The Ohio Bureau of Workers’ Compensation (BWC) wants to return $1.5 billion to Ohio employers this year in the wake of strong returns on the agency’s investments.
The plan includes money for public employers – including more than $114.3 million for local governments and nearly $50 million for public schools – on top of funds for private businesses.
The move comes after the BWC saw strong returns on its investments. This year’s dividend marks the sixth investment return to private and public employers since 2013, officials said.
“This is great news for Ohio,” Gov. Mike DeWine said in a statement. “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.”
Under Ohio law, businesses must carry workers’ compensation coverage to protect workers who suffer injuries or illnesses while on the job. The state agency covers approximately 242,000 public and private employers.
The agency invests employers’ premiums to grow the fund that supports worker claims. When investment returns are high, the agency shares a portion of the investments with qualifying employers in the form of a dividend.
In 2018, BWC earned a net investment income of $1.3 billion, a net return of 5.1 percent on its $26.9 billion in assets, according to a news release. The dividend is 88 percent of the premiums employers paid for the policy year that ended June 30.
The BWC has returned more than $5.7 billion in dividends to the state since 2013.
DeWine joined BWC Administrator/CEO Stephanie McCloud at Dynalab Electronic Manufacturing Services in Reynoldsburg to announce the proposal.
McCloud will present the proposal to the BWC’s Board of Directors during a May 22 board committee meeting. The board could vote on the plan at its June 28 meeting, and, if approved, the agency will issue checks to employers in September.
“Our investment portfolio is strong, our injury claims are falling, and our safety and wellness initiatives are making a difference,” McCloud said in a news release. “All of these actions mean big savings for employers, and we’re delighted to share this success with them.”
The BWC said it has reduced premium rates several times in recent years, including a 12 percent cut for public employers that went into effect in January. Meanwhile, a 20 percent cut for private employers starts on July 1.
According to the BWC, worker claims in Ohio have dropped from 260,000 in 2000 to 85,000 in 2018.
“To compete in the global market, we must be on the cutting edge at all times and that takes resources,” Dynalab President Gary James said in a news release. “The check we’ll receive in late summer will definitely help.”