Chautauqua County is considering making a change with its municipal workers’ compensation plan that could save the county hundreds of thousands of dollars, but also cost some municipalities more money.
Discussions took place last week at a meeting of the County Legislature’s Administrative Services and Audit and Oversight Committee regarding the county’s self-insurance scheme.
Chief Financial Officer Kitty Crow noted that the county administers a self-funded municipal workers’ compensation plan.
“Currently, 40% of plan costs are allocated based on property valuation and 60% are allocated based on claims experience from the previous five years,” she says. ‘Considering that a standard workers’ compensation plan would not take property valuation into consideration, County Chief Financial Officer Kitty Crow, right, speaks at the Audit and Finance Committee meeting control of the Legislative Assembly.
When setting bonuses, the proposed change in local law would replace the assessment-based allowance with a salary-based allowance. No change to the 60% experience allowance is proposed. »
Crow proposed a local law plan under which allocated costs would be 40% based on salaries and 60% based on experience. Based on trends, this change is expected to reduce the total cost of the 2023 plan by nearly $700,000.
She thinks it makes more sense to use wages instead of property valuation. “It’s really more relevant when evaluating the costs of a scheme such as workers’ compensation insurance,” she says.
Crow did an analysis of the impact this would have on municipalities. There were four municipalities that would have a “spectacular” impact.
These were the town of Chautauqua, the village of Westfield, and the towns of Dunkirk and Jamestown.
Crow explained that the town of Chautauqua, because its land values are so high around the lake and has a low labor force, would see a significant decline.
Crow noted that Westfield would get a raise. She noted that the village has a police department and paid utility workers. “Their salaries are a bit higher as a percentage of the total compared to their valuation,” she says.
The same goes for Dunkirk and Jamestown. “Both cities would also see an increase under the new formula because their wages as a percentage of the total are larger,” she says.
Crow provided a detailed analysis of each municipality’s individual cost if the change had gone into effect in 2022. The analysis shows the town of Chautauqua would save nearly $110,000. Westfield would pay $14,090 more. Dunkirk would pay around $115,000 more. Jamestown would pay $330,400 more.
Crow noted that benefits paid to an individual are based, in part, on lost wages, which is why she is pushing for change. “Appraisal is never a factor when determining the amounts paid on an individual’s claim,” she says.
The local law contains a section stating that a municipality that sees a large increase in its annual share, that municipality would allow it to make installment payments. Crow said it was because they wanted to help municipalities like Jamestown and Dunkirk which are facing a big increase.
Lawmaker Bob Scudder, R-Fredonia, said he supports the change because it is similar to the private sector. “That’s what I know best, offering another percentage of salary other than wages and experience to pay my workers’ compensation for the companies I’ve owned. So I really appreciate that,” he said.
Audit and control supported the proposal to change local legislation. The Administrative Services Committee chose not to vote. The local law is now submitted to the entire legislature for final approval. If approved, it will come into force in 2023.