EDITORIAL: Colorado paid family leave act is a fatally flawed, noble cause legislators should block

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    These things are all true: Almost everybody in Colorado must work when they grow up; with everybody working, a seriously sick family member can create a crisis; and a plan by Colorado Democratic state legislators to address the first two things is a big and dubious income tax hike.

    A bevy of prominent state Democratic lawmakers, including Aurora’s state Sen. Rhonda Fields, have rallied to House Bill 18-1001, the “FAMLI” Medical Leave Insurance Program. The measure would impose an income tax increase on everyone in the state, couched as a “premium,” to get around the state’s tax-increase laws. That income tax hike could be as high as about 1 percent, meaning that someone who makes $50,000 a year would pay an increase of $500 a year in wage “premiums” to the state.

    That’s a chunk, and, yes, that’s a tax.

    In exchange, everyone would be eligible for checks from the state for about two-thirds of their salary for up to 12 weeks if they had or adopted a baby, or if a family member were to take ill and needed care.

    No one can successfully argue that a Scandinavian real-life social system is bad for anyone, businesses included. Even the churlish Trump Administration sees the wisdom of letting workers stay home with very sick children or spouses. The reality for most Americans is that sick leave, if they even have it as a benefit, evaporates long before a new-mother is ready to go back to work or the parent of a seriously ill child can even think of returning. And the worst part of reality for many Americans is that they don’t have the money in savings to do without a paycheck for two or three months until a home-crisis resolves.

    We certainly would argue that the lack of paid family leave is a problem in Colorado, but HB 18-1001 is the wrong answer.

    The least of its problems are how the system would be set up. It levies a tax, so it’s a tax. Proponents can call it anything they want, it’s likely that if this measure were to pass, critics would be successful persuading a court that it violates Colorado’s problematic Taxpayer Bill of Rights. That misguided measure requires tax increases like this one to be approved by voters.

    The Aurora Sentinel argued for years in editorials that the controversial Colorado Medicaid Hospital Fee was a fee, not a tax. But this levy, imposed on every worker in the state, is a tax.

    A bigger problem this measure has is the benefit itself. Let’s say you or your spouse has a baby, and you make $25,000 a year. You would pay about $250 a year for this “insurance” policy, about $21 a month. If you invoke the benefit, your stay-at-home-benefit would be about $288 a week for up to 12 weeks. Ask anyone making $25,000 a year, losing a third of their salary would be just as much a crisis as having a sick kid.

    We agree that the most financially challenged Coloradans are the ones most vulnerable during a family crisis, but if you live in the Denver area, the FAMLI Act would be like giving someone in a sinking boat a styrofoam coffee cup to bail water. You could certainly argue that it’s better than nothing, but those who do probably don’t have to try an live on two-thirds of $25,000 a year, and they don’t consider the biggest problem the FAMLI Act causes: what we would give up to get it.

    Finally, employers would get a bye on paying for this service and would arguably be huge beneficiaries. Well-cared for employees undoubtedly add to every businesses’ bottom line. The Scandinavian safety-net system has proven that repeatedly. Businesses should pay, too.

    A 1-percent income tax increase, or fee, is serious. The chances would be almost certain that if this were to pass, there would never be another income tax hike in Colorado, at least not one like this, which affects everyone in the state.

    Paid family leave is important, but it’s even more unnerving that Colorado, and the nation, are barreling toward a health-care system catastrophe. Within a very few years, and possibly within just a few months, the cost of increasingly useless health insurance will rocket as the Trump Administration and Republicans in Congress cut the legs out from under the Affordable Care Act. If Republicans prevail in keeping both houses in Congress this fall, it will almost certainly mean the end of expanded Medicaid and a spiraling down of an already dismal health-care system.

    As the nation’s health-insurance and health-care systems reel, Colorado may have to go it alone to emulate the Affordable Care Act. To do that, taxing room against employee paychecks, either through a “premium,” a “fee” or an honest tax, will be necessary.

    While both paid family leave and affordable health care are both critical, the widespread loss of health insurance across the state would be so catastrophic that the need for paid-leave would pale in comparison.

    Instead, lawmakers could require the state’s insurance division to create FAMLI-like  family-leave policies for employees making less than $50,000 a year. Give businesses tax breaks for purchasing these policies and additional incentives for employees to help pay part of the premiums.

    Lawmakers should not, however, set up a system that will cost Colorado taxpayers millions to fight for — against tax-protestors — in court, a system that would preclude an income tax hike that will probably be needed soon for a public benefit even critical than paid family leave.