Mr. Bemi said illegal fees and assessments, unduly restrictive state registration requirements, and coverage interpretations conflict with the authority granted to RRGs under federal law.

The Risk Retention Modernization Act (H.R. 4802), introduced in the House, would allow RRGs to write commercial property insurance, create uniform governance standards for RRGs, and give the Treasury Department authority to oversee the RRG sector and resolve interstate operating authority disputes.

Brian Braley, newly-elected chairman of NRRA, said the association will join other industry organizations to advocate for enactment of HR 4802 in 2011.

"The federal dispute resolution mechanism, when achieved, will transition the risk retention industry to a playing field that is more workable and more equitable. A federal statute that promotes one single regulatory framework for RRGs, but which has no federal enforcement mechanism, is simply legislation that is not finished. We must see this through to a successful conclusion," he declared.

Mr. Braley is vice president-legislative affairs for the Housing Authority Risk Retention Group.

At an NRRA Government Affairs Committee meeting here, Robert Myers Jr., general counsel for NRRA and counsel, Morris, Manning & Martin, LLP, gave an update on ANI-RRG, a risk retention group which has operated in Nevada for nine years and was told this year by the state that it could not provide first-dollar coverage because it is not a licensed insurer in the state.

The RRG provides auto coverage for charities that transport the elderly and shut-ins.

After a hearing at the state level, and an appeal to the Attorney General, ANI-RRG is filing in federal court and is positioned for a summary judgment, Mr. Myers said.

"It's a question of law, but if states want to make it difficult, they can drag it out," he explained. "It gets expensive."

He added that once one state takes such an action, other states will follow. Their attitude is, "If you don't like it, you can sue me," Mr. Myers said.