NU Online News Service, June 3, 1:10 p.m.EDT

Political infighting has left the Texas Department of Insurancefacing the possibility of being abolished through legislativeinaction, but industry officials say there is no crisis at themoment.

As matters now stand, legislation that allows the department tooperate will be allowed to expire September 2010.

The Texas legislature adjourned on Monday without completing anumber of legislative items, including continued funding of theTexas Department of Insurance and several other major stateagencies.

Their stalemate on legislation stemmed from individual stateSenator's objections to language in legislation passed by the Housefor funding departments threatened with expiration under the TexasSunset law..

Ben Gonzalez, spokesman for TDI, said the department iscontinuing its work and expects the governor and legislators toresolve the issue.

"We are not operating as if we were in a crisis," said Mr.Gonzalez. "We think this is just a technicality."

He said the department is operating "today as we did yesterdayand the day before. We are still fully regulating insurance, takingconsumer complaints and doing what we usually do."

By law, he said the department will continue operation untilSept. 1 before it has to wind down, and that process would take ayear. He said the department is confident it will hear from thestate leadership long before then.

More than 150 departments in Texas are reviewed by the SunsetAdvisory Commission every 12 years. In its report, the commissionsaid "the agency works well" and made a number of recommendationsto improve services and transparency for TDI.

Texas Gov. Rick Perry, in the text of a speech he gave the dayfollowing the legislature's adjournment, praised the body for thework it did finish, but said of its unfinished work, "I want toensure our citizens and the employees of these agencies that Texaswill continue to build and maintain roads, regulate the insuranceindustry, and provide essential services while we work with agencyleadership in the coming days to choose the best of our manyoptions."

Mark Hanna, spokesman for the Insurance Council of Texas, agreedthe situation was not a crisis and that the governor is probablyletting the dust settle from heated legislative battles beforecalling a special session of the legislature to take care ofunfinished business.

"The state is not in any type of financial crisis," henoted.

He said the Texas legislature, which meets every two years, didtake some important steps on insurance issues, resolving fundinggoing forward for the Texas Wind Pool and passing anti-fraudlegislation that prohibits attorneys and chiropractors fromsoliciting business for the first 30 days after an event.

Reacting to the failure of the legislature to fund TDI, theAmerican Insurance Association expressed its dissatisfaction withthe situation.

"We are very disappointed that this legislation has fallenvictim to partisan politics," Fred C. Bosse, AIA regional vicepresident, said in a statement. "The TDI Sunset bill deserved fullconsideration and a final vote."