SSB 5286, which would make changes to the paid family and medical leave (PFML) rate structure, has been passed by both the Senate and the House. I described the bill here.

The bill requires the premiums to be set to maintain a new three-month reserve. The legislative task force on paid family and medical leave premiums recommended in November that the reserve be seeded with money from the general fund–state (GFS). Last year, in the 2022 supplemental, the Legislature had set aside $350 million from the GFS for the PFML account, but that was only to ensure that the account is not in deficit at the end of 2021–23.

Both the Senate- and House-passed 2023 supplemental budgets would reduce the $350 million appropriation—to $225 million in the Senate and to $200 million in the House. Under both proposals, the appropriation would be direct (not contingent on a deficit).

According to the Employment Security Department (ESD), the Senate proposal would result in a PFML premium rate of 0.82% in 2024. The House proposal would result in a premium rate of 0.83% in 2024. In future years, the rate would be the same under each proposal. (It would increase to 0.94% in 2025.) The chart below shows ESD’s estimates for the rates under all the scenarios.