Under California’s first-in-the-nation paid family leave (PFL) program, enacted in 2004, workers who become new parents or care for an ill family member can take up to 6 weeks of partially paid leave (55% of a worker’s weekly pay).

Researchers at Columbia University who analyzed the effects of the PFL program on the labor market and new mothers’ use of leave found PFL doubles the average length of leave for new mothers – from 3 weeks to at least 6 weeks.

These effects were most evident among mothers from economically disadvantaged groups – including non-college educated, unmarried, Hispanic, and Black moms – whose average length of leave increased from 1-2 weeks to 4-7 weeks. The research also suggests that PFL increases work hours and wage income for those mothers who returned to work.

On the employer’s end of the experience, another study found business owners’ fears of increased costs and abuse of the policy were unfounded. Six years after California implemented PFL, more than nine in ten employers reported they were not aware of any instances of abuse of the program. Small businesses were less likely than larger companies to report negative effects. Other findings from employers include:

• 89% reported “positive” or “no noticeable” effects on productivity.

• 91% reported “positive” or “no noticeable” effects on profitability or performance.

• 96% reported “positive” or “no noticeable” effects on turnover.

Researchers also found that PFL increased retention among workers in low-quality jobs (paying less than $20 per hour and providing employer-paid health insurance): 83% who used PFL returned to the same employer, compared with 74% of those who did not use PFL. There are also positive effects on workers’ ability to care for a new child and arrange child care, and increased duration of breastfeeding for all new mothers who used PFL.

Locally, the Washington Family Leave Coalition is working to ensure people in our state also have access to paid leave. The state’s Family Medical and Leave Insurance program was established in 2007, and is currently scheduled for implementation in 2015.

WA Gov. Clarence Daniel Martin signed the Revenue Act in 1935, the last comprehensive overhaul of Washington's tax code

While short-term fixes to backfill +$10 billion in budget cuts since 2009 are essential to avoid further damage to Washington’s economy (62% of state spending goes to the private sector), the state faces some long-term structural problems with its tax code that also need to be addressed.

For example, consider the source of half of all state revenue: the sales tax. It applies only to goods, not most services. It’s a swell deal for attorneys, accountants and stock brokers (to name a few) whose services are exempt from the sales tax – but not so good for everyone else.

See, services are becoming a much larger part of Washington’s economy, and because we exempt them from taxes, it means a) the tax base is shrinking, and b) consumers who buy more goods effectively subsidize those who buy more services.

A ”goods-only” sales tax was a fine idea for Washington’s 1930′s agrarian economy (the last time Washington’s tax code was seriously updated) – but today it’s a relic that’s holding back public investment in a modern service-based economy.

To solve these kinds of problems, state lawmakers need to look for solutions to the short-term revenue shortfall that lay the foundation for long-term tax reform. Here are a few ways to accomplish that.

John Burbank, Executive Director

From the Everett Herald | By John Burbank

There’s no other way to say it: Health coverage for new employees is dismal in Washington.

Barely half of Washington employers actually offer health coverage to full-time employees. Then there is the traditional waiting period until you qualify, the employee share of the health costs … and it’s probably best to not even calculate the cost of full family coverage.

But Washington also has a home-grown solution. Thirty years ago two state senators (George Sellar, R-Wenatchee, and Jim McDermott, D-Seattle) teamed up to create the Basic Health Plan. As Sellar put it, lunch-bucket workers deserved health coverage, even if their employers did not provide it. Participants pay premiums and co-pays, and in turn, Basic Health provides coverage and peace of mind for workers and their families who have nowhere else to turn.

Over the years Basic Health has been a bipartisan target for cuts, whittled down in each succeeding fiscal crisis. Enrollment was set for 200,000 by the Republican-controlled 1995 Legislature. But the funding never really came through. Instead, legislators gradually squeezed down enrollment and funding, even while the need for health coverage grew.

In 2001, Basic Health enrollment was capped at 125,000 — but that upside-down situation was turned right side up that fall. Two-thirds of voters approved an initiative to increase cigarette taxes by 60 cents and use the money to expand Basic Health coverage to 175,000.

Coverage briefly expanded, but when the 2001-2002 fiscal crisis hit, the first thing the Legislature did was cut Basic Health funding. And that’s been the storyline for the past decade — cut and cut while the need for health care grows and grows. Today just 35,000 people are enrolled in Basic Health, and five times as many — 157,000 — are on the waiting list.

