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   Cost Allocation Tuesday, July 25, 2017   
LAWCX 2016-2017 BUDGET

 

The 2016-2017 LAWCX Budget [click to download the budget] was adopted by the Board at its June 7, 2016, meeting. The major components of the member deposit calculations are outlined below.

 

SELF-FUNDED RATES FOR THE POOLED LAYERS OF COVERAGE

The Board approved funding at the 80% confidence level, discounted at 3% interest at its November 4th meeting.  This is the same level as the prior year.  Funding rates in this layer increased by 12% for both safety and non-safety classifications. 

 

EXPERIENCE MODIFIER

Compared to the prior year, 2015/16 experience modification factors (ex-mods) increased for 19 members, with the largest increase of 7.6%, and 15 ex-mods decreased, with the largest decrease of 5.0%. 

 

PAYROLL 

2014/15 actual payroll was used to calculate contributions.

 

$2M to $5M SELF-INSURED LAYER

The layer from $2 million to $5 million was funded by members from 2005/06 to 2009/10, at which time the assets reached a $5 million target set by the Board.  Since claim obligations are charged to this pool annually (both for reported losses and incurred but not reported liabilities), and the only additions to assets are through interest earnings, the net assets have dropped below the expected confidence level.  The Board approved funding this layer at the expected confidence level, discounted at 3%, for the 2015/16 fiscal year. Funding for this layer will be reviewed annually. 

  

EXCESS INSURANCE RATE 

CSAC EIA’s excess insurance cost is $1.692 million, a 9.59% increase over the prior year.  The increase was driven by a combination of increases in LAWCX’s estimated payroll, and an increase in the CSAC EIA rate.   

 

ADMINISTRATIVE EXPENSES

Administrative expenses were budgeted based on existing contracts or planned activity. 

 

 

Please direct questions or comments to Jim Elledge at jelledge@bickmore.net or (800) 541-4591 ext. 1124.

 

 

  
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