Did the Texas Open Meetings Act apply to four insurance-solvency and guaranty boards, and could they meet privately or by telephone?

TX AG Opinion DM-0284: Were insurance boards subject to open meetings?

Plain-English summary

The Texas insurance commissioner asked whether the Open Meetings Act applied to the governing bodies of four statutory entities: the HMO Solvency Surveillance Committee, the Life, Accident, Health, and Hospital Service Insurance Guaranty Association, the Texas Property and Casualty Insurance Guaranty Association, and the Texas Title Insurance Guaranty Association.

The Attorney General concluded that each governing body was a “governmental body.” Each entity had been created by law within the executive branch, had statewide insurance-related duties, exercised authority delegated by the Legislature, and was supervised by the insurance commissioner or state board. Their meetings therefore had to comply with Government Code chapter 551.

Because the four entities had statewide rather than local jurisdiction, the secretary of state had to post meeting notice for at least seven days before the meeting. The ordinary seventy-two-hour local-government notice period did not apply.

Confidentiality did not itself authorize a closed meeting. Article 20A.36(b)(2) did not permit the HMO committee to meet in executive session, although members could not disclose protected material. Sections 12 and 13 of articles 21.28-D and 21.28-C likewise protected records but did not authorize the life-and-health or property-and-casualty boards to close their meetings. The title-insurance statute was different: article 9.48, section 14(e)(3) expressly allowed the title guaranty board to meet privately when advising the commissioner about insurer solvency and barred disclosure of information received there.

The life-and-health guaranty association’s plan-of-operation statute expressly included telephone conference calls. Its board could therefore meet by telephone, but the call remained subject to the Act’s notice and public-access requirements. The opinion noted separate express telephone authority for the property-and-casualty and title guaranty boards.

Currency note

This opinion was issued in 1994. 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.

Who this opinion affected (as of 1994)

The four insurance governing bodies: Their meetings fell within the Open Meetings Act, including statewide notice requirements.

Board and committee members handling confidential information: They had to protect confidential reports without assuming that confidentiality automatically permitted a closed session.

The title-insurance guaranty board: It had express authority for a closed solvency-advice meeting under article 9.48.

The life-and-health guaranty board: It could use telephone conferences under article 21.28-D, but could not avoid notice or public-access duties.

Insurers and policyholders: The opinion treated the entities’ public functions, assessments, plan approvals, and insolvency-related duties as governmental work subject to open-government rules.

Common questions

Were these private insurance associations outside the Open Meetings Act?
No. The opinion focused on their statutory creation, executive-branch placement, delegated authority, and state supervision rather than their corporate labels.

Did a confidential-records statute automatically permit an executive session?
No. A closed meeting required specific statutory authorization. Most of the confidentiality provisions at issue protected information but did not authorize private deliberations.

Which board had express executive-session authority?
The Texas Title Insurance Guaranty Association board, for meetings called to advise the commissioner about insurer-solvency matters under article 9.48, section 14(e)(3).

Could the life-and-health guaranty board meet by telephone?
Yes. Article 21.28-D, section 10(c)(3) expressly contemplated telephone conference calls, while leaving other Open Meetings Act requirements in place.

How much notice was required?
At least seven days, posted by the secretary of state, because the entities exercised statewide jurisdiction.

Background and statutory framework

The opinion used Gulf Regional’s four considerations for Open Meetings Act coverage: whether an entity was within the executive or legislative department, controlled public business, exercised authority delegated by law, and possessed rulemaking or quasi-judicial power. The first two determined governmental-body status; the others helped determine whether a particular gathering was a meeting.

Each insurance entity had statutory membership, duties, and state supervision. Their functions included monitoring solvency, administering guaranty protections, assessing member insurers, submitting plans of operation for approval, and addressing impaired or insolvent insurers.

The opinion followed Opinion MW-578’s rule that confidential information alone did not justify an executive session. A governmental body either needed a specific closed-meeting exception or had to avoid discussing protected details publicly.

For telephone meetings, the opinion relied on the Legislature’s practice of granting express authority to identified bodies. The life-and-health association’s direction to establish meeting places and times “including telephone conference calls” was sufficiently express.

Citations

Statutes:

• Tex. Gov’t Code ch. 551; §§ 551.071-.084, 551.102, 551.121-.124
• Tex. Ins. Code arts. 9.48, 20A.36, 21.28-C, 21.28-D
• Former V.T.C.S. arts. 6252-17, 6252-13a

Cases:

• Gulf Regional Educ. Television Affiliates v. University of Houston, 746 S.W.2d 803 (Tex. App.-Houston [14th Dist.] 1988, writ denied)
• Texas Catastrophe Property Ins. Ass’n v. Morales, 975 F.2d 1178 (5th Cir. 1992), cert. denied, 113 S. Ct. 1815 (1993)
• League Gen. Ins. Co. v. Michigan Catastrophic Claims Ass’n, 458 N.W.2d 632 (Mich. 1990)

Related opinions:

• Tex. Att’y Gen. Ops. MW-578 (1982); H-1154 (1978); H-780 (1976); H-484 (1974); JM-584 (1986); DM-207 (1993)

Source

• Landing page: https://www.texasattorneygeneral.gov/opinions/dan-morales/dm-0284
• Original PDF: https://www.texasattorneygeneral.gov/sites/default/files/opinion-files/opinion/1994/dm0284.pdf

Original opinion text

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

State of Texas

DAN MORALES

ATTORNEY GENERAL

January 11, 1994

Mr. J. Robert Hunter
Commissioner
Texas Department of Insurance
P.O. Box 149104
Austin, Texas 78714-9104

Opinion No. DM-284

Re: Whether the Open Meetings Act, Government Code chapter 551, applies to
the governing bodies of the Health Maintenance Organization Solvency Surveillance
Committee, Insurance Code article 20A.36; the Life, Accident, Health, and Hospital
Service Insurance Guaranty Association, Insurance Code article 21.28-D; the Texas
Property and Casualty Insurance Guaranty Association, Insurance Code article 21.28-C;
and the Texas Title Insurance Guaranty Association, Insurance Code article 9.48, and
related questions (RQs-409, 410, 411, and 412)

Dear Commissioner Hunter:

On behalf of the Department of Insurance (the “department"), you have submitted
four opinion requests asking whether the Open Meetings Act, Government Code chapter
551,! applies to the meetings of governing bodies of four entities created under the
Insurance Code.2 The four entities at issue are:

(i) the Health Maintenance Organization Solvency Surveillance
Committee ("HMO solvency surveillance committee"), Ins. Code art.
20A.36;

(ii) the Life, Accident, Health, and Hospital Service Insurance
Guaranty Association ("LAHHSI guaranty association"), Ins. Code
art. 21.28-D;

IThe Open Meetings Act, formerly V.T.C.S. art. 6252-17, was recently codified by the
legislature. See Acts 1993, 73d Leg., ch. 268, §§ 1, 46 (eff. Sept. 1, 1993). This codification was
nonsubstantive. See id. § 47. In this opinion, the terms “Open Meetings Act" and “act” are used to refer
to the statute in its newly codified form.

