONTACT PERSON:

Robert Palm

6.E. Page 4 of 11






$47,827,477 Beginning Balance (Unencumbered):Healthy TX Sm Emp Prem Stabil. Fund 329

$47,827,477 $47,827,477 $6,774,953 $6,774,953

Estimated Revenue:

DEDUCTIONS:

Expended/Budgeted/Requested 0 0 (41,052,524) 0 0

Total, Deductions $0 $0 $(41,052,524) $0 $0



Prompt payment penalties that used to be deposited in this fund are now deposited to the General Revenue Fund.

CONTACT PERSON:

Robert Palm

6.E. Page 5 of 11






$3,349,223 Beginning Balance (Unencumbered):Appropriated Receipts 666

$4,360,321 $4,458,806 $0 $0

Estimated Revenue:

0 3206 Insurance Companies Fees 221,783 0 0 0

1,500,000 3222 Ins Penalty Lieu of Suspension 2,250,000 0 0 0

87,101 3719 Fees/Copies or Filing of Records 41,098 51,900 71,300 71,300

218,361 3722 Conf, Semin, & Train Regis Fees 134,528 0 0 0

2,721,162 3802 Reimbursements-Third Party 2,871,423 2,873,400 3,000,800 3,081,500

6 3839 Sale of Motor Vehicle/Boat/Aircraft 2,301 0 0 0

12,556 3879 Credit Card and Related Fees 7,923 0 0 0


Total Available

4,539,186 5,529,056 2,925,300 3,072,100 3,152,800

$7,888,409 $9,889,377 $7,384,106 $3,072,100 $3,152,800

DEDUCTIONS:

Expended/Budgeted/Requested (952,172) (2,736,135) (4,663,951) (276,525) (276,525)

Art IX, Sec. 8.10- Appropriation of Credit Card Fees (12,581) (9,804) 1,906 0 0

Art IX, Sec. 8.02- Title Examination and Liquidation Oversight (GAA) (2,069,051) (2,142,527) (2,171,857) (2,237,151) (2,309,508)

Transfer - Employee Benefits (Benefit Replacement Pay) (3,224) (2,197) (2,197) (2,197) (2,197)

Transfer - Employee Benefits (OASI, ERS, Insurance) (491,060) (539,908) (548,007) (556,227) (564,570)


Ending Fund/Account Balance $4,360,321 $4,458,806 $0 $0 $0


Assumes revenues will be collected to sustain current appropriated receipt funding levels. Estimated Liquidation and Title Allocated accounts revenue equal estimated

disbursements including matching and BRP benefits.

CONTACT PERSON:

Robert Palm

6.E. Page 6 of 11






$0 Beginning Balance (Unencumbered):Earned Federal Funds 888

$0 $0 $0 $0

Estimated Revenue:

324,867 3702 Fed Receipts-Earned Federal Funds 251,123 224,406 224,406 22,446


Total Available

324,867 251,123 224,406 224,406 22,446

$324,867 $251,123 $224,406 $224,406 $22,446

DEDUCTIONS:

Expended/Budgeted/Requested (271,165) (224,406) (224,406) (224,406) (224,406)

Art. IX, Sec. 13.11(g)- Benefits Proportional (53,702) (26,717) 0 0 0

Total, Deductions $(324,867) $(251,123) $(224,406) $(224,406) $(224,406)

Ending Fund/Account Balance $0 $0 $0 $0 $(201,960)


The Department assumes same level of appropriation funding and assumes recoveries are sufficient to fund proportional fringe benefits.

CONTACT PERSON:

Robert Palm

6.E. Page 7 of 11






$88,333,637 Beginning Balance (Unencumbered):Subsequent Injury Fund 5101

$80,777,686 $84,260,458 $89,107,394 $92,833,102

Estimated Revenue:

10,356,183 3869 Workers'CompDeathBenefits to State 12,861,400 11,398,400 11,398,400 11,398,400


Total Available

10,356,183 12,861,400 11,398,400 11,398,400 11,398,400

$98,689,820 $93,639,086 $95,658,858 $100,505,794 $104,231,502

DEDUCTIONS:





COBJ 3869 estimates based on 36 month average of revenue collections.

CONTACT PERSON:

Robert Palm

6.E. Page 8 of 11






$49,153 Beginning Balance (Unencumbered):Fire Prevention And Public Safety 5138

$49,153 $49,153 $49,153 $49,153

Estimated Revenue:

Ending Fund/Account Balance $49,153 $49,153 $49,153 $49,153 $49,153


The Department assumes no revenue or deductions.

