Florida Cabinet Meeting

The Florida Cabinet held a meeting in Tallahassee, Florida on Tuesday, January 15, 2008 to consider various items from the Office of Insurance Regulation (“OIR”), Division of Bond Finance (“DBF”) and State Board of Administration (“SBA”). Below is a brief description of those items and actions taken by the Cabinet.

To view the complete agenda, click here.

Office of Insurance Regulation

Insurance Commissioner Kevin McCarty presented the following items, which were all approved by the Cabinet with minimal discussion:

• Item 1- Minutes of the previous meeting.
• Item 2- Request for Approval to Adopt Proposed Rules 690-171.002, .008 relating to procedures that property and casualty insurers are required to follow when reporting certain required information.
• Item 3- Request for Approval to Adopt proposed Rule 690-137.001. This Proposed Rule adopts the National Association of Insurance Commissioners’ (“NAIC”) Quarterly and Annual Statement Instructions and Accounting Practices and Procedures Manual.
• Item 4- Request for Approval to Adopt proposed Rule 690-138.001. This Proposed Rule adopts the 2007 NAIC Financial Condition Examiners Handbook.
• Item 5- Request for Approval to Repeal Rule 690-186.017. This Proposed Rule repeals the authority of the Financial Services Commission to set actuarially sound rates for Certificates of Mortgage Release.
• Item 6- Approval for Publication of a proposed amendment to Rule 690-167.004 relating to required pre-insurance inspection of private passenger motor vehicles.

To view the OIR-specific Cabinet meeting agenda, click here.

Division of Bond Finance

Ben Watkins with the DBF provided a review of the 2007 Debt Affordability Report. He noted that state and federal economies are weak and that this trend likely will continue for the near future. Attorney General Bill McCollum asked a question about Florida’s future debt predictions. Mr. Watkins noted that the State currently has $24 billion in debt and he expects it to increase to $28-$30 billion in ten years. Chief Financial Officer Alex Sink noted that Florida needs to add bonding capacity (particularly in the affordable housing and transportation arenas) in a responsible way in order to stimulate the economy and help create jobs.

To view the complete agenda from this portion of the meeting, click here.

State Board of Administration (“SBA”)

SBA Interim Executive Director Bob Milligan discussed several items. Of note, he provided the Cabinet with an update on the local government investment pool (“LGIP”) and his search for a new SBA Executive Director. Regarding the LGIP, General Milligan noted that cash flows continue to improve and there is currently $724 million liquid balance in Fund A. He also stated that his office has received 15 responses to the SBA search for a new company to replace BlackRock as an independent, private LGIP advisor. He expects to make a selection on January 31, 2008.

Regarding the hiring of a permanent Executive Director, General Milligan recommended a revised salary range of $250,000-$350,000. He suggested hiring a private search firm (costing approximately $60,000) to find a qualified candidate. Attorney General McCollum noted that Florida is nowhere near other states in regards to salary range for this position and we need to bring on the best. As such, he supported the recommendation. Governor Charlie Crist was the lone dissenter, without comment. To view the SBA’s portion of the agenda, click here.

Following the presentation from General Milligan, the Cabinet Meeting adjourned.

Should you have any questions regarding the above information, please feel free to contact this office.