2You also ask whether the Administrative Procedure Act, formerly V.T.C.S. art. 6252-13a
(‘APA") recently enacted by Acts 1993, 73d Leg., ch. 268, § 1 to be codified at title 10, chapter 2001 of
the Government Code, applies to these entities. We understand that the department is no longer interested
in obtaining an opinion with respect to this issue.

(iii) the Texas Property and Casualty Insurance Guaranty
Association ("PCI guaranty association"), Ins. Code art. 21.28-C;
and

(iv) the Texas Title Insurance Guaranty Association ("TI
guaranty association"), Ins. Code art. 9.48.

Apparently, the governing bodies of these entities are currently complying with the Open
Meetings Act.3

If the governing bodies of these entities are subject to the Open Meetings Act, you
also ask about the length of time which notice of their meetings must be posted prior to a
meeting. In addition with respect to the particular entities, you ask (i) whether the board
of directors of the HMO solvency surveillance committee is authorized to hold executive
sessions to consider matters which are confidential under article 20A.36(b)(2) of the
Insurance Code; (ii) whether the board of directors of the LAHHSI guaranty association is
authorized to hold executive sessions to consider matters which are confidential under
section 12 and to meet by telephone conference under section 10(c)(3) of article 21.28-D
of the Insurance Code; (iii) whether the board of directors of the PCI guaranty association
is authorized to hold executive sessions to consider matters which are confidential under
section 13 of article 21.28-C of the Insurance Code; and (iv) whether the board of
directors of the TI guaranty association is authorized to hold executive sessions to
consider matters which are confidential under section 14 of article 9.48 of the Insurance
Code.

IL APPLICATION OF THE OPEN MEETINGS ACT
A. Definition of a “governmental body"

The Open Meetings Act applies to “governmental bodies." It defines the term
“governmental body" to include “a board, commission, department, committee, or agency
within the executive or legislative branch of state government that is directed by one or
more elected or appointed members." Gov't Code § 551.001(3)(A). In addition, a
governmental body must have supervision or control over public business or policy. See
id. § 551.001(4) (definition of a meeting); Gulf Regional Educ. Television Affiliates v.
University of Houston, 746 S.W.2d 803, 809 (Tex. App.--Houston [14th Dist.] 1988, writ
denied). An entity which supervises but does not ultimately control public business or
policy still qualifies as a “governmental body." Attorney General Opinion H-438 (1974).
On the other hand, an entity which serves a purely advisory function, with no power to

3The TI guaranty association's plan of operation provides that "[aJll meetings of the Association
shall ‘be conducted in compliance with [the Open Meetings Act] provided, however, no person may bring
an action against the Association for violation of the [act] or for penalties under the [act] unless it is
determined by 2 court of competent jurisdiction that the [act] is legally applicable to the Association."
Texas Title Insurance Guaranty Association Plan of Operation at 5 (approved July 13, 1992).

supervise or control public business, is not a “governmental body,” and is not subject to
the Open Meetings Act. Attorney General Opinion JM-331 (1985).

In Attorney General Opinion H-772 (1976), this office set forth five prerequisites
for a meeting of an entity to be subject to the Open Meetings Act:

(1) The body must be an entity within the executive or legislative
department of the state;

(2) The entity must be under the control of one or more elected or
appointed members;

(3) The meeting must involve formal action or deliberation between
a quorum of members;*

(4) The discussion or action must involve public business or public
policy; and

(5) The entity must have supervision or control over that public
business or policy. [Footnote added; citations omitted.]

This opinion concentrates on the first, second and fifth criteria because they are relevant to
whether an entity is subject to the Open Meetings Act. The third and fourth criteria are
relevant to determining whether a particular meeting is subject to the Open Meetings Act,
an issue which we have not been asked to address.6

Significantly for our purposes, the Open Meetings Act has been held applicable to

a quasi-private entity which was an auxiliary enterprise of a state university. See Gulf

Regional, 746 S.W.2d 803. In Gulf Regional, the court addressed the legal status of the

Gulf Regional Education Television Affiliates ("GRETA"), a group of independent school

districts and parochial schools that provided educational television programming in

conjunction with the public television station of the University of Houston. Id. at 804.

.The member schools elected representatives to a board of directors who advised the

4Since Attorney General Opinion H-772 (1976) was issued, the iegislature has amended the
definition of “deliberation” to include “a verbal exchange during a meeting .. . between a quorum of a
governmental body and another person.” Gov't Code § 551.001(2).

5The test for determining whether an entity is a "governmental body" subject to the Open
Meetings Act involves different factors than one might take into account in determining whether an entity
is a “state agency" for other purposes. Compare authorities cited in text supra with Texas Catastrophe
Property Ins. Ass'n v. Morales, 975 F.2d 1178 (5th Cir. 1992), cert. denied, 113 S. Ct. 1815 (1993)
(holding that the Texas Catastrophe Property Insurance Association (*CATPOOL") was not “part of the
state" for purposes of being barred from bringing an action against the state largely because its funds were
private); League Gen. Ins. Co. v. Michigan Catastrophic Claims Ass'n, 458 N.W.2d 632 (Mich. 1990)
(holding that the Michigan Catastrophic Claims Association was not an “agency” subject to the Michigan
Administrative Procedure Act); Attorney General Opinion JM-67 (1983) (suggesting that CATPOOL is
not a state agency under APA because it is wholly controlled by the State Board of Insurance).

-”~ VAa7

station of the members’ wishes regarding programming. Id. at 805. The university
managed the association through its director, a university employee, who reported to the
university officer in charge of telecommunications. The association's funds were also
subject to audit and financial controls by the university. Id. at 806-08. Largely on the
basis of these facts, the court rejected the contention that GRETA was an independent,
unincorporated association and held that the association was “an auxiliary enterprise of the
University, and the latter, as a state-supported university, [was] part of the executive
branch." Id. at 809. The court concluded that the board representing the school districts
and parochial schools was a “governmental body" subject to the Open Meetings Act and
could not take official action without complying with the act. Id.

B. Analysis

As Gulf Regional demonstrates, an entity need not be a traditional governmental
entity, or be wholly devoid of private involvement, in order to be a “governmental body"
subject to the Open Meetings Act. Each of the entities at issue here is clearly an entity
within the executive branch of the state, as a board or committee within and subordinate
to the Department of Insurance, under the control of one or more elected or appointed
members. The central issue presented by these requests is whether these entities supervise
or control public business or policy. t requires a careful examination of each entity's
functions and an assessment of whether the entity's performance of those functions
involves the supervision or control of public business or policy.

Although the State Board of Insurance and the commissioner exercise control over
them, the entities have varying degrees of autonomy in exercising their statutory duties.
They are clearly not merely advisory bodies but rather are bodies which exercise control
and supervisory authority. The critical and more difficult issue is whether they supervise
and control public business. As discussed below, we ultimately conclude that these four
entities supervise or control public business because we believe that the function of
protecting policyholders through an association with membership, duties and assessments
mandated by state law is a public one. We now turn to a detailed examination of each of
the four entities at issue.

