Gov. Mike DeWine and Stephanie McCloud, Ohio Bureau of Workers' Compensation (BWC) administrator and CEO, are pushing for boost for businesses.
McCloud will pitch the proposal to the BWC board of directors today. A vote could follow at the June 28 meeting. If approved, checks would be issued to employers in September.
“This is great news for Ohio,” DeWine said. “This money will help Ohio employers expand their businesses, create jobs and invest in capital improvements. Ohio’s economy is strong and this proposal reinforces our goal of creating more jobs in the state.”
This is good news for the local economy, especially the county’s small business owners, Huron County Economic Development executive director Carol Knapp said. She recently attended the Ohio Economic Development Association (OEDA) seminar, where DeWine discussed some of the small business funding plans he was considering. If it passed, local small business owners could see the benefits in the form of a check this summer.
Knapp said no specific criteria has been outlined yet for the potential programs.
“It’s so exciting that this administration is looking at economic development, realizing that there is a need for additional assistance,” she said. “One thing we heard last week at OEDA was that they have a sweet spot, if you will, for small businesses. That’s great because so often big business opportunities are greater than small business opportunities.”
Main Street Café owner Amy Fulton said the proposal would be a great benefit to the local mom ‘n’ pop owners such as herself.
“If it would work out and could apply for certain things, that would be great,” she said. “It’d be great if we would be able to use it to help do some upgrades and renovations, that would be helpful.”
The first thing on Fulton’s wishlist of changes would be to add parking. However, she admitted she’s not sure how it would be facilitated through the proposal.
“I believe our business would do a lot better if we could increase parking,” she said. “There are times when customers cannot park uptown because things are going on and there aren’t any spaces available.”
Knapp said she’s “so happy” to hear of the governor’s proposal because many of Huron County’s employers are small businesses, according to the state’s definition. A small business is one which employs fewer than 500 people.
In fact, Knapp said local economy is “doing well.” The business leader said while the county hasn’t seen a lot of new business coming in necessarily, mom ‘n’ pop shops are making a strong comeback.
“An unbelievable number of small businesses are starting up,” she said, adding that it makes her week to help a small business come up with a business plan that gets excited. “It’s so exciting. So many big businesses started off just being two-man shops or small town businesses.
“So it’s very exciting to me that this administration is aware of those needs,” Knapp added. “I’m looking forward to how we can work with our Huron County businesses to make sure they are aware of these opportunities once the criteria is announced and to assist them in any way we can.”
In addition to money for private businesses, the $1.5 billion proposal also includes money for public employers, including about $114 million for local governments and nearly $50 million for public schools.
The money would be Ohio’s fifth investment return to private and public employers of at least $1 billion since 2013 and the sixth overall during that time.
“Our investment portfolio is strong, our injury claims are falling and our safety and wellness initiatives are making a difference,” McCloud said. “All of these actions mean big savings for employers and we’re delighted to share this success with them.”
State law requires businesses to carry workers’ compensation coverage to protect employees who suffer injuries or illnesses on the job. The employers’ premiums are invested to grow the fund that supports injured worker claims. When investment returns are strong, the agency shares a portion of the investments with qualifying employers in the form of a dividend.
The $1.5 billion dividend equals 88 percent of the premiums employers paid for the policy year that ended June 30, 2018 (or calendar year 2017 for public employers). BWC insures roughly 242,000 public and private employers.
DeWine and administrator McCloud announced their proposal Monday at Dynalab Electronic Manufacturing Services in Reynoldsburg.
“I really appreciate this news today and what Governor DeWine and BWC are doing to help businesses succeed,” said Dynalab president Gary James. “To compete in the global market, we must be on the cutting edge at all times and that takes resources. The check we’ll receive in late summer will definitely help.”
Knapp agreed, adding the boost may be just what some local businesses need to take their success to the next level.
“Sometimes a business just needs a little bit of an incentive to proceed with a plan they are already considering,” she said. “This would help to spur additional expansions, create new jobs and help businesses grow.”
McCloud will present the proposal to the BWC board of directors today during board committee meetings. A vote would follow at the June 28 meeting. If approved, checks would be issued to employers in September.
BWC earned $1.3 billion in net investment income in 2018, a net return of 5.1 percent on assets of $26.9 billion.
The proposal continues a trend of lowering workers’ comp costs for Ohio’s private and public employers. BWC has repeatedly lowered premium rates in recent years, including a 12-percent cut for public employers that took effect in January and a 20-percent cut for private employers that begins July 1.
The agency disbursed $1 billion or more to employers in 2013, 2014, 2017 and 2018. It also distributed $15 million in 2016 for public employers. In total, BWC has saved employers nearly $10 billion in workers’ comp costs through dividends, credits, rate reductions and greater efficiencies since 2011.