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Monday, October 20, 2014

The Long Arm of Failure

Today's post was shared by WorkCompCentral and comes from

How far do failed New York self-insurance trust issues go?
Answer: All the way across the nation to the West Coast.
In a lawsuit recently filed, California-based Waste Connections Inc. says it was duped because New York based Hudson Valley Waste Holding Inc. failed to disclose nearly $5 million in assessments by New York regulators for liabilities stemming from the Team Transportation Workers' Comp Trust, that failed in 2010.
Waste paid $300 million for Hudson Valley in 2011.
In 2005, the New York Workers' Compensation Board calculated that the trust equity ratio was 78.6% and deemed it to be underfunded as of Dec. 31, 2004. While the group's equity ratio improved to the point that the board stopped classifying it as underfunded as of Dec. 31, 2007, by July 29, 2010, it was once again declared underfunded.
In October 2010, the trustees held a meeting in which they voted to close the trust effective Jan. 1, 2011.

An audit was conducted by the board after it took control of the trust in 2012 and the analysis found the trust had a deficit of $32.5 million, plus interest.
The amount owed by the Hudson Valley companies consequently became $4.9 million. As of July 1, 2014, interest totaling $49,000 had accrued, and continues to accrue until the deficit is fully paid, according to Waste's complaint.
A Workers' Compensation Board report sent to lawmakers in June says the Team Trust has 120 open claims. The trust had 193 open claims when the board took it over in 2012.
Hudson Valley has not...
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