(a) Subject to subsection (b), the head of each department and independent agency in the executive branch of the government shall obtain, under rules adopted by the Treasurer, blanket, position schedule, or other types of surety bonds covering the officers and employees of the departments or independent agencies who are required by law or administrative rule to be bonded. Bonds obtained under this section shall be of the most economical type available for the number and type of personnel to be bonded and shall be conditioned upon the faithful performance of the duties of the individual or individuals so bonded. The bond premium may cover a period not exceeding 2 years and shall be paid from any funds available for the payment of administrative expenses at the time the premium becomes payable. Whenever officers or employees are covered by a bond under authority of this section, the surety or sureties on any existing bond of those officers or employees shall not be liable for any defaults occurring subsequent to the date of the new coverage. For purposes of this section, the term “faithful performance of the duties” shall include the proper accounting for all funds or property received by reason of the position or employment of the individual or individuals so bonded and all duties and responsibilities imposed upon individuals by law or by rule adopted under law.
(b) If, in the opinion of the head of the department or independent agency concerned, the premium cost for bonds procured under this section covering officers or employees in the executive branch of the government will exceed the rate of $150 a year, the procurement of the bonds shall be made by the head of the department or independent agency only after advertising a sufficient time previously for proposals for the furnishing of the bonds, except that the advertising for proposals shall not be required when the public exigencies require the immediate procurement of the bonds.
(c) The Treasurer shall transmit to the Governor for submission to the Secretary of the Interior by 30 September each year a comprehensive report of the operations of the departments and independent agencies under this section. The report shall include, among other matters, information, in summary and in detail, with respect to operations under this section, setting forth:
(1) the number of officers and employees covered by bonds procured under this section;
(2) the number and types of bonds procured under this section and the individual penal sums thereof;
(3) the amounts of the premiums paid for bonds procured under this section; and
(4) other information as may be necessary to enable the Secretary of the Interior to determine the results of operations under this section.
(d) Procedures for taking exceptions to holders of bonds by another supervisory authority shall be established by rule by the Treasurer under the rules adopted under the Administrative Procedure Act, section 4.1001 et seq., implementing this act. Also, procedures of not releasing bonds until all exceptions have been satisfied shall be adopted under the rules.History: 1977, PL 15-49.