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WORKERS' COMPENSATION AND <br />LIABILITY EQUITY RETURNS <br />At the end of 2007-08, the Workers' Compensation and Liability Funds satisfied the <br />Board-adopted criteria for equity returns. One-half of the equity gained in the Workers' <br />Compensation Fund and 75% of the equity gained in the Liability Fund will be returned to <br />the Pool's members. Returns of $8.1 million from the Workers' Compensation Fund and <br />$7.8 million from the Liability Fund will be distributed to qualifying Members. <br />Distribution will be made to Members that; <br />1. Participated in the individual Fund for at least one complete year on <br />September 30, 2008. <br />2. Have a loss ratio for that Fund that is less than 100% since joining the <br />Fund or for the last 5 or 10 years, and <br />3. Continue to be a Member of that Fund on April l, 2009. <br />Loss ratios are calculated for 5 years, 10 years and all years by dividing losses incuned by <br />contributions paid. The experience period that produces the most favorable result for the <br />member is used to determine the return. The equity return calculation also recognizes the <br />length of time a Member has participated in the Fund. <br />Workers' Compensation <br />Approximately 2,093 Workers' Compensation Fund Members will receive some portion of <br />the $8.1 million equity return with 1,433 Members receiving the largest percentage credit, <br />12%, plus a credit for longevity. <br />Liability <br />Approximately 2,300 Liability Fund Members will receive some portion of the $7.8 <br />million equity return with 1,804 Members receiving a distribution of at least 17.5% plus a <br />credit for longevity. <br />Loss Ratio Component <br />The amount of each Member's Liability and Workers' Compensation Equity Return will <br />be a percentage of 2007-08 contributions determined as follows for members that have <br />participated in the applicable fund for three years or more: <br />Member's <br />Loss Ratio <br />Workers' Compensation Equity <br />Return as a PerceMage of Member's <br />Estimated 2007-08 Contributions* <br />Liability Equity Return as a <br />Pexcentage of Member's <br />2007-08 Contributions <br />Less than 25% <br />12% <br />17.5% <br />25% to less than 50% <br />10% <br />15% <br />50% to less than 75% <br />8% <br />13% <br />75% to less than 100% <br />7% <br />1 1% <br />1000/o or more <br />0% <br />0% <br />* The pereentage credit for Workers' Compensation will be applied eo 2007-08 estimated contribution, which does not reflect <br />adjustments bascd on the payroll audit afeer the cnd of the year. <br />Members that have participated in a fund for at least one year but less than three years will <br />receive one-half of the credit indicated above. <br />April 2009 <br />w 0OP24fi <br />