So what can the Legislature do now to cover the growing slack of employers who don’t provide health coverage and the hundreds of thousands of unemployed workers who have no access to health insurance? The answer is “revenue bonds.”

We’ve done it before. When Gov. Chris Gregoire was attorney general, she shepherded a settlement with tobacco companies that forced them to pay states for some of the health costs of tobacco-pushing through advertising. Washington’s portion is $4 billion over 25 years.

During the 2002 fiscal crisis, the Legislature took a portion of that $4 billion and created revenue bonds, essentially selling off a portion of the future stream of tobacco settlement money to get an immediate lump sum of $450 million. The measure passed with Democratic support (plus one Republican) by simple majority vote, and the governor signed it into law.

Today, 1 million people in our state have no health coverage, and the remaining 35,000 people on Basic Health may lose it if funding is cut. There’s a bright spot on the horizon if we can get to it: the federal government will finance health coverage starting in 2014 as part of the Affordable Care Act.

Should we just let people hang out there for two years, with disease, injury and death hanging over their heads? No. We need to build a bridge to 2014 — and thanks to the Legislature’s precedent for revenue bonds, we’ve got one.

Rep. Hans Dunshee (D-Snohomish) has proposed that the state sell revenue bonds by pledging about 40 percent of the remaining stream of tobacco settlement as payment. This would generate $350 million to finance Basic Health. A portion of that funding could be matched by the federal government, thanks to Sen. Maria Cantwell making sure funding for basic health was part of health care reform. In total, about 100,000 people would retain or gain health coverage.

With 1 million people lacking health insurance, covering 100,000 is more than a drop in the bucket — and less than what we ultimately need, which is health care for everyone. But we might not get to universal health coverage if we don’t take an incremental step to ensure basic health for our friends, our neighbors and ourselves. There is a way. Now the Legislature and the governor have to find the will.

Yesterday’s post illustrated how to get comparable state budget numbers by accounting for inflation and population growth. Today I’ll look at three other ways we can put state spending in context.

The first is to compare the general fund budget to the state’s gross domestic product (GDP), to see whether spending is increasing or decreasing as a portion of the overall state economy. To do that, we’ll divide yearly general fund expenditures* by the state’s GDP for that year, after adjusting for inflation using the appropriate Implicit Price Deflator (IPD):

By this measure, state spending has declined from 6.0% of the state’s economy in 1997 to 5.3% of GDP in 1999, then climbed to 6.0% in 2002 before declining and leveling off at about 5.0% of GDP from 2005-09, then declining again to 4.1% of GDP in 2011.**

Of course, economic output is just one way to measure economic prosperity; another is income. So let’s also take a look at state spending versus personal income. As with the previous chart, we’ll get inflation-adjusted numbers first; then we’ll divide per-capita state general fund spending by per-capita income for each year to get the percentage:

The trends are very similar to the state GDP comparison; the general fund is trending downward overall, from 8.3% to 4.9% of personal income between 1991 and 2011, with similar (but less pronounced ups and downs) along the way.

So let’s go a different direction, and take a look at state employment. We’ll compare the number of residents per state employee over time using state government employment and population data.

First, the raw numbers. In 2001 (the first year data for which I have data available), there were 99,439 FTEs (full-time equivalent positions) employed in state government and 5,974,910 people living in Washington. In 2011, there were 103,996 FTEs and Washington residents.

That works out to 16.6 FTEs per 1,000 Washingtonians in 2001, and 15.4 FTEs in 2011. So relative to a decade ago, today there are 1.1 fewer state employees for every thousand people living in the state:

The take-home point: Whether you use economic growth or personal income as your yardstick, Washington’s general fund budget is smaller than it’s been in 20 years. If state government employment is your measure, it’s at a decade-plus low relative to the state’s population.

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*The general fund is the principal state fund supporting the operation of state government. All major state tax revenues are deposited into the general fund, making it the largest single fund in the state operating budget. The operating budget constitutes the majority of all state spending and pays for most of the day-to-day operations of state government. Total operating budget revenue comes from a variety of taxes and fees, as well as federal funding, such as Medicaid and the Social Services Block Grant. Capital projects and transportation are not part of the state’s operations budget. Learn more in the Citizen’s Guide to the Washington State Budget.

