LEGISLATIVE BUDGET BOARD
Austin, Texas
FISCAL NOTE, 77th Regular Session
March 20, 2001
TO: Honorable Kim Brimer, Chair, House Committee on Business
& Industry
FROM: John Keel, Director, Legislative Budget Board
IN RE: HB2612 by Hochberg (Relating to the payment and funding
of workers' compensation benefits for certain claimants
who work part-time or have multiple employment.), As
Introduced
**************************************************************************
* Estimated Two-year Net Impact to General Revenue Related Funds for *
* HB2612, As Introduced: positive impact of $0 through the biennium *
* ending August 31, 2003. *
**************************************************************************
General Revenue-Related Funds, Five-Year Impact:
****************************************************
* Fiscal Year Probable Net Positive/(Negative) *
* Impact to General Revenue Related *
* Funds *
* 2002 $0 *
* 2003 0 *
* 2004 0 *
* 2005 0 *
* 2006 0 *
****************************************************
All Funds, Five-Year Impact:
*****************************************************
* Fiscal Year Probable Savings/(Cost) from *
* Subsequent Injury Trust Fund *
* 0918 *
* 2002 $(382,888) *
* 2003 (382,888) *
* 2004 (382,888) *
* 2005 (382,888) *
* 2006 (382,888) *
*****************************************************
Fiscal Analysis
The bill would amend the Labor Code to clarify the calculation of Average
Weekly Wage (AWW) for injured employees who are employed part-time or by
multiple employers. The bill would require, for those injured employees
out of work due to a compensable injury for 13 weeks or longer, the AWW
be calculated on all wages earned from all employment for the 13th week
and forward. Currently, income benefits are calculated only on the wage
earned from the employer where the injury occurred.
The new calculations would include wages earned from nonsubscribing
employers. The insurance carrier covering the employer where the injury
occurred would be responsible for all income benefits awarded by TWCC.
The bill would allow insurance carriers to apply for and receive
reimbursement annually from the Subsequent Injury Trust Fund for the
amount of income benefits paid to injured workers that were based on
nonsubscriber employment.
The bill would require a TWCC actuary or financial advisor to submit a
biannual report to the Research and Oversight Council on Workers'
Compensation (ROC) on the financial condition and project assets and
liabilities of the Subsequent Injury Trust Fund.
The bill would take effect on September 1, 2001 and apply only to
injuries occurring on or after that date.
Methodology
The Texas Workers' Compensation Commission (TWCC) estimates the bill
would result in additional reimbursements from the Subsequent Injury
Trust Fund (SIF) of $382,888 per year. SIF is funded from insurance
carriers depositing death benefits when no legal beneficiary exists.
Based on a March 1997 Research and Oversight Council on Workers'
Compensation (ROC) report on nonsubscribing employers and census data,
TWCC estimates an additional 272 claims annually on the SIF. According to
TWCC data, the Average Weekly Wage (AWW) in fiscal year 2000 for a
30-hour work week was $205.50. The average number of weeks of benefit
payments was 18.85, which equals 6.85 weeks of recalculated benefits when
subtracting the first 12 weeks of benefits. This results in $1,408 per
claim multiplied by the estimated 272 additional claims for a total
impact on SIF of $382,888 annually.
The State Office of Risk Management estimates no significant fiscal
impact since very few of its claims are based on part-time employment.
Local Government Impact
No significant fiscal implication to units of local government is
anticipated. Local fiscal impact would vary based on the number of
part-time or multiple employment claims.
Source Agencies: 453 Texas Workers' Compensation Commission, 479
State Office of Risk Management
LBB Staff: JK, JO, RT, KM