Committee advances ordinance to offset federal tax on same‑sex spouse/domestic partner health premiums

The Budget & Finance Committee on Feb. 6 voted to forward to the full Board an ordinance that would require the City and County of San Francisco to make payments to affected city employees to offset federal income tax owed on health insurance premiums provided for same‑sex spouses or domestic partners.

Chair Supervisor Mark Farrell, who introduced the legislation, described the measure as a local remedy to what he called a discriminatory federal tax treatment stemming from the Defense of Marriage Act (DOMA), noting the ordinance would align benefits for same‑sex and opposite‑sex couples while DOMA remains in effect. Chair Farrell said about 386 active members of the city workforce had same‑sex spouses or domestic partners as of year end and urged passage.

Controller’s office staff and the Department of Human Resources explained how the benefit would be administered: the payroll division would calculate a one‑time annual payment (initially covering six months) equal to 20 percent of the premium associated with the dependent’s coverage, based on information provided by the Health Service System; if federal tax law changes, the payments would be adjusted or terminated. The budget legislative analyst presented an estimated city cost of approximately $616,004.92 per year, including employer payroll taxes.

Unions and community groups including IFPTE Local 21, the Alice B. Toklas LGBT Democratic Club and the Harvey Milk LGBT Democratic Club urged approval in public comment. Supervisors added cosponsors, accepted clarifying technical amendments, and moved the item to the Board calendar for Feb. 26 with recommendation.

The ordinance references federal tax treatment under DOMA and will return to the Board for final action.