Attorney General's News Release

June 26, 2007

Nixon asks Blunt to call special session on Schoemehl decision; says inaction will hurt businesses, workers

Jefferson City, Mo. — Attorney General Jay Nixon today asked Gov. Matt Blunt to call the General Assembly into special session during September’s veto session to address the issues raised by a decision last January by the Missouri Supreme Court in a Second Injury Fund case.

Nixon said if the General Assembly continues to fail to address the issues raised by Schoemehl v. Treasurer of Missouri, as Custodian of the Second Injury Fund, the impact could cost the state up to an estimated $35 million each year and the result would be “an unnecessary increase to the financial burdens on business, an unfortunate reduction in protection for injured workers, or both.”

When Gov. Blunt asked the State Auditor to audit the Second Injury Fund, he noted the impact that the Schoemehl decision would have on the solvency of the fund. Nixon said testimony before the House Interim Committee focused on this issue, including testimony that the impact of Schoemehl could be up to $35 million annually, increasing payouts as much as 50 percent from present levels.

The testimony of a financial analyst for the Department of Labor and Industrial Relations indicated such increases would cause the fund to be insolvent by the end of 2009.

“Such a result must be avoided, and the continuing failure to address this issue is sapping the Fund of needed resources,” Nixon wrote.

Because the General Assembly failed to address the Schoemehl decision in the last session, it is time for the Governor to act, Nixon said.

“Every month’s delay results in increased long-term liabilities for the Fund and increased risk to the stability of this system that was designed to protect both workers and employers. I urge you to act now to protect Missouri businesses and their employees,” Nixon wrote.

Read Attorney General Nixon's letter to Matt Blunt

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