Washington state’s paid family leave program could hit a deficit as early as March. There are concerns about long-term solutions following a significant increase in demand for the benefit that launched in 2020.
Since the start of the program, the Employment Security Department has processed more than 365,000 individual applications and has paid out more than 2.2 million weekly claims.
Officials with the Employment Security Department told lawmakers at a Senate Ways & Means Committee hearing last week that since the cash influx from the tax rate increase won’t be available until the end of the first quarter, there are concerns about the fund’s solvency and said that a deficit was likely soon.
Under the law, an additional solvency surcharge of at least .1% could be ultimately be added to the current rate if the account balance falls below a certain range.
According to the agency, as of Jan. 22 the program’s balance was $78.7 million.
Senate Bill 5649
- Concerning WA PFML - Modifying the Washington state paid family and medical leave act.
The bill now includes a requirement for the department to immediately contract with the Office of the State Actuary for an actuarial review of the program. The department will have established actuaries to assist with fund and balance projection and performance. The bill will also add a three-year long review and performance audit of the program. The bill will create a task force comprised of the advisory committee and the Legislature to make recommendations for long-term stability for the department to execute.