The Senate Industry and Business Committee heard testimony on House Bill 10‑26, which would move administration of the state bonding fund from the Insurance Commissioner to the Office of Management and Budget (OMB). Representative Emily O'Brien presented the bill and described it as the companion to HB 10‑27, which addresses the state fire and tornado fund.

O'Brien said the interim Government Finance Committee recommended study of whether the Office of Management and Budget should administer the funds after the Insurance Commissioner began contracting for administration in 2019. "The legislative assembly had removed 3 FTE positions from the insurance department during the 2019 session, when the department started contracting for those funds," she said, describing the historical context for the proposal.

John Arnold, deputy insurance commissioner, testified in support of moving administration to OMB to avoid a conflict when the Insurance Department both regulates and contracts with the same vendor (the North Dakota Insurance Reserve Fund, often referenced as NDERF). "By moving the ultimate authority of the fund to the Office of Management and Budget, [this] removes our regulatory issues with both being a contractual in a contractual relationship with the vendor currently, NDERF," Arnold said.

Representatives of OMB, including Todd Anderson, director of the Risk Management Division, said OMB had been neutral but recognized it would make sense to consolidate administration of both the fire and tornado fund and the bonding fund at OMB if HB 10‑27 proceeds. Anderson and others raised a fiscal concern: OMB does not currently have the staff to administer the fund directly if the current contractor discontinues services. The bill, as drafted, would require a two‑year contract for administrative services to provide continuity and time for OMB to plan if the vendor declines to continue.

Committee members pressed witnesses on the fiscal note and contingency plans. Anderson said he was unaware of private entities that could administer the funds in a cost‑effective manner and noted the legislation's two‑year contract requirement is intended to keep the current administrator available while the state coordinates a transition if necessary.

Deputy Insurance Commissioner Arnold and OMB witnesses said they have a good working relationship with the North Dakota Insurance Reserve Fund, which currently performs day‑to‑day administration, and that keeping that contractor in place would limit the need for additional state staff. The committee took no final action on HB 10‑26 and closed the hearing after testimony. Members indicated they may consider HB 10‑26 and HB 10‑27 together when amendments to HB 10‑27 are available.