Repealing paid family and medical leave saves no money – and may actually cost more

February 11th, 2013 | Alex Stone

john braun

WA state Senator John Braun

Washington’s Family and Medical Leave Insurance (FMLI) law, which passed in 2007, would provide paid leave to new parents caring for a newborn or newly adopted child. Unfortunately, the bill passed without a funding source, and fell victim to the recession that immediately followed. Until this year, FMLI had been tabled by legislators grappling with ongoing state budget woes.

With the state now pulling out of its recessionary tailspin, some legislators have introduced measures to both implement and expand the family and medical leave system. Not everyone supports that idea: Sen John Braun (R-20) has introduced a bill to repeal family and medical leave, arguing “It may have seemed like a good idea, but we don’t have the money to do it.”

But Braun’s argument just had a big hole punched in it by a fiscal note released on Friday, which shows the state’s family leave bill has absolutely no impact on the state budget – zero, zilch, none. So much for the cost argument.

If legislators are serious about saving the state money, they should get busy and pass the new Family and Medical Leave Insurance bill. Why? Half of all births in Washington are covered by Medicaid, and just over 20 percent of new moms in Washington are eligible for Temporary Assistance for Needy Families (TANF). A paid family and medical leave system would greatly reduce the financial obligation of the state in this area, as it has in states with similar systems like California and New Jersey.

paid family leave and public assistance for new moms

New mothers that take paid family leave are 39% less likely to report using public assistance, and 40% less likely to use SNAP benefits (food stamps). In states with a Temporary Disability Insurance (TDI) or Paid Family Leave (PFL) system, just 10% of new moms use public assistance, compared to 24% in other states (about 21% in Washington state).

Paid family leave allows new parents to take time away from work – without falling into poverty – to care for and bond with a new baby. That early investment in infant and maternal health also means more kids ready for school. Even those willing to overlook the social benefits of paid family leave shouldn’t overlook the economic implications for our state.

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Posted in Family Leave Insurance

Comments

  1. Emily Makings says:

    “But Braun’s argument just had a big hole punched in it by a fiscal note released on Friday, which shows the state’s family leave bill has absolutely no impact on the state budget – zero, zilch, none.”

    Actually, the enacted family leave legislation would have a significant impact on the budget, if it were ever implemented. According to the state budget outlook (http://www.erfc.wa.gov/forecast/documents/November2012Outlook.pdf), paid family leave would cost the state $52 million in 2015-17 (which is the first biennium it would be effective).

    These costs would be avoided if paid family leave is repealed. As the fiscal note for the repeal bill, SB 5159, says: “In 2007, the Legislature enacted a framework for a family leave insurance program; however, the legislature did not fund the program and implementation was delayed in both 2009 and 2011. Current law delays the program until October 1, 2015. There is no fiscal impact to the department [of the repeal] as the Family Leave Insurance Program RCW 49.86 does not identify which agency would administer the program and no appropriation was authorized by the legislature. There would be cost avoidance for future costs.”

    • Alex Stone says:

      The original family and medical leave insurance bill passed the Senate with a funding source, which was stripped out by the House (http://apps.leg.wa.gov/billinfo/summary.aspx?bill=5659&year=2007). Legislators promised to find a funding source, but the recession hit soon after and that didn’t happen.

      The plan was for family and medical leave insurance to be paid for by workers and their employers via a payroll premium, much like Social Security. That’s what the new FMLI bill (http://apps.leg.wa.gov/billinfo/summary.aspx?bill=1457&year=2013) does – the cost would shake out to about $1/week for someone earning $50K per year.

      Legislators actually have 3 options here: 1) identify a funding source for the 2007 law still on the books 2) pass a new FMLI plan that includes a funding source, or 3) repeal the 2007 law. The first two options are a step in the right direction for moms, dads, kids and workers in Washington. Repealing the bill is a step backward. The idea of repeal shows how out of touch some legislators are with the needs of regular working people in this state.

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