Following the lead of other cities like Cambridge, Mass., and companies like Google, San Francisco will begin picking up the federal tax bill for health benefits provided to the same-sex partners of San Francisco government workers.
The Board of Supervisors gave final and unanimous approval Tuesday to legislation introduced by Supervisor Mark Farrell that, he said, “counters what is very much a discriminatory federal tax policy.”
Under federal tax law, city workers who receive health insurance benefits for their same-sex married spouses or domestic partners must pay federal income taxes on the premiums paid by The City. The cost for each of the estimated 386 city workers in this situation can be more than $1,750 a year, whereas heterosexual couples do not have to pay the tax.
The law goes into effect July 1. There is a possibility the U.S. Supreme Court could strike down the federal tax policy in a scheduled review this spring of the Defense of Marriage Act in the United States v. Windsor case or the Perry v. Brown case, which will determine the constitutionality of California’s Proposition 8, which banned same-sex marriages. Rulings could come as early as June.
If the policy remains in place, the expected cost of paying the federal tax for city workers is $616,492 annually.
San Francisco is following the lead of other locations and private businesses. Throughout the nation, more than 30 private companies, such as Google and Facebook, and at least two cities — Cambridge, Mass., and Hallandale Beach, Fla. — have enacted a policy of paying the federal tax.