Senate committee hears first testimony on bill to abolish Workers' Compensation Appeals Commission

Senate Bill 251, which would repeal the Workers' Compensation Appeals Commission and return jurisdiction over workers' compensation appeals to the superior court, received its first hearing in the Senate Judiciary Committee on Feb. 23.

Sponsor Senator Wilkowsky told the committee the appeals commission has not delivered the expected time or cost savings since its creation in 2005 and said many commission decisions continue to be appealed to the Alaska Supreme Court. "It has cost the state money," the senator said, citing appeal rates and a projected fiscal figure during his remarks. He framed repeal as a fiscally necessary step amid a large state deficit.

David Dunsmore, staff to the sponsor, told the committee the workload of the commission has fallen dramatically and said the bill would save about $518,300 per year. Dunsmore said the court system's fiscal note was conservative and that the commission heard just eight new cases last year; he said returning appeals to the superior court should preserve parties' rights while reducing administrative overhead.

Committee members asked why the bill sends appeals directly to superior court rather than routing them to the Office of Administrative Hearings (OAH). Dunsmore explained that OAH decisions are administrative determinations that may then be appealed to superior court, whereas the appeals commission is a quasi-judicial executive-branch panel created to hear workers' compensation appeals.

Public testimony came from Jeffrey Holloway, a workers' compensation attorney of 26 years, who testified in support of repeal. Holloway said the prior system of appealing to superior court "was fine," argued the appeals commission's resources could be better allocated to the workers' compensation board (which he described as underfunded) and recommended greater use of mediation and alternative dispute resolution to reduce appeals.

The committee closed public testimony, took no vote and set the bill aside for now. The record at the hearing includes multiple numerical claims'1 including the sponsor's statements about appeal rates and a projected fiscal figure and the staff fiscal estimate of roughly $518,300 in savings'1 that reporters or fiscal staff may want to verify against agency fiscal notes and budget documents.