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Video Broadcast Lights Out on Sawmill’s Self-Insured Claims Runtime 2:01 Real Media 56k | Broadband Windows Media Player 56k | Broadband Quicktime 56k | Broadband

Eel River Sawmill’s self-insured status has fallen on hard times. It’s formal announcement Dec.10 to California’s Self Insurance Plans (SIP) paved the way for the state’s Self Insurers’ Security Fund to kick in and cover what the mill couldn’t.

Chuck Cake, acting director of the California Department of Industrial Relations (DIR) gave the go ahead Dec. 26 for the Security Fund, a private, nonprofit mutual benefit corporation to take over the payment of the mill’s workers’ compensation claims.

The Fortuna-based sawmill portion of the company closed a year ago and a power plant that was paying the remaining claims is now slated for a shut down.

A SIP audit revealed that the company understated its liability on 142 open indemnity claims by $2,159,824 and had a total remaining liability on its workers’ compensation claims estimated at $7,021,506.

SIP Manager, Mark Ashcraft explained that the remaining claims would initially be covered by the mill’s self-insured security deposit. He also explained that Security Fund would pay any benefits that exceed the security deposit as well.

“Eel River Sawmill defaulted on benefit payments so we turned their security deposit and workers' compensation liabilities over to the Security Fund, which will ensure continued benefit payments to injured workers,” said Ashcraft.

Now that the mill can no longer cut benefit checks and the lights will soon be going out at the power plant, claimants will be relying on the Security Fund to pull them out of the woods from this failed logging venture.