**Comparable state GDP data available only from 1997-2010; 2011 state GDP is author’s estimate based on national GDP figures.

Policy issues like marriage equality, paid sick days and the minimum wage have dominated the news from Olympia so far – but with the next state revenue forecast due on Thursday and cutoff dates looming, it’s time to get some perspective on Washington’s budget.

You can download state expenditures over the past decade on the state’s ever-handy fiscal website. But to get the long view, let’s go back even further and look at the state general fund* since 1991. Here’s a chart showing the raw numbers:

This chart is very pretty – but it has some problems, like the fact that it doesn’t account for inflation.

Inflation means that when prices go up, budget numbers look bigger even if you’re just buying the same stuff – or in Washington’s case, providing the same public services – as you did the year before. (If you happen to encounter these budget numbers in the wild,  remember that you’re not getting an honest comparison.)

So how do we get numbers we can compare year to year? One way is to use a price index like the implicit price deflator (IPD). The IPD is calculated yearly by the Bureau of Economic Analysis – there’s even a price deflator specifically for state and local governments, which I’ve used here to get inflation-adjusted spending figures:

Now we can see that in comparable dollars, state spending increased from $13.1 billion in 1991 to $17.4 billion in 2002, declined to $16.3 billion in 2005, increased and leveled off at just over $17 billion from 2006-09, and since then has been in a steep decline, to $14.8 billion in 2011.

By this measure, state general fund spending hasn’t been this low since around 1997. But this chart is still missing something: population.

Washington’s population is growing, and that cuts both ways in the state budget. On the one hand, more people can mean more public services are required (more kids in schools, more public safety officials, more health inspectors, etc.) which can equate to increased costs. On the other, new residents are in some cases new taxpayers who will contribute to increased revenue.

The state uses caseload forecasts and demographic studies to anticipate expenditures for agencies and departments (and economic projections to account for increased revenue). But since we’re looking at total general fund expenditures here, for now I’ll just keep things simple and use overall population as a proxy.

According to the state Office of Financial Management, Washington’s population grew by more than 1.74 million between 1991 and 2011 (from 5,025,624 to an estimated 6,767,900). If you divide the inflation-adjusted numbers above by Washington’s population for the corresponding year, you’ll get this:

In inflation-adjusted per-capita dollars, general fund spending was more or less flat from 1991 to 1999 (at around $2610 per capita), then increased by about 10% to $2,869 per capita in 2002. Four straight years of declines followed, taking spending back to pre-1999 levels; after a small (4.2%) upturn in 2006, spending declined slightly every year, then fell more precipitously to $2,181 per capita in 2011.

By this measure, the general fund budget has declined by 24% since 2002, and by 16% since 1991 – in other words, it hasn’t been this low in at least 20 years. Tomorrow we’ll look at three other ways to get context for Washington’s budget.

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*The general fund is the principal state fund supporting the operation of state government. All major state tax revenues are deposited into the general fund, making it the largest single fund in the state operating budget. The operating budget constitutes the majority of all state spending and pays for most of the day-to-day operations of state government. Total operating budget revenue comes from a variety of taxes and fees, as well as federal funding, such as Medicaid and the Social Services Block Grant. Capital projects and transportation are not part of the state’s operations budget. Learn more in the Citizen’s Guide to the Washington State Budget.

February’s “Film from Finland,” The Finland Phenomenon: Inside the World’s Most Surprising School System addresses the question of how the Finns have done it, especially in the face of what are often thought to be obstacles to educational progress here – little standardized testing, relatively little homework, strong teacher unions, and substantial classroom autonomy for teachers and students. Indeed, the subtitle of The Finland Phenomenon declares that Finland’s success is “surprising.” This suggests that what Finland is doing runs counter to many expectations and orthodoxies embraced in the United States and elsewhere.

Here’s the trailer for the video:

These and many other issues will be the subject of a panel discussion following the sixty-minute documentary to be shown on February 22 at 7:30 p.m. in the Swedish Cultural Center. Members of the panel include John Burbank, Aija Elg, Karoliina Kuisma and Jenni Salmi. John, who is executive director of the Seattle-based Economic Opportunity Institute, has a long-standing interest in Finnish education and has given presentations on the subject.

