2021 -- S 0303

========

LC001209

========

     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2021

____________

A N   A C T

RELATING TO STATE AFFAIRS AND GOVERNMENT - INTERSTATE COMPACT TO

AWARD PRIZES FOR CURING DISEASES

     Introduced By: Senators Gallo, and Goodwin

     Date Introduced: February 18, 2021

     Referred To: Senate Health & Human Services

     It is enacted by the General Assembly as follows:

     SECTION 1. Title 42 of the General Laws entitled "STATE AFFAIRS AND

GOVERNMENT" is hereby amended by adding thereto the following chapter:

CHAPTER 32.1

INTERSTATE COMPACT TO AWARD PRIZES FOR CURING DISEASES

     42-32.1-1. Enactment of compact.

     The Solemn Covenant of the States to Award Prizes for Curing Diseases Interstate

Compact is hereby enacted and entered into with all other jurisdictions that legally join in the

compact, which is, in form, substantially as follows:

     Article I

     Definitions.

     For purposes of this compact:

     (1) "Compacting state" means either of the following:

     (i) Any state that has enacted the compact and which has not withdrawn or been suspended

pursuant to Article XIV of the compact; or

     (ii) The federal government in accordance with the commission's bylaws;

     (2) "Compact" means the Solemn Covenant of the States to Award Prizes for Curing

Diseases enacted in this section;

     (3) "Non-compacting state" means any state or the federal government, if it is not at the

time a compacting state;

     (4) "Public health expenses" means the amount of all costs paid by taxpayers in a specified

geographic area relating to a particular disease; and

     (5) "State" means any state, district, or territory of the United States of America.

     Article II

     Establishment of the Commission Membership.

     (a) Upon the enactment of the compact by six (6) states, the compacting states shall

establish the Solemn Covenant of States Commission.

     (b) The commission is a body corporate and politic and an instrumentality of each of the

compacting states and is solely responsible for its liabilities, except as otherwise specifically

provided in the compact.

     (c) Each compacting state shall be represented by one member as selected by the

compacting state. Each compacting state shall determine its member's qualifications and period of

service and shall be responsible for any action to remove or suspend its member or to fill the

member's position if it becomes vacant. Nothing in the compact shall be construed to affect a

compacting state's authority regarding the qualification, selection, or service of its own member.

     Article III

     Powers of the Commission.

     The commission shall have the following powers:

     (1) To adopt bylaws and rules pursuant to Articles V and VI of the compact, which shall

have the force and effect of law and shall be binding in the compacting states to the extent and in

the manner provided in the compact;

     (2) To receive and review in an expeditious manner treatments and therapeutic protocols

for the cure of disease submitted to the commission and to award prizes for submissions that meet

the commission's standards for a successful cure treatment or therapeutic protocol;

     (3) To make widely available a cure treatment or therapeutic protocol upon a prize winner

claiming a prize and transferring any intellectual property necessary for the manufacture and

distribution of the cure in accordance with section (c)(7)(i) of Article VI, including by arranging or

contracting for the manufacturing, production, or provision of any drug, serum, or other substance,

device, or process, provided that the commission does not market the cure or conduct any other

activity regarding the cure not specifically authorized in the compact;

     (4) To establish a selling price for the cure, which shall be not more than the expenses for

the cure's manufacturing, distribution, licensing, and any other necessary governmental

requirements for compacting states, or those expenses plus any royalty fees, for noncompacting

LC001209 - Page 2 of 17

states; the price shall not include the expenses of any other activities;

     (5) In non-compacting states and foreign countries, to establish and collect royalty fees

imposed on manufacturers, producers, and providers of any drug, serum, or other substance, device,

or process used for a cure treatment or therapeutic protocol, for which a prize is awarded; royalty

fees may be added to the sales price of the cure pursuant to section (4) of this Article; provided that

the royalty fees shall cumulatively be not more than the estimated five (5) year savings in public

health expenses for that state or country, as calculated by actuaries employed or contracted by the

commission;

