City opts out of state-run family medical leave program

Back in 2020, Colorado voters approved Proposition 118, which began the implementation of a state-run Paid Family Medical Leave Insurance (FAMLI) program. 

With a unanimous vote on Tuesday, Oct. 18, Steamboat Springs City Council voted to opt out of that plan. 

While private employers are required to participate in the program, unless they are enrolled in an approved private plan that offers the same or greater benefits and protections as the FAMLI program, local governments are given the option to opt out. 

The FAMLI program pays up to 12 weeks to care for oneself or family members during serious health conditions such as pregnancy or the birth of a child. The FAMLI program pays between 37%-90% of employees’ gross wages, up to $1100 weekly. 

The city already pays parental leave at 100% of regular wages up to 12 weeks and offers short-term disability relief that pays 60% of wages up to $750 weekly, but neither policies cover many other family medical leave circumstances.

“For instance, if I wanted to care for a loved one, it’s an unpaid benefit,” the city’s Human Resources and Risk Manager Wendy Ecklund said. “It doesn’t apply to domestic violence, sexual assault reasons unrelated to medical either.” 

Ecklund was not trying to persuade City Council in either direction but was explaining the pros and cons of each decision so council members could make an informed choice. 

Since 2021, 20 city employees have utilized their paid parental leave benefit — eight mothers and 12 fathers. During that same timeframe, 11 city employees took unpaid family medical leave for reasons not covered by the paid benefits of the city’s plan. 

Angie Tonozzi, who works for the city’s streets department, asked council members to opt out of the FAMLI program through a City Council contact form. 

“I’m all for assisting or helping an individual in need, however I feel there are alternatives for people on an individual basis,” Tonozzi wrote. “Let’s not fund insurance companies. This is why we live in a small community we can band together if a need arises.”

Individual employees can still opt in to the FAMLI program, which is one of the primary reasons the city felt comfortable opting out of the state-run program. If the city did opt in, individual employees wouldn’t have been able to opt out and would have to pay toward the FAMLI plan’s premium of 0.9% of employees’ gross wages; split 50/50 between employees and the employer at 0.45% each. 

By opting out, any of the city’s employees who do choose to opt in would still only pay the 0.45% of their gross wages. Opting in would also require the city to remain in the program for three years, while voting to opt out gives the city flexibility to opt back in at any time, but that could change as the new program develops.

The city also hasn’t budgeted the cost of the FAMLI program, which would start around $108,000 and increase as wages go up. 

City Council also had to consider the potential recruitment and retention advantage of having a benefit plan that parallels state and private sector employers. The amount of paid leave in the FAMLI program doesn’t deplete either, and offering paid leave for a broader range of circumstances would help the city compete with other employers. 

The city believes it could instead expand on its plans while potentially saving money or offering more flexibility for individual employees. 

“We could do a very comparable plan and just completely hold it in house,” Ecklund said. 

City Council asked Ecklund a few clarifying questions before they voted. Council member Joella West wanted to make sure that the benefits for employees who choose to opt in individually to the state’s program would be the same if the city opted in as a whole, which Ecklund assured they would. 

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