The economic vulnerability of single parent families cannot be overstated. In 1990, 65% of California's single parent family households received Aid to Families with Dependent Children (AFDC), while only 3% of its two parent families received AFDC.³

The potential state budgetary impact of not recognizing a marriage that would lift a family out of eligibility for these programs is large. In 1993, the average California family on AFDC received $6,816, and the state spent an average of $581 per family to administer the program.⁴ The State pays for half of this program's costs.

Another program, Supplemental Security Income (SSI), supports the aged or disabled. Eligibility is based on financial resources, so an unmarried individual is more likely to qualify. In 1994, the maximum California supplement was $1884 per year for an individual and $5280 for a couple.⁵ California added an average of $2,159 to the federal government's average $3,970 payment in 1993.⁶

MediCal is available to those on AFDC and SSI as well as other needy individuals. The federal and state governments split the cost of MediCal, which in 1992 averaged $1,480 per adult on AFDC and $652 per child on AFDC in California.⁷ Finally, state and local governments might incur additional costs from other means-tested programs not discussed here, such as General Assistance, that use resources to determine eligibility.

Of course, not all same gender marriages would lift one spouse out of eligibility for these programs, but marriage is the most common route off welfare.⁸ Certainly in a state as large as California, the economic position of some families headed by gay people will be dramatically helped by marriage. And many gay people do have children, making this scenario plausible. (A 1993 survey by Yankelovich Partners showed that lesbians are as likely as heterosexual women to be parents and to have children in their households. Gay men are less likely to have children, but many do.⁹)

The total cost to the state and federal governments of not recognizing one such marriage could easily be $9,000 for a small family eligible for AFDC and MediCal. Using that average cost per family, every 100 families leaving AFDC reduces expenditures by nearly

$1 million per year -- half of those savings going to the state. If only 0.1% of families on AFDC in 1994 married and left AFDC, the total savings would be over $3.3 million to the state in this hypothetical scenario.¹⁰

Marriage and the Federal Budget.

Since the federal government shoulders at least half of these safety net program costs, it will also pay more if California refuses to recognize particular marriages. On the other hand, it is not likely to incur any higher costs if California recognizes all marriages.

Impact on Federal Income Tax.

The state's failure to recognize these marriages also could deprive the federal government of additional tax revenue. The impact of marriage on a couple's tax obligations depends on whether both spouses work and how similar their earnings are. By paying more taxes as a married couple than they would as single individuals, couples with similar earnings suffer a "marriage penalty" that averaged $1244 in 1994.¹¹ The traditional married couple, with the wife working in the home and the husband in the workforce, receive a marriage benefit (averaging $1399 in 1994) since they pay less in taxes than they would pay separately if single.

In some ways, marriage provides incentives for couples to form more traditional kinds of households that will get the marriage benefit.¹² But studies show that even if they legally marry, same gender couples are not likely to adopt that traditional form, often expressing a strong belief that both members of the couple should work outside the home.¹³ Therefore, same gender couples would be more likely to pay the marriage penalty.

The total increase in tax revenues will depend on whether the marriage penalty discourages some couples from marrying. Results of recent studies imply that 10-15% of two earner couples might decide not to marry because of the marriage penalty. That means that 85-90% of such couples would still marry, contributing an additional $1,244 in federal taxes. California's failure to recognize the marriages of 10,000 two-earner gay couples, for instance, could cost the federal government over $12 million.¹⁴

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NOTES:
3. Calculated with Cal. data from the 1990 Census of Population and data on AFDC recipiency from the State of Cal., Dept. of Social Services. The standards for AFDC Unemployed Parent are more stringent, which exaggerates the difference in rates somewhat. [Go Back]
4. 1994 Green Book compiled by the Comm. on Ways and Means, US House of Representatives.  [Go Back]
5. 1994 Green Book, pp. 224-225.  [Go Back]
6. Social Security Bulletin, Annual Statistical Suppl., 1994, p. 69.  [Go Back]
7. 1994 Green Book, p. 811.  [Go Back]
8. R. Moffitt's study, (note 2). [Go Back]
9. G. Lukenbill, Untold Millions, Harper Business, New York, 1995.  [Go Back]
10. In 1994, 742,656 single parent families received AFDC, according to the State of California's Dept. of Social Services.  [Go Back]
11. D. Feenberg and H. Rosen, "Recent Developments in the Marriage Tax," National Tax Journal, Vol. 48, No. 1, March 1995.  [Go Back]
12. G. Becker, Treatise on the Family, Harvard Univ. Press, Boston, 1991. [Go Back]
13. P. Blumstein and P. Schwartz, American Couples, Wm. Morrow and Co., N.Y., 1983; L. Kurdek, "Lesbian and Gay Couples," Lesbian, Gay, and Bisexual Identities Over the Lifespan, ed. by A. D'Augelli and C. Patterson, Oxford Univ. Press, New York, 1995.  [Go Back]
14. This figure results from using the -0.012 elasticity of the marriage probability with respect to change in taxes reported in Alm & Wittington (see note 2) and the $1,244 avg. marriage penalty for 2-earner couples from Feenberg & Rosen (see note 11).
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