The proposed rules are expected to apply to only a small number of places, i.e., those which (1) accommodate 500 or more people and are not addressed by the Department's rules for commercial buildings, or for public swimming pools and other water attraction, and (2) have also been voluntarily provided with separate restrooms or other toilet facilities for males and females. Examples of these places include state or local parks, county or district fairs, and open arenas without a permanent structure for assembly, such as those used for rallies, concerts, exhibits or other assemblies.

The fiscal effect of the proposed rules on these state and municipal places is expected to be insignificant, because (1) the rules would apply only where separate restrooms or other toilet facilities are voluntarily provided; (2) unisex toilets can be provided, which would avoid application of the ratio; (3) portable toilets can be used, since the rules do not mandate water-flush toilets; and (4) the rules would not apply to existing places unless new toilets are provided or major renovation of a toilet facility occurs, in which case the rules would apply only to the new or renovated portion.

The proposed rules and an analysis of the proposed rules are available on the Internet at the Safety and Buildings Division Web site at:
www.commerce.state.wi.us/SB/SB-HomePage.html.

Paper copies may be obtained without cost from Roberta Ward at the Department of Commerce, Program Development Bureau, P.O. Box 2689, Madison, WI 53701-2689, or at rward@commerce.state.wi.us, or at telephone (608) 266-8741 or (608) 264-8777 (TTY). Copies will also be available at the public hearing.

NOTICE IS HEREBY GIVEN that pursuant to ss. 16.004 (1), 227.11 (2) (a), 563.04 (3) and (14), and 563.05 (2), (3) and (4), Stats., and interpreting ss. 563.04, 563.05, 563.93 and 563.935, Stats., the Department of Administration will hold a public hearing to consider amendments to Chapters Game 41 to 44 of the Wisconsin Administrative Code, relating to charitable gaming and crane games.

Date:   August 2, 2004

Time:   10:30 am

Location:   Eau Claire County Courthouse Room 2550

  721 Oxford Avenue

  Eau Claire, Wisconsin

Date:   August 2, 2004

Time:   6:00 pm

Location:   Oshkosh City Hall

  Room 404

  215 Church Avenue

  Oshkosh, Wisconsin

Date:   August 3, 2004

Time:   10:30 am

Location:   Waukesha Co. Admin. Bldg. - Room 155

  1320 Pewaukee Road

  Waukesha, Wisconsin

Date:   August 3, 2004

Time:   2:30 pm

Location:   Wisconsin Division of Gaming

  2005 W. Beltline Hwy, Suite 201

  Madison, Wisconsin

Interested persons are invited to present information at the hearing. Persons appearing may make an oral presentation but are also urged to submit facts, opinions and arguments in writing as well. Written comments from persons unable to attend the public hearing, or who wish to supplement testimony offered at the hearing, should be directed to: Chris Patton, Department of Administration-Division of Gaming, PO Box 8979, Madison, WI 53708-8979. Written comments must be received by August 4, 2004, to be included in the record of rule-making proceedings.

The Department proposes to revise its administrative code relating to charitable gaming and crane games. The revision process is in response to 2001 Wis. Act 16, requiring the Department to promulgate rules that allow for the sale of equal shares of a single Class A raffle ticket to one or more purchasers. In addition, the revision process was conducted in order to ensure the Department exercises its regulatory oversight functions in an effective and efficient manner.

The proposed rule amendments are expected to have no fiscal impact on state or local governments.

The proposed rule amendments are expected to have no significant impact on small business.

A copy of the full text of the rule amendments and fiscal estimate may be obtained free of charge on the internet at www.doa.state.wi.us/gaming, by contacting the Division of Gaming at (608) 270-2555, or by visiting the Division of Gaming's office at the address listed below.

