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COMMITTEE REPORT
April 23, 2003
S. 372
S. Printed 4/23/03--S.
Read the first time February 18, 2003.
To whom was referred a Bill (S. 372) to amend Section 42-7-10 of the 1976 code, relating to the State Accident Fund, to provide that the State Treasurer shall invest the trust fund in the same manner, etc., respectfully
That they have duly and carefully considered the same and recommend that the same do pass with amendment:
Amend the bill, as and if amended, page 2, beginning on line 6, in Section 42-7-10(B), as contained in SECTION 1, by striking Section 42-7-10(B) in its entirety and inserting therein the following:
/ (B) One-third of the investment income generated in Fiscal Year 1990-91 and two-thirds of the income generated in Fiscal Year 1991-92 must be credited to the state fund in those years respectively. Thereafter all All such income must be credited to the state fund except that the State Treasurer may charge the state fund, and credit to the general fund, the customary investment management fee. Unless the balance of the state fund should exceed the actuarial estimate of ultimate claim liability in three consecutive years, no funds of the state fund may be applied in any state appropriations bill for any purpose other than for funding workers' compensation claim obligations and operating expenses as provided in Section 42-7-90." /
Renumber sections to conform.
Amend title to conform.
LARRY A. MARTIN for Committee.
EXPLANATION OF IMPACT:
State Accident Fund
The State Accident Fund is operated from the revenue generated by premiums paid to the fund by state agencies to cover workers' compensation claims for state employees. Those agencies may pay the fund from the General Fund of the State and/or other funds. Enactment of this bill would have no direct impact on the General Fund of the State or federal and/or other funds. Enactment could indirectly impact agency premiums based on investment performance.
Treasurer's Office
The Treasurer's Office indicates there will be no fiscal impact on the General Fund of the State or on federal and/or other funds.
LOCAL GOVERNMENT IMPACT:
Local governments, which participate in the State Accident Fund, would be impacted in the same manner as state agencies.
SPECIAL NOTES:
The Board of Economic Advisors is the appropriate agency to address any revenue impact of this legislation.
Approved By:
Don Addy
Office of State Budget
REVENUE IMPACT 1/
This bill would have no impact on general fund revenue in FY2004.
Explanation
This bill would implement that the State Treasurer shall invest the State Accident Fund in the same manner and in the same type and grade of securities as is the accumulated account of the South Carolina Retirement System. The bill also does not allow any funds of the State Accident Fund to be applied in any state appropriations bill for any purpose other than for funding workers' compensation claim obligations and operating expenses unless the balance of the State Accident Fund should exceed the actuarial estimate of ultimate claim liability in three consecutive years. This bill therefore would have no impact on general fund revenue in FY2004.
Approved By:
William C. Gillespie
Board of Economic Advisors
1/ This statement meets the requirement of Section 2-7-71 for a state revenue impact, Section 2-7-76 for a local revenue impact, and Section 6-1-85(B) for an estimate of the shift in local property tax incidence.
TO AMEND SECTION 42-7-10 OF THE 1976 CODE, RELATING TO THE STATE ACCIDENT FUND, TO PROVIDE THAT THE STATE TREASURER SHALL INVEST THE TRUST FUND IN THE SAME MANNER AND IN THE SAME TYPE AND GRADE OF SECURITIES AS IS THE ACCUMULATED ACCOUNT OF THE SOUTH CAROLINA RETIREMENT SYSTEM; TO AMEND SECTION 42-7-50 OF THE 1976 CODE, RELATING PARTICIPATION IN THE STATE ACCIDENT FUND, TO PROVIDE THAT AN APPLICANT FOR COVERAGE UNDER THIS SECTION MUST PRESENT ITS RECENT LOSS HISTORY, UPON WHICH ITS PREMIUM CHARGES MUST BE BASED, AND THAT THE STATE ACCIDENT FUND MAY DENY OR REFUSE TO RENEW COVERAGE UNDER CERTAIN CIRCUMSTANCES; AND TO ADD SECTION 42-7-85 TO PROVIDE THAT EMPLOYERS INSURED UNDER THIS ARTICLE MUST MAKE REASONABLE EFFORTS TO PROVIDE OR ARRANGE FOR LIMITED DUTY WORK.
Be it enacted by the General Assembly of the State of South Carolina:
SECTION 1. Section 42-7-10 of the 1976 Code is amended to read:
"Section 42-7-10. (A) There is established as a separate agency of state government a separate fund to be known as the State Accident Fund, hereinafter referred to as the `fund' or `state fund' in this article. This fund consists of annual premium charges, recoveries from the Second Injury Fund, recoveries by subrogation and, subject to subsection (B) of this section, of all income or revenue derived from investing these funds. Receipts for the credit of the fund and expenditures from the fund must be handled in the manner provided by law governing all other state funds except that the State Treasurer shall invest the state fund in the same manner and in the same type and grade of securities as is the accumulated account of the South Carolina Retirement System.
(B) One-third of the investment income generated in Fiscal Year 1990-91 and two-thirds of the income generated in Fiscal Year 1991-92 must be credited to the state fund in those years respectively. Thereafter all All such income must be credited to the state fund except that the State Treasurer may charge the state fund, and credit to the general fund, the customary investment management fee. Unless the balance of the state fund should exceed the actuarial estimate of ultimate claim liability in three consecutive years, no funds of the state fund may be applied in any state appropriations bill for any purpose other than for funding workers' compensation claim obligations and operating expenses as provided in Section 42-7-90."
SECTION 2. Section 42-7-50 of the 1976 Code is amended to read:
"Section 42-7-50. Any county or municipality in the State or any agency or institution thereof shall have the option of participating under the provisions of this article but no county, municipality, agency, or institution thereof shall be covered by the workers' compensation insurance provided in this article until payment of the annual charge provided in this Title title shall have been made to the fund, nor shall any county, municipality, agency, or institution thereof be covered by this insurance after the lapse of the period for which the annual charge has been paid. The director shall notify each county, municipality, agency, or institution thereof at least thirty days before the expiration date of its coverage in order that the county, municipality, agency, or institution may keep its insurance in force continuously. An applicant for coverage under this article must present its recent loss history, upon which its premium charges must be based. The state fund may, upon proper notice, cancel or refuse to renew coverage under this article if the applicant or insured refuses to provide loss history information or to cooperate with state fund recommendations regarding safety and health, drug free workplace, loss prevention, or return-to-work programs."
SECTION 3. Chapter 7, Title 42 of the 1976 Code is amended by adding:
"Section 42-7-85. Employers insured under this article must make reasonable efforts to provide or arrange for limited duty work consistent with limitations specified by the treating physician. When such limited work cannot be provided within a worker's regular workplace but can be provided by another public funded entity, the employer may arrange for such limited duty work and assign its employee to such public funded work, whether or not such other agency will itself pay for such limited work. A worker so assigned shall, while performing the assigned tasks, be deemed for all purposes to be an employee of and performing official duties for the assigning employer during such arrangement and such arrangements shall constitute providing limited duty for purposes of Section 42-9-260(B)(5)."
SECTION 4. This act takes effect upon approval by the Governor.
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