PRESS RELEASE
Daily Pacific Builder
Garamendi Addresses Ailing Workers’ Comp System
Economist Issues Gloomy Bay Area Forecast for Next 2 Years
March 19, 2003
Skyrocketing workers’ compensation insurance premium costs, a tightening bond market and the Bay Area’s economic forecast were focal points of the 10th annual Construction Employers’ Association/Santa Clara and San Mateo Counties Building Trades Conference held March 5-6, 2003 at the La Playa Hotel in Carmel, California.
State Insurance Commissioner John Garamendi, a featured speaker at the labor-management conference, solicited support from the Construction Employers’ Association and the building trades representatives to effect legislative and regulatory action to address the serious crisis that exists in the $15 billion California workers’ compensation system. He outlined his plan to bring down the “cost drivers” for workers’ compensation to reduce premium costs for employers. Garamendi advocated the need for legislation to control medical costs, create uniformity and certainty in permanent disability benefits, reduce litigation and establish standards of conduct for claims adjusters and appeals judges.
Garamendi also discussed his plan to correct the serious financial problems for State Fund, California’s largest provider of worker’s compensation insurance, insuring over half of all employers in the state. He indicated that among the steps State Fund’s management intends to take to strengthen the ailing Fund are rate increases that would be effective July 1 and the reduction of broker commissions.
Dr. Mario Belloti, an economics professor with Santa Clara University, provided participants with economic forecasts for both national and local economies. Belloti projected that the American economy will begin to show moderate signs of growth during the next year; however, growth in the Silicon Valley and Bay Area will lag behind the national economy for as long as a year and a half. Belloti explained that the San Francisco Bay Area economy historically takes longer to recover from a recession than the national economy, but once it does, its growth surpasses the national average.
Jim Untiedt of Allied North America, another featured conference speaker, provided an analysis of the changing surety and insurance markets and their impact on the construction industry. He said that today’s tightening surety industry is a result of greater financial scrutiny by underwriters, restrictions in bond size, restrictions in accumulated bond exposure, and capacity issues.
The event was jointly chaired by Charles Toeniskoetter, CEO of Toeniskoetter & Breeding, Inc., San Jose; Neil Struthers, CEO of the Santa Clara & San Benito Counties Building & Construction Trades Council; and Bill Nack, Business Manager/Executive Officer of the Building and Construction Trades Council of San Mateo County.
Approximately 65 industry leaders representing general contractors, subcontractors and union construction crafts attended the conference.
 |
| Event chairmen from left: Jim Losch, Hallmark Construction,
Inc.; Bill Nack, San Mateo Building Trades Council; Neil Struthers, Santa
Clara Building Trades Council; Chuck Toeniskoetter, Toeniskoetter & Breeding,
Inc.; and Michael Walton, CEA.
|
