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Governor Gary Locke issued the following news release:

August 2, 2000

Locke hands out first of $200 million refund checks to employers

OLYMPIA - Gov. Gary Locke today hand-delivered the first checks to some of the 130,000 employers who will share in a $200 million refund in the state's workers' compensation system.

"We want Washington to be a great place to do business and be affordable," Locke said. "This money is employers' money, and I am happy to be able return it."

Locke today visited employers in Tukwila, Vancouver and Yakima to personally return some of the $200 million refund.

This is the second workers' compensation refund employers have received in two years. The first $200 million refund was issued in January 1999. Since 1998, workers' compensation refunds and premium rate cuts have totaled $469 million.

Employers sharing in the refund are receiving 30.8 percent of premiums they were assessed for the Accident Fund during the fiscal year that ended June 30, 1999. Locke said the checks he was unable to personally deliver are being mailed this week.

The Accident Fund is the largest of several funds that make up the State Fund of the workers' compensation system. The workers' compensation system in Washington is managed by the Department of Labor & Industries and covers about 1.9 million workers.

Accident Fund premiums are paid solely by employers. The premiums provide benefits for workers hurt on the job, such as lost wages and disability benefits.

"The main reason we can issue a dividend is because of good returns on investments," said Gary Moore, director of Labor & Industries.

Moore said Washington's workers' compensation system is financially sound and has enough reserves for expected benefit costs - despite stock market fluctuations and the $200 million refund.

The Washington State Investment Board manages the department's $8.7 billion workers' compensation portfolio. Currently, only about 15 percent of State Fund assets are invested in the stock market. More than 80 percent of the assets are invested in high-quality bonds.

Only employers who do not owe money to Labor & Industries or another state or federal agency will receive the full refund. Employers due less than a $10 refund will receive credit to their accounts.

A 1998 performance audit of the state's workers' compensation system reported that Washington pays higher-than-average benefits to injured workers - in the top 25 percent, at lower-than-average cost for employers - in the bottom 25 percent.

Questions and answers about the dividend


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