Committee reviews proposal to fund BOLI via worker-benefit assessment, raises oversight and reserve questions

The Senate Committee on Labor and Business heard detailed testimony on SB 1506 and its dash-1 amendment, which would use the Worker Benefit Fund (WBF) assessment mechanism to create ongoing funding for the Bureau of Labor and Industries (BOLI) operations and increase the prevailing-wage fee cap.

Jessica Genentino Viatoro, deputy commissioner at the Bureau of Labor and Industries, described two main elements in the amendment: (1) using existing worker-benefit infrastructure to create a shared assessment equally split between workers and employers to fund BOLI operations, and (2) raising the prevailing-wage fee cap from $7,500 to $12,500. She said the amendment phases funding in two rounds: a near-term retention of positions temporarily funded in the prior session and a second phase to address longer-term capacity needs costing roughly $5,250,000 per year.

Sean O'Dane, director of the Department of Consumer and Business Services (DCBS), testified that DCBS reviewed the draft and found the concept feasible, provided the draft language explicitly isolates the BOLI expense account and prevents transfers that would reduce injured-worker programs. "Based on the drafts ... the bill would keep the monies collected for BOLI within the WBF assessment separate for BOLI expense purposes," O'Dane said.

Committee members pressed on how rate setting, reserves and shortfalls would be handled. DCBS explained that the director sets the WBF assessment (commonly in September for a January effective date) and that both accounts would have individual reserves; if revenues fall short, programmatic adjustments or rate changes are possible under existing statutory tools. The sponsors said the aim is to provide modest, stable funding to address substantial increases in wage-and-hour and civil-rights claims and to avoid recurring ad-hoc funding requests.