SUBJECT:

Rate Reduction for Campus Workers' Compensation Program New Campus Rate for General Liability Program

As you review this month's ledgers for Campus funded activities, you will
note two changes which have been mandated by the Office of the President:

1. Rate reductions for the Campus Workers' Compensation Program, and
2. A new charge for the Campus General Liability Program.

Workers' Compensation Program:
The FY 97/98 Campus Workers' Compensation Program rates per $100 of payroll
have been adjusted as follows:

General Funds: from $.91 to $.84
Federal Funds: from $.91 to $.84
All other Funds: from $.91 to $.20

The charge appears on the general ledger under 668500, "STATE WORKERS COMP
INS" and is supported by information on the Distribution of Payroll Expense
(DOPE) report.

General Liability Program:
Prior to July 1, 1997, the UC General Liability Program's funding was
centrally maintained by the Office of the President. Each campus is now
responsible for funding its portion of the program, which is based on past
experience. The rates will continue to fluctuate each year, dependent upon
claims experience.

Effective October 1997, the FY 97/98 Campus General Liability Program rate
per $100 of payroll is:

General Funds: $.51
All Other Funds: $.51

General Fund charges will be offset by an appropriation. Federal Funds are
not being assessed at this time, pending discussions with the Department of
Health and Human Services. The anticipated rate for Federal Funds would be
the standard $.51 per $100 of payroll.

This charge will appear on the general ledger under 637930, "GENERAL
LIABILITY PROGRAM" and departments will receive a report on the
calculations along with the operating ledger report. This information will
be available in the SQLDSE in the future.

In the coming months, seminars will be presented by Risk Management and
Workers' Compensation regarding practical steps departments and individuals
can take to minimize losses resulting in a reduction of the above rates.
If there are questions regarding these mandated rate changes and their
impact upon the General Liability and Workers' Compensation Programs,
please contact Van Jahnes-Smith at extension 43782.

Van Jahnes-Smith Risk Manager