     (6) To do the following regarding the collected royalty fees:

     (i) Pay or reimburse expenses related to the payment of a prize, which shall include

employing or contracting actuaries to calculate annual taxpayer savings amounts in compacting

states in accordance with section (c)(7)(iii) of Article VI, and payment of interest and other

expenses related to a loan obtained in accordance with section (c)(7)(vi) of Article VI; and

     (ii) Annually disburse any amounts remaining after making payments or reimbursements

under section (6)(i) of this Article as refunds to compacting states based on the percentage of the

state's prize obligation in relation to the total obligation amount of all compacting states;

     (7) To bring and prosecute legal proceedings or actions in its name as the commission;

     (8) To issue subpoenas requiring the attendance and testimony of witnesses and the

production of evidence;

     (9) To establish and maintain offices;

     (10) To borrow, accept, or contract for personnel services, including personnel services

from employees of a compacting state;

     (11) To hire employees, professionals, or specialists, and elect or appoint officers, and to

fix their compensation, define their duties and give them appropriate authority to carry out the

purposes of the compact, and determine their qualifications; and to establish the commission's

personnel policies and programs relating to, among other things, conflicts of interest, rates of

compensation, and qualifications of personnel;

     (12) To accept any and all appropriate donations and grants of money, equipment, supplies,

materials, and services, and to receive, utilize, and dispose of the same; provided that at all times

the commission shall strive to avoid any appearance of impropriety;

     (13) To lease, purchase, or accept appropriate gifts or donations of, or otherwise to own,

hold, improve, or use, any property, real, personal, or mixed; provided, that at all times the

commission shall strive to avoid any appearance of impropriety;

     (14) To sell, convey, mortgage, pledge, lease, exchange, abandon, or otherwise dispose of

LC001209 - Page 3 of 17

any property, real, personal, or mixed;

     (15) To monitor compacting states for compliance with the commission's bylaws and rules;

     (16) To enforce compliance by compacting states with the commission's bylaws and rules;

     (17) To provide for dispute resolution among compacting states or between the commission

and those who submit treatments and therapeutic protocols for the cure of disease for consideration;

     (18) To establish a budget and make expenditures;

     (19) To borrow money;

     (20) To appoint committees, including management, legislative, and advisory committees

comprised of members, state legislators or their representatives, medical professionals, and such

other interested persons as may be designated by the commission;

     (21) To establish annual membership dues for compacting states which shall be used for

daily expenses of the commission and not for interest or prize payments;

     (22) To adopt and use a corporate seal; and

     (23) To perform such other functions as may be necessary or appropriate to achieve the

purposes of this compact.

     Article IV

     Meetings and Voting.

     (a) The commission shall meet and take such actions as are consistent with the compact,

bylaws, and rules.

     (b) A majority of the members of the commission shall constitute a quorum necessary in

order to conduct business or take actions at meetings of the commission.

     (c) Each member of the commission shall have the right and power to cast one vote

regarding matters determined or actions to be taken by the commission. Each member shall have

the right and power to participate in the business and affairs of the commission.

     (d) A member shall vote in person or by such other means as provided in the commission's

bylaws. The commission's bylaws may provide for members' participation in meetings by telephone

or other means of communication.

     (e) The commission shall meet at least once during each calendar year. Additional meetings

shall be held as set forth in the commission's bylaws.

     (f) No decision of the commission with respect to the approval of an award for a treatment

or therapeutic process for the cure of a disease shall be effective unless two-thirds (2/3) of all the

members of the commission vote in favor thereof.

     (g) Guidelines and voting requirements for all other decisions of the commission shall be

established in the commission's bylaws.

LC001209 - Page 4 of 17

     Article V

     Bylaws.

