Monday, October 3, 2011

Loan From UEBTF to Create More Bureaucracy

I've whined about this before, but the wheels of government continue to move, sometimes forward, sometimes backward.

California Gov. Jerry Brown on Friday signed AB 436 by Jose Solorio, D-Santa Ana, authorizing a $4.3 million loan from the Uninsured Employers Benefit Trust Fund (UEBTF) to establish a program for monitoring prevailing wages on public works projects.

The UEBTF is an employer-funded account that pays for benefits when employers are uninsured. It is financed through a tax on workers' compensation insurance policies and a separate assessment on self insured entities.

The UEBTF nearly became insolvent in September 2010, because more claims were filed than the Division of Workers' Compensation (DWC)  anticipated. The division was not able to loan money to the trust at that time because a budget had not been approved. As a consequence thousands of claimants were almost left penniless.

DWC documents show assessments for insured employers increased from $22 million in 2010 to $44 million in 2011. Assessments for self-insured employers increased from $3.8 million to $13.5 million over the same period.

Good job government in taking care of it's population ... NOT!

AB 436 establishes a Compliance Monitoring Unit within the Department of Industrial Relations to make sure contractors are complying with prevailing wage requirements on public works projects. The legislation creates the State Public Works Enforcement Fund to pay for the department's monitoring efforts.

Maybe I'm missing something important here because I did not attend the hearings on this bill and don't understand the arguments for the bill, but it seems to me that that last thing we need is another regulatory agency placing additional burden on business while taking money away from a program that plays a very important role in today's economy - especially in today's economy.

Brown signed AB 436 but did not include a signing message with the bill.

Dean Fryer, a spokesperson for the Department of Industrial Relations, told WorkCompCentral in a Sept. 1 story that once funds from bond money come in, the Compliance Monitoring Unit will be self-sufficient and the "loan will be promptly paid back."

We'll see. Past history of government manipulation of public funds does not give me confidence.

No comments:

Post a Comment