September 12, 2025 | SIBTF.org — California’s Subsequent Injuries Benefits Trust Fund (SIBTF) is facing a financial crisis, with unpaid SIBTF liabilities now exceeding $20 billion—more than double earlier projections. Analysts warn that without meaningful reforms, the fund’s ballooning debt could jeopardize its ability to provide long-term support for injured workers with preexisting disabilities.
AB 1329 Offers Limited Relief
The passage of AB 1329 SIBTF reforms could help reduce costs by an estimated 20–25%, according to recent legislative estimates. The bill includes measures such as stricter eligibility standards and improved oversight, both intended to stabilize the program’s finances. While these changes represent progress, experts caution they may not be enough to reverse years of unchecked liabilities.
In practical terms, this means that even if the reforms take effect as planned, the reduction in SIBTF liabilities would still leave the fund with billions in unpaid obligations. For injured workers, this raises concerns about whether payments will continue without delay, while for employers and insurers, it signals that assessments and funding contributions could remain high despite the proposed cost-cutting measures.
Legislative Analyst’s Office Calls for Broader Action
In a recent review, the Legislative Analyst’s Office (LAO) suggested that more extensive changes may still be required. Proposals include narrowing claimant eligibility further, restructuring funding mechanisms, and prioritizing backlog reductions for the most vulnerable workers. Without deeper reforms, the LAO warns that the program’s long-term sustainability remains uncertain.
For policymakers, this means that AB 1329 should be viewed as only a first step rather than a final solution. The LAO’s recommendations underscore the possibility of future legislation that could significantly alter how SIBTF liabilities are managed, particularly if the current reforms fail to bring the fund’s debt under control.
Stakeholders—including injured workers, employers, and insurers—are closely watching these discussions, as the direction lawmakers choose could reshape both benefits and financial obligations in the years ahead.
The Road Ahead for SIBTF Reform
With unpaid liabilities at historic levels, lawmakers are under pressure to act swiftly. As AB 1329 moves through the State Senate, the debate will likely intensify over whether incremental reforms are sufficient—or whether broader structural changes are necessary to secure SIBTF’s future.
The challenge lies in balancing immediate relief with long-term stability. Because SIBTF liabilities have already surpassed $20 billion, any delay in broader reform could deepen the funding gap and reduce confidence in the program’s ability to meet its obligations.
Lawmakers must weigh whether incremental adjustments will be enough to slow the growth of debt, or if a comprehensive restructuring of funding and eligibility is the only way to protect both injured workers and California’s workers’ compensation system as a whole.
For further coverage, visit Workers’ Comp Executive.
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Read More from SIBTF.org:
- AB 1329 Tightens Standards: Proof of Preexisting Disability’s Impact Now Required
- Senate Committee Takes Up AB 1329 as SIBTF Costs Continue to Climb
- State Senate Eyes AB 1329: SIBTF Reforms Advance in Summer Session
FAQs: SIBTF Liabilities
How much are SIBTF’s current unpaid liabilities?
Unpaid liabilities have exceeded $20 billion, more than double previous projections.
Can AB 1329 solve the SIBTF funding crisis?
AB 1329 could reduce costs by 20–25%, but experts caution the reforms may not fully address the scale of the problem.
What additional reforms does the Legislative Analyst’s Office recommend?
The LAO has suggested narrowing eligibility further, restructuring funding, and prioritizing backlog reductions.
Why is SIBTF’s sustainability at risk?
Rising costs, long delays, and inadequate oversight have created a debt burden that threatens the fund’s ability to support injured workers in the future.
How do rising SIBTF liabilities affect California employers and workers?
Rising SIBTF liabilities increase pressure on the state’s workers’ compensation system, which can lead to higher assessments for employers and potential delays in benefits for injured workers. As the fund’s debt grows, both groups face uncertainty about long-term stability and the availability of supplemental support.
What is SIBTF?
The Subsequent Injuries Benefits Trust Fund (SIBTF) helps California workers who suffer a new workplace injury and already had a prior disability. It offers supplemental compensation when combined impairments severely limit earning capacity.