     The commission shall, by a majority vote of all the members of the commission, prescribe

bylaws to govern its conduct as may be necessary or appropriate to carry out the purposes, and

exercise the powers, of the compact, including, but not limited to:

     (1) Establishing the fiscal year of the commission;

     (2) Providing reasonable procedures for appointing and electing members, as well as

holding meetings, of the management committee;

     (3) Providing reasonable standards and procedures:

     (i) For the establishment and meetings of other committees;

     (ii) Governing any general or specific delegation of any authority or function of the

commission; and

     (iii) Voting guidelines and procedures for commission decisions;

     (4) Providing reasonable procedures for calling and conducting meetings of the

commission that shall consist of requiring a quorum to be present, ensuring reasonable advance

notice of each such meeting, and providing for the right of citizens to attend each such meeting

with enumerated exceptions designed to protect the public's interest and the privacy of individuals;

     (5) Providing a list of matters about which the commission may go into executive session

and requiring a majority of all members of the commission vote to enter into such session. As soon

as practicable, the commission shall make public:

     (i) A copy of the vote to go into executive session, revealing the vote of each member with

no proxy votes allowed; and

     (ii) The matter requiring executive session, without identifying the actual issues or

individuals involved;

     (6) Establishing the titles, duties, authority, and reasonable procedures for the election of

the officers of the commission;

     (7) Providing reasonable standards and procedures for the establishment of the personnel

policies and programs of the commission. Notwithstanding any civil service or other similar laws

of any compacting state, the commission's bylaws shall exclusively govern the personnel policies

and programs of the commission;

     (8) Allowing a mechanism for:

     (i) The federal government to join as a compacting state; and

     (ii) Foreign countries or subdivisions of those countries to join as liaison members by

adopting the compact; provided that adopting countries or subdivisions shall not have voting power

LC001209 - Page 5 of 17

or the power to bind the commission in any way;

     (9) Adopting a code of ethics to address permissible and prohibited activities of members

and employees;

     (10) Providing for the maintenance of the commission's books and records;

     (11) Governing the acceptance of and accounting for donations, annual member dues, and

other sources of funding and establishing the proportion of these funds to be allocated to prize

amounts for treatments and therapeutic protocols that cure disease;

     (12) Governing any fundraising efforts in which the commission wishes to engage; and

     (13) Providing a mechanism for winding up the operations of the commission and the

equitable disposition of any surplus funds that may exist after the termination of the compact after

the payment and reserving of all its debts and obligations.

     Article VI

     Rules.

     (a) The commission shall adopt rules to do the following:

     (1) Effectively and efficiently achieve the purposes of this compact;

     (2) Govern the methods, processes, and any other aspect of the research, creation, and

testing of a treatment or therapeutic protocol for each disease for which a prize may be awarded.

     (b) The commission shall also adopt rules establishing the criteria for defining and

classifying the diseases for which prizes shall be awarded. The commission may define and classify

subsets of diseases, for example, tubular carcinoma of the breast. For purposes of sections (c)(1)

and (c)(3) of this Article, a subset of a disease shall be considered one disease. The commission

may consult the most recent edition of the international classification of disease as published by

the world health organization or other definitions agreed to by a two-thirds (2/3) vote of the

commission.

     (c) The commission shall also adopt rules regarding prizes for curing diseases that establish

the following:

     (1) At least ten (10) major diseases for which to create prizes, which shall be determined

based on the following factors:

     (i) The severity of the disease to a human individual's overall health and well-being;

     (ii) The survival rate or severity of impact of the disease; and

     (iii) The public health expenses and treatment expenses for the disease.

     (2) The criteria a treatment or therapeutic protocol must meet in order to be considered a

cure for any of the diseases for which a prize may be awarded, which shall include the following

requirements:

LC001209 - Page 6 of 17

     (i) It must be approved by the Federal Food and Drug Administration or have otherwise

obtained legal status for the compact to immediately contract to manufacture and distribute in the

United States;

     (ii) Except as provided in section (d) of this Article, it must yield a significant increase in

survival with respect to the diseases if early death is the usual outcome; and

     (iii) It requires less than one year of the treatment or protocol to completely cure the

disease.

