PUBLIC Law Chapter 668

processing clients; and $750 for those payroll processors that have

more than 500 employers as payroll processing clients.__The

aggregate of license fees and other fees and assessments provided

for by this chapter is appropriated for the use of the

administrator.__Any balance of these funds does not lapse but must

be carried forward to be expended for the same purpose in the

following fiscal year.

§1495-E.__Surety bonding

1.__Bond required; minimum amount; duration.__Each application
for a license under section 1495-D must be accompanied by
evidence of a surety bond, in a form approved by the
administrator, in an amount equal to the total of all local,
state and federal tax payments and unemployment insurance
premiums processed by the payroll processor on behalf of
employers in this State in the 3-consecutive-month period of
highest volume during the previous calendar year or $100,000,
whichever is greater, but not to exceed $500,000.__The bond must
designate the administrator as payee.__The bond paid to the
administrator may be used for the purposes of the administrator
and for the benefit of any employer who may have a cause of
action against the payroll processor. The terms of the bond must
run continuously until cancelled and the aggregate amount of the
bond must be maintained at all times during the licensing period.

2.__Modification of bond terms.__If bonding is unavailable
under the terms and conditions of subsection 1, the
administrator, within the administrator's discretion, may modify
those terms and conditions so as to ensure the maximum
practicable protection for employers.

3.__Cancellation notification.__A surety company issuing a
bond pursuant to this section shall immediately notify the
administrator when that bond is cancelled or terminated or
lapses.__The notice must include the name and address of the
payroll processor and the amount of the bond.__The cancellation,
termination or lapse is not effective until at least 30 days
after the administrator receives notice.

4.__Exception.__A payroll processor that does not have the
authority to access, control, direct, transfer or disburse a
client's funds is not subject to this section.

§1495-F.__Powers of administrator

1.__Examinations.__The administrator shall establish a program
of regular examinations of payroll processors subject to the
provisions of this chapter.__The regular examinations must be
conducted not less frequently than every 18 months.__The

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