TO: Joe Smith, Executive Director

Jane Jones, Director of Finance and Administration

XYZs Board of Directors and Personnel Committee

From: Lori Factor-Marcus

Date: Jan 1, 1900

Subject: Adoption Benefit Proposal

This is a proposal for XYZ Agency to provide an adoption benefit for its employees to assist with expenses of adopting a child.

At present, XYZ provides full benefits to families for the birth of a child as well as five weeks of salary (paid at 2/3) for mothers to recuperate and bond with their new children. These benefits are covered through insurance policies.

However, if a child enters the family through adoption, the very substantial expenses involved (typically $15,000 to $25,000) must currently be paid by the employee.

XYZ Agency has considered itself a progressive, family-friendly agency, taking pride in its benefit package, and proactively embracing diversity and alternative family structures. For these reasons, I believe XYZ should offer adoptive parents similar benefits to those offered parents forming families through childbirth.

The attached pages elaborate on the points mentioned above, and include, as a guideline, a proposal for the plan.

As some of you may be aware, my husband and I are in the process of adopting two children. This is an area of vital concern for us at this time, and I appreciate your review and consideration of this proposal.

WHY XYZ SHOULD OFFER ITS EMPLOYEES

AN ADOPTION ASSISTANCE PLAN

Establishes Equity

XYZ recognizes (in its personnel policies) that forming a family through adoption will create the same need for bonding time as in birth families. This document proposes that adoptive parents have financial needs that are similar to or greater than those of birth parents.

Employees establishing their family through childbirth receive full coverage through XYZs medical insurance. Adoptive parents currently receive no employer assistance in forming their families; out-of-pocket expenses can easily top $25,000.

A woman establishing her family through childbirth currently receives "disability" insurance amounting to five weeks of paid time off, paid at 2/3 of her salary. At XYZ, that value would range from $1,242 to $3,000.

It is true that an adoptive mother will not have the same physical recuperation, but it is well understood that this time is most significantly used for bonding. Adoptive parents deserve the same chance to form these all-important attachments, and they usually do not have the advantage of breast feeding and physical contact from the moment of birth.

Low Cost

Very few employees would use an adoption benefit; nationally the rate is less than of 1 percent for employers offering this benefit.

To compare affordability, a midrange adoption benefit of $5,000 per child would compare favorably with the current Domestic Partner benefit, which, for health and dental benefits, is over $5,000 each year.

Benefits to XYZ

An Adoption Assistance Plan will show employees how committed XYZ is to family life for all its employees.

Employee satisfaction is very important at XYZ and contributes to the longevity and loyalty evident in its workforce. This goodwill is particularly critical where salaries are limited by outside forces.

This is consistent with XYZs image as a progressive, family-friendly agency, and will send a positive message about diversity and alternative family structures.

Benefits to Society

XYZ is a heavily child and family-centered organization; this is evident in the excellent work we do serving the community.

By making it easier for employees to adopt, XYZ acknowledges the importance of a stable, permanent family environment for all children, and encourages more employees to consider adoption as a way to create and build families. These benefits may make the difference in a decision to adopt; this can be particularly meaningful for the growing number of available children in foster care in the United States or waiting children in foreign countries.

Less tangible, but also significant, are the benefits gained by reducing the need for expensive fertility treatments and special-needs pregnancies and births. Lower utilization of specialized medical resources will help keep insurance premiums from rising.

Adoption benefits are good for children, families, employers and society.

Other Things to Know

Nationwide, there is a growing trend for employers to offer adoption benefits to their employees. A 2000 study of 1020 mixed U.S. employers found that 32% offer financial benefits, up from 23% 5 years ago. Also, 85% of Working Mothers Top 100 Companies for Working Women offered financial assistance for adoption in 1997.

Financial reimbursements range from $2,000 to $10,000.3 Paid time off may be additional.

The IRS recognizes the financial difficulties that adoptive families face by allowing the first $5,000 of employer benefits on a tax-free basis. There is an additional $5,000 tax credit available to adoptive parents for the reimbursement of eligible expenses. 4

PROPOSAL

ADOPTION ASSISTANCE PROGRAM

FOR XYZ AGENCY

The Adoption Assistance Program, effective 5/1/2001, pays, upon placement in the home, up to $5,000 per adopted child to eligible staff for adoption-related expenses.

Eligible employees are Regular and Continuing employees. For employees working 21 hours or more per week, but less than full-time, benefits will be prorated based on a 35 hour work week. Part-time staff who work less than 21 hours per week are not eligible. Adopted children must be under 18, and they may be biologically related to either parent. If both parents work at XYZ, the maximum benefit may not exceed $5,000 per child.

Reimbursement: Upon placement in the home, eligible adoption-related expenses will be reimbursed to a maximum of $5,000 per child. Reasonable and necessary expenses directly related to the adoption are reimbursable, including:

Not all expenses are eligible. Examples are:

Procedure for reimbursement: Upon placement of the child in your home, itemized receipts for eligible incurred expenses should be presented to the Fiscal Office.

Sources and Footnotes

From The National Adoption Center

2 By benefit consulting firm, Hewett Associates. Additionally, in April 2001, Working Woman magazine cites a study of Fortune 1000 companies by the Dave Thomas Foundation for Adoption showing that 65% offer financial adoption benefits, up from 20% five years ago.

3 From The National Adoption Center. According to Mady Prowler, Adoption in the Workplace Program Director, reimbursement rates are rising significantly, along with the trend of offering paid time off.

4 These tax benefits are fully available to parents whose incomes are under $75,000, and are phased out between $75,000 and $115,000. The tax credit is due to expire after 2001, but there is currently legislation pending which may reinstate the credit, possibly up to the level of $10,000.

Acknowledgements

In addition to the sources cited above, the following individuals and organizations have generously provided valuable information, guidelines and inspiration used in this proposal: David C. Greene and Melissa Sherlock ( www.adopteegathering.com - Holt International), Ilissa Schoenberg, Karen Holt, and the National Adoption Information Clearinghouse.

There are many variables that may be considered when constructing an adoption benefit. I would be happy to discuss any of this, as well as provide additional resources.



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