COMMITTEE ON LEGISLATIVE RESEARCH OVERSIGHT DIVISION FISCAL NOTE L.R. No.:0282H.01I Bill No.:HB 365 Subject:Workers Compensation; Emergencies; Law Enforcement Officers and Agencies; Department of Labor and Industrial Relations; Employees - Employers; Accountants Type:Original Date:January 6, 2025Bill Summary:This proposal modifies provisions relating to line of duty compensation awards. FISCAL SUMMARY ESTIMATED NET EFFECT ON GENERAL REVENUE FUNDFUND AFFECTEDFY 2026FY 2027FY 2028General Revenue Fund* ($600,000)($612,000)($624,240) Total Estimated Net Effect on General Revenue($600,000)($612,000)($624,240) *Oversight notes it is unknown how many individuals may be killed in the line of duty in any particular year; however, the annual average has been 8 payouts $200,000 per year for FY 2019 thru 2024 (excluding FY 2022). Oversight will note the difference in the payout of $600,000 ($800,000 – $200,000) per year adjusted for inflation. ESTIMATED NET EFFECT ON OTHER STATE FUNDSFUND AFFECTEDFY 2026FY 2027FY 2028Total Estimated Net Effect on Other State Funds $0$0$0 Numbers within parentheses: () indicate costs or losses. L.R. No. 0282H.01I Bill No. HB 365 Page 2 of January 6, 2025 BB:LR:OD ESTIMATED NET EFFECT ON FEDERAL FUNDSFUND AFFECTEDFY 2026FY 2027FY 2028Total Estimated Net Effect on All Federal Funds $0$0$0 ESTIMATED NET EFFECT ON FULL TIME EQUIVALENT (FTE)FUND AFFECTEDFY 2026FY 2027FY 2028Total Estimated Net Effect on FTE 000 ☒ Estimated Net Effect (expenditures or reduced revenues) expected to exceed $250,000 in any of the three fiscal years after implementation of the act or at full implementation of the act. ☐ Estimated Net Effect (savings or increased revenues) expected to exceed $250,000 in any of the three fiscal years after implementation of the act or at full implementation of the act. ESTIMATED NET EFFECT ON LOCAL FUNDSFUND AFFECTEDFY 2026FY 2027FY 2028Local Government$0$0$0 L.R. No. 0282H.01I Bill No. HB 365 Page 3 of January 6, 2025 BB:LR:OD FISCAL ANALYSIS ASSUMPTION §287.243 – Line of duty compensation awards Officials from the Office of Administration (OA) state section 287.243.3 increases the workers' compensation benefit for the death of a public safety officer killed in the line of duty from $25,000 to $100,000 beginning August 28, 2025, and increasing with the consumer price index beginning calendar year 2025. This would increase expenses to the state in workers' compensation cases where such benefits are due. Potential costs to the state are unknown as it would depend on the facts and circumstances of each case. Officials from the Department of Labor and Industrial Relations (DOLIR) state the Division of Worker's Compensation expects an increased requirement to General Revenue due to the increased claims amount. The expected increase is between $200,000 and $400,000 including the cost of living increase based on the consumer price index. Oversight notes the DOLIR, upon request for purpose of the Sunset Review of this statute (2024), provided information related to line of duty compensation claims paid for fiscal years FY 2019 through FY 2024, as shown in the table below: Fiscal YearTotal ClaimsTotal Paid20198$200,00020206$150,000202110$250,000 2022*24$600,00020238$200,00020246$150,000Total62 $1,550,000 *Seventeen of the 24 payments were due to COVID-19. DOLIR further stated that while there are no outstanding claims at this time, there are currently five cases on appeal. Additionally, four (4) pending cases for FY 2025 have been received to date. Oversight notes it is unknown how many individuals may be killed in the line of duty in any particular year; however, the annual average has been 8 [(8+6+10+6+8) /5] excluding FY 2022, due to the increase in COVID related deaths. Currently, the amount of compensation per claimant is $25,000. This proposal increases the payout to $100,000. Oversight estimates the increased cost at $600,000 (8 claimants times $75,000) per year beginning in FY 2026. L.R. No. 0282H.01I Bill No. HB 365 Page 4 of January 6, 2025 BB:LR:OD Oversight notes the compensation shall be adjusted annually by the precent increase in the Consumer Price Index. Assuming 2% inflation per year, Oversight estimates the following impact for FY 2027 and FY 2028 respectively $612,000 and $624,240. Officials from the Department of Corrections, the (Office of the Director Capitol Police, Alcohol & Tobacco Control, Fire Safety, Gaming Commission, State Emergency Management Agency and Veterans Commission the Missouri Department of Transportation each assume the proposal will have no fiscal impact on their respective organizations for this proposal. Officials from the Department of Public Safety – Highway Patrol defer to the Missouri Department of Transportation for the potential fiscal impact of this proposal. Officials from the University of Central Missouri and the Missouri University System both assume the proposal will have no fiscal impact on their organization. Oversight does not have any information to the contrary. Therefore, Oversight will reflect a zero impact in the fiscal note for colleges and universities. Officials from the City of Kansas City, the Phelps County Sheriff Department, the Kansas City Police Department, and the St. Louis County Police Department each assume the proposal will have no fiscal impact on their respective organizations. In response to similar legislation from 2024 (HB 1732), officials from the Eureka Fire Protection District – St. Louis assumed the proposal will have no fiscal impact on their organization. FISCAL IMPACT – State GovernmentFY 2026 (10 Mo.) FY 2027FY 2028GENERAL REVENUECosts - DOLIR p. 3 (§287.243) Increase claims amount for Line of Duty Comp($600,000)($612,000)($624,240) ESTIMATED NET EFFECT ON GENERAL REVENUE($600,000)($612,000)($624,240) FISCAL IMPACT – Local GovernmentFY 2026 (10 Mo.) FY 2027FY 2028$0$0$0 L.R. No. 0282H.01I Bill No. HB 365 Page 5 of January 6, 2025 BB:LR:OD FISCAL IMPACT – Small Business No direct fiscal impact to small businesses would be expected as a result of this proposal. FISCAL DESCRIPTION LINE OF DUTY COMPENSATION AWARDS (Section 287.243) This bill increases the line of duty compensation benefit paid to a claimant from the current amount of $25,000 to $100,000, subject to appropriation, for deaths occurring on or after August 28, 2025. Beginning in 2026, the amount of compensation benefits are adjusted annually by the percent increase in the Consumer Price Index for All Urban Consumers, as reported by the United States Department of Labor. The annual adjustment would not decrease the compensation benefit paid to a claimant to less than $100,000. . This legislation is not federally mandated, would not duplicate any other program and would not require additional capital improvements or rental space. L.R. No. 0282H.01I Bill No. HB 365 Page 6 of January 6, 2025 BB:LR:OD SOURCES OF INFORMATION Department of Corrections Department of Public Safety - Office of the Director Capitol Police Alcohol & Tobacco Control Fire Safet Gaming Commission State Emergency Management Agency Veterans Commission Highway Patrol Missouri Department of Transportation Office of Administration City of Kansas City Phelps County Sheriff Department Kansas City Police Department St. Louis County Police Department University of Central Missouri Missouri University System Julie MorffJessica HarrisDirectorAssistant DirectorJanuary 6, 2025January 6, 2025