     (3) The procedure for determining the diseases for which to award prizes, which includes

the option to award prizes for more than ten (10) diseases that meet the above criteria, if agreed to

by two-thirds (2/3) vote of the commission, and a requirement to update the list every three (3)

years.

     (4) The submission and evaluation procedures and guidelines, including filing and review

procedures, a requirement that the person or entity submitting the cure bears the burden of proof in

demonstrating that the treatment or therapeutic protocol meets the above criteria, and limitations

preventing public access to treatment or protocol submissions.

     (5) The estimated five (5) year public health savings that would result from a cure, which

shall be equal to the five (5) year public health expenses for each disease in each compacting state,

and a procedure to update these expenses every three (3) years in conjunction with the requirements

in section (c)(3) of this Article. The estimated five (5) year public health savings amount shall be

calculated, estimated, and publicized every three (3) years by actuaries employed or contracted by

the commission.

     (6) The prize amount with respect to cures for each disease, which shall be equal to the

most recent estimated total five (5) year savings in public health expenses for the disease as

calculated in section (c)(5) of this Article in all of the compacting states; amounts donated by

charities, individuals, and any other entities intended for the prize under Article I of the compact;

and any other factors that the commission deems appropriate.

     (7) The prize distribution procedures and guidelines, which shall include the following

requirements:

     (i) Upon acceptance of a cure, the prize winner shall transfer to the commission the patent

and all related intellectual property for the treatment or therapeutic protocol in exchange for the

prize, except in the case that the prize money is considered by the commission to be too low, and

that a prize will be awarded only to the first person or entity that submits a successful cure for a

disease for which a prize may be awarded;

     (ii) Donation amounts intended for the prize shall be kept in a separate, interest-bearing

LC001209 - Page 7 of 17

account maintained by the commission. This account shall be the only account in which prize

money is kept;

     (iii) Each compacting state shall have the responsibility to pay annually the compacting

state's actual one year savings in public health expenses for the particular disease for which a cure

has been accepted. The compacting state shall make such an annual payment until it has fulfilled

its prize responsibility as established in section (c)(6) of this Article. Each compacting state's

payment responsibility begins one year after the date the cure becomes widely available. The

commission shall employ or contract with actuaries to calculate each state's actual one year savings

in public health expenses at the end of each year to determine each state's responsibility for the

succeeding year;

     (iv) Compacting states may meet prize responsibilities by any method, including the

issuance of bonds or other obligations, with the principal and interest of those bonds or obligations

to be repaid only from revenue derived from estimated public health expense savings from a cure

to a disease. If the compacting state does not make such revenue available to repay some or all of

the revenue bonds or obligations issued, the owners or holders of those bonds or obligations have

no right to have excises or taxes levied to pay the principal or interest on them. The revenue bonds

and obligations are not a debt of the issuing compacting state;

     (v) A compacting state may issue bonds or other debt that are general obligations, under

which the full faith and credit, revenue, and taxing power of the state is pledged to pay the principal

and interest under those obligations, only if authorized by the compacting state's constitution or, if

constitutional authorization is not required, by other law of the compacting state; and

     (vi) Upon acceptance of a cure, the commission shall obtain a loan from a financial

institution in an amount equal to the most recently calculated total estimated five (5) year public

health expenses for the disease in all compacting states, in accordance with section (c)(6) of this

Article. The commission reserves the right to continuously evaluate the cure in the interim and

rescind a prize offer if the commission finds that the cure no longer meets the commission's criteria.

     (d) The commission may award a prize for a treatment or therapeutic protocol that yields a

survival rate that is less than what is established in the cure criteria through at least five (5) years

after the treatment or protocol has ended. In that case, the prize amount awarded for that treatment

or therapeutic protocol shall be reduced from the prize amount originally determined by the

commission for a cure for that disease. The reduction shall be in proportion to the survival rate

yielded by that treatment or protocol as compared to the survival rate established in the cure criteria.