1. The HMO Solvency Surveillance Committee
   a. Statutory Scheme

The HMO solvency surveillance committee is composed of nine members, all of
whom are appointed by the commissioner of insurance. See Ins. Code art. 20A.36(a).6 A

6A licensed HMO or its agents or employees, the committee or its agents, employees, or
members, “are not liable in a civil action for any act taken or not taken in good faith in the performance of
powers and duties under this section.” Ins. Code art. 20A.36(g). Unlike the other articles of the
Insurance Code considered below, article 20A.36 does not specify that the committee's representatives arc
entitled to representation by the attorney general.

= 14aa

member must be either a licensed health maintenance organization or holding company
represented by an officer or employee, or a representative of the public. Id. The HMO
solvency surveillance committee "is created under the direction of the commissioner" and
performs its functions “under a plan of operation approved by the State Board of
Insurance." Id.

The HMO solvency surveillance committee serves two functions. First, it assists
and advises the commissioner relating to the detection and prevention of HMO
insolvencies, and HMOs placed in rehabilitation, liquidation, supervision, or conservation.
Id. art. 20A.36(b)(1). Second, at the commissioner's direction, it assesses’? each HMO
licensed in the state to provide funds for the administrative expenses of the State Board of
Insurance regarding rehabilitation, liquidation, supervision, or conservation of an impaired
HMO. Id. art. 20A.36(c).2 This assessment may be levied only after the commissioner
determines that adequate assets of the HMO are not immediately available. Id. In
addition, the commissioner may abate or defer an assessment if he or she determines that
payment of the assessment would endanger the ability of an HMO to fulfill its contractual
obligations. Id.

The HMO solvency surveillance committee's powers are quite limited. It is
authorized to enter into contracts to implement article 20A.36; to take legal action as
necessary to recover any unpaid assessments; to employ staff as necessary to handle its
financial transactions; and to assess each HMO for funds necessary to carry out its duties
and to reimburse committee members for their actual expenses. Id. art. 20A.36(d).

b. Application of the Open Meetings Act

We conclude that the HMO solvency surveillance committee is a governmental
body subject to the Open Meetings Act for the following reasons. First, the committee,
given that all of its members are appointed by the commissioner of insurance and that it is
controlled to a large degree by the commissioner, is clearly a committee “within the
executive . . . branch of the state," as an entity within and subordinate to the Department
of Insurance, for purposes of the Open Meetings Act's definition of a “governmental
body." See Gov't Code § 551.001(3)(A). Furthermore, it is clearly "directed by one or
more elected or appointed members." Id.

The critical question is whether the HMO solvency surveillance committee
supervises or controls public business or policy. Its first function, assisting and advising

7An HMO is assessed an amount in proportion to the gross premiums the HMO has written in
the state in comparison to the aggregate gross premiums written in the state by all HMOs. Id. art.
20A.36(c).

6The commissioner is authorized to supervise the rehabilitation, liquidation, supervision, or
conservation of an HMO by article 20A.21 of the Insurance Code.

the commissioner of insurance on the detection and prevention of insolvencies, is an
advisory function and does not bring the committee within the Open Meetings Act's
definition of a governmental body.: See id. and authorities cited supra. We believe,
however, that the HMO solvency surveillance committee's second function, i.e., collecting
assessments from member HMOs, is public business. We conclude that this is the case
even though the funds are collected from HMOs, private entities, to aid other HMOs.
While the committee supervises the collection of the assessments and may bring legal
action to recover unpaid assessments, the commissioner determines when an assessment
will be collected and can excuse particular HMOs from paying the assessment in whole or
in part. Furthermore, the assessments are used to provide funds for the State Board of
Insurance's administrative expenses “regarding rehabilitation, liquidation, supervision, or
conservation” of impaired HMOs. See V.T.C.S. art. 20A.36(c). Because these funds are
used by the State Board of Insurance to carry out its statutory duty to supervise the
rehabilitation, liquidation, supervision or conservation of impaired HMOs under article
20A.21, the collection of the funds is public business. Therefore, the committee's
supervision of the collection of the assessments makes it a governmental body subject to
the Open Meetings Act.9

2. The LAHHSI Guaranty Association
   a. The Statutory Scheme
   The LAHHSI guaranty association is a rionprofit legal entity, Ins. Code art.
   21.28-D, § 6, the purpose of which is to protect insurance policyholders from insurers’

failure to perform contractual obligations because of insolvency or other financial
impairment, id. § 2. "To provide this protection, an association of insurers is created to

Subsection (b)(2) of article 20A.36 addresses the disclosure of certain reports and information
discussed by the committee. It provides that reports regarding the financial condition of HMOs licensed
in Texas and HMOs in rehabilitation, liquidation, supervision, or conservation shall be provided to the
committee members at meetings. It further provides that “[c]ommittee members shall not reveal the
condition of nor any information secured in the course of any meeting of the Solvency Surveillance
Committee with regard to any corporation, form or person examined by the committee. Committee
proceedings shall be filed with the commissioner and reported to the members of the State Board of
Insurance.” Ins. Code art, 20A.36(b(2).

We do not believe that subsection (b)(2) of article 20A.36 is evidence that the legislature did not
intend for the Open Meetings Act to apply to the HMO solvency surveillance committee. Arguably, this
provision suggests that the legislature did not intend for the committee to be subject to the act because it
prohibits members from revealing certain kinds of information obtained in a committee meeting, which
would make little sense if meetings were open to the public. We believe, however, that this provision is
narrower in scope and merely anticipates that committee members will receive copies of reports and other
written information about the financial condition of HMOs during meetings and prohibits them from
revealing the contents of this material in a mecting or elsewhere. We realize that this may present
practical difficulties for committee discussion. It may be possible for the committee to avoid these
difficulties by discussing such confidential information in a public meeting without revealing the identity
of the “corporation, form or person examined by the committee." See also discussion infra p. 17.

mn 1eaNnn

pay benefits and to continue coverages . . . and members of the association are subject to
assessment to provide funds." Id.

Its membership includes all insurers providing life, accident, health, and hospital
service coverage licensed or holding a certificate of authority to transact business in this
state. Id. §§ 3, 5(7). Membership is a condition of such an insurer's authority to transact
business in the state. Id. §6. The LAHHSI guaranty association performs its functions
under a plan of operation approved by the commissioner. Id. §§ 6, 10(a). The State
Board of Insurance is authorized to issue rules and regulations necessary to carry out the
act. Id. § 21. The association exercises its powers through a board of directors, id. §§ 6,
7, which consists of nine members appointed by the State Board of Insurance, id. § 7.1°

Section 8 of article 21.28-D provides that if an impaired insurer is not timely
paying claims, the LAHHSI guaranty association is required to guarantee its policies and
loan it money. Id. § 8(b)(1). Alternatively, the LAHHSI guaranty association is required
to provide substitute benefits “for policy or contract owners [of such impaired insurers]
who petition for substitute benefits under claims of emergency or hardship under standards
proposed by the association and approved by the commissioner." Id. § 8(b)(2).11 If a
member insurer is insolvent, the LAHHSI guaranty association is required to provide
moneys and guarantees necessary to discharge its duties. Id. § 8(d). If the LAHHSI
guaranty association fails to act within a reasonable time, the commissioner may 3 assume
its responsibilities. Id. § 8(q).

