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PA Bulletin, Doc. No. 97-1027


[31 PA. CODE CH. 113]

Premium Taxes for Foreign Fire Insurance

[27 Pa.B. 3056]

   The Insurance Department (Department) hereby amends Chapter 113 (relating to miscellaneous provisions) by deleting Subchapter B (relating to premium taxes for foreign fire insurance). The deletion is proposed under the authority of sections 206, 506, 1501 and 1502 of The Administrative Code of 1929 (71 P. S. §§ 66, 186, 411 and 412); and the Foreign Fire Insurance Tax Distribution Law (53 P. S. §§ 895.701--895.803). Notice of proposed rulemaking is omitted in accordance with section 204(3) of the act of July 31, 1968 (P. L. 769, No. 240) (45 P. S. § 1204(3)) (CDL).


   The purpose of this final-omitted rulemaking is to eliminate obsolete, unnecessary regulations. The regulations were adopted April 15, 1970, under the authority of the act of June 28, 1895 (P. L. 408, No. 289) (Act 1895) (72 P. S. § 2262) (now repealed). Act 1895 provided that the 2% premium tax paid by foreign fire insurers was to be distributed to political subdivisions and used for relief or pension funds for paid or volunteer employes of fire departments. The regulations require foreign fire insurers to assign a code number to each policy to identify the political subdivision in which the insured property is located. The Department of Revenue previously used the codes to assure that tax revenue was being properly distributed among the various political subdivisions.

   Act 1895 was repealed by the Foreign Fire Insurance Tax Distribution Law (Act 1984) (53 P. S. §§ 895.701--895.803) in particular section 801(a) (53 P. S. § 895.801(a)). Act 1984 provides for the distribution of the 2% tax based on population and market values of property. The location of the insured property is irrelevant under Act 1984. Accordingly, the Department of Revenue no longer requires information concerning locations of insured properties and no longer assigns codes to political subdivisions. Therefore, the regulations adopted to implement Act 1895 have been superseded by the distribution mechanism provided in Act 1984.

   Under section 204(3) of the CDL, notice of proposed rulemaking may be omitted if the agency finds that the notice procedures are impracticable and unnecessary. The deletion of Subchapter B eliminates obsolete regulations that are no longer applicable to the distribution of the 2% premium tax paid by foreign fire insurers. Furthermore, public comments cannot change the obsolete status of these regulations. Accordingly, the Insurance Commissioner finds that the proposed rulemaking procedures in sections 201 and 202 of the CDL (45 P. S. §§ 1201 and 1202) are impracticable and unnecessary in this situation.

Affected Parties

   The regulations apply to foreign fire insurance companies doing business in this Commonwealth. Because the regulations are obsolete, there are no parties affected by the deletion of the regulations.

Fiscal Impact

   The deletion of the regulations has no fiscal impact.


   The deletion of the regulations has no impact on paperwork.

Effectiveness/Sunset Date

   This order is effective upon publication in the Pennsylvania Bulletin. No sunset date has been assigned because the order deletes obsolete regulations.

Contact Person

   The person to contact for information on the deletion of these regulations is Elaine Leitzel, Administrative Officer, Office of Regulation of Companies, 1345 Strawberry Square, Harrisburg, PA 17120 (717) 787-8840.

Regulatory Review

   Under section 5(f) of the Regulatory Review Act (71 P. S. § 745.5(f)), on June 15, 1997, the Department submitted a copy of the rulemaking with proposed rulemaking omitted to the Independent Regulatory Review Commission (IRRC) and the Chairpersons of the Senate Banking and Insurance Committee and the House Insurance Committee. On the same date, the rulemaking was submitted to the Office of Attorney General for review and approval under the Commonwealth Attorneys Act (71 P. S. §§ 732-101--732-506). In accordance with section 5(c) of the Regulatory Review Act, the rulemaking was deemed approved by the Senate and House Committees on June 4, 1997. IRRC met on June 4, 1997, and approved the regulations.


   The Insurance Commissioner finds that:

   (1)  There is good cause to delete the regulations effective upon publication. Deferral of the effective date of the deletion of the regulations is impractical or contrary to the public interest under section 204 of the CDL because there is no purpose served by deferring the effective date, and an immediate effective date best serves the public interest by deleting unnecessary regulations.

   (2)  There is good cause to forego public notice of the intention to delete Subchapter B because public notice of the deletion is unnecessary and impractical, for the following reasons:

   (i)  Deletion of the regulations eliminates a rulemaking that was adopted under a statute that has been repealed, and implements requirements on the distribution of the 2% premium tax paid by foreign fire insurers which are no longer effective.

   (ii)  Public comment cannot change the fact that the regulations have been rendered obsolete due to the revision of statutory law.


   The Insurance Commissioner, acting under the statutory authority, orders that:

   (a)  The regulations of the Department, 31 Pa. Code Chapter 113, are amended by deleting §§ 113.21--113.23 to read as set forth in Annex A.

   (b)  The Department shall submit this order and Annex A to the Office of the Attorney General and the Office of General Counsel for approval as to form and legality as required by law.

   (c)  The Department shall certify this order and Annex A and deposit them with the Legislative Reference Bureau as required by law.

   (d)  This order shall take effect upon its publication in the Pennsylvania Bulletin.

Insurance Commissioner

   (Editor's Note: For the text of the order of the Independent Regulatory Review Commission relating to this document, see 27 Pa.B. 3000 (June 21, 1997).)

   Fiscal Note:  11-154. No fiscal impact; (8) recommends adoption.

Annex A




Subchapter B.  (Reserved)

§§ 113.21--113.23.  (Reserved).

[Pa.B. Doc. No. 97-1027. Filed for public inspection June 27, 1997, 9:00 a.m.]

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