     (e) The commission also shall adopt rules that do the following:

     (1) Establish the following regarding commission records:

LC001209 - Page 8 of 17

     (i) Conditions and procedures for public inspection and copying of its information and

official records, except such information and records involving the privacy of individuals or would

otherwise violate privacy laws under federal law and the laws of the compacting states;

     (ii) Procedures for sharing with federal and state agencies, including law enforcement

agencies, records and information otherwise exempt from disclosure; and

     (iii) Guidelines for entering into agreements with federal and state agencies to receive or

exchange information or records subject to nondisclosure and confidentiality provisions;

     (2) Provide a process for commission review of submitted treatments and therapeutic

protocols for curing diseases that includes the following:

     (i) An opportunity for an appeal, not later than thirty (30) days after a rejection of a

treatment or protocol for prize consideration, to a review panel established under the commission's

dispute resolution process;

     (ii) Commission monitoring and review of treatment and protocol effectiveness consistent

with the cure criteria established by the commission for the particular disease; and

     (iii) Commission reconsideration, modification, or withdrawal of approval of a treatment

or protocol for prize consideration for failure to continue to meet the cure criteria established by

the commission for the particular disease;

     (3) Establish a dispute resolution process to resolve disputes or other issues under the

compact that may arise between two (2) or more compacting states or between the commission and

individuals or entities who submit treatments and therapeutic protocols to cure diseases, which

process shall provide for:

     (i) Administrative review by a review panel appointed by the commission;

     (ii) Judicial review of decisions issued after an administrative review; and

     (iii) Qualifications to be appointed to a panel, due process requirements, including notice

and hearing procedures, and any other procedure, requirement, or standard necessary to provide

adequate dispute resolution;

     (4) Establish and impose annual member dues on compacting states, which shall be

calculated based on the percentage of each compacting state's population in relation to the

population of all the compacting states.

     (f) Recognizing that the goal of the compact is to pool the potential savings of as many

states and countries as possible to generate sufficient financial incentive to develop a cure for many

of the world's most devastating diseases, the compact will respect the laws of each of these United

States by adopting rules that establish ethical standards for research that shall be followed in order

for a prize to be claimed. The compact, in the rules, shall establish a common set of ethical standards

LC001209 - Page 9 of 17

that embodies the laws and restrictions in each of the states so that to be eligible for claiming a

prize the entity submitting a cure must not have violated any of the ethical standards in any one of

the fifty (50) states, whether the states have joined the compact or not. The compact will publish

these common ethical standards along with the specific criteria for a cure for each of the diseases

the compact has targeted. So long as a researcher follows the common ethical standards in effect at

the time the research is done, an entity presenting a cure will be deemed to have followed the

standards. On or before January 1 of each year, the compact shall review all state laws to determine

if additional ethical standards have been enacted by any of the fifty (50) states and the federal

government. Any changes to the common ethical standards rules based on new state laws shall be

adopted and published by the compact, but shall not take effect in cure criteria for a period of three

(3) years to allow for sufficient notice to researchers.

     (g) All rules may be amended as the commission sees necessary.

     (h) All rules shall be adopted pursuant to a rulemaking process that conforms to the model

state administrative procedure act of 1981 by the uniform law commissioners, as amended, as may

be appropriate to the operations of the commission.

     (i) In the event the commission exercises its rulemaking authority in a manner that is

beyond the scope of the purpose of this compact, or the powers granted hereunder, then such rule

shall be invalid and have no force and effect.

     Article VII

     Committees.

     (a) Management Committee.

     (1) The commission may establish a management committee comprised of not more than

fourteen (14) members when twenty-six (26) states enact the compact.

     (2) The committee shall consist of those members representing compacting states whose

total public health expenses of all of the established diseases are the highest.

