HELENA - The Montana State Fund, which last week said state agencies would see average workers' compensation rate increases of 34 percent beginning next month, confirmed Monday it will seek pay raises for some of its employees.

Laurence Hubbard, State Fund president and chief executive officer, said the average 3.25 percent pay increase, which will be pitched to the State Fund's board of directors Friday, is less than last year and is needed to

retain and recruit employees in the insurance industry.

But Chuck Swysgood, Gov. Judy Martz's budget director, said he thinks the State Fund, which...