Jack Pollock

On Wednesday morning, April 19, just after press time, Portland City Council was expected to vote on an Equal Benefits Ordinance (EBO) for city contractors. Barring a major shakeup, the ordinance was widely expected to pass unanimously—the result of more than a year of work by City Commissioner Sam Adams' office.

Along the way, something huge happened very quietly—all eight of the state's major health insurers have agreed to offer domestic partner benefits to even the smallest of small businesses.

The idea gained publicity as one of the key items in former Mercury Managing Editor Phil Busse's failed 2004 bid for mayor: The City of Portland should only contract with companies who offer health benefits to their employees' domestic partners—if the employers already offer benefits to spouses.

In essence, the idea requires city contractors to treat families of same-sex partners in exactly the same way they treat families of legally married (i.e., heterosexual) employees.

Jesse Beason, who worked on the EBO for Busse, was plucked by Adams to be his senior policy adviser. The EBO quickly became one of Adams' policy goals for his first year in office.

But months of public input from stakeholders—insurance companies and small business owners—revealed the idea's biggest obstacle. Few, if any, insurers offered domestic partner benefits to small businesses, and none offered them to businesses with less than 50 employees, making it impossible for most contractors to comply with the proposed ordinance.

In fact, according to testimony given at council last Wednesday by Basic Rights Oregon (BRO) Executive Director Roey Thorpe, not even BRO—the state's leading GLBT activist organization—could convince insurers to offer benefits to domestic partners of its employees.

Beason began having conversations with a few of the insurers, and was told they would be willing to offer domestic partner benefits to small businesses only if most of the other insurers also agreed. Beason was able to get many insurers—most notably, Kaiser, Regence, and Health Net—to agree to begin offering domestic partner benefits. The ordinance was then scheduled for a first discussion at council on April 12. In the weeks leading up to the council meeting, Beason pulled in more holdouts, ending with two of the largest insurers—Providence and Lifewise.

Providence was one of the last insurers to sign on. But, Government Affairs Specialist Ed Nieubuurt explained, "When we talked to Sam and Jesse, and found out about the other companies signing on, there was no compelling reason for us not to agree. ... We also didn't want to be the odd man out."

In many ways, the EBO was billed as a small step for Portland—since city leaders don't have any power over relationship equality (meaning marriage), requiring benefit equality from contractors was the most the city could do. Adams' office frequently said the EBO simply gave the city's nondiscrimination policy "some teeth" when making decisions on whom to contract with.

But along the way, the process of bringing these insurance companies on board sparked a change that will have wide-reaching effects throughout the state and beyond: 99 percent of small businesses in Oregon that offer healthcare to their employees will now be able to offer benefits to employees' domestic partners. Plus, some of the insurers that also do business in Vancouver may extend the same coverage to Washington.

"The great untold story of this ordinance is not the impact it will have on the employees of city contractors, although that's important," Kaiser Government Affairs Director Dan Field said during his testimony at council. "The untold story is the change it's bringing to the small group marketplace in this city.

"What you will see is now all small businesses throughout the city will have access to a benefit they previously didn't."

According to Nieubuurt, Providence had unofficially considered offering domestic partner coverage to businesses with fewer than 50 employees in the past, but hadn't heard from a lot of business owners looking for the service.

"It wasn't on our short list of things to roll out for 2007," Nieubuurt said. "I think the city's action propelled this forward."

The EBO will go into effect on January 1, 2007 if it passes. Last month, Commissioner Dan Saltzman said he had concerns about the impact the ordinance would have on small businesses. During last Wednesday's council meeting, however, he said those concerns had been allayed, and that he's "proud to support this." After the meeting, he explained that the inclusion of small businesses and the Small Business Advisory Council in the input process convinced him that it was supported by the businesses it would impact.

At least one business, though, isn't as convinced. Ken Ray, the fleet sales manager for Ron Tonkin Dodge, sent a letter to the commissioners explaining that the dealership will no longer be bidding for city contracts—implying that Tonkin will not begin offering domestic partner benefits.

Further, Ray pointed out, "The only dealers who will be able to bid with Portland are the ones who offer no benefits whatsoever."

"I disagree with that prediction," Adams said. "The fact that we worked to get eight insurers to agree to offer small group coverage that's affordable ... means that we'll have enough dealerships offering them that we'll still have competitive bids.

"Plus, he's misunderstanding the ordinance—if they currently offer no spousal benefits, they don't have to change. I think they should offer benefits, and they'd be able to do so with no additional cost with [most of the insurers]."

If the council passes the Equal Benefits Ordinance, Portland will join a handful of governments with the same requirements of contractors—including the State of California and the cities of San Francisco, Minneapolis, and Tumwater, WA.