SCS CSHB 378(FIN): "An Act relating to the establishment of, assessment of, collection of, and accounting for service fees for state administration of workers' compensation and workers' safety programs; establishing civil penalties and sanctions for late payment or nonpayment of the service fee; and providing for an effective date."
00SENATE CS FOR CS FOR HOUSE BILL NO. 378(FIN) 01 "An Act relating to the establishment of, assessment of, collection of, and 02 accounting for service fees for state administration of workers' compensation and 03 workers' safety programs; establishing civil penalties and sanctions for late 04 payment or nonpayment of the service fee; and providing for an effective date." 05 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 06 * Section 1. AS 21.09.150(a) is amended to read: 07 (a) The director may suspend or revoke an insurer's certificate of authority if, 08 after a hearing, the director finds that the insurer has violated a lawful order of the 09 director or a provision of this title other than those for which suspension or revocation 10 is mandatory or has not paid any annual service fees assessed under AS 23.05.067 . 11 * Sec. 2. AS 23.05 is amended by adding a new section to read: 12 Sec. 23.05.067. Service fees for administration of workers' safety and 13 compensation programs. (a) Each insurer providing workers' compensation 14 insurance and each employer who is self-insured or uninsured for purposes of
01 AS 23.30 in this state shall pay an annual service fee to the department for the 02 administrative expenses of the state for workers' safety programs under AS 18.60 and 03 the workers' compensation program under AS 23.30 as follows: 04 (1) for each employer, 05 (A) except as provided in (b) of this section, the service fee 06 shall be paid each year to the department at the time that the annual report is 07 required to be filed under AS 23.30.155(m) or (n); and 08 (B) the service fee is 2.9 percent of all payments reported to the 09 Alaska Workers' Compensation Board under AS 23.30.155(m) or (n), except 10 second injury fund payments; and 11 (2) for each insurer, the director of the division of insurance shall, 12 under (e) of this section, deposit from funds received from the insurer under 13 AS 21.09.210 a service fee of 1.82 percent of the direct premium income for workers' 14 compensation insurance received by the insurer during the year ending on the 15 preceding December 31, subject to all the deductions specified in AS 21.09.210(b). 16 (b) An employer who is required to pay an annual service fee under (a) of this 17 section may elect to pay in yearly increments over a five-year period the portion of the 18 service fee due under (a) of this section as a result of a settlement of over $50,000 19 approved under AS 23.30.012. An election under this subsection must be made in the 20 first year that a service fee would be due as a result of the settlement. The employer 21 shall notify the department of an election under this subsection. If an election is made, 22 payment of each yearly increment that is due shall be made at the time the annual 23 report is required to be filed under AS 23.30.155(m) or (n). 24 (c) Payment of the annual service fee under this section shall be made in the 25 manner and by the method specified by the department. 26 (d) If an employer who is required to pay an annual service fee under this 27 section does not pay the required amount of the service fee by the time specified in 28 this section, the employer shall pay a civil penalty of $100 for the first day the 29 payment is late and $10 a day for each additional day the payment is late. The civil 30 penalty under this subsection is in addition to any civil penalties imposed for late 31 filings of reports under AS 23.30.155(m).
01 (e) Annual service fees and civil penalties collected under this section shall be 02 deposited in the workers' safety and compensation administration account in the state 03 treasury. Under AS 37.05.146(b), the service fees and civil penalties shall be 04 accounted for separately, and appropriations from the account are not made from the 05 unrestricted general fund. The legislature may appropriate money from the account 06 for expenditures by the department for necessary costs incurred by the department in 07 the administration of the workers' safety programs contained in AS 18.60 and of the 08 Alaska Workers' Compensation Act contained in AS 23.30. Nothing in this subsection 09 creates a dedicated fund or dedicates the money in the account for a specific purpose. 10 Money deposited in the account does not lapse at the end of a fiscal year unless 11 otherwise provided by an appropriation. 12 (f) The department may adopt regulations to implement and interpret this 13 section. 14 (g) Notwithstanding AS 21.76.020(a), a joint insurance arrangement established 15 under AS 21.76 is subject to the provisions of this section and regulations adopted 16 under this section and, if self-insured, is subject to the annual service fee on behalf of 17 its members. 18 (h) The department shall grant a credit against the service fee imposed under 19 (a)(1) of this section to an employer if (1) the employer applies to the department for 20 the credit on a form prescribed by the department; (2) the employer provides proof that 21 the employer has paid a premium tax imposed under AS 21.09.210 on an insurance 22 policy; and (3) workers' compensation claims have been paid under the insurance 23 policy described in (2) of this subsection and the claims are subject to the service fee 24 imposed under (a) of this section. The credit allowed under this subsection is equal 25 to the amount of the premium tax paid by the employer under the insurance policy, 26 may not exceed the service fee imposed under (a) of this section, and only applies to 27 premium taxes paid by the employer on or after January 1, 2000. 28 (i) In this section, "insurer" has the meaning given in AS 21.90.900. 29 * Sec. 3. AS 23.30.015(e) is amended to read: 30 (e) An amount recovered by the employer under an assignment, whether by 31 action or compromise, shall be distributed as follows:
01 (1) the employer shall retain an amount equal to 02 (A) the expenses incurred by the employer with [IN] respect to 03 the action or compromise, including a reasonable attorney fee determined by 04 the board; 05 (B) the cost of all benefits actually furnished by the employer 06 under this chapter; 07 (C) all amounts paid as compensation and second-injury fund 08 payments , and, if the employer is self-insured or uninsured, all service fees 09 paid under AS 23.05.067 ; 10 (D) the present value of all amounts payable later as 11 compensation , [(PRESENT VALUE TO BE] computed from a schedule 12 prepared by the board ; [),] and the present value of the cost of all benefits to 13 be furnished later under AS 23.30.095 [(] as estimated by the board ; [),] the 14 amounts so computed and estimated to be retained by the employer as a trust 15 fund to pay compensation and the cost of benefits as they become due and to 16 pay any finally remaining excess sum to the person entitled to compensation 17 or to the representative; and 18 (2) the employer shall pay any excess to the person entitled to 19 compensation or to the representative of that person. 20 * Sec. 4. AS 23.30.090 is amended to read: 21 Sec. 23.30.090. Self-insurance certificates. If an employer has complied with 22 the provisions of this chapter relating to self-insurance and has paid annual service 23 fees assessed under AS 23.05.067 , the board shall issue the employer a certificate that 24 [WHICH] shall remain in force for a period fixed by the board. The board may, upon 25 at least 10 days' notice and a hearing, revoke a self-insurance certificate upon 26 satisfactory proof that an employer is no longer entitled to it. After revocation , the 27 board may grant a new certificate to an employer, upon the employer's petition and 28 satisfactory proof of the employer's financial ability as provided in this chapter. An 29 employer authorized as a self-insurer shall provide claims facilities through its own 30 staffed adjusting facilities located within the state, or independent, licensed, resident 31 adjusters with power to effect settlement within the state.
01 * Sec. 5. AS 37.05.146(b)(4) is amended by adding a new subparagraph to read: 02 (X) workers' safety and compensation administration account 03 (AS 23.05.067); 04 * Sec. 6. The uncodified law of the State of Alaska is amended by adding a new section 05 to read: 06 TRANSITION: PHASE-IN OF FEES FOR EMPLOYERS. (a) Notwithstanding the 07 amount of the annual service fee set by AS 23.05.067(a), enacted by sec. 2 of this Act, the 08 annual service fee for employers equals the following percentages of all payments reported 09 to the Alaska Workers' Compensation Board under AS 23.30.155(m) and (n), except second 10 injury payments: 11 (1) for payment due in 2001, 3.6 percent; 12 (2) for payment due in 2002, 3.4 percent; 13 (3) for payment due in 2003, 3.2 percent. 14 (b) Notwithstanding the amount of the annual service fee set by AS 23.05.067(a)(1) 15 and (b), enacted by sec. 2 of this Act, the state, a political subdivision of the state, a joint 16 insurance arrangement authorized under AS 21.76, and other employers who are self-insured 17 under AS 23.30.090 shall instead pay an annual service fee of the following amounts in the 18 following years: 19 (1) for payment due in 2001, 25 percent of the amount calculated for the 20 service fee under AS 23.05.067; 21 (2) for payment due in 2002, 50 percent of the amount calculated for the 22 service fee under AS 23.05.067; 23 (3) for payment due in 2003, 75 percent of the amount calculated for the 24 service fee under AS 23.05.067; and 25 (4) for payment due in 2004 and subsequent years, 100 percent of the amount 26 calculated for the service fee under AS 23.05.067. 27 * Sec. 7. The uncodified law of the State of Alaska is amended by adding a new section 28 to read: 29 TRANSITION: SERVICE FEE FOR INSURERS. Notwithstanding the allocation of 30 the annual service fee imposed under AS 23.05.067(a)(2), enacted by sec. 2 of this Act, the 31 director of the division of insurance shall allocate the annual service fee during the years
01 2000, 2001, and 2002 as follows: 02 (1) for untaxed premium income in 2000, 2.31 percent shall be deposited into 03 the workers' safety and compensation administration account in the state treasury, and .39 04 percent shall be deposited into the unrestricted general fund; 05 (2) for premium income in 2001, 2.17 percent shall be deposited into the 06 workers' safety and compensation administration account in the state treasury, and .53 percent 07 shall be deposited into the unrestricted general fund; and 08 (3) for premium income in 2002, 2.03 percent shall be deposited into the 09 workers' safety and compensation administration account in the state treasury, and .67 percent 10 shall be deposited into the unrestricted general fund. 11 * Sec. 8. The uncodified law of the State of Alaska is amended by adding a new section 12 to read: 13 TRANSITION: REGULATIONS. The director of the division of insurance in the 14 Department of Community and Economic Development, and the Department of Labor and 15 Workforce Development, may proceed to adopt regulations necessary to implement this Act. 16 Regulations to implement a provision of this Act take effect under AS 44.62 (Administrative 17 Procedure Act), but not before the effective date of secs. 1 - 5 of this Act. 18 * Sec. 9. Section 8 of this Act takes effect immediately under AS 01.10.070(c). 19 * Sec. 10. Except as provided in sec. 9 of this Act, this Act takes effect January 1, 2001.