The association is required to assess its members both for its administrative costs
and for costs incurred in meeting the obligations of an impaired or insolvent insurer. Id.
§ 9(a)-(b). The amount and timing of the assessments are set by the association's board
of directors. Id. § 9(a). The assessments collected are deposited in the Texas Treasury
Safekeeping Trust Company. Id. § 9(n). The commissioner is authorized to suspend or
revoke the license of an insurer that fails to pay an assessment or fails to comply with the
plan of operation. Id. § 11(c). Alternatively, the commissioner may levy a forfeiture
against an insurer who fails to pay an assessment. Id. An action by the board of directors
or the association, including an assessment, may be appealed to the commissioner by a
member insurer. Id. § 11(d).

The commissioner is required to report to the LAHHSI guaranty association's
board of directors when he or she has reasonable cause to believe from an examination of
a member insurer that it may be impaired or insolvent. Id. § 12(a)(3). The board may use

10The association, its members, board of directors, agents and employees representatives, are
immune from liability for good faith actions in the performance of powers and duties under the act, and
the attorney general is required to defend any such action, but only with respect to the applicability or
effect of this immunity. Ins. Code art. 21.28-D, § 17.

11]f an insurer is impaired but timely paying its claims, the LAHHSI guaranty association may
guarantee the insurer's policies, subject to the approval of the commissioner. Id. § 8(a).

this information but is required to keep the report confidential until it is made public by the
commissioner or other lawful authority. Id. § 12(b). In addition, the board, on a majority
vote, may make reports and recommendations to the commissioner on the solvency of any
member insurer. Id. §12(d). “These reports and recommendations are not public
documents and are not subject to the open records law . . . until such time as an insurer is
declared to be impaired." Id.

b. Application of the Open Meetings Act

Because the members of the board of directors of the LAHHSI guaranty
association are appointed by the State Board of Insurance and the association performs its
functions under a plan of operation approved by the commissioner, the association's board
of directors is “within the executive ... branch of the state," as an entity within and
subordinate to the Department of Insurance, and is “directed by one or more elected or
appointed members" for purposes of the Open Meetings Act's definition of a governmental
body. See Gov't Code § 551.001(3)(A). Again, the crucial question is whether the
association's board supervises or controls public business or policy.

The LAHHSI guaranty association has three distinct functions. First, in cases
where impaired insurers are not timely paying claims, it guarantees the policies of impaired
and insolvent insurers and provides funds so that impaired and insolvent insurers can meet
their obligations. Second, it assesses its members to fund its administrative costs and its
costs in meeting the obligations of impaired and insolvent insurers. Third, it may make
recommendations to the commissioner of insurance regarding insurer insolvencies. While
the latter function is an advisory one, we believe that the first and second functions are
public business under the board's supervision or control.

As section 2 states, the purpose of article 21.28-D is to protect policyholders
“against failure in the performance of contractual obligations... because of the
impairment or insolvency" of a member insurer. “To provide this protection, an
association of insurers is created to pay benefits and to continue coverages... and
members of the association are subject to assessment to provide funds to carry out the
purpose of this [article].". Ins. Code art. 21.28-D, §2; see also id. § 4 ("Section
2... shall be used as an aid and guide to interpretation"). The protection of policyholders
by an association whose membership, duties and assessments are mandated by state law is
public business.

Furthermore, the public nature of these functions is underscored by the
commissioner's authority in each area. The commissioner is authorized to assume the
association's duties when it fails to meet the obligations of an impaired or insolvent insurer
“within a reasonable period of time." Id. § 8(q). With respect to assessments, a member
insurer can appeal an assessment imposed by the board of directors to the commissioner.

Id. § 11(d). Because the activities of the association's board of directors are reviewed and
may ultimately be assumed by the commissioner, they are clearly “public business."!2

3. The PCI Guaranty Association
   a. The Statutory Scheme

The PCI guaranty association is also a nonprofit legal entity. Ins. Code art.
21.28-C, § 6. Its purpose is to provide a mechanism for the payment of claims to avoid
delay in payment, to protect policyholders from financial loss because of the impairment of
an insurer, and to detect and prevent insurer insolvency. Id. §2. Its membership is
comprised of all property and casualty insurers licensed to transact business in the state,
who must be members as a condition of their authority to transact business in the state.
Id. §§ 3, 5(10), 6.

The PCI guaranty association is quite similar to the LAHHSI guaranty association
with respect to its functions, mode of operation, authority and duties. The PCI guaranty

12 Article 21.28-D contains’ several provisions which specifically require the association to keep
certain information confidential. These provisions are not inconsistent with the conclusion that the
association is a governmental body subject to the Open Meetings Act. First, section 12(0) requires that the
association's board of directors keep confidential reports it receives from the commissioner regarding
insurers’ impairment or insolvency. In addition, section 12(d) provides that the board, on a majority vote,
may make reports and recommendations to the commissioner on the solvency of any member insurer.
“These reports and recommendations are not public documents and are not subject to the open records law
... until such time as an insurer is declared to be impaired.” Ins. Code art. 21.28-D, § 12(d). These
provisions primarily require the association's board of directors to keep confidential certain records, and
do not appear to have any bearing on whether the association's board of directors is subject to the Open
Meetings Act. See also discussion infra p. 17.

Article 21.28-D also contains the following provision, section 14(b), regarding the foregoing
activities of the association:

The association shall maintain records of all negotiations and meetings in
which the association or its representatives discuss the activities of the
association in carrying out its powers and duties under Section 8 of this Act.
Records of the negotiations or meetings may be made public only on the
termination of a liquidation, rehabilitation, or conservation proceeding involving
the impaired or insolvent insurer, on the termination of the impairment or
insolvency of the insurer, or on the order of a court of competent jurisdiction. . . .

