GENERAL ASSEMBLY OF NORTH CAROLINA

SESSION 1989

H	2 

HOUSE BILL 622
Committee Substitute Favorable 5/5/89

Short Title:  Fire Ins. Fund Reimbursements.	(Public)
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Sponsors:
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March 15, 1989

A BILL TO BE ENTITLED
AN ACT TO CHANGE THE PROCEDURE FOR AND AMOUNTS OF PAYMENTS FROM THE STATE PROPERTY FIRE INSURANCE FUND TO LOCAL GOVERNMENTS FOR THE PROTECTION OF STATE-OWNED PROPERTY.
Whereas, the State Property Fire Insurance Fund (" Fund" ) has safeguarded the State's interests in State-owned property through responsible risk and financial management; and
Whereas, recent losses and expanded coverages have increased demand on Fund monies; and
Whereas, the transfer of one million four hundred fifty thousand dollars ($1,450,000) per year to local governments for fire protection of State-owned property is seriously depleting the reserves of the Fund; and
Whereas, if the Fund was a licensed fire insurance company, because of its precarious financial condition the Commissioner of Insurance would by law be required to rehabilitate or liquidate the Fund; and
Whereas, in 1977 the Legislative Research Commission in its Report on Tax-Exempt State-Owned Property recommended that the General Assembly not change the tax-exempt status afforded State-owned property under the State Constitution and not make payments in lieu of taxes to local government for local government services, including fire protection; and
Whereas, the 1983 General Assembly enacted a special provision in the current operations appropriations act to provide for the transfer referred to above; and
Whereas, the General Assembly recognizes the need for resources and equipment of fire departments that protect State-owned property; and
Whereas, the Fund has actually purchased fire fighting equipment for local fire departments; Now, therefore,
The General Assembly of North Carolina enacts:
Section 1.  G.S. 58-191.4 is repealed.
Sec. 2.  Article 21 of Chapter 58 of the General Statutes is amended by adding a new section to read:
"§ 58-194.5.  Payment from Fund for local fire protection of State-owned property.
The Commissioner shall annually distribute money from the Fund to local governments providing fire protection of State-owned property with a value of one million dollars ($1,000,000) or more.  The amounts distributed to such local governments shall be calculated on the value of such property protected, on a pro rata basis.  The local government protecting the highest value shall receive two hundred thousand dollars ($200,000) per year and the remaining local governments shall receive lesser amounts in proportion to the value of the property they protect."
Sec. 3.  There is appropriated from the General Fund to the State Property Fire Insurance Fund for fiscal year 1989-90 the sum of $900,000 and for fiscal year 1990-91 the sum of $900,000 for the purpose of increasing the reserves of the Fund for the protection of State-owned property.
Sec. 4.  This act shall become effective July 1, 1989.