     (3) The committee shall have such authority and duties as may be set forth in the

commission's bylaws and rules, including:

     (i) Managing authority over the day-to-day affairs of the commission in a manner

consistent with the commission's bylaws and rules and the purposes of the compact;

     (ii) Overseeing the offices of the commission; and

     (iii) Planning, implementing, and coordinating communications and activities with state,

federal, and local government organizations in order to advance the goals of the compact.

     (4) The commission annually shall elect officers for the committee, with each having such

authority and duties as maybe specified in the commission's bylaws and rules.

LC001209 - Page 10 of 17

     (5) The management committee, subject to commission approval, may appoint or retain an

executive director for such period, upon such terms and conditions, and for such compensation as

the committee determines. The executive director shall serve as secretary to the commission, but

shall not be a member of the commission. The executive director shall hire and supervise such other

staff as may be authorized by the committee.

     (b) Advisory Committees. The commission may appoint advisory committees to monitor

all operations related to the purposes of the compact and make recommendations to the

commission; provided that the manner of selection and term of any committee member shall be as

set forth in the commission's bylaws and rules. The commission shall consult with an advisory

committee, to the extent required by the commission's bylaws or rules, before doing any of the

following:

     (1) Approving cure criteria;

     (2) Amending, enacting, or repealing any bylaw or rule;

     (3) Adopting the commission's annual budget; and

     (4) Addressing any other significant matter or taking any other significant action.

     Article VIII

     Finance.

     (a) The commission annually shall establish a budget to pay or provide for the payment of

its reasonable expenses. To fund the cost of initial operations, the commission may accept

contributions and other forms of funding from the compacting states and other sources.

Contributions and other forms of funding from other sources shall be of such a nature that the

independence of the commission concerning the performance of its duties shall not be

compromised.

     (b) The commission shall be exempt from all taxation in and by the compacting states.

     (c) The commission shall keep complete and accurate accounts of all of its internal receipts,

including grants and donations, and disbursements of all funds under its control. The internal

financial accounts of the commission shall be subject to the accounting procedures established

under the commission's bylaws or rules. The financial accounts and reports, including the system

of internal controls and procedures of the commission, shall be audited annually by an independent

certified public accountant. Upon the determination of the commission, but not less frequently than

every three (3) years, the review of the independent auditor shall include a management and

performance audit of the commission. The commission shall make an annual report to the governors

and legislatures of the compacting states, which shall include a report of the independent audit. The

commission's internal accounts shall not be confidential and such materials may be shared with any

LC001209 - Page 11 of 17

compacting state upon request; provided, however, that any work papers related to any internal or

independent audit and any information subject to the compacting states' privacy laws, shall remain

confidential.

     (d) No compacting state shall have any claim or ownership of any property held by or

vested in the commission or to any commission funds held pursuant to the provisions of the

compact.

     Article IX

     Records.

Except as to privileged records, data, and information, the laws of any compacting state pertaining

to confidentiality or nondisclosure shall not relieve any member of the duty to disclose any relevant

records, data, or information to the commission; provided, that disclosure to the commission shall

not be deemed to waive or otherwise affect any confidentiality requirement; and further provided,

that, except as otherwise expressly provided in the compact, the commission shall not be subject to

the compacting state's laws pertaining to confidentiality and nondisclosure with respect to records,

data, and information in its possession. Confidential information of the commission shall remain

confidential after such information is provided to any member. All cure submissions received by

the commission are confidential.

     Article X

     Compliance.

The commission shall notify a compacting state in writing of any noncompliance with commission

bylaws and rules. If a compacting state fails to remedy its noncompliance within the time specified

in the notice, the compacting state shall be deemed to be in default as set forth in Article XIV.

     Article XI

     Venue.

Venue for any judicial proceedings by or against the commission shall be brought in the appropriate

court of competent jurisdiction for the geographical area in which the principal office of the

commission is located.

     Article XII

     Qualified Immunity, Defense, and Indemnification.

