Attorney General of Louisiana — Opinion
September 3, 1999
54 INSURANCE 90-A-1-(c) PUBLIC FUNDS CONTRACTS — PURCHASE OF MATERIALS
SUPPLIES 109 STATE — EMPLOYEES DEPARTMENTS La. R.S. 39:1551, et seq.; La. R.S. 42:821
The maximum term for a contract between the Board of Trustees State Employees Group Benefits Program and an insurer to provide life insurance for participants in the State Employees Group Benefits Program is two years.
Mr. Thomas D. Benoit Special Counsel Board of Trustees State Employees Group Benefits Program P. O. Box 44036, Capitol Station Baton Rouge, LA 70804-9036
RICHARD P. IEYOUB
Dear Mr. Benoit:
We received your request regarding life insurance for participants in the State Employees Group Benefits Program. Specifically, we provide you with our opinion on the following issue:
What is the maximum term for a contract between the Board of Trustees State Employees Group Benefits Program and an insurer to provide life insurance for participants in the State Employees Group Benefits Program?
The Louisiana Procurement Code, found at La. R.S. 39:1551, et seq, applies to every expenditure of public funds by the state acting through a governmental body under any contract for supplies, services, or major repairs. A governmental body, as defined in La. R.S. 39: 1556, includes any board of the executive or judicial branches of state government. La. R.S. 39:1556
further defines supplies as all property including insurance. Thus, it appears that The Board of Trustees for the State Employees Group Benefits Program is a “governmental body” and insurance is a “supply” as defined in the statute.
The Procurement Code addresses multi-year contracts in Section 1615(A). This section provides as follows:
Unless otherwise provided by law, a contract for supplies or services may be entered into for periods of not more than three years, if funds for the first fiscal year of the contemplated contract are available at the time of contracting. . . . (emphasis added)
However, La. R.S. 42:821(4)(b) which pertains to group life insurance provides, “No future such contract shall be for a longer period of time than two years.” It thus appears that La. R.S. 42:821(4)(b) is the “otherwise provided by law” referred to in Section 1615(A).
Accordingly, it is our opinion that the maximum term for a contract of life insurance for participants in the State Employees Group Benefits Program is two years.
We trust that this answers your request. If you need further assistance, please do not hesitate to contact our office.
Yours very truly,
RICHARD P. IEYOUB ATTORNEY GENERAL
BY: TINA VICARI GRANT
Assistant Attorney General
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