Could LaMATS audit records when it collected local insurance premium taxes for a Louisiana parish or municipality?

Plain-English summary

The Louisiana Municipal Advisory and Technical Services Bureau, known as LaMATS, collected insurance premium taxes for local governments. The 2013 opinion concluded that LaMATS could request local tax information needed to audit compliance when a parish or municipality had imposed the tax by ordinance and signed a collection agreement. Under La. R.S. 22:834, the contract gave LaMATS the local government’s rights and duties as collector for its duration.

The opinion addressed the authority of a contracted collector. The statute it quoted also treated LaMATS records maintained under local tax ordinances as confidential, subject to specified enforcement and judicial exceptions.

Currency note

This opinion was issued in 2013. Subsequent statutory amendments, court decisions, or later AG opinions may have changed the analysis. Treat this page as historical context, not current legal advice. Verify current law before relying on any specific rule, deadline, or remedy mentioned here.

Historical summary

Local governments using LaMATS

The AG conditioned LaMATS’s collection authority on both a local ordinance imposing the tax and an agreement with the local government. Once those existed, the opinion treated LaMATS as having the government’s collection rights for the agreement’s duration.

Insurance companies and LaMATS

The AG said LaMATS’s collection role included requesting access to local tax information necessary to audit whether companies complied with applicable requirements. The opinion did not treat the collection contract alone, without an ordinance, as sufficient.

Common questions

Could LaMATS ask for records to audit local insurance premium taxes?

The AG said yes when the local ordinance and collection agreement were in place, to the extent the information was necessary or proper to enforce the relevant tax laws.

Did every LaMATS contract automatically give it tax collection powers?

The opinion described a two-part condition: the local government had to adopt the tax ordinance and enter a collection agreement with LaMATS.

Were records obtained by LaMATS public for any purpose?

The statute quoted in the opinion called records and files maintained under local tax ordinances confidential and privileged, with exceptions for tax administration, enforcement, and specified judicial proceedings.

Background and statutory framework

La. R.S. 22:833 authorized the taxes discussed. La. R.S. 22:834 allowed LaMATS to collect taxes imposed by local ordinance under an agreement and gave it the local government's rights and duties as collector during that agreement. The AG applied those provisions to an audit-record request.

Citations

• La. R.S. 22:834: LaMATS collection authority, access to tax information, and confidentiality provisions.
• La. R.S. 22:833: local tax authorization referenced by the opinion.

Source

• Landing page: https://www.ag.state.la.us/Opinions
• Original PDF: https://www.ag.state.la.us/Opinion/Download/13-0062

Original opinion text

Best-effort transcription from a scanned PDF. Minor errors may remain — the linked PDF is authoritative.

~tat.e of 1fiouisiana
DEPARTMENT OF JUSTICE
P.O. BOX 94005
BATON ROUGE
70804-9005
JAMES D. "BUDDY" CALDWEll
ATTORNEY GENERAL

May 22,2013
OPINION 13-0062

54 - INSURANCE
115 - TAXATION

Mr. John A. Gallagher
La. R.S. 22:834

Louisiana Municipal Association
700 North 10th Street
Consistent with La. R.S. 22:834, once an ordinance has been
adopted for the imposition of taxes authorized by La. R.S. 22:833 and
P.O. Box 4327
LaMATS enters into a contract with the municipality or parish for
Baton Rouge, LA 70821
collecting such taxes. LaMATS possesses the same authority as any
municipality or parish acting alone in collecting the taxes. This authority includes the ability to request access to any information regarding local taxes deemed necessary for the purpose of auditing records to ensure companies are complying with any necessary legal
Dear Mr. Gallagher: requirements as described by La. R.S. 22:834(8)(1).

Our office received your request for an opinion submitted on behalf of the Louisiana Municipal Advisory and Technical Assistance Bureau (liLaMATS") concerning the authority to audit insurance companies pursuant to La. R.S. 22:834.

Your letter indicates LaMATS was created in 1999 and is a wholly-owned for-profit subsidiary of the Louisiana Municipal Association ("LMA"). Further, you state the purpose of LaMATS is to contract with Louisiana municipalities and parishes for the collection of insurance premium taxes owed.