Ins. Code art. 21.28-D, § 14(b). Section 14(b), if read broadly, could be construed to require the
association to keep confidential records of board meetings, and therefore could be read to suggest that the
Open Meetings Act does not apply to the LAHHSI guaranty association's board of directors. We believe,
however, that section 14(b) is merely intended to require the association to keep confidential records of
negotiations and meetings in which the association or its representatives negotiate with a particular

impaired or insolvent insurer, and that it does not exempt board meetings from the Open Meetings Act.
See also infra note 19.

n 15N2

association performs its functions under a plan of operation approved by the
commissioner. Id. §§ 6, 9. The State Board of Insurance is authorized to issue rules and
regulations necessary to carry out the act. Id. § 23. The association exercises its powers
through a board of directors, id. §§ 6, 7, which consists of nine members, five of whom
are appointed by member insurers subject to the approval of the commissioner, and four of
whom are members of the public appointed by the commissioner, id. § 7(a).4

When a member insurer becomes impaired, the association is required to pay
certain claims. Id. § 8(a). "The association is considered the insurer to the extent of its
obligation on the covered claims and to that extent has all rights, duties and obligations of
the impaired insurer as if the insurer had not become impaired." Id. § 8(b). The
association is required to investigate claims and adjust, compromise, settle and pay
covered claims to the extent of its obligation, and may handle claims through its
employees or through one or more insurers or other designated servicing facilities. Id.

§ 8(d) - (.

To pay its obligations, the expenses it incurs in handling claims, and other
expenses, the association is required to assess member insurers. Id. § 8(c); see also id.
§ 18. The commissioner is required to suspend or revoke the license of an insurer that
fails to pay its assessment or to comply with the plan of operation. Id. § 10(d). The
commissioner is authorized to file suit to collect assessments on behalf of the association.

Id. § 18(d).

The association is required to submit to the commissioner a plan of operation
which must include its procedures for exercising its powers and duties, handling its assets,
and handling claims. Id. § 9(a), (d). If the association fails to submit suitable amendments
to the plan, the commissioner, after notice and hearing, shall adopt rules to implement
article 21.28-C. Id. § 9(b). The plan of operation must provide that any member insurer
aggrieved by a final action of the association may appeal it to the commissioner. Id.
§ (£3).

b. Application of the Open Meetings Act

Because four of the nine members of the board of directors of the PCI guaranty
association are appointed by the commissioner of insurance and five are appointed by
association members subject to the commissioner's approval, and the association performs
its functions under a plan of operation approved by the commissioner, the association's
board is "within the executive . . . branch of the state," as an entity within and subordinate
to the Department of Insurance, and is “directed by one or more elected or appointed
members" for purposes of the Open Meetings Act's definition of a governmental body.

13The association, its members, board of directors, agents and employees, are immune from
liability for good faith actions in the performance of powers and duties under the act, and the attorney
general is required to defend any action brought against the foregoing, but only with respect to the
applicability or effect of this immunity. Ins. Code art. 21.28-C, § 16.

See Gov't Code § 551.001(3)(A). As with the other entities, the crucial question is
whether the association's board supervises or controls public business or policy.

Like the LAHHSI guaranty association, the PCI guaranty association has three
distinct functions. First, when an insurer becomes impaired, the association must assume
its obligations to insureds, and when an insurer is insolvent, the association must provide
money to discharge its duties. Second, it must assess its members to fund its
administrative costs and its costs in meeting the obligations of impaired and insolvent
insurers. Third, it may make recommendations to the commissioner of insurance
regarding insurer insolvencies. Again, the latter function is an advisory one. We believe
that the first two functions, however, involve the supervision or control of public business.

Unlike the case of the LAHHSI guaranty association, the commissioner is not
authorized to assume the PCI guaranty association's duties when it fails to meet the
obligations of an impaired or insolvent insurer within a reasonable time. Indeed, the
commissioner has much less control over the PCI guaranty association than the LAHHSI
guaranty association. Like LAHHSI! guaranty association, however, a strong argument
can be made that the PCI guaranty association's purpose and mission is fundamentally
public. The purpose of article 21.28-C is to “provide a mechanism for the payment of
covered claims . . . to avoid excessive delay in payment," to “avoid financial loss to
claimants or policyholders because of the impairment of an insurer," and to “provide an
association to assess the cost of that protection among insurers." Id. § 2(1) - (3); see also
id. § 4 ("This Act shall be liberally construed to effect the purposes under Section 2 of this
Act, which will constitute an aid and guide to interpretation"). The protection of
policyholders by an association whose membership, duties and assessments are mandated
by state law is public business.

In addition to the fact that its funds are collected to enable the guaranty association
to carry out its purposes under section 2, the association's plan of operation must permit
members to appeal its final actions, including assessments, to the commissioner. The
commissioner is required to fine or suspend or revoke the licenses of insurers who fail to
pay assessments, and the commissioner is authorized to file suit to collect assessments on
behalf of the association. The commissioner's enforcement role further supports the
conclusion that the collection of assessments is a public function, and that the board,
which supervises this function, is therefore a governmental body subject to the Open
Meetings Act.

Finally, we note that the legislature recently amended article 21.28-C of the
Insurance Code to expressly authorize the PCI guaranty association's board of directors to
meet by telephone conference in certain circumstances. See Acts 1993, 73d Leg., ch. 685,
§9.11 (eff Sept. 1, 1993). That provision provides in pertinent part that
"[nJotwithstanding [the Open Meetings Act], the board may hold an open meeting by
telephone conference call if immediate action is required and the convening at one location
of a quorum of the board is not reasonable or practical” Ins. Code art. 21.28-C,
§ 8(k)(1). We believe that this amendment to article 21.28-C is a strong indication that

the legislature intended for the Open Meetings Act to apply to the PCI guaranty
association. '4

4. The Texas Title Insurance Guaranty Association
   a. The Statutory Scheme

The TI guaranty association is a nonprofit legal entity created under section 14 of
article 9.48 of the Insurance Code (the "Texas Title Insurance Guaranty Act"). All title
insurers must be members of the association as a condition of their authority to transact
business in the state. Ins. Code art. 9.48, § 14(a). It exercises its powers through a board
of directors consisting of nine members, appointed by the State Board of Insurance. Id.
§ 14(a) - (b). The association functions under a plan of operation that must be approved
by the commissioner. Id. § 14(d). If the association fails to submit a suitable plan of
operation, the commissioner may adopt rules to carry out the article. Id. § 14(d)(2). The
State Board of Insurance is authorized to issue rules and regulations necessary to carry
out the act. Id. § 18.

The association's purpose is to provide funds in addition to the assets of impaired
insurers for the protection of policyholders through payments of covered claims,
reinsurance, and assumption of liabilities. Id. §§ 2, 7(a). The association's activities are
funded by a mandatory assessment of its members. Id. § 7(b).'6 The commissioner is

M4Section 13 of article 21.28-C of the Insurance Code was also recently amended by the
legislature as follows:

The association shall have access to the books and records of a member
insurer in receivership, in order to make a determination of the extent of the
association shail have the authority to perform or cause to be performed an
actuarial and operational analysis of the member insurer and prepare a report on
matters relating to the impact or potential impact on the association in the event
of impairment. Such reports shall not be public documents.

Id. § 13(a) (as amended by Acts 1993, 73d Leg., ch. 685, § 9.17 (eff. Sept. 1, 1993)). This amendment
merely provides that certain reports prepared by the association are not public documents, and does not
appear to have any bearing on whether the association's board of directors is subject to the Open Meetings
Act. See also discussion infra pp. 17-18.