     (a) The members, officers, executive director, employees, and representatives of the

commission shall be immune from suit and liability, either personally or in their official capacity,

for any claim for damage to or loss of property or personal injury or other civil liability caused by

or arising out of any actual or alleged act, error, or omission that occurred, or that such person had

a reasonable basis for believing occurred within the scope of the person's commission employment,

LC001209 - Page 12 of 17

duties, or responsibilities; provided, that nothing in section (a) of this Article shall be construed to

protect any such person from suit or liability for any damage, loss, injury, or liability caused by the

intentional or willful and wanton misconduct of that person.

     (b) The commission shall defend any member, officer, executive director, employee, or

representative of the commission in any civil action seeking to impose liability arising out of any

actual or alleged act, error, or omission that occurred within the scope of the person's commission

employment, duties, or responsibilities, or that such person had a reasonable basis for believing

occurred within the scope of commission employment, duties, or responsibilities; provided, that

nothing in the compact or commission bylaws or rules shall be construed to prohibit that person

from retaining his or her own counsel; and provided further, that the actual or alleged act, error, or

omission did not result from that person's intentional or willful and wanton misconduct.

     (c) The commission shall indemnify and hold harmless any member, officer, executive

director, employee, or representative of the commission for the amount of any settlement or

judgment obtained against the person arising out of any actual or alleged act, error, or omission that

occurred within the scope of the person's commission employment, duties, or responsibilities, or

that such person had a reasonable basis for believing occurred within the scope of commission

employment, duties, or responsibilities; provided, that the actual or alleged act, error, or omission

did not result from the intentional or willful and wanton misconduct of that person.

     Article XIII

     Compacting States, Effective Date, and Amendment.

     (a) Any state is eligible to become a compacting state.

     (b) The compact shall become effective and binding upon legislative enactment of the

compact into law by two (2) compacting states; provided, the commission shall only be established

after six (6) states become compacting states. Thereafter, the compact shall become effective and

binding as to any other compacting state upon enactment of the compact into law by that state.

     (c) Amendments to the compact may be proposed by the commission for enactment by the

compacting states. No amendment shall become effective and binding until all compacting states

enact the amendment into law.

     (d) If funding is requested or required, the legislative authority of each compacting state

shall be responsible for making the appropriations it determines necessary to pay for the costs of

the compact, including annual member dues and prize distributions.

     Article XIV

     Withdrawal, Default, and Expulsion.

     (a) Withdrawal.

LC001209 - Page 13 of 17

     (1) Once effective, the compact shall continue in force and remain binding upon each and

every compacting state; provided, that a compacting state may withdraw from the compact by doing

both of the following:

     (i) Repealing the law enacting the compact in that state; and

     (ii) Notifying the commission in writing of the intent to withdraw on a date that is both of

the following:

     (A) At least three (3) years after the date the notice is sent; and

     (B) After the repeal takes effect.

     (2) The effective date of withdrawal is the date described in section (a)(1)(ii) of this Article.

     (3) The member representing the withdrawing state shall immediately notify the

management committee in writing upon the introduction of legislation in that state repealing the

compact. If a management committee has not been established, the member shall immediately

notify the commission.

     (4) The commission or management committee, as applicable, shall notify the other

compacting states of the introduction of such legislation within ten (10) days after its receipt of

notice thereof.

     (5) The withdrawing state is responsible for all obligations, duties, and liabilities incurred

through the effective date of withdrawal, including any obligations, the performance of which

extend beyond the effective date of withdrawal. The commission's actions shall continue to be

effective and be given full force and effect in the withdrawing state.

     (6) Reinstatement following a state's withdrawal shall become effective upon the effective

date of the subsequent enactment of the compact by that state.

     (b) Default.