Aija, currently a lecturer in Finnish in the UW Scandinavian Department, is also an experienced classroom teacher in secondary schools in Finland.

Karoliina was the previous lecturer in Finnish at the University of Washington and now focuses her pedagogy and skills on teaching young children, including her own.

Jenni Salmi is both a product of Finnish schools as well as a practitioner of innovative methods of teaching the Finnish language in a variety of settings here, including FFSC-sponsored classes. Moderating the panel will be Mia Spangenberg, recent Ph.D. recipient in Finnish Studies from the University of Washington. Mia’s employment is in the growing nexus of technology and language.

The Finland Phenomenon will be shown again at the same location on February 24, but no panel discussion will accompany it. A $5.00 donation may be made at the door for both showings. The Swedish Cultural Center is located at 1920 Dexter Avenue and has ample parking.

Presenters at Seattle's Care Congress share personal stories of caregiving

As the nation’s population ages – an American turns 65 every 8 seconds – more families are turning to paid caregivers and taking on caregiving responsibilities themselves.

The local launch of the national Caring Across Generations movement (which kicked off last summer in Washington, D.C.) took place on Saturday. Nearly 200 people gathered at the Greenwood Senior Center for Seattle’s Care Congress to tackle the challenges presented by the growing need for affordable, quality long-term care.

Caring Across Generation focuses on five major efforts:

• Job creation: Create 2 million new jobs in home care, and explore new funding streams for job creation.

• Job quality: Establish stronger labor standards to protect workers and recipients of care. Improve job quality, wages and access to health insurance.

• Training and career ladder: Build a career ladder and improved job training and certification programs.

• Path to legalization: Create a new visa category to create a path to citizenship for participants in training and certificate programs.

• Support for individuals and families: Preserve and expand Medicaid, Medicare, Social Security and the Affordable Care Act. Support unpaid family caregivers who are taking time from employment with Social Security credits and paid family leave.

One of the presenters was Sylvia Liang, who left her career to care for her autistic son. Once Sylvia’s son turned 18, she was able to receive some compensation for the hours she spent providing care. But state budget cuts resulted in a reduction in the hours for which she is paid. This loss of income coincided with family tragedy when her husband suddenly passed away. Now the family is struggling to stay afloat financially, and Sylvia fears that if she is forced to return to other employment her son will lose his ability to function in society.

As others shared their experiences in smaller groups, it was evident that Liang’s story wasn’t unique. Families across Seattle are facing economic, emotional, and health challenges because of the current inadequacies of our systems and standards. Better pay and training for caregivers, and paid family leave to provide adequate time to respond to changing needs for levels of care, are among the changes our society needs.

Seattle City Council Member Nick Licata spoke to the crowd, sharing his personal experiences in caring for family members. City Council Member Mike O’Brien and representatives from the offices of Senator Murray, Senator Cantwell, and Representative McDermott were also there to show support.

Other presenters included domestic workers and caregivers, who shared their struggles to receive adequate training, secure fair wages and benefits, and obtain quality, affordable care for their loved ones.

Seattle is the third city, after Austin and San Francisco, to host a Care Congress. At least seven more are scheduled in cities across the country through this summer. The Congresses are the start of an exciting movement. The next meeting of the Seattle Council will be on Wednesday, February 28 from 4:00-6:00 pm at Casa Latina (317  17^th Ave South, Seattle 98144). All are welcome to join!

Systemic underfunding of public higher education is closing the doors on educational opportunity for an increasing number of middle class and low income students. While tuition increases and “sticker shock” create significant financial and psychological barriers to high school graduates contemplating higher education, median household income growth has slowed to a crawl.

For example, at the University of Washington, tuition costs have increased by 215% between 1989 and 2010 (all calculations in constant dollars). Today total cost for in-state students in tuition and mandatory fees is more than $10,500/year. Tuition costs at community colleges have followed a similar trend, jumping from a little over $1,400 in 1989 to over $3,500 now.

By contrast, for the same time period (1989-2010), the median household income has grown by just one-tenth of one percent.

Not surprisingly, loans bridge the gap. In 2007, student debt for a graduating University of Washington student ranges, on average, from over $17,000 for students with family income of less than $25,000; to $15,000 for students with family incomes between $25,000 and $50,000; to $14,500 for students with family incomes greater than $75,000. And that was five years ago!

