Revision: Jan. 30, 2017, 12:15 p.m.
HB 204-FN - AS INTRODUCED
2017 SESSION
17-0065
06/05
HOUSE BILL 204-FN
AN ACT relative to bonds for public employees.
SPONSORS: Rep. Marple, Merr. 24; Rep. Itse, Rock. 10
COMMITTEE: Executive Departments and Administration
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This bill permits certain inhabitants to have access to bonds issued to indemnify public and municipal employees. This bill also gives the bonding company an equitable remedy of subrogation.
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Explanation: Matter added to current law appears in bold italics.
Matter removed from current law appears [in brackets and struckthrough.]
Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.
17-0065
06/05
STATE OF NEW HAMPSHIRE
In the Year of Our Lord Two Thousand Seventeen
AN ACT relative to bonds for public employees.
Be it Enacted by the Senate and House of Representatives in General Court convened:
1 New Section; Officials and Employees Bonds; Subrogation. Amend RSA 93-B by inserting after section 1-a the following new section:
93-B:1-b Subrogation.
I. Any inhabitant, as defined by article 30 of the constitution of New Hampshire, who is injured or damaged as a result of the failure of the officers, clerks, and employees covered under RSA 93-B:1 to perform their duties, or through fraudulent acts or omissions committed by such public servants, shall have access to all bonds issued to indemnify against such losses.
II. Upon investigation and payment of any claim to the damaged party, the bonding company shall have a full equitable remedy of subrogation.
2 New Section; Bonds of County Officers; Subrogation. Amend RSA 27 by inserting after section 5 the following new section:
27:5-a Subrogation.
I. Any inhabitant, as defined by article 30 of the constitution of New Hampshire, who is injured or damaged as a result of the failure of the officers and employees covered under this chapter to perform their duties, or through fraudulent acts or omissions committed by such public servants, shall have access to all bonds issued to indemnify against such losses.
II. Upon investigation and payment of any claim to the damaged party, the bonding company shall have a full equitable remedy of subrogation.
3 New Section; Town Officers; Surety Bond; Subrogation. Amend RSA 41 by inserting after section 6 the following new section:
41:6-a Subrogation.
I. Any inhabitant, as defined by article 30 of the constitution of New Hampshire, who is injured or damaged as a result of the failure of the officers, clerks, and employees covered under RSA 41:6 to perform their duties, or through fraudulent acts or omissions committed by such public servants, shall have access to all bonds issued to indemnify against such losses and shall have a right of subrogation against such officers, clerks, and employees.
II. Upon investigation and payment of any claim to the damaged party, the bonding company shall have a full equitable remedy of subrogation.
4 Effective Date. This act shall take effect 60 days after its passage.
17-0065
12/22/16
HB 204-FN- FISCAL NOTE
AS INTRODUCED
AN ACT relative to bonds for public employees.
FISCAL IMPACT: [ X ] State [ X ] County [ X ] Local [ ] None
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| Estimated Increase / (Decrease) | |||
STATE: | FY 2018 | FY 2019 | FY 2020 | FY 2021 |
Appropriation | $0 | $0 | $0 | $0 |
Revenue | $0 | $0 | $0 | $0 |
Expenditures | Indeterminable | Indeterminable | Indeterminable | Indeterminable |
Funding Source: | [ X ] General [ ] Education [ ] Highway [ ] Other | |||
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COUNTY: |
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Revenue | $0 | $0 | $0 | $0 |
Expenditures | Indeterminable | Indeterminable | Indeterminable | Indeterminable |
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LOCAL: |
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Revenue | $0 | $0 | $0 | $0 |
Expenditures | Indeterminable | Indeterminable | Indeterminable | Indeterminable |
METHODOLOGY:
This bill permits inhabitants, as defined in Article 30 of the New Hampshire Constitution, to pursue compensation when such person is injured as a result of the failure of officers, clerks or employees of the State, counties or municipalities to perform their duties, or through fraudulent acts or omissions of these public servants. Inhabitants may file claims for compensation directly with the bondholder. Bonding companies are granted full equitable remedy of subrogation.
The Department of Administrative Services states the bond maintained by the State currently pursuant to RSA 93-B provides for first party coverage, payable only to the State, for certain financial losses suffered by the State. This bill would require the State to purchase a bond to cover injuries to inhabitants resulting from the failure of State officials to perform duties or through officials’ fraudulent acts. It would be extremely difficult to estimate the cost of such an insurance bond due to the high cost associated with the expansive potential exposure the bond would be required to address.
The New Hampshire Association of Counties states the bill applies to officers, which would include county commissioners, county creasurers, registers of deeds and deputy registers of deeds, sheriffs and deputy sheriffs, and county attorneys, who are presently required to be bonded pursuant to RSA 27. The bill also applies to employees who are bonded in accordance with RSA 27:16, whereby the county convention votes to require the bonding of any employee. Counties would have to determine which employees would have to be bonded and at what cost. The Associaton states this bill may increase costs to counties by an indeterminable amount and has no impact on county revenues.
The New Hampshire Municipal Association states bonds issued under RSA 41:6 are intended to protect the municipality against losses caused by the official’s acts or omissions. Requiring the bonds also indemnify private citizens would likely increase the costs of the bonds, resulting in an increase in municipal expenditures. The increase in cost would depend on specific facts relevant to each municipality and its bonding company, therefore it is impossible to determine the amount of the fiscal impact. There is no effect on municipal revenues.
AGENCIES CONTACTED:
The Department of Administrative Services, New Hampshire Association of Counties, and New Hampshire Municipal Association