Friday, April 26, 2024

A sign waved during a November 2006 protest in Boston over gay marriage seems to sum up Cambridge workers’ arguments about a U.S. tax on health benefits for same-sex couples. (Photo: Sushieque)

City councillors rejected an assertion by the city manager that Cambridge can’t help same-sex married couples suffering from inequities in the federal tax code, sending the problem back to him Monday for another go.

The answer councillors got from City Manager Robert W. Healy outlined the complexity of pinning down how much more 22 affected employees paid than their counterparts who were married to people of the opposite sex. It concluded that “an alternative approach, advocated by some, including a spokesperson for Yale University, is to act consistently with current law while speaking out about the inherent unfairness” and noting that a decision by the federal government to stop defending the Defense of Marriage Act “may bode well for ending this inequitable tax treatment.”

But councillors, who alerted Healy to the issue in a policy order, were having none of it.

“I’m extremely disappointed in this response. I’m not at all satisfied,” said Denise Simmons, whose name led the Jan. 10 policy order. “We’re saying, ‘Oh, we know it’s unfair, but we don’t want to do anything about it,’ and that’s just not something I see the city doing. So I do not accept this response.”

Henrietta Davis, Ken Reeves and Mayor David Maher joined Simmons in expressing disappointment. Leland Cheung went a little further.

“I’ve only been here a little over a year, but I’ve gotten used to sending an order down to the manager’s office only to hear back in a report why something that we want to be done cannot be done. For something as important as this, it’s just not good enough to say that it cannot be done,” Cheung said. “I want to send this back to the manager and say, ‘Try again.’”

City manager was missing

Healy was not present to hear this. Though he had been seen shortly before climbing the stairs toward Sullivan Chambers to present his four-item agenda, he had gone home sick sometime during the night’s bitter discussion of police training in Israel and councillors’ angry words over his role in it. His finance team, assistant city manager for fiscal affairs Louis Depasquale and budget director David Kale, were sitting in for him.

“I’m going to support sending this back also in an effort to ask our very fine financial folks and Mr. Healy and [director of the Personnel Department Michael]  Gardner if there isn’t some other avenue to look at,” Maher said genially, directing his comments to Depasquale and Kale. “Is there in fact some clever way we can look at this?”

The item was referred back to Healy and what Maher hoped would be “a team of top-level thinkers to find if there is a legal way to do this.”

Although same-sex marriage is recognized in Massachusetts, it is not federally, with the result that under the U.S. tax code city-provided health benefits for same-sex married workers are counted as taxable income. The policy order, signed by all members of the council except Marjorie Decker, who had recently given birth, called it “unacceptable that an unfair financial burden has been” costing workers since May 2005 and asked for a plan to make up for the inequity. Companies such as Google, which has offices in Cambridge, and Kimpton Hotels, which operates the Hotel Marlowe in East Cambridge, were cited as examples of businesses doing so for their workers.

‘True equalization is difficult’

The city could not match the efforts, though, according to Healy. It can’t gather pay information to estimate the tax burden for reasons of privacy, he wrote in a reply dated Monday, and paying more to union workers affected would upset pay scales set by collective bargaining.

There might be other complications, he wrote, “particularly if federal tax policy changes to make the value of health coverage a taxable benefit for some or all employees on a going forward basis, a policy change currently under discussion.”

Finally, he noted the math problem: Give the workers more money to make up for the tax inequity and it raises the rate at which they’re taxed.

“True equalization is difficult,” Healy wrote.

Two city workers with same-sex spouses came forward to politely dispute his report.

Deb Allenberg, a worker in the Water Department who lives in Boston, and Priscilla Lee, a resident who teaches and counsels at the Community Learning Center, stated their wages in separate speeches during public comment and gave figures for the additional burden from federal taxation on health benefits extended to their families.

“I humbly present my own data,” Lee said, rattling off her wages and noting the roughly 12 percent cut from her net income resulting from sharing health benefits with her wife. “For each successive year that this discrimination persists, I’m personally willing to waive the privacy of my tax data for the city.”

The unions can be asked how they would handle a discrepancy, Lee said, and companies such as Google and Kimpton Hotels could offer their accounting help to the city’s financial team.