15The association, its members, board of directors, agents, and employees, are immune from
liability for good faith actions in the performance of powers and duties under the act, and the atlorney
general is required to defend any action brought against the foregoing, but only with respect to the
applicability or effect of this immunity. Ins. Code art. 9.48, § 17.

16Article 9.48 also requires agents or insurers to remit a guaranty fee not to exceed $5 for each

owner or mortgagee policy to the association on a quarterly basis. Id. § 6. Guaranty fees may be used to
pay covered claims and audit expenses. Id. § 6(c).

• 16Nh

authorized to bring suit to collect assessments on behalf of the association, and to suspend
or revoke the licenses of insurers who fail to pay. See id. §§ 7(d), 8. The commissioner is
also authorized to assess an administrative penalty on any insurer that fails to pay an
assessment when due. Id. § 8(a) (as amended by Acts 1993, 73d Leg., ch. 685, § 11.04).
A member insurer may appeal any action or ruling of the association relating to an
assessment to the commissioner. Id. § 20(a).

When a member goes into receivership, the association is required to pay covered
claims. Id. §10. The association is required to investigate claims, and to adjust,
compromise, settle, pay, or deny them to the extent of the impaired insurer's obligation.
Id. § 10(e). “Subject to the approval of the commissioner, the association shall establish
procedures by which claims may be filed with the association and acceptable forms of
proof of covered claims." Id. § 10(g). The association may handle claims through an
employee or through designated servicing facilities. Id. § 10(h). The association may also
use funds derived from assessments to consummate contracts of reinsurance, assumption,
or substitution. Id. § 10(i).

The association is authorized to advise the commissioner, upon his or her request,
concerning the rehabilitation of impaired insurers. Id. § 14(c)(1); see also id. § 14(eX5)
(the board may make recommendations to the commissioner for the detection and
prevention of insurer or agent impairments). The association is also required to take
certain steps to prevent the impairment of its members. Id. § 14(e). It must notify the
commissioner of any information indicating that any insurer or agent may be unable to
fulfill its contractual obligations, and may request the commissioner to investigate. Id.
§ 14(eX2). The board is also required to advise the commissioner upon matters relating to
the solvency of insurers at a meeting called by the commissioner. “Such a meeting is not
open to the public and only members of the board of directors, members of the State
Board of Insurance, the commissioner, and persons authorized by the commissioner shall
attend." Id. § 14(eX3). In addition, the board may make reports and recommendations to
the commissioner relating to "any matter germane to the solvency, liquidation,
rehabilitation, or conservation of any insurer or agent." Id. § 14(e)(4). Such reports and
recommendations “shall not be considered public documents until such time as an insurer
is declared to be impaired." Id.}7 ,

In addition, the legislature recently amended article 9.48 of the Insurance Code by
adding section 15A. See Acts 1993, 73d Leg., ch. 685, § 11.08. Generally, section 15A
requires the commissioner to notify the TI guaranty association of the existence of an
impaired insurer "not later than the third day after the date on which the commissioner

I7Section 14(f) states that the association's plan of operation may provide that any or all of its
powers and duties, with two exceptions, may be delegated to another entity. The association is not
authorized to delegate its authority under section 7, which requires the association to assess member
insurers, or section 14(c)(3), which requires directors of the association to file financial statements with
the Texas Ethics Commission.

gives notice of the designation of impairment.” Ins. Code art. 9.48, § 1SA(a). Subsection
(c) of the provision provides as follows:

The commissioner shall report to the board when the
commissioner has reasonable cause to believe from any examination,
whether completed or in process, of any insurer that the insurer may
be an impaired insurer. The board may use this information in
carrying out its duties and responsibilities under this article. The
board shall keep the report and the information contained in the
report confidential until it is made public by the commissioner or
other lawful authority.

b. Application of the Open Meetings Act

Because all members of the board of directors of the TI guaranty association are
appointed by the State Board of Insurance, and the association functions under a plan of
operation that must be approved by the commissioner, the board is “within the
executive . . . branch of the state," as an entity within and subordinate to the Department
of Insurance, and is “directed by one or more elected or appointed members" for purposes
of the Open Meetings Act's definition of a governmental body. See Govt Code
§ 551.001(3)(A). As with the other three entities, the crucial question is whether the
association's board supervises or controls public business or policy.

The association serves three functions. First, it pays covered claims of
policyholders of impaired insurers. Second, it collects moneys to fund these activities by
assessing its members. Third, it is required to take certain steps to prevent insolvencies,
primarily by notifying and advising the commissioner. We conclude that the latter function
is an advisory one, but that the first two functions involve the supervision or control of
public business.

The association seems to perform the first function largely independent of the
commissioner or the State Board of Insurance. The fact that the association is authorized
to delegate the handling of claims to a designated servicing facility underscores that the
association's role is to step into the shoes of the insolvent insurer. That the association's
role is to take over the obligations of a private insurer, however, does not make its
function non-public. The purpose of article 9.48 is to provide "funds in addition to assets
of impaired insurers for the protection of the holders of ‘covered claims' . . . through
payment and through contracts of reinsurance or assumption of liabilities or of substitution
or otherwise." Ins. Code art. 9.48, § 2; see also id. § 4 ("This article shall be liberally
construed to effect the purpose under Section 2 which shall constitute an aid and guide to
interpretation"). The protection of policyholders by an association whose membership,
duties and assessments are mandated by state law is public business. In addition, the
commissioner is authorized to bring suit to collect assessments on behalf of the association

and to suspend or revoke the licenses of insurers who fail to pay assessments and other
fees, see id. §§ 6(e) (guaranty fees), 7(d) (assessments), 8 (assessments), as well as to
assess administrative penalties on insurers that fail to pay assessments when due. Id.
§ 8(a). The commissioner's enforcement role supports the conclusion that the collection
of assessments is a public function.

As noted above, the board is required to advise the commissioner upon matters
relating to the solvency of insurers at a meeting called by the commissioner, and the act
specifically states that “[s]uch a meeting is not open to the public." Id. § 14(e)(3). In
addition, members of the board are prohibited from revealing information received in such
meetings. Id. This provision suggests that the legislature contemplated that the Open
Meetings Act would apply to other activities of the TI guaranty association. The
provision which states that the board's reports and recommendations to the commissioner
regarding agents' or insurers’ solvency shall not be considered public documents, id.
§ 14(e)(4), because it addresses the public nature of documents as opposed to meetings, is
not germane to whether the board is subject to the Open Meetings Act. For the same
reason, we do not believe that recently enacted section 15A is germane to this question.
We do note, however, that section 15A appears to prohibit board members from
discussing the contents of a report from the commissioner about an impaired insurer in a
public meeting until the information is made public “by the commissioner or other lawful
authority.” Id. § 15A(c). See also discussion infra p. 18.

