For years, the regulation-hating Republican boosters at the Building Industry Association of Washington have been loudly bellyaching about government incompetence costing its members money. And

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BIAW Turns Out To Be Right About Government Bureaucrats--And Profitably So

For years, the regulation-hating Republican boosters at the Building Industry Association of Washington have been loudly bellyaching about government incompetence costing its members money. And no agency has come in for more rabid criticism than the Department of Labor & Industries, which enforces worker-safety rules and oversees the insurance program that pays for injured workers.

Now, it appears that the BIAW had a point--sort of. Late today L&I admitted that for almost 15 years the agency has been making an error in the way it manages the insurance program. But it turns out that error has been working in the BIAW's favor.

According to L&I, a glitch in its computer coding resulted in the agency refunding $10 million to $15 million more per year to employers and groups that participate in the so-called Retrospective Rating program for workers' comp insurance. That is, they were getting a bigger refund on their premiums than their actual injured-worker claims would have justified.

It's impossible to say, without knowing many more details, how much the BIAW might have benefited from this overpayment. But the builders' lobby is the biggest participant in the "retro" program and uses the refund money to fund its political machine. The fact that government "incompetence" has, for years now, been helping the BIAW underwrite its war on government is either fitting or ironic, it's hard to know which.

Robert Malooly, who runs the workers' comp program for L&I, says the error was uncovered as part of a general examination of the retro program that was initiated last legislative session. A wayward line of computer code was doubling the recorded cost of injured worker claims in the first quarter of every year--but only for employers NOT in the retro program.

The nature of the error was such that, on the whole, employers with a relatively bad record with worker injuries were charged more and those with a relatively better record were charged less, Moody contends. "If you think about it from a public policy perspective, that's not such a bad thing," he says.

L&I is working with the Attorney General's office to figure out what to do next, if anything. "There's limits to what state agencies can do when we find a clerical error," Malooly says.

 
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