State Accident Fund Seeks $691,401 Increase to Cover Personnel and IT Overhaul

Erin Farthing, director of the South Carolina State Accident Fund, told the Senate Finance Transportation Regulatory Subcommittee that the fund is requesting an authorization increase of $691,401 for the coming year, with roughly half the amount earmarked for personnel and employer contributions and about $328,000 for ongoing IT work to replace a claims system that dates to the mid-1990s.

"We provide workers' compensation coverage for all the state agencies and to other governmental entities around the state," Farthing said, noting the agency does not draw on the state general fund. She added that the Uninsured Employers Fund within the agency receives money from the Department of Insurance and the Workers' Compensation Commission.

Farthing said the personnel portion of the request responds in part to classification and pay changes implemented last year and to address some salary inequities within the agency. "Some of that did contribute to a little bit of inequity around the agency as far as salaries are concerned, so there is a need to kind of adjust that a little bit in the year to come," she said.

A senator pressed Farthing about reports from other agencies that premium bills had risen sharply. Farthing acknowledged increases tied to higher pay and to agencies' claims histories but said she would not agree that premiums have gone "through the roof," and clarified the State Accident Fund handles workers' compensation (a no-fault system) while tort claims and lawsuits are handled by the insurance reserve fund.

Farthing also said the agency is concluding a multiyear claims-system replacement and wanted to ensure funds remain available for maintenance and related systems. "Our current system goes back to, I think, the mid-90s. It's been a major, major project, and we are coming to the tail end of it," she said.

The subcommittee did not take any formal votes during the presentation. Farthing invited questions and provided Abby Sellers, the fund's director of finance, as a resource for more complex financial questions.

The subcommittee moved on after questioning; the director's request and the fund's other-funds status will be considered during later budget deliberations.