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General Services reports ~$402M risk‑management deficit; lawmakers flag rising civil‑rights payouts
Summary
GSD Secretary Anna Silva told the committee the department is seeing a large projected deficit in risk management (roughly $402 million) and rising claims frequency, with civil‑rights claims increasing since 2021; GSD described steps including monthly agency claim reviews and a new mitigation bureau.
Anna Silva, cabinet secretary for the General Services Department, told the Legislative Finance Committee that risk management is GSD’s most pressing fiscal exposure and presented data showing rising claims and a projected deficit of roughly $402 million.
Silva walked members through a risk‑management overview that breaks claim exposure into workers’ compensation, public liability, property and other categories, and showed a ten‑year trend of increasing claim frequency across multiple coverage types. "This is just the number of claims to show how the claims have increased over the years in a 10‑year period," she said when asked to clarify the chart.
Civil‑rights and agency drivers: Committee members zeroed in on civil‑rights payouts, which have increased materially since legislation enacted in 2021. Silva confirmed that CYFD is among the agencies with the highest payouts and said GSD now meets monthly with CYFD to review incoming claims and mitigation strategies. "We do meet with them monthly," Silva said, adding GSD has instituted agency meetings and a new Office of Mitigation, Prevention and Resolution to reduce future losses.
Premiums and deficits: Silva said GSD is raising agency premiums this year after actuarial review but warned that unknown and high‑value claims — including litigation and civil‑rights judgments — continue to create volatility. She told the committee that some deficits are triggered by timing and large one‑off settlements and that the department is reserving based on recent five‑year experience and actuarial advice.
Why it matters: a long‑term upward trend in claims and a large projected deficit place pressure on the state budget. Committee members urged GSD to produce per‑year dollar figures by claim type, more detail on CYFD exposures and options for statutory or policy changes to slow growth in civil‑rights claims.
Next steps: GSD agreed to provide more detailed cost breakdowns, historical dollar amounts tied to claim categories, and further information on mitigation activities and expected effects on future premiums. No immediate policy changes were enacted during the session.