As background information, you represent that LaMATS has contracted with 180 municipal and parish governments to collect insurance premium taxes. Once the contract is executed, the governing authority of the local entity adopts an ordinance implementing the tax and granting LaMATS the authority to collect on its behalf. You state that it is the position of LaMATS and the LMA that once an ordinance is adopted implementing the tax and the contract to collect is entered into, by the authority granted to LaMATS in La. R.S. 22:834 and acting as an agent for the local government entity, it possesses all the authority as any municipality or parish acting alone in collecting the insurance premium taxes including the authority to request access to necessary records for purposes of auditing a company's records for the necessary and proper enforcement of not only state law but the laws of the political subdivisions under contract.

Once an ordinance is adopted and LaMATS enters into a contract with the municipality or parish, you have asked whether LaMATS possesses the same authority as any municipality or parish acting alone in collecting the insurance premium taxes, including

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OPINION 13·0062
Mr. John A. Gallagher
Page 2

the authority to request access to records for audit purposes to ensure companies are complying with necessary legal requirements.

The pertinent statute is La. R.S. 22:834, which provides:

A. The taxes authorized by the provisions of R.S. 22:833 and imposed by local ordinance may be collected by the Louisiana Municipal Advisory and Technical Services Bureau (LaMATS) if an agreement upon the terms of the collection procedure is executed between LaMATS and the municipality or parish imposing the taxes. Once such an agreement is executed, LaMA TS is hereby endowed with all the rights, responsibilities, duties, and privileges of the municipality or parish in regard to the collection of the tax for the duration of the agreement.

B.(1) In accordance with the duty as collector, LaMA TS shall have access to any information regarding local taxes deemed necessary by the commissioner of insurance or the Department of Insurance if such access is necessary or proper for the enforcement of the laws of this state or of a political subdivision of this state.

(2) Except as otherwise provided by law, the records and files of LaMATS, as the contractually authorized collector of local taxes, which are maintained pursuant to the local tax ordinances are confidential and privileged, and no person shall divulge or disclose any information obtained from such records and files except in the administration and enforcement of the tax laws of this state or of a political subdivision of this state.

(3) Neither the collector nor any employee engaged in the administration or charged with the custody of any such records or files shall be required to produce any of them for inspection or use in any action or proceeding, except in an action or proceeding in the administration or enforcement of the tax laws of this state or of a political subdivision.

(4) Nothing contained in this Section shall be construed to prevent such persons from disclosing a return of a taxpayer or the records or files maintained pursuant to the local tax ordinances by which LaMATS is contracted to collect as authorized by law in any judicial proceeding in which the state or any political subdivision thereof is a party.

[Emphasis added].

Once an ordinance has been adopted and an agreement has been entered into between LaMATS and the municipality or parish, the unambiguous language of La. R.S. 22:834(A) provides, in pertinent part, that "LaMATS is hereby endowed with all the

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OPINION 13·0062
Mr. John A. Gallagher
Page 3
.

rights, responsibilities, duties, and privileges of the municipality or parish in regard to the collection of the tax for the duration of the agreement." Further, in connection with its duty as collector, "LaMATS shall have access to any information regarding local taxes ...if such access is necessary or proper for the enforcement of the laws of this state or of a political subdivision of this state." La. R.S. 22:834(B)(1).

In light of the above, it is the opinion of this office that, consistent with La. R.S. 22:834, once an ordinance has been adopted for the imposition of taxes authorized by La. R.S. 22:833 and LaMATS enters into a contract with the municipality or parish for collecting such taxes, LaMATS possesses the same authority as any municipality or parish acting alone in collecting the taxes. This authority includes the ability to request access to any information regarding local taxes deemed necessary for the purpose of auditing records to ensure companies are complying with any necessary legal requirements as described by La. R.S. 22:834(B)(1).

We hope that this opinion has adequately addressed the legal issues you have raised. If our office can be of any further assistance, please do not hesitate to contact us.

With best regards,

JAMES D. "BUDDY" CALDWELL
ATTORNEY GENERAL

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Assistant Attorney General

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cc: Commissioner James J. Donelon, Louisiana Department of Insurance