Worker's compensation for special education teachers.

14LSO-0301.L2

FISCAL NOTE

	FY 2015	FY 2016	FY 2017
NON-ADMINISTRATIVE IMPACT
Anticipated Revenue Increase:
INDUSTRIAL ACCIDENT FUND	2,284,379	2,284,379	2,284,379

Source of revenue increase:  Increase in worker's compensation premiums paid by school districts for coverage of teachers and other professional staff who provide services to special education students

Assumptions:

Based on end of year staffing collection data for school year 2012-13, the Legislative Service Office (LSO) estimates that 1,330.28 full time equivalent (FTE) teachers and other professional staff positions provide services to special education students, with a total annual wage of $73,689,647. These 1,330.28 FTE would now be included in the extrahazardous occupations category under this bill.

The Department of Workforce Services (DWS) states that since no past claim experience exists for this category, they estimate that school districts would pay premiums based on a base rate premium that is currently utilized for this category (W.S. 27-14-108(d)(xvi)) of $3.10/$100. DWS does not project an increase in the base rate for the next three years at this time.

LSO estimates that school districts would pay total additional premiums of $2,284,379 (73,689,647 x 3.1% = $2,284,379) to the Worker's Compensation Industrial Accident fund for FY 2015, FY 2016, and FY 2017.

DWS anticipates the cost of claims and medical/indemnity reserves will approximately equal the amount of increased premiums. The DWS actuarial analysis and review process supports the statutory requirement under W.S. 27-14-201(a) which states “The worker’s compensation program shall be neither more nor less than self-supporting.” W.S. 27-14-201(c) requires the same review for each class (industry). In summary, this means that each year, premiums and expenditures should be roughly equal (including administrative expenses). The actuarial process and review adjusts premiums each year to maintain this balance. DWS is not able to accurately predict claims for this group as no past experience exists for this category.

Since school districts receive 100% reimbursement for special education expenditures through the K-12 school funding model, this increase in worker's compensation claims paid by school districts will result in a corresponding expenditure increase from the School Foundation Program. It is anticipated that the appropriation included in the JAC recommended budget for special education is sufficient to pay for these additional expenditures.

Prepared by:   Dean Temte / Matt Willmarth, LSO      Phone: 777-7881

(Information provided by John Ysebart, Dept. of Workforce Services; 777-8229)