CONTACT PERSON:

Robert Palm

6.E. Page 9 of 11






$0 Beginning Balance (Unencumbered):Insurance Maint Tax Fees 8042

$0 $0 $0 $0

Estimated Revenue:

90,560,165 3203 Insurance Comp Maintenance Tax 88,080,806 92,587,700 92,587,700 92,245,300

1,726,113 3206 Insurance Companies Fees 1,531,142 1,707,000 1,707,000 1,707,000

224,714 3215 Insurance Dept Fees - Misc 224,642 224,200 224,200 224,200


Total Available

92,510,992 89,836,590 94,518,900 94,518,900 94,176,500

$92,510,992 $89,836,590 $94,518,900 $94,518,900 $94,176,500

DEDUCTIONS:


DSHS- Department State Health Services (6,955,880) (6,853,032) (6,313,765) (6,313,765) (6,313,765)

DSHS- Matching Benefits 0 0 (1,170,000) (1,170,000) (1,170,000)

Fund 8042 Transfer to Comptroller (TIC Art. 201.052) (642,702) (693,030) (713,988) (759,684) (741,120)

OAG- Attorney General Funding (4,786,959) (3,736,331) (3,411,343) (3,411,343) (3,411,343)

OAG- Matching Benefits 0 0 (961,000) (961,000) (961,000)

TAMFS- Matching Benefits 0 0 (1,840,000) (1,840,000) (1,840,000)

TAMFS- Texas A&M Forest Service (25,424,557) (22,809,925) (21,569,182) (21,569,182) (21,569,182)

TAMFS- TRS rider group health insurance 0 0 (2,782,469) (2,782,469) (2,782,469)

TxDOT- Crash Records Info System (CRIS) (730,218) (730,218) (730,218) (730,218) (730,218)

Reclass remaining fund balance to Fund 36 (14,504,343) (15,042,010) (12,769,605) (13,795,938) (14,113,330)




6.E. Page 10 of 11






The Department assumes the appropriated funding level for agencies 302, 303, 454, 576, and 601 plus fringe benefits for object 3203 (maintenance taxes) for future years. The

Department also included other funding requirements such as reimbursement of statewide allocated costs and costs associated with the Comptroller tax function. The

Department did not include $3.05 million deducted by the Comptroller as required by chapter 252 of the Texas Insurance Code.

The Commissioner sets maintenance tax rates annually and takes into consideration estimated fund balances and combined revenues and deductions in funds 8042 and 36

since fund 8042 is in ABEST only and all transactions occur in fund 36. Any end of year balances below are transferred to fund 36 to pay for TDI fringe benefits and to better

identify the actual fund balance.

CONTACT PERSON:

Robert Palm

6.E. Page 11 of 11

ESTIMATED GRAND TOTAL OF AGENCY FUNDS OUTSIDE THE 2022-23 GAA BILL PATTERN 331,487,823$

Summary

Estimated Beginning Balance in FY 2020 139,994,935$ Estimated Revenues FY 2020 68,406,055$ Estimated Revenues FY 2021 27,320,308$

FY 2020-21 Total 235,721,298$


FY 2022-23 Total 331,487,823$

Constitutional or Statutory Creation and Use of Funds:

Method of Calculation and Revenue Assumptions:

Texas Department of Insurance6.H. Estimated Total of All Agency Funds Outside the GAA Bill Pattern

See additional pages for details.

See additional pages for details.

6.H. Page 1 of 6


Catastrophe Reserve Trust Fund (3204)


FY 2020-21 Total 193,075,031$


FY 2022-23 Total 287,529,360$


6.H. Estimated Total of All Agency Funds Outside the GAA Bill PatternTexas Department of Insurance

The Texas Legislature established the Catastrophe Reserve Trust Fund (CRTF) in 1993 as part of the state's overall plan for fundingcatastrophic losses caused by windstorm and hail damage for designated areas on the Texas Gulf coast (designated catastrophe area). In the event of a major storm affecting the Texas coast, the Texas Windstorm Insurance Association (TWIA) would use the CRTF to paycertain losses. See Texas Insurance Code Chapter 2210.

6.H. Page 2 of 6


Fiscal Year (FY) 2020The FY 2020 revenue estimate is composed of deposits made by TWIA during FY2020, actual and estimated interest earned, andactual and estimated management fees. The annual rate used for the CRTF management fees was 0.0002, based on the published fee schedule of the Texas Treasury Safekeeping Trust Company (TTSTC), applied to the average daily balance of the fund during thefiscal year. The assumed average annual investment yield was 0%, based on the average yield actually paid in April through June of 2020, applied to the average daily balance of the fund during the fiscal year. It is assumed TWIA depopulation efforts and policy attrition will result in a 5 percent decrease in residential policies and a 15 percent decrease in commercial policies in calendar year 2020 compared to calendar year 2019.Hurricane Hanna, which made landfall in South Texas on July 25, 2020, and Hurricane Laura, which made landfall at Cameron, Louisiana, on the night of August 26-27, will combined result in about $65 million in claim payments and claim adjusting expenses.

