House Passes Massive $120 Million Payroll Tax Increase to Create Largest Paid Family Leave Program in Nation

The House has passed a paid family leave bill that moves Vermont from a forthcoming voluntary paid family leave program to the largest state-run family leave program in the nation. According to estimates from the Joint Fiscal Office, the costs required just to stand up the program would be staggering: $111.5 million over the next three fiscal years, an ongoing annual administration cost of $13 million, and $94 million for anticipated benefit payments. With no carve-out for small businesses, all Vermont employers would provide 12 weeks of leave for a broad swath of conditions. Even after a lengthy floor debate that stretched far into the night, essential questions remain unanswered.  

During the House floor debate on H.66, critical questions were raised concerning the size, cost, and complexity of the proposal to create an expansive paid family and medical leave program that would offer the largest state benefit in the nation. Several questions were raised by legislators during the debate that went unanswered, including: 

  • What would the cost be for a program to run through an established third-party insurance company rather than trying to stand it up within state government? 
  • What are the safeguards in place if the uptake of the program exceeds the JFO estimate and uses up the program’s reserve?  
  • What matrix or data was used to determine that 2 weeks of bereavement leave was appropriate? 
  • How will the state find the 65 new government employees to run this program given that the state currently has 800 open positions?  

Qualified conditions for employee leave include a serious health condition of the employee, care for a family member with a serious health condition, birth, adoption or foster care initial placement, own disability, military exigencies and care, safe leave, and, up to two weeks of bereavement leave.