WA Paid Family Leave “In Red Soon,” Higher Taxes Coming?

The program began four years ago, and now state officials say it's headed for red.

Like many state programs, The Paid Family Medical Leave program headed for deficit

The Paid Family Medical Leave Program, or PFML, began four years ago in WA state. It allows a worker to receive as much as 90 percent of their regular pay for up to 12 weeks. It can be used for the birth of a child, adoption or to care for a family member.

Now, officials who oversee the plan say it will venture into the red (deficit) in July, and rates (taxes) could potentially have to be raised to keep it solvent.

Get our free mobile app

In the beginning, the program was considered controversial because of the high terms, meaning the percentage of a worker's pay they receive and the duration of the program.

The Center Square reports:

"There’s been continuous growth since we launched in 2020,” said Alison Eldridge, leave and care assistant director at the Employment Security Department, which oversees the program. 

Last month, Eldridge told members of the Senate Labor & Commerce Committee that the fund will be in the red in a matter of months.

“You can see that a deficit can now happen earlier, as soon as October 2024,” Eldridge said during the work session, posting a graph showing the declining fund balance. “And, it may be more severe than was previously projected.”

The number of people who have accessed the program each year grew from 112,737 in year one to 210,268 in 2023.

A report from the Washington Policy Center reveals that 42 percent of those utilizing the program are among the higher wage earners in the state:

"42% of people who took part in the program for fiscal year July 2022 through June 2023 made between $35 and $61 an hour, 36% made between $24 and $35 an hour, 21% made between $18 to $24 an hour, and 12% made less than $18 an hour."

According to reports, Democratic legislators have pushed aside an idea to have a wage cap for the plan, and they suggest the rate workers pay for PFML from their paychecks will likely have to go up.