General Assumptions Applicable to FY 2021 through FY 2023- No hurricanes strike in Texas in FYs 2021 – 2023- TWIA devotes approximately half of its annual earnings for early repayment of principal on the TWIA Series 2014 Bonds in FY's 2021-2023, similar to what TWIA did during FY 2020. TWIA deposits the remaining amount of its earnings intot the CRTF.

- TWIA's reinsurance costs continue to change with its exposure (see also exposure increase).- The inflationary growth in exposures for existing TWIA policyholders is 1 percent per year for residential policyholders and 3

percent per year for commercial buildings.- The TWIA depopulation efforts as a result of TWIA take-out through Voluntary Take-out and Assumption Reinsurance will result in

an annual 2 percent decline in residential policies in calendar years 2021 through 2023. It is also assumed that TWIA depopulation and policy attrition will result in an annual 10 percent decline in commercial policies in calendar years 2021 through 2023.

- Rates increase 2 percent per year effective January 1 of each year.- The non-hurricane loss experience and the expenses of TWIA will approximate historical averages.- No income generated during FY2021 through FY 2023 will be used to pay for Hurricane Harvey (2017) or Hurricane Hanna claims, even if there is adverse loss development from those hurricanes during those fiscal years. Instead, Hurricane Harvey and Hurricane Hanna losses will be paid from funding sources available for catastrophe years 2017 and 2020, respectively, even if there is adverse loss development on these hurricanes during in FY 2021 through FY 2023.

6.H. Page 3 of 6


Examination Self Directed Budget Account


FY 2020-21 Total 31,343,535$


FY 2022-23 Total 33,098,422$




Pursuant to Chapter 401 Subchapter F, examination costs, including all employees of the Actuarial Office and Financial Examinations, are funded by a self directed budget. Examination costs by statute {Section 401.251(2)} are defined as salary, travel, or other personnel expenses associated with the examination of insurers and other entities by staff of these two areas, both of which are part of the Financial Regulation Division.

1. Assumes staffing levels will remain constant during the period.

2. Interest rates on Trust Fund account have significantly decreased in FY 2020 and are expected to continue the same in FY 2021. Modest increases in the interest rate are projected in FY 2022 and FY 2023 with the assumption that the economy will begin to recover from the effects of COVID-19.

3. Other than the nominal amount of investment revenue being projected because of the low interest rate environment, the revenues will be collected from direct billings and overhead assessments to domestic insurers and other entities being examined.

4. 5% growth rate for FY 2021-FY 2023 to fund merit raises, promotions, and certifications in accordance to Section's career ladder.

5. SORM fees will be calculated in the Admin and Direct Costs amount in the upcoming Fiscal Years.

6.H. Page 4 of 6


Abandoned Property / Liquidation Operating Fund (1999)


FY 2020-21 Total 11,302,732$


FY 2022-23 Total 10,860,040$



The Texas Insurance Code governs receiverships of insurance companies. When a court places an insurer in receivership, the Commissioner is appointed as Receiver, and vested with the insurer’s assets. The Abandoned Property/Liquidation Operating Fundcontains funds from insurers that have been placed into receivership under Texas Insurance Code Chapter 443 or its predecessor, Article 21.28. Described below are the sources and uses of these funds:

(1) Funds of insurers that are in receivership (Receivership Funds). The costs of operating receiverships are paid with Receivership Funds under Texas Insurance Code § 443.015(i). Expenses incurred in carrying out the Commissioner’s duties as Receiver (Receiver’s Expenses) include salaries of TDI staff assigned to work on receiverships.

(2) Receivership Funds that the court declared as abandoned under former Article 21.28, §8 after the receivership closed (Abandoned Funds). Article 21.28, §8 allows TDI to use Abandoned Funds to: (a) operate receiverships that lack funds to pay operating costs (No Asset Receiverships), and (b) pay the Receiver’s Expenses that cannot be allocated to receiverships. Abandoned Funds are deposited in the Abandoned Property Fund (APF).

6.H. Page 5 of 6


Estimated Revenue includes: (a) the APF and other accounts containing abandoned funds; (b) accounts containing Receivership Funds that are used to pay Receiver’s Expenses; and (c) interest earned on these funds. Revenue estimated for FY2020 is based on interest received and projected interest through fiscal year-end. Revenue estimates for FY2021, FY2022 and FY2023 are based on the following:

1) Assumes staffing levels will remain constant during period.

