Ohio Governor Mike DeWine and Ohio Bureau of Workers’ Compensation (BWC) Administrator/CEO Stephanie McCloud have proposed giving $1.5 billion to Ohio employers this year following strong returns on the agency’s investments.
“This is great news for Ohio,” said Governor DeWine.
“This money will help Ohio employers expand their businesses, create jobs, and invest in capital improvements. Ohio’s economy is strong, and this proposal reinforces our goal of creating more jobs in the state.”
In addition to money for private businesses, the $1.5 billion proposal also includes money for public employers, including approximately $114 million for local governments and around $50 million for public schools.
The money would be Ohio’s fifth investment return to private and public employers of at least $1 billion since 2013 and sixth overall during that time.
“Our investment portfolio is strong, our injury claims are falling, and our safety and wellness initiatives are making a difference,” said Administrator McCloud.
“All of these actions mean big savings for employers, and we’re delighted to share this success with them.”
State law requires businesses to carry workers’ compensation coverage to protect workers who suffer injuries or illnesses on the job. The employers’ premiums are invested to grow the fund that supports injured worker claims. When investment returns are strong, the agency shares a portion of the investments with qualifying employers in the form of a dividend.
The $1.5 billion dividend equals 88 percent of the premiums employers paid for the policy year that ended June 30, 2018 (calendar year 2017 for public employers). BWC insures roughly 242,000 public and private employers.
Governor DeWine and Administrator McCloud announced their proposal this morning at Dynalab Electronic Manufacturing Services in Reynoldsburg.
“I really appreciate this news today and what Governor DeWine and BWC are doing to help businesses succeed,” said Dynalab, Inc. President Gary James. “To compete in the global market, we must be on the cutting edge at all times and that takes resources. The check we’ll receive in late summer will definitely help.”
McCloud will present the proposal to the BWC Board of Directors on Wednesday during board committee meetings. A vote would follow at the board’s June 28 meeting. If approved, checks would be issued to employers in September.
BWC earned $1.3 billion in net investment income in 2018, a net return of 5.1 percent on assets of $26.9 billion.
The proposal continues a trend of lowering workers’ comp costs for Ohio’s private and public employers. BWC has repeatedly lowered premium rates in recent years, including a 12 percent cut for public employers that took effect in January and a 20 percent cut for private employers that began July 1. The agency disbursed $1 billion or more to employers in 2013, 2014, 2017 and 2018. It also distributed $15 million in 2016 for public employers.
In total, BWC has saved employers nearly $10 billion in workers’ comp costs through dividends, credits, rate reductions and greater efficiencies since 2011.