The Pay It Forward solution substitutes today’s “high tuition, big loan” model with “attend free, then pay 3″- that is, students in public institutions of higher education pay no tuition up-front, in exchange for agreeing to pay 3.0% of their annual income over the next 30 years. In so doing, they “pay forward” the opportunity for future students to do the same. (It’s similar to a proposal independently developed by students at University of California-Riverside.)

For example, a graduate earning $60,000 would pay $1800 a year; someone making $250,000 a year would pay $7500; and whoever gets a $1 million salary (say, for inventing the next Google or Facebook) would pay $30,000. Students in community college programs would use a similar model, but with a payback percentage of 1.0% per year.

Start-up funding will be required to get the first few generations of graduates through school and into jobs where they can start paying it forward. This could be a one-time source of private and/or public money used to cover the transition costs, enabling all students to participate in the Pay It Forward plan.

Another possibility is to use current state funding for tuition assistance as the starter fund, and as more students graduate through the pay-it-forward mechanism, gradually expanding the program to all students. Once it’s fully implemented, Pay It Forward will provide enough revenue to fully fund Washington’s public colleges and universities with no additional public revenue necessary.

At the federal level, Pay It Forward could also integrate Pell grant funding ($35 billion for FY 2011) and other sources of federal tuition assistance. A federal system would also simplify and streamline the tracking of graduates and their payback amounts through calculation, attachment, and collection through the IRS 1040 and W-2 forms.

To keep Washington competitive in the globalizing economy, we need a homegrown brain trust of talent and skill to attract good jobs and investment. One of our top priorities as a state should be to ensure all high school graduates have the opportunity to pursue an advanced degree or skilled trade in an institution of higher education. But ever-increasing tuition rates and a reluctance to take on significant student debt are discouraging some students from attending college. Pay It Forward would encourage student enrollment in higher education – particularly those deterred by high up-front costs – and allow graduates more flexibility in career choice without the threat of student loan repayments looming.

IWPR’s analysis of the revised jobs numbers for November and December, released by the Bureau of Labor Statistics on February 3, show that women gained 33 percent (265,000) and men gained 67 percent (544,000) of the 809,000 total jobs gained in the last four months (October-January).  The gap between women’s and men’s employment in January is 1.8 million.

According to IWPR analysis: 

• Overall, women have regained about one out of four (23 percent) of the total jobs they lost in the recession while men have gained more than one out of three (34 percent).

• In the last year, from January 2011 to January 2012, of the 2.1 million jobs added to payrolls, 643,000 or 31 percent were filled by women and 1,438,000 or 69 percent were filled by men.

• Since October of 2009, when men’s and women’s total jobs numbers were virtually equal, women have gained 545,000 jobs, whereas men have gained 2,359,000.

Report: Training Makes a Difference (1.5MB)

New research shows “family, friend and neighbor” (FFN) childcare providers with higher levels of education or training are more likely to have the skills to provide higher quality care for children, resulting in improved health and safety, and richer learning experiences.

Around 6,200 FFN providers care for approximately 13,600 children eligible for child care subsidies in Washington. After collectively organizing through the SEIU 925 in 2006, FFN providers successfully bargained for increased state investments in training – including first aid, health and safety, engaging children in age appropriate activities, and guiding children’s behavior.

When researchers at the Economic Opportunity Institute (EOI) examined the impact of that training, they found multiple positive outcomes for providers, including:

• Positive impacts on both their knowledge and their skill level.
• Increased professional connections with other providers, used to share advice and seek support.
• Improved satisfaction with providing child care.

“Training is important for improving quality outcomes in family, friend and neighbor child care settings,” said Gary Burris, co-author of the study. “This research finds measureable increases in the knowledge base and skill level of child care providers who participate in trainings – and suggests children are receiving higher quality care as a result.”

A majority of the child care providers surveyed (+90%) indicated SEIU 925 plays a significant role in making training opportunities available, and felt that fewer training opportunities would be available without collective bargaining.

The survey found that over 70% of FFN providers have one to three children in their care. Many provide child care as a full-time job, with an average of caring for children of 36 hour per week. A preponderance of FFN providers are female, with English as their first language. A majority are over the age of 45, about half are married, and about half describe themselves as White.

The study was funded by a research grant from American Rights at Work Education Fund.