2) Interest rates on the Trust fund accounts have significantly decreased in FY2020 and are expected to continue in FY2021. Modest increases in interest rates are projected in FY2022 and FY2023 with the assumption that the economy will begin to recover from the effects of COVID-19.

3) When a certain receivership estate is closed in FY2021, an estimated revenue of $500,000 will be received in the APF. This revenue isestimated because the estate will repay the funds that remain from an advance that was made from the APF several years ago.

4) Includes a 5% growth rate for FY2021-FY2023 salaries to fund merit increases and promotions.There are other factors that could impact revenue of these funds. Revenues related to receiverships are dependent on the assetsavailable in receiverships that are opened and closed during a fiscal year. Revenues related to the APF will depend on the amount of funds that remain unclaimed in a receivership, and a declaration by a court that the funds have been abandoned. These factors are inherently unpredictable.

The Abandoned Property/Liquidation Operating Fund does not include other accounts containing Receivership Funds that are not used for the payment of Receiver’s Expenses. These other accounts are used to pay other receivership costs and to make distributions to guaranty associations, policyholders, and other creditors.

Reasons why funds are not part of agency’s bill pattern:These funds cannot be included in the agency’s bill pattern. The funds are not appropriated or received from any governmental entity; they are funds of insurers placed in receivership by a court. Receivership Funds are held by the Commissioner as the court appointed Receiver of an insurer. The funds can only be used as permitted by the Texas Insurance Code, subject to court approval. The APF funds can only be used for the purposes permitted by the Texas Insurance Code, which include continuing the operation of receiverships and paying Receiver’s Expenses that cannot be allocated to receiverships.

6.H. Page 6 of 6


6.K. Part A Budgetary Impacts Related to Recently Enacted State Legislation Schedule


Exp 2019 Bud 2020 Est 2021 Est 2022 Est 2023

10/6/2020

10:31:11AMTIME:

DATE:


Expanded or New Initiative: Temporary Health Insurance Pool 1.

Legal Authority for Item:

Insurance Code, Chapter 1510, as amended by SB 1940, 86th Regular Session

Description/Key Assumptions (including start up/implementation costs and ongoing costs):

S.B. 1940 provides TDI the ability to create a temporary high risk pool and apply for access to federal funds on an interim basis to administer this chapter should such funds become available

under federal law, regulation, or executive action. The chapter expires August 31, 2021.

State Budget by Program: Contingency - Temporary Health Insurance Pool

IT Component:


No

Yes

Objects of Expense

Strategy: 7-1-1 CONTINGENCY HEALTH INS RISK POOL

$0 $0 $904,779 $0 $0 1001 SALARIES AND WAGES

$0 $0 $4,524 $0 $0 1002 OTHER PERSONNEL COSTS

$0 $0 $2,000,000 $0 $0 2001 PROFESSIONAL FEES AND SERVICES

$0 $0 $7,200 $0 $0 2003 CONSUMABLE SUPPLIES

$0 $0 $500 $0 $0 2004 UTILITIES

$0 $0 $39,910,474 $0 $0 2009 OTHER OPERATING EXPENSE

SUBTOTAL, Strategy 7-1-1 $0 $0 $42,827,477 $0 $0

TOTAL, Objects of Expense $0 $0 $42,827,477 $0 $0

Method of Financing

GR DEDICATED


$0 $0 $1,774,953 $0 $0 36 Dept Ins Operating Acct


$0 $0 $1,774,953 $0 $0 SUBTOTAL, GR DEDICATED

OTHER FUNDS


$0 $0 $41,052,524 $0 $0 329 Healthy TX Sm Emp Prem Stabil. Fund


$0 $0 $41,052,524 $0 $0 SUBTOTAL, OTHER FUNDS

TOTAL, Method of Financing $0 $0 $42,827,477 $0 $0

6.K. Page 1 of 3





10/6/2020

10:31:11AMTIME:

DATE:


FULL-TIME-EQUIVALENT POSITIONS (FTE)

0.0 0.0 12.0 0.0 0.0 Strategy: 7-1-1 CONTINGENCY HEALTH INS RISK POOL

TOTAL FTES 0.0 0.0 12.0 0.0 0.0

Contract Description:

TDI is currently soliciting actuarial services (NIGP Class/Item 946-12) related to the Affordable Care Act (ACA) Section 1332 Waiver for State Innovation (1332 Waiver). The actuarial work

consists of analyses and a certification for a waiver application under Section 1332 of the ACA. The work is expected to be completed by August 31, 2021. The procurement method is a

Request for Proposal (RFP).