Finally, we note that the legislature recently amended article 9.48 of the Insurance
Code to expressly authorize the TI guaranty association's board of directors to meet by
telephone conference in certain circumstances. See Acts 1993, 73d Leg., ch. 685, § 11.06.
That provision provides in pertinent part that “[nJotwithstanding [the Open Meetings Act],
the board may hold an open meeting by telephone conference call if immediate action is
required and the convening at one location of a quorum of the board is not reasonable or
practical." Ins. Code art. 9.48, § 14(g). We believe that this amendment to article 9.48 is
a strong indication that the legislature intended for the Open Meetings Act to apply to the
TI guaranty association. 18

18The legislature also amended article 9.48 by adding section 23, subsection (a) of which requires
the association to “maintain records of all negotiations and meetings in which the association or its
ives discuss the activities of the association in carrying out its duties under this article." Id.
§ 23(a) (as amended by Acts 1993, 73d Leg., ch. 685, § 11.11). It further provides that “[rJjecords of the
negotiations or meetings may be made public only on the termination of a liquidation, rehabilitation, or
conservation proceeding involving the impaired or insolvent insurer, on the termination of the impairment
or insolvency of the insurer, or on the order of a court of competent jurisdiction." Id. This provision, if
read broadly, could be construed to require the association to keep confidential records of board meetings,
and therefore could be read to suggest that the Open Meetings Act does not apply to the TI guaranty
association's board of directors. We believe, however, that section 23(a) is merely intended to require the
association to keep confidential records of negotiations and meetings in which the association or its
representatives negotiate with a particular impaired or insolvent insurer, and that it does not exempt board
meetings from the Open Meetings Act, especially in light of the telephone conference amendment
discussed above. See also infra note 20.

II. NOTICE UNDER THE OPEN MEETINGS ACT

Having concluded that the governing bodies of the four entities at issue are
"governmental bodies" subject to the Open Meetings Act, we now turn to your more
specific questions about the act. First, you ask about notice. The act's notice
requirements are set forth in sections 551.041 through 551.054 of the
Government Code. Section 551.043 and section 551.044 provide in pertinent part:

Sec. 551.043. TIME AND ACCESSIBILITY OF NOTICE;
GENERAL RULE. The notice of a meeting of a governmental body
must be posted in a place readily accessible to the general public at
all times for at least 72 hours before the scheduled time of the
meeting, except as provided by Sections 551.044-551.046.

Sec. 551.044. EXCEPTION TO GENERAL RULE:
GOVERNMENTAL BODY WITH STATEWIDE JURISDICTION.
(a) The secretary of state must post notice of a meeting of a state
board, commission, department, or officer having statewide
jurisdiction for at least seven days before the day of the meeting.

Acts 1993, 73d Leg., ch. 268, § 1. You ask whether the foregoing entities are subject to
the 72 hour notice requirement or seven day notice requirement. Clearly, these provisions
are intended to require a longer notice period for governmental bodies with statewide
jurisdiction in comparison with local governmental bodies with a much more limited
geographical jurisdiction. The entities at issue are not local governmental bodies.
Therefore, we conclude that notice of their meetings must be posted by the secretary of
state for at least seven days preceding the day of the meeting.

III. EXECUTIVE SESSIONS UNDER THE OPEN MEETINGS ACT

You ask several questions about executive sessions under the Open Meetings Act.
The Open Meetings Act sets forth several specific exceptions to the general requirement
that the meetings of a governmental body be open to the public. See Gov't Code
§§§ 551.071-.084. Prior to 1982, this office stated on several occasions that a
governmental body could deliberate in a closed session about confidential information,
even though no Open Meetings Act provision authorizing a closed session applied to the
deliberations. See, e.g., Attorney General Opinions H-1154 (1978); H-780 (1976); H-484
(1974). In Attorney General Opinion MW-578 (1982), however, this office concluded
that closed meetings may be held only where specifically authorized. It suggested that the
only way for a governmental body to protect confidential information is to avoid
discussing it altogether.

You ask whether the board of directors of each of the entities at issue may meet in
executive session to discuss information which is confidential under various provisions of
the Insurance Code. The answer to your question depends upon whether the statutes at
issue provide specific authorization to do so.

First, you ask whether the board of directors of the HMO solvency surveillance
committee is authorized to hold executive sessions to consider matters which are
confidential under article 20A.36(b)(2) of the Insurance Code. Subsection (b)(2) of article
20A.36 addresses the disclosure of certain reports and information discussed by the
committee. It provides that reports regarding the financial condition of HMOs licensed in
Texas and HMOs in rehabilitation, liquidation, supervision, or conservation shall be
provided to the committee members at meetings. It further provides that

[c]ommittee members shall not reveal the condition of nor any
information secured in the course of any meeting of the Solvency

• Surveillance Committee with regard to any corporation, form or
  person examined by the committee. Committee proceedings shall be
  filed with the commissioner and reported to the members of the State
  Board of Insurance.

This provision does not provide express authorization for the board of directors of the
HMO solvency surveillance committee to meet in executive session. We believe that this
provision anticipates that committee members will receive copies of reports and other
written information about the financial condition of HMOs during meetings and prohibits
the directors from revealing the contents of this material in a meeting or elsewhere. See
also supra note 9. —

Second, you ask whether the board of directors of the LAHHSI guaranty
association is authorized to hold executive sessions to consider matters which are
confidential under section 12 of article 21.28-D of the Insurance Code. Section 12(b)
requires the association's board of directors to keep confidential reports it receives from —
the commissioner regarding insurers' impairment or insolvency, and section 12(d) provides
that the board, on a majority vote, may make reports and recommendations to the
commissioner on the solvency of any member insurer. "These reports and
recommendations are not public documents and are not subject to the open records law
... Until such time as an insurer is declared to be impaired." Ins. Code art. 21.28-D,
§ 12(d). These provisions primarily require the association's board of directors to keep
confidential certain records. They do not authorize the board of directors to meet in
executive session. In keeping with the spirit of these provisions, the board of directors
could choose to avoid disclosing the substance of a recommendation or record by
refraining from discussing its particulars in a public meeting. See also supra note 12.'9

Third, you ask whether the board of directors of the PCI guaranty association is
authorized to hold executive sessions to consider matters which are confidential under
section 13 of article 21.28-C of the Insurance Code. Since this opinion request was

19In addition, Insurance Code article 21.28-D, section 14(b) appears to prohibit board members
from revealing in a public meeting the contents of records of negotiations and meetings in which the
association or its representatives negotiate with a particular impaired or insolvent insurer. See discussion
supra note 12.

submitted, section 13 has been substantially amended. See supra note 14. As amended,
section 13 merely provides that certain reports prepared by the association are not public
documents. It does not expressly authorize the board of directors to meet in executive
session. In keeping with the spirit of this provision, the board of directors could choose to
avoid disclosing the substance of such a report by refraining from discussing its particulars
in a public meeting. See id.

