By Scott Taylor,Staff Writer

LEWISTON – City leaders hope to pay down a deficit created by workers compensation claims.

The city currently faces having to pay off almost $3.5 million in workers compensation claims. City Finance Director Dick Metivier said that is an estimate based on an insurance risk study performed last summer.

“We’re trying to close the gap between what we have available and what we could end up paying,” Metivier said. He plans to ask the City Council to earmark $1.4 million from city fund balances to the workers compensation fund at the Feb. 8 meeting.

Lewiston is self-insured when it comes to workers compensation. The city pays into a fund that is used to pay injured city employees’ medical claims and salaries.

The balance for the fund is $506,790, based on the city’s 2004 annual report. However, the city could end up paying as much as $3.5 million in claims, according to the insurance risk study.

“What happened is that we had several years, in the late 1990s through about 2001, when cases didn’t develop like we would have wanted,” Metivier said. In most situations, the city pays medical claims and salaries for a few months.

“But they are certainly expected to return to work,” Metivier said. “Occasionally, they don’t. When that happens, we end up paying more than we planned for.”

The workers compensation deficit was created by claims between 1997 and 2001, Metivier said. A June actuarial study put the possible deficit at $2.99 million. Transferring $1.4 million into the account will reduce the possible deficit to $1.6 million, and that’s much more manageable, he said.

City leaders have been working to reduce claims and have had some success, Metivier said. The city was on pace to pay out about $163,000 for 2004. That’s a marked improvement from years past: There were $209,327 in claims for 2003; $382,083 for 2002; and $1.37 million for 2001.

“One thing that is clear is that our deficit would be much higher if we had not reduced those claims,” Metivier said. “It has absolutely taken off the pressure.”