If you have any questions regarding the rule amendments, please contact:

Brian Whittow

Department of Administration – Division of Gaming

2005 W. Beltline Hwy., Suite 201

PO Box 8979

Madison, WI 53708-8979

Telephone: (608) 270-2555

brian.whittow@doa.state.wi.us (email)

NOTICE IS HEREBY GIVEN that pursuant to the authority granted under s. 601.41 (3), Stats., and the procedures set forth in under s. 227.18, Stats., OCI will hold a public hearing to consider the adoption of the attached proposed rulemaking order affecting ss. Ins 2.80, 2.81, and Chapter Ins 50, Wis. Adm. Code, relating to prescribing mortality tables and actuarial opinions, analysis and reports.

Date:   Monday August 2, 2004

Time:   10:30 a.m., or as soon thereafter
  as the matter may be reached.

Place:   OCI, 2nd Floor,
  125 S. Webster Street, Madison, WI

Written comments or comments submitted through the Wisconsin Administrative Rule website at: https://adminrules.wisconsin.gov on the proposed rule will be considered. The deadline for submitting comments is 4:00 p.m. on the 7th day after the date for the hearing stated in this Notice of Hearing.

Written comments should be sent to:

Fred Nepple
Legal Unit - OCI Rule Comment for Rule 2.81
Office of the Commissioner of Insurance
PO Box 7873
Madison WI 53707-7873

Statutes interpreted: ss. 600.01, 601.42, 623.02, 623.04, 623.06, 628.34, 632.43, Stats.

Statutory authority: ss. 600.01 (2), 601.41 (3), 601.42, 623.02, 623.04, 623.06, 632.43, Stats.

Explanation of the OCI's authority to promulgate the proposed rule:

The proposed rule is promulgated under the commissioner's statutory authority to prescribe valuation of liabilities, non-forfeiture values, and accounting standards and reporting for insurers. The rule is also promulgated under the commissioner's authority to prescribe actuarial reporting and analysis by life insurers.

Related Statutes or rules: The proposed rule amends or references existing rules prescribing valuation of liabilities, non-forfeiture values, and actuarial reporting and analysis under ss. 601.42, 623.02, 623.04, 623.06, and 632.43 and ss. Ins 2.80 and ch. 50, Wis. Adm. Code.

5. The plain language analysis and summary of the proposed rule:

The proposed rule incorporates the National Association of Insurance Commissioners' (“NAIC") 2001 CSO Table into the current reserve and non-forfeiture valuation laws and rules. The rule would establish the new table as the minimum valuation standard for calculating reserves and nonforfeiture benefits for individual life insurance policies and extended term benefits issued after the effective date. The new table would be optional for newly issued policies until January 1, 2009 and mandatory after that date. The proposed rule also corrects references in the current rule establishing valuation standards (s. Ins 2.80, Wis. Adm. Code). The primary statutes interpreted by the proposed rule are the Standard Valuation Law (s. 623.06) and the Standard Nonforfeiture Law (s. 632.43).

The proposed rule is based on the NAIC model recognition of the 2001 CSO mortality table for use in determining minimum reserve liabilities and nonforfeiture benefits regulation and the NAIC revised model actuarial opinion and memorandum regulation. The CSO mortality table is not included in the NAIC model but is published separately by the NAIC. Accordingly it is adopted by reference under s. 601.41 (3) (b), Stats.

The proposed rule also revises the requirements for life insurers (including fraternals) as regards required actuarial opinions and memoranda. The proposed rule requires all life insurers to perform asset adequacy testing every year. The current rule provides an exemption, or limited scope of compliance, from asset adequacy analysis for smaller companies meeting certain conditions. The proposed rule also prescribes standards for the commissioner's acceptance of actuarial opinions and reporting from companies based on the standards of their state of domicile. In addition, the proposed rule revises the required wording of the actuarial opinion, adds some additional requirements concerning the actuarial opinion and actuarial memorandum, and it creates a new requirement for the preparation of a summary of the actuarial memorandum called the “regulatory asset adequacy issues summary."

