Dear Friends and Neighbors,
The regular legislative session ended April 22, two days before scheduled adjournment, but not because state lawmakers finished their work early. In fact, the opposite is true. The Legislature was unable to pass the operating and capital budgets and a 30-day special session was called by the governor on April 26. This is the third special session in the last two years, and the 12th since 2000.
It appears House and Senate budget writers have grown more distant on a compromise this week. At one point earlier in the special session it looked as if both sides were moving closer together, but this assessment has changed. Three major issues stand in the way of the operating and capital budgets moving forward:
- workers' compensation insurance reform (Senate Bill 5566 and House Bill 2109);
- the debt reduction measure (Senate Joint Resolution 8215); and
- teacher salaries being cut by 3 percent.
We, as Republicans, are standing up against a status quo budget and asking for real, lasting reforms in state government. I have been working on legislation since the legislative session started to eliminate the state printer. It has received strong support in the Senate, but working across the aisle in the House has proved more challenging. I'm hopeful the concept will be a part of the final budget solution, but it will be close.
There are a lot of moving part in this special session and I will do my best to apprise you of what's happening. In the meantime, I welcome you to contact me if you have any questions or ideas to pass along.
Please consider reading my workers' compensation opinion piece below.
It is an honor to serve you.
Here is an op-ed I wrote recently on the issue of workers' compensation reform …
Workers' compensation reform is needed now
As my fellow legislators and I enter our third week of an unnecessary special session, at a cost of up to $16,000 per day, it has become apparent that workers' compensation reform is the number one hindrance to the Legislature passing the operating and capital budgets and finishing its work.
This week, we received news that new unemployment applications hit an eight-month high. At a time when we must get Washington working again, workers' compensation continues to be a barrier to private-sector job growth in our state.
Workers' compensation reform is needed now.
Washington has a monopolistic, state-run workers' compensation insurance system. This means there are no private-sector options, as 46 other states offer. Our state also has one of the richest benefit packages in the country.
With these distinctions come costs. Our system is very costly and inefficient, and this hurts employers and workers. As a small-business owner, I can attest to these facts. Since 2001, workers' compensation rates have increased for employers nine times. Rates increased by $117 million in 2010, and by $196 million this year. Our state auditor has said there is a 95 percent our system will become insolvent in the next five years.
This means we have a serious problem, which leaves us with two primary options. We either need to reform our system, or drastically raise rates on our employers.
The latter is unacceptable to me, a majority group of bipartisan legislators in the House and Senate, and the governor. We are trying to ensure workers' compensation reform moves forward in the special session.
Senate Bill 5566, which passed with strong bipartisan support in the Senate during the regular legislative session, would provide a new, flexible option for workers to voluntarily settle claims, and offer a wage subsidy to encourage workers a faster return to work. It would save our system more than $2 billion over the next three years. Unfortunately, the measure did not even receive a hearing in the House.
House Bill 2109 was introduced in the special session and shares similarities with Senate Bill 5566. This legislation, co-sponsored by nine House Democrats and supported by every House Republican, has enough votes to pass and would be supported by the Senate and governor. Unfortunately, it has also not received a hearing in the House.
So, why has this solution not moved forward?
The issue can be boiled down to one question: Should the state allow injured workers to have the option to take voluntary lump-sum settlements instead of pensions? The Senate, a majority of state representatives and governor have said, “Yes.”
However, the speaker of the House has said, “No.” He has joined big labor in thinking that injured workers might make choices they will regret later. The operative word is choice. No one is forcing workers to do anything. It's an option 44 other states offer – states that believe workers will make choices that are best for them and their families.
As long as our workers' compensation system continues to be an outlier, it will experience unsustainable costs that threaten solvency and jobs. The status quo will also result in our state continuing to have an unemployment rate that is higher than the national average. These are unacceptable outcomes for our economy.
Legislators took an important step to improve our state's business climate by addressing problems in the unemployment insurance system. Through bipartisan legislation signed into law, our employers will receive unemployment insurance rate relief this year and have more certainty in the future. The next step must be workers' compensation reform, and it must be taken now.
421 John L. O'Brien Building | P.O. Box 40600 | Olympia, WA 98504-0600
360-786-7922 | Toll-free: (800) 562-6000