The budget is based on revenues of $73.1 million and expenses of $70.5 million, leaving $2.6 million in net revenue.

Revenue is up 7.1 percent, or $4.8 million, while expenses are up 6 percent, or $4 million over the 2008 budget.

Among the reasons Mr. Sevigny cited for the growth in projected revenues is the growth in the System for Electronic Rate and Form Filing, royalties received from data redistributors, and revenues from the state-based systems and the state producer licensing system.

The increase in projected expenses, he continued, is due to an increase in salaries and employee benefits which are budgeted to increase a respective 3.5 percent and $411,873 in 2009. Expenses also include an additional $748,000 in travel subsidies for insurance departments, he added.

Deirdre Manna, vice president-industry, regulatory and political affairs at Property Casualty Insurers Association of America, Des Plaines, Ill., asked if there was a specific budget number for the proposal to create an independent rating agency.

While there is no specific line item, the cost would come from other regulatory modernization initiatives' lines, explained Brady Kelley, NAIC chief financial and business strategy officer.

Mr. Sevigny also discussed the new market conduct analysis program. Even though there is a budget line for the item, it has no dollar figure. He said commissioners will continue to discuss issues such as a centralized data bank and which data elements need to be collected.

Also questioned were a dollar settlement with Ms. Weatherford and a decision on the 2009 salary and benefits of the next NAIC executive, which had no dollar figure listed.

Andy Beale, NAIC's acting executive vice president and CEO, said that terms of Ms. Weatherford's separation agreement were confidential and would not be released, when asked for details by Bill Boyd, financial regulation manager with the National Association of Mutual Insurance Companies, Indianapolis.

Specifics concerning the 2009 salary of the next NAIC CEO and the cost of moving executive management to Washington have not been determined because details of the change are still being worked out, according to Mr. Sevigny.

Ms. Manna of PCI also asked about the cost of developing a national catastrophe model and whether the budgeted amount for it will get bigger in fiscal-year 2010. In 2009, the projected expense is $200,000.

Mr. Sevigny confirmed that given the cost of creating systems and a structure if the plan proceeds, it is likely that the cost will increase.

Mr. Boyd of NAMIC questioned whether the duties of a proposed Brussels-based liaison could be made part of an existing position the NAIC created to support the International Association of Insurance Supervisors, Basel, Switzerland. A total of $541,000 has been budgeted for the creation of a new liaison to ensure that U.S. insurance interests are represented. Mr. Sevigny responded that the duties for both positions are too broad to be incorporated into a single post.