NAIC Financial Regulation Standards and Accreditation Committee voted to expose the revised NAIC Actuarial Opinion and Memorandum Regulation for comment for a two-year period, beginning January 1, 2003. The NAIC is seeking comment on whether the revised Model should be adopted as a mandatory requirement for accreditation of a state and may recommend that it be required as an accreditation standard effective in calendar year 2007.

The 2001 CSO mortality table changes are effective for policies issued on or after January 1, 2005. The revised actuarial opinion and memorandum requirements are effective for reporting requirements for calendar year 2005 and subsequent calendar years.

6. Summary of and preliminary comparison with any existing or proposed federal regulation that is intended to address the activities to be regulated by the proposed rule:

Not applicable. There is no such federal regulation.

7. Comparison of similar rules in adjacent states as found by OCI:

Iowa: Iowa has the current version of, and has not adopted the revised, NAIC model actuarial opinion and memorandum regulation. Iowa has adopted the NAIC model recognition of the 2001 CSO mortality table for use in determining minimum reserve liabilities and nonforfeiture benefits regulation.

Illinois: Illinois has the current version of, and has not adopted the revised, NAIC model actuarial opinion and memorandum regulation. Illinois has adopted the NAIC model recognition of the 2001 CSO mortality table for use in determining minimum reserve liabilities and nonforfeiture benefits regulation.

Minnesota: Minnesota has the current version of, and has not adopted the revised, NAIC model actuarial opinion and memorandum regulation. Minnesota has adopted the NAIC model recognition of the 2001 CSO mortality table for use in determining minimum reserve liabilities and nonforfeiture benefits regulation.

Michigan: Michigan has the current version of, and has not adopted the revised, NAIC model actuarial opinion and memorandum regulation. Michigan has not adopted the NAIC model recognition of the 2001 CSO mortality table for use in determining minimum reserve liabilities and nonforfeiture benefits regulation.

Indiana: Indiana has adopted the NAIC revised model actuarial opinion and memorandum regulation. Indiana has adopted the NAIC model recognition of the 2001 CSO mortality table for use in determining minimum reserve liabilities and nonforfeiture benefits regulation.

8. A summary of the factual data and analytical methodologies that OCI used in support of the proposed rule and how any related findings support the regulatory approach chosen for the proposed rule:

The American Academy of Actuaries report to the NAIC's Life and Health Actuarial Task Force states the basis for its recommendation for the new 2001 CSO mortality table (the basis for OCI's proposal of this rule authorizing the use of the 2001 CSO mortality table) as follows:

“The current statutory valuation standard, the 1980 CSO Table, is more than 20 years old. As is shown in this report, current mortality levels, represented by the 2001 Valuation Basic Table, are lower than the mortality levels underlying the 1980 CSO Table. The current valuation mortality standard produces reserves, excluding deficiency reserves, that overall are higher for the illustrated model office than those produced by the proposed 2001 CSO Table.

At the request of the LHATF, both the SOA and the Academy have worked to develop a proposed mortality table intended to replace the 1980 CSO Table in the current statutory valuation structure. While the Academy's Life Practice Council believes that a move to a valuation system that provides more actuarial flexibility and responsibility to set reserves that reflect individual company characteristics is desirable, we recognize that a new table is appropriate. The new table is more consistent with current experience and will result in reserves, excluding deficiency reserves, that overall are approximately 20 percent lower than those produced by the 1980 CSO Table.

The following analysis compares reserves calculated using the proposed ultimate 2001 CSO Table to those calculated using the ultimate 1980 CSO Table. Deficiency reserves were not considered. CRVM reserves for individual cells were weighted using a relatively simple model office (consisting of three plans, five ages, and both genders) based on industry business distributions obtained from LIMRA International. To produce a single number for comparison, the Academy Task Force assumed that sales levels increased at five percent per year and focused its analysis on results after 10 and 20 years.