Fiscal impact reports (FIRs) are prepared by the Legislative Finance Committee (LFC) for standing finance

committees of the NM Legislature. The LFC does not assume responsibility for the accuracy of these reports

if they are used for other purposes.

Current FIRs (in HTML & Adobe PDF formats) are a vailable on the NM Legislative Website (legis.state.nm.us).

Adobe PDF versions include all attachments, whereas HTML versions may not. Previously issued FIRs and

attachments may be obtained from the LFC in Suite 101 of the State Capitol Building North.

F I S C A L I M P A C T R E P O R T

SPONSOR Lujan, A.

ORIGINAL DATE

LAST UPDATED

1-19-07

HB 80

SHORT TITLE FARM & RANCH WORKERS COMP COVERAGE SB

ANALYST Lucero

Duplicates Appropriation in the General Appropriation Act

Relates to Appropriation in the General Appropriation Act

ESTIMATED ADDITIONAL OPERATING BUDGET IMPACT (dollars in thousands)

FY07

FY08

FY09 3 Year

Total Cost

Recurring

or Non-Rec

Fund

Affected

Total

$150.0-275.0 $150.0-275.0 $300.0-550.0 Recurring

(Parenthesis ( ) Indicate Expenditure Decreases)

SOURCES OF INFORMATION

LFC Files

Responses Received From

Worker’s Compensation Administration (WCA)

SUMMARY

Synopsis of Bill

House Bill 80 amends the Workers’ Compensation Act to include farm and ranch workers as

covered employees under the Act. The bill also corrects gender specific language in the original

Act.

FISCAL IMPLICATIONS

WCA believes that there could be a significant fiscal impact for employers who would be

required to obtain workers’ compensation coverage for workers who are currently exempt from

coverage. While costs associated with the bill are unknown, WCA’s best cost estimate has a

$150,000 to $275,000 per year.

SIGNIFICANT ISSUES

WCA states that there would be a significant impact to the workers’ compensation system. This

bill would impact small and large employers; however, the bill would provide a safety net for

workers in the event that they are injured.

House Bill 80 – Page

2

PERFORMANCE IMPLICATIONS

The very nature of farm and ranch work is generally transitory and temporary; WCA would

expect disputes to arise over whether the worker was considered a worker for purposes of the

Workers’ Compensation Act or an independent contractor. Additionally, the worker’s legal

status to work in the United States could ultimately affect the outcome of his or her benefits.

ADMINISTRATIVE IMPLICATIONS

WCA believes that this bill would significantly increase the caseload of the Agency. The

Agency, at present staffing levels, could not absorb the increased number of claims. There could

be an increase in the use of translators needed to process these claims and out of pocket expenses

for workers. The locality of workers could be an issue for the agency and the parties when

communication with the worker becomes necessary. It would increase the compliance caseload

of the Agency as well.

CONFLICT, DUPLICATION, COMPANIONSHIP, RELATIONSHIP

Relates to SB153 “WORKERS COMP CALCULATIONS FOR IMPAIRMENT", and

SB190 “WAGES FOR INJURED WORKERS RETURNING TO WORK", and

SB208 “PROHIBIT CERTAIN WORKERS COMP PAYMENTS".

TECHNICAL ISSUES

The bill does not make a distinction between regular full time farm and ranch workers and part-

time transitional/seasonal and or migrant employees.

OTHER SUBSTANTIVE ISSUES

This bill has not been approved by the Workers’ Compensation Advisory Council.

According to the Farmworker Justice website:

http://www.fwjustice.org/Health&Saftey/workers_comp.htm

Although agriculture is one of the nation’s most hazardous industries, about half of all

states allow agricultural employers to provide little or no workers compensation coverage

for migrant and seasonal farm workers.

There are many obstacles preventing farm workers from securing needed workers

compensation benefits. They include: lack of coverage; a small, but growing trend for

states to reduce or deny benefits to undocumented workers; workers’ reluctance to file

claims for fear of employer retaliation; and the difficulty of finding a doctor who will keep

farm workers off work long enough to allow them to fully recover. Without workers

compensation benefits, however, injured farm workers often forgo needed treatment or go

into debt to obtain it.

Many states do not require agricultural employers to provide workers compensation

coverage for migrant and seasonal farm workers. The states are almost evenly split between

those that provide all or most migrant and seasonal farm workers with workers

House Bill 80 – Page

3

compensation coverage and those that require little or no coverage for this workforce.

Specifically, only 13 states, the District of Columbia, Puerto Rico and the Virgin Islands

require employers to cover seasonal agricultural workers to the same extent as all other

workers. These jurisdictions are: Arizona, California, Colorado, Connecticut, the District of

Columbia, Hawaii, Idaho, Massachusetts, Minnesota, Montana, New Hampshire, New

Jersey, Ohio, Oregon, Puerto Rico and the Virgin Islands. In an additional 13 states

(including Florida and New York), only small farmers are exempt from providing coverage

to their migrant and seasonal farm workers. Moreover, employers who hire legal temporary

foreign workers, under the H-2A visa program, are required to provide workers

compensation insurance or equivalent benefits to their employees.

By contrast, 16 states do not require employers to provide any workers compensation

insurance for migrant or seasonal farm workers. These states are: Alabama, Arkansas,

Delaware, Georgia, Indiana, Kansas, Kentucky, Mississippi, Missouri, Nebraska, Nevada,

New Mexico

, North Dakota, South Carolina, Tennessee and Texas. In an additional eight

states, coverage is limited to full-time workers (e.g., Maine), workers in specialty jobs

(e.g., South Dakota), or those employed on large farms (e.g., Rhode Island).

ALTERNATIVES

The bill could differentiate between large and small farm and ranch employers and between full

time employees and seasonal or migrant employees.

WHAT WILL BE THE CONSEQUENCES OF NOT ENACTING THIS BILL

Status quo.

DL/nt