5.0%Approximate Percentage of Expanded or New Initiative Contracted in FYs 2020-21:

6.K. Page 2 of 3





10/6/2020

10:31:11AMTIME:

DATE:


Expanded or New Initiative: Agents License Alternative Continuing Education 2.

Legal Authority for Item:

Insurance Code, Section 4101.062, as added by SB 1584, 86th Regular Session

Description/Key Assumptions (including start up/implementation costs and ongoing costs):

S.B, 1584 amends the Insurance Code to require the Texas Department of Insurance to accept a claims certification issued to a licensed insurance adjuster by a national or state claims

association as satisfaction of any continuing education requirement imposed on the adjuster if the association and its certification program satisfy certain criteria. The increase in workload

from the enactment of this bill created a fiscal impact and TDI was appropriated 2 FTEs and funding to implement the legislation.

State Budget by Program: Customer Operations

IT Component:


No

No

Objects of Expense

Strategy: 1-1-2 CUSTOMER OPERATIONS

$90,048 $90,048 $90,048 $90,048 $0 1001 SALARIES AND WAGES

$450 $450 $450 $450 $0 1002 OTHER PERSONNEL COSTS

$1,070 $1,070 $1,070 $1,070 $0 2003 CONSUMABLE SUPPLIES

$1,530 $1,530 $1,530 $4,530 $0 2009 OTHER OPERATING EXPENSE

SUBTOTAL, Strategy 1-1-2 $0 $96,098 $93,098 $93,098 $93,098

TOTAL, Objects of Expense $0 $96,098 $93,098 $93,098 $93,098

Method of Financing

GENERAL REVENUE FUNDS

Strategy: 1-1-2 CUSTOMER OPERATIONS

$93,098 $93,098 $93,098 $96,098 $0 8042 Insurance Maint Tax Fees

SUBTOTAL, Strategy 1-1-2 $0 $96,098 $93,098 $93,098 $93,098

$0 $96,098 $93,098 $93,098 $93,098 SUBTOTAL, GENERAL REVENUE FUNDS

TOTAL, Method of Financing $0 $96,098 $93,098 $93,098 $93,098

FULL-TIME-EQUIVALENT POSITIONS (FTE)

0.0 2.0 2.0 2.0 2.0 Strategy: 1-1-2 CUSTOMER OPERATIONS

TOTAL FTES 0.0 2.0 2.0 2.0 2.0

6.K. Page 3 of 3


6.K. Part B Summary of Costs Related to Recently Enacted State Legislation Schedule



10/6/2020

10:31:12AMTIME:

DATE:


EXPANDED OR NEW INITIATIVEITEM

Temporary Health Insurance Pool 1 $0 $0 $42,827,477 $0 $0

Agents License Alternative Continuing Education 2 $0 $96,098 $93,098 $93,098 $93,098

$42,920,575 $93,098 $93,098 Total, Cost Related to Expanded or New Initiatives $96,098 $0

METHOD OF FINANCING

$0 $96,098 $93,098 $93,098 $93,098 GENERAL REVENUE FUNDS

$0 $0 $1,774,953 $0 $0 GR DEDICATED

$0 $0 $41,052,524 $0 $0 OTHER FUNDS

$42,920,575 $93,098 $93,098 Total, Method of Financing $96,098 $0

FULL-TIME-EQUIVALENTS (FTES): 0.0 2.0 14.0 2.0 2.0

6.K. Page 1 of 1


Estimated Budgeted2020 2021

$134,000 $30,000$3,200 $5,000

$137,200 $35,000Total Estimated Paper Volume Reduced - 101,250.00

Description:1. TDI has implemented sending digital notifications for many processes instead of mailing paper copies, thereby reducing paper usage and postage costs. 2020 savings are measured against 2019 expenditures.

2. TDI reviewed paper-intensive processes and focused on areas that received large amounts of paper which required storage and FTE time to manage documents. By transitioning to electronic submission processes the agency eliminated the need to store large amounts of paper and/or the need for FTEs to scan and manage documents the agency reduced paper storage costs and freed up FTE time for other tasks. The agency is working to transition all areas to electronic submission processes where feasible. Savings are measured as an estimate of annual storage costs.

Total, All Strategies

6.L. Document Production StandardsSummary of Savings Due to Improved Document Production Standards

Agency Code: Prepared By:454 Anthony Infantini

Documented Production Standards Strategies

1. Digital notifications in lieu of paper mailings2. Encourage electronic submission of documents to reduce paper storage

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