On October 11, 2012, the Board of Directors approved changes to assessment policy to introduce a net rate transitioning program. This new policy was introduced to reduce the financial hardship that some firms face when they are reclassified and must pay a substantially higher net assessment rate as a result.

Under this policy, qualifying firms facing sudden and substantial net rate increases because of reclassification will not pay their new net assessment rate — or “target rate” — right away. Instead, qualifying firms will transition to their new, higher net rates over a period of up to three years. To fund the shortfall caused by these lower transitional rates, firms across the rate groups receiving transitioning firms will pay a nominal additional premium.

The net rate transitioning policy was effective as of October 11, 2012 and will apply to rate determinations for the 2013 and later rate years.