Finally, you ask whether the board of directors of the TI guaranty association is
authorized to hold executive sessions to consider matters which are confidential under
section 14 of article 9.48 of the Insurance Code. Under section 14, the board is required
to advise the commissioner upon matters relating to the solvency of insurers at a meeting
called by the commissioner. Section 14(e)(3) specifically states that "[s]uch a meeting is
not open to the public." Ins. Code art. 9.48, § 14(e)(3). In addition, members of the
board are prohibited from revealing information received in such meetings. Id. We
believe that section 14(e)(3) specifically authorizes the board of directors to meet in
executive session to advise the commissioner about matters relating to the solvency of
insurers, and precludes the directors from revealing information received at such an
executive session in a public meeting. See also discussion supra p. 15.20

IV. TELEPHONE CONFERENCES UNDER THE OPEN MEETINGS ACT

You also ask whether the board of directors of the LAHHSI guaranty association
is authorized by section 10 of article 21.28-D of the Insurance Code to meet by telephone
conference. In Attorney General Opinion JM-584 (1986), this office concluded that a
meeting by telephone conference would not comply with the requirements of the Open
Meetings Act. Since that opinion was issued, the legislature has amended the act to
specifically authorize the governing body of certain entities to hold a meeting by telephone
conference. See, e.g., Gov't Code §§ 551.121 (governing board of institution of higher
education), 551.122 (Texas High-Speed Rail Authority), 551.123 (Texas Board of
Criminal Justice), 551.124 (Board of Pardons and Paroles). In addition, as noted above,
the legislature recently enacted legislation authorizing the PCI guaranty association and
the TI guaranty association to meet by telephone conference. See Ins. Code art. 9.48,
§ 14(g); id. art. 21.28-C, § 8(k)(1). For this reason, we believe that authorization to hold

20Insurance Code article 9.48, section 14(e)(4) provides that reports and recommendations that
the TI guaranty association's board makes to the commissioner regarding “the solvency, liquidation,
rehabilitation or conservation of any insurer or agent" are not public records until the insurer is declared
to be impaired. To the extent the board is not authorized by section 14(e)(3) to discuss such information
in executive session, the board of directors could choose to avoid disclosing the substance of such report or
recommendation by refraining from discussing its particulars in a public meeting. As discussed above,
see discussion supra p. 15, recently enacted section 15A appears to prohibit board members from
discussing the contents of a report from the commissioner about an impaired insurer in a public meeting
until the information is made public “by the commissioner or other lawful authority." Id. § 15A(c). In
addition, recently enacted section 23(a) appears to prohibit board members from revealing in a public
meeting the contents of records of negotiations and meetings in which the association or its
representatives negotiate with a particular impaired or insolvent insurer. See discussion supra note 18.

such a meeting must be express. Cf. Attorney General Opinion DM-207 (1993)
(suggesting that authorization for member of board subject to the Open Meetings Act to
participate in meeting via live video transmission must be express).

Section 10 of article 21.28-D sets forth the requirements for the LAHHSI guaranty
association's plan of operation. Subsection (c)(3) provides that the plan of operation must
“establish regular places and times for meetings, including telephone conference calls, of
the board of directors." We believe that this provision expressly authorizes the board of
directors to meet by telephone conference. We caution, however, that this authorization
does not exempt the LAHHSI guaranty association's board meetings from any other
aspect of the Open Meetings Act. Therefore, telephone conference meetings are
otherwise subject to the Open Meetings Act, including its notice requirements, and open
sessions must be available to be heard by the public at the board's usual meeting place.
See, e.g., Gov't Code § 551.121 (as amended by Acts 1993, 73d Leg., ch. 268, § 1); Ins.
Code art. 9.48, § 14(g) (as amended by Acts 1993, 73d Leg., ch. 685, § 11.07), art.
21.28-C, § 8(k)(1) (as amended by Acts 1993, 73d Leg., ch. 685, §§ 9-11).

V. CONCLUSION

_ The governing bodies of the Health Maintenance Organization Solvency
Surveillance Committee, the Life, Accident, Health, and Hospital Service Insurance
Guaranty Association, the Texas Property and Casualty Insurance Guaranty Association,
and the Texas Title Insurance Guaranty Association are governmental bodies subject to
the Open Meetings Act. Notice of their meetings must be posted by the secretary of state
for at least seven days before the day of the meeting. -

Article 20A.36(b)(2) of the Insurance Code does not authorize the board of
directors of the HMO solvency surveillance committee to meet in executive session, but
does prohibit the directors from revealing the contents of certain material in a public
meeting or elsewhere. Section 12 of article 21.28-D of the Insurance Code does not
authorize the board of directors of the LAHHSI guaranty association to meet in executive
session. Section 13 of article 21.28-C of the Insurance Code does not authorize the board
of directors of the PCI guaranty association to meet in executive session. Section 14(e)(3)
of article 9.48 of the Insurance Code specifically authorizes the board of directors of the
TI guaranty association to meet in executive session to advise the commissioner about
matters relating to the solvency of insurers, and precludes the directors from revealing
information received at such an executive session in a public meeting. Section 10(c)(3) of
article 21.28-D of the Insurance Code authorizes the board of directors of the LAHHSI
guaranty association to meet by telephone conference.

SUMMARY

The governing bodies of the Health Maintenance Organization
Solvency Surveillance Committee, Insurance Code article 20A.36,
the Life, Accident, Health, and Hospital Service Insurance Guaranty
Association, Insurance Code article 21.28-D, the Texas Property and
Casualty Insurance Guaranty Association, Insurance Code article
21.28-C, and the Texas Title Insurance Guaranty Association,
Insurance Code article 9.48, are governmental bodies subject to the
Open Meetings Act. Gov't Code ch. 551 (former V.T.C.S. art.
6252-17 repealed and codified by Acts 1993, 73d Leg., ch. 268,
§§ 1, 46). Notice of their meetings must be posted by the secretary
of state for at least seven days before the day of the meeting.

Article 20A.36(b)(2) of the Insurance Code does not authorize
the board of directors of the HMO solvency surveillance committee
to meet in executive session, but does prohibit the directors from
revealing the contents of certain material in a public meeting or
elsewhere. Section 12 of article 21.28-D of the Insurance Code does
not authorize the board of directors of the LAHHSI guaranty
association to meet in executive session. Section 13 of article 21.28-
C of the Insurance Code does not authorize the board of directors of
the PCI guaranty association to meet in executive session. Section
14(e)(3) of article 9.48 of the Insurance Code specifically authorizes
the board of directors of the TI guaranty association to meet in
executive session to advise the commissioner about matters relating
to the solvency of insurers, and precludes the directors from
revealing information received at such an executive session in a
public meeting. Section 10(c)(3) of article 21.28-D of the Insurance
Code authorizes the board of directors of the LAHHSI guaranty
association to meet by telephone conference.

Very truly yours,

DAN MORALES
Attorney General of Texas

JORGE VEGA
First Assistant Attorney General

WILL PRYOR
Special Counsel

RENEA HICKS
State Solicitor

MADELEINE B. JOHNSON
Chair, Opinion Committee

Prepared by Mary R. Crouter
Assistant Attorney General