(a) The department shall determine each eligible employer's ratable payroll. The department shall then put all eligible employers in the order of their average quarterly decline quotients beginning with the smallest average decline quotient and shall determine, with respect to each employer, the cumulative ratable payroll during the four consecutive quarters ending with the computation date of the employer together with all employers who precede the employer on the list.

(b) The department shall segregate the employers into groups in accordance with cumulative ratable payroll. The limits of the groups are those set out in column B of the table in (c) of this section. Each of these groups shall be identified by the rate class number in column A which is opposite the figures in column B which represent the percentage limits of each group. An employer shall be assigned the experience factor in column C which is opposite the rate class in which the greater part of the employer's ratable payroll falls. If one-half of the employer's ratable payrolls falls in one class, and one-half in another, the employer shall be assigned to the lower numbered rate class. An employer may not be assigned to a higher numbered rate class than is assigned to another employer with the same average quarterly decline quotient.

(c) The rate of contributions for each employer is a percentage of the average benefit cost rate multiplied by the employer's experience factor set out in column C of the table in this subsection opposite the employer's applicable rate class set out in column A plus the fund solvency adjustment surcharge required under (f) of this section. That percentage is 76 percent beginning January 1, 2009, and 73 percent beginning January 1, 2010. However, the rate of contributions for an employer may not be less than one percent or more than six and one-half percent. The rate of contributions for an employer in rate class 21 may not be less than 5.4 percent. The rate of contributions for an employer must be rounded to the nearest 1/100th of one percent.

COLUMN ARate ClassCOLUMN BCumulativeRatable PayrollCOLUMN CExperienceFactor

at least(percent)but less than(percent)

1 5 .40

2 510 .45

31015 .50

41520 .55

52025 .60

62530 .65

73035 .70

83540 .80

94045 .90

1045501.00

1150551.00

1255601.10

1360651.20

1465701.30

1570751.35

1675801.40

1780851.45

1885901.50

1990951.55

2095 99.991.60

21 99.991.65.

(d) The rate of contributions payable by each employee of an employer who is subject to AS 23.20.165 is a percentage of the average benefit cost rate as determined in (e) of this section rounded to the nearest 1/100th of one percent. That percentage is 24 percent beginning January 1, 2009, and 27 percent beginning January 1, 2010. However, the rate of contributions for an employee may not be less than one-half percent or more than one percent.

(e) The department shall determine the average benefit cost rate as follows:

(1) the department shall determine the amount of benefits paid to insured workers during the last three computation years;

(2) the department shall subtract from the amount determined in (1) of this subsection the amount of any benefits reimbursed to the fund and the amount of interest earned on the trust fund balance during those computation years;

(3) the department shall divide the amount determined in (2) of this subsection by the total wages paid by all employers required to pay contributions under this chapter during the first three of the last four computation years;

(4) the department shall determine the amount of total wages subject to contributions under this chapter paid during the preceding computation years;

(5) the department shall determine the amount of all wages paid to insured workers during the preceding computation year;

(6) the department shall subtract from the amount determined in (5) of this subsection the amount of wages paid during the preceding computation year by employers who elect to reimburse the department under AS 23.20.276 and 23.20.277;

(7) the department shall divide the amount determined in (4) of this subsection by the amount determined in (6) of this subsection; and

(8) the department shall divide the amount determined in (3) of this subsection by the amount determined in (7) of this subsection.

(f) An employer shall pay a fund solvency adjustment surcharge if the reserve rate is less than three percent. The surcharge is a percentage equal to the difference between three percent and the reserve rate, rounded to the nearest 1/100 of one percent. An employer shall receive a fund solvency adjustment credit if the reserve rate is greater than 3.3 percent. The credit is a percentage equal to the difference between 3.3 percent and the reserve rate rounded to the nearest 1/100 of one percent. The solvency surcharge may not be greater than 1.1 percent, and the solvency credit may not be greater than 0.4 percent. However, an employer's fund solvency adjustment surcharge may not increase more than 0.3 percent from one year to the next year.