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By AJ Burton
GFN.com (The Gay Financial Network)
June 23, 2004

A new study by the Congressional Budget Office concludes allowing same-sex couples to marry would have a positive impact on the federal budget, with a net savings of nearly $1 billion per year.

Although the federal government currently does not recognize marriages of same-sex couples either for receipt of federal benefits or for tax purposes, using Census 2000 data, the Congressional Budget Office, or CBO, found that allowing same-sex couples to marry would boost federal income tax revenues by $400 million per year through the end of this decade. Social security payments would rise over time, as would spending on spousal health insurance benefits for federal workers, concluded the report. Other expenditure items would be much lower, however, since spending on Medicaid and Supplemental Security Income, SSI, would fall.

These findings, requested by Congressman Steve Chabot, were released as Senate Republican leaders have begun pushing hard for a constitutional amendment banning same-sex marriage.

Majority Leader Bill Frist, a Tennessee Republican, has scheduled a Senate debate and vote on the amendment for the week of July 12, two weeks before the Democratic National Convention.

Massachusetts Gov. Mitt Romney told the Senate Judiciary Committee yesterday that unless the Constitution is changed, gay marriages will spread across the country and "may affect the development of children" and "society."

Romney, whose home state approved same-sex marriage in May, did not offer specifics to back up his statements yesterday.

Economists, however, praised the CBO study Tuesday.

“Same-sex marriage makes sense from an economic perspective,” said economist M. V. Lee Badgett of the Institute for Gay and Lesbian Strategic Studies, IGLSS. “Strengthening same-sex couples’ legal standing will reduce demands on federal and state budgets.”

Badgett points to recent studies conducted by IGLSS and the Williams Project at UCLA Law School regarding the impact of granting marriage and domestic partnership rights at the state level. The study showed California, for example, would have a net savings of $22-25 million per year if same-sex couples could marry.

A 2003 study of New Jersey’s Domestic Partnership Act, which goes into effect in July, predicts the state is likely to see a net savings of $61 million per year by giving same-sex couples rights.

“Rather than relying on stereotypes about gay and lesbian couples, the CBO used the best data available on same-sex couples from Census 2000 to calculate their estimates,” said Brad Sears, the executive director of UCLA’s Williams Project and a co-author of the studies in California and New Jersey.

Little Impact on Business Costs if Same-Sex Couples Marry

Another study released this week concludes American businesses will see very little impact on their benefits costs if same-sex couples are allowed to marry, concluded a report released Tuesday by the Human Rights Campaign Foundation.

Among the report’s findings:

* More than 96 percent of firms will have no additional costs for health care benefits as a result of extending marriage to same-sex couples. At most, only about 190,000 out of 5 million U.S. firms will even have one new spouse covered by its health benefit programs.

* The vast majority of small businesses, those with 0-19 employees, will see no change in costs at all.

* Large businesses (those with more than 500 employees) will see an average increase of just under $25,000 per year for providing additional health benefits.

The report, The Business Cost Impact of Marriage for Same-Sex Couples, was produced jointly by the HRC Foundation and the Institute for Gay and Lesbian Strategic Studies.

“When same-sex couples are afforded equal marriage rights, it won’t affect the bottom line,” said HRC President Cheryl Jacques. “Denying marriage to same-sex couples only serves to exclude them from the same rights and responsibilities as other families.”

The report also looked at retirement benefits and found that employer costs for defined contribution plans won’t be affected since employer contributions are not based on a family’s status. Employer costs for defined benefit plans may increase slightly, the study found.

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