Jamestown Mayor Sam Teresi, like a lot of municipal leaders, is seeing an increase in workers' compensation costs - shared evenly among every city, town and village in Chautauqua County.
And constant increases - many of which are the result of large claims within the city - may force Teresi to find an alternative insurance option.
It's a move, however, that is being cautioned by the county finance department.
"We will, as we've done over the last two years, be looking at a substantial increase," Teresi told The Post-Journal of the city's increased annual workers' compensation payment.
According to the Democrat, the city in 2010 had a compensation payment to the county of $309,880. In 2011, the cost rose 9.1 percent to a payment of $338,023.
This year, claims increased again- this time 23.6 percent for a payment of $417,893.
Fact Box
"We see that there is a potential problem there. We want to get our arms around the problem."
Sam Teresi
Jamestown mayor
"Obviously, things go up in all areas of the budget," Teresi said. "But, when you're seeing ... increases from year-to-year and your workforce is smaller, where your injury rate has been in check, it signals that there is a problem."
Workers' compensation costs aren't letting up in the county. Teresi said the city is projecting a payment of $500,000 to the county next year, almost a 20 percent increase.
Susan Marsh, county finance director, said the recent spike in workers' compensation payments is due to "major hits" in claims from municipalities in the county.
In fact, Marsh said the city of Jamestown alone has had $3 million in claims in the last five years. Many of those claims, she said, were from the city's police, fire and Board of Public Utilities departments.
"The reason to have the costs countywide is to spread the risks," Marsh said. "So when you get hit with these major claims, you don't have to bare 100 percent of the costs."
Workers' compensation costs countywide have gone from $2.8 million in 2007 to $4.1 million last year. Marsh, however, sees overall claims decreasing in the future. "We may be trending down, based on what I have seen this year," she said.
Teresi, meanwhile, compared workers' compensation costs to recent increases in the city's contribution to the state retirement system.
"We see that there is a potential problem there," the mayor said. "We want to get our arms around the problem.
"We want to see if we can work with the county to get it corrected. If we can't, we will have no choice but to seek other options as to how we are going to provide workers' compensation insurance for the city."
Teresi would not elaborate what options the city would explore to lower its costs.
Marsh said if the city of Jamestown chose to seek its own insurance option, all previous tail costs will need to be paid. Furthermore, the city would have to wait until 2014 to find an alternative plan, as deadlines from dropping out have passed, she said.
"Do I think that would be smart? No," Marsh said. "I think in the long run they are better off with the county."
She added: "If (Jamestown) dropped out, it means it would affect other municipalities. Actually, it would help the plan because the city has a lot of huge claims. But in the end, it may end up costing everyone more."
Marsh said the county hopes to educate municipalities in creating safer work environments, which she said would reduce compensation claims to begin with. Safety training and case management is typically offered to area officials every six months, with the next workshop scheduled around April.
"If you can keep an accident from happening, you won't have the claims," Marsh said. "You won't be spending in the long run.
"A lot of the towns are looking at their workers' compensation and what it costs. It is a lot of money. They want to be responsible, but I think we got hit by some major claims."