Laila Freeman and Chad Brummett
NEW MEXICO (KRQE) – Millions of dollars in state payouts: Risk management asked the legislature for more money to cover lawsuit settlements. Will it be enough to cover the growing number of lawsuits the state is facing?
The General Services Department reports funds managed by the Risk Management Division continue to dry up. It is driven by large civil rights claims against several state agencies and institutions of higher education.
The state legislature approved a one-time cash infusion of $20 million in the session this year to help rebuild the cash reserves.
Those reserves stood at $38 million in January of this year but are projected to fall to only $9 million by the end of June.
Risk management settled 94 claims in the second quarter of this fiscal year. A total settlement cost of more than $5 million with half of those settlements being less than $10,000.
Five settlements though had payouts totaling $2.6 million. Those were from UNM-Hosptial and the Corrections Department.
In total, this fiscal year settlements have totaled more than $28 million coming from a few agencies like the Department of Transportation and the Children, Youth, and Families Department (CYFD).
The increase in liability premiums is also hurting the agency. Some of the payouts are much greater than their premiums.
Some of the biggest settlements have happened for CYFD in the third quarter for this fiscal year and are not on this report.
Risk management said expenses for the fund to cover liability, and lawsuits are up more than $3.5 million year-to-year.
There is talk of charging agencies like CYFD more for premiums if they continue to have big payouts.