     (1) If the commission determines that any compacting state has at any time defaulted in the

performance of any of its obligations or responsibilities under the compact or the commission's

bylaws or rules, then, after notice and hearing as set forth in the bylaws, all rights, privileges, and

benefits conferred by this compact on the defaulting state shall be suspended from the effective

date of default as fixed by the commission. The grounds for default include failure of a compacting

state to perform its obligations or responsibilities, and any other grounds designated in commission

rules. The commission shall immediately notify the defaulting state in writing of the suspension

pending cure of the default. The commission shall stipulate the conditions and the time period

within which the defaulting state shall cure its default. If the defaulting state fails to cure the default

within the time period specified by the commission, the defaulting state shall be expelled from the

compact and all rights, privileges, and benefits conferred by the compact shall be terminated from

LC001209 - Page 14 of 17

the effective date of the expulsion. Any state that is expelled from the compact shall be liable for

any cure prize or prizes for three (3) years after its removal. The commission shall also take

appropriate legal action to ensure that any compacting state that withdraws from the compact

remains liable for paying its responsibility towards a prize for a cure that was accepted while the

compacting state was a member of the commission.

     (2) The expelled state must reenact the compact in order to become a compacting state.

     (c) Dissolution of Compact.

     (1) The compact dissolves effective upon the date of either of the following:

     (i) The withdrawal or expulsion of a compacting state, which withdrawal or expulsion

reduces membership in the compact to one compacting state; and

     (ii) The commission votes to dissolve the compact.

     (2) Upon the dissolution of the compact, the compact becomes null and void and shall be

of no further force or effect, and the business and affairs of the commission shall be wound up and

any surplus funds shall be distributed in accordance with the commission's bylaws; provided, that

the commission shall pay all outstanding prizes awarded before the dissolution of the compact, as

well as any other outstanding debts and obligations incurred during the existence of the compact.

Any unawarded funds donated to be a part of a prize shall be returned to the donor, along with any

interest earned on the amount.

     Article XV

     Severability and Construction.

     (a) The provisions of the compact shall be severable; and if any phrase, clause, sentence,

or provision is deemed unenforceable, the remaining provisions of the compact shall be

enforceable.

     (b) The provisions of the compact shall be liberally construed to effectuate its purposes.

     Article XVI

     Binding Effect of Compact and Other Laws.

     (a) Other Laws: Nothing herein prevents the enforcement of any other law of a compacting

state, except as provided in section (b)(2) of this Article.

     (b) Binding Effect of the Compact.

     (1) All lawful actions of the commission, including all commission rules, are binding upon

the compacting states.

     (2) All agreements between the commission and the compacting states are binding in

accordance with their terms.

     (3) Except to the extent authorized by the compacting state's constitution or, if

LC001209 - Page 15 of 17

constitutional authorization is not required, by other law of the compacting state, such state, by

entering into the compact does not:

     (i) Commit the full faith and credit or taxing power of the compacting state for the payment

of prizes or other obligations under the compact; and

     (ii) Make prize payment responsibilities or other obligations under the compact a debt of

the compacting state.

     (4) Upon the request of a party to a conflict over the meaning or interpretation of

commission actions, and upon a majority vote of the compacting states, the commission may issue

advisory opinions regarding the meaning or interpretation in dispute.

     (5) In the event any provision of the compact exceeds the constitutional limits imposed on

any compacting state, the obligations, duties, powers or jurisdiction sought to be conferred by that

provision upon the commission shall be ineffective as to that compacting state, and those

obligations, duties, powers, or jurisdiction shall remain in the compacting state and shall be

exercised by the agency thereof to which those obligations, duties, powers, or jurisdiction are

delegated by law in effect at the time the compact becomes effective.

     SECTION 2. This act shall take effect upon passage.

========

LC001209

========

LC001209 - Page 16 of 17

EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N   A C T

RELATING TO STATE AFFAIRS AND GOVERNMENT - INTERSTATE COMPACT TO

AWARD PRIZES FOR CURING DISEASES

***

     This act would adopt the Interstate Compact to Award Prizes for Curing Diseases. The act

would also provide that upon enactment by six (6) states, a commission would be established. The

Commission may award prizes for successful cures for diseases.

     This act would take effect upon passage.

========

LC001209

========

LC001209 - Page 17 of 17