BILL ANALYSIS
Senate Appropriations Committee Fiscal Summary
Senator Christine Kehoe, Chair
3 (Cedillo)
Hearing Date: 5/18/2009 Amended: As Introduced
Consultant: Bob Franzoia Policy Vote: Labor 4-2
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BILL SUMMARY: SB 3 would provide, for injuries occurring on or
after January 1, 2010, for a supplemental job displacement
benefit (SJDBs) in the form of a voucher for up to $6,000 to
cover reeducation and skill enhancement expenses. The SJDB
would expire two years after the day the voucher is furnished to
the employee or five years after the date of injury, whichever
is later. This bill would exempt employers who make an offer of
reemployment or continued employment from providing vouchers.
This bill would require the Administrative Director of the
Division of Workers' Compensation within the Department of
Industrial Relations to adopt regulations implementing the
program.
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Fiscal Impact (in thousands)
Major Provisions 2009-10 2010-11 2011-12 Fund
Increased benefit payments Unknown, potentially $335 or
more annually General*
for state employees
Regulations Up to $100 one time General
* In 2005-06, $12 in SJDBs were paid to state employees
In 2006-07, $135 in SJDBs were paid to state employees
In 2007-08, an estimated $335 in SJDBs were paid to state
employees
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STAFF COMMENTS: This bill meets the criteria for referral to the
Suspense File.
On 1/1/2004, employees became eligible for SJDBs. The
regulations for SJDBs were finalized 6/2005 and became effective
8/2005. The current SJDB schedule would apply only to injuries
that occurred before January 1, 2010 and would be replaced by a
single SJDB voucher amount.
The state paid approximately $10,600 in SJDBs in 2004-05 and
$12,200 in 2005-06. In 2006-07, payments increased to $135,341.
Generally, from the time of injury there is a year of
rehabilitation and then a medical determination of the percent
of disability. Based on preliminary 2007-08 information on
SJDBs, it appears state payments are increasing. How the amount
paid in SJDBs to state employees would change as a result of
this bill, which provides a lower maximum and eliminates the
nexus between percentage of permanent partial disability and
amount of SJDB, is unknown at this time.
As a legally uninsured entity, the state would need to
appropriate General Fund moneys to pay for any increase in
benefits. This scenario would apply to other governmental
entities, including cities and counties. The state's 2007-08
workers' compensation costs were $460 million, a $5.8 million
decrease from 2006-07.