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State plan just plain wrong

June 13, 2003

How volatile are the talks aimed at creating a new West Virginia workers' comp system? Gov. Bob Wise says it's as if everyone sitting at the negotiating table had a hand grenade and could destroy the deal at any minute. The only thing that may restrain them is the knowledge that, in this case, a bad deal is better than no deal at all.

With the system facing possible bankruptcy by 2006, the legislature is looking for a fix this week in a special session.

The clash of interests is a classic political divide, with Democrats arguing that the proposal asks injured workers to give up too much, while Republicans declare that the proposed solutions burden businesses too heavily. Add to that both sides' desire to avoid raising taxes and you've got one tough dilemma.

The latest proposal would allow the legislation to reach its $225 million target by taking another $20 million from the state's allegedly overfunded black-lung fund. Another $10 million would come from a federal grant sent to compensate the state for losses in tax revenue that will result from the Bush administration's tax cuts.

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But the final $15 million would come from an unexpected premium charge on businesses. The Associated Press reports that because the state incorrectly calculated something called the "claims management incentive assessment," many businesses got bills for premiums that exceeded the 15 percent increase promised by Wise.

Incredibly, lawmakers want to cut the CMIA charge in half this year, then bill the other half to business over the next three years.

In essence, the state has made a mistake in its favor, but now proposes not to correct it, but to keep the revenue it wrongly billed businesses for.

That's not acceptable. What would the state's reaction be if it mistakenly sent a citizen a tax refund twice as large as it should be? We're sure it wouldn't be to allow the taxpayers to profit from its mistake, which is just what the state is proposing to do in this case.

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