Aug. 14 (Bloomberg) -- Hans Bernhard and Mitch Null say they may leave North Carolina -- taking their daughter, their jobs as a veterinarian and an information technology business operations manager at Cisco Systems Inc. and the tax revenue from their properties.
Following the U.S. Supreme Court’s decision to overturn a key part of the Defense of Marriage Act, the couple is considering moving to Maryland, where they could have a recognized marriage and guaranteed access to the related federal benefits. Bernhard could also become a lawful father to the couple’s 1-year-old daughter, Eva, since North Carolina law prevents residents from adopting a child if they aren’t married to the legal parent.
“As Eva grows, when friends of hers ask her, it would be nice for her to be able to say, ‘My dads are married, and they love each other dearly, and they love me dearly, and we’re just like anybody else,’” said Bernhard, 34.
Thirteen states and the District of Columbia, making up 34 percent of gross domestic product, have legalized same-sex marriage, including Minnesota and Rhode Island, where laws took effect Aug. 1. Laws ban the practice in 35 states, with five of those allowing civil unions or domestic partnerships. New Mexico does not expressly sanction or ban same-sex matrimony; New Jersey allows civil unions.
Bernhard and Null’s dilemma illustrates the economic benefits and consequences of a state’s same-sex marriage policy. Following the Supreme Court’s June 26 ruling, gay rights proponents and some economic development officials say states with gay-friendly laws can leverage them for financial gain, while those with prohibitive policies will miss out.
The Supreme Court ruling will force some states to examine whether it’s worth losing out on talent and businesses that are attracted to areas that allow same-sex marriages, said Richard Florida, a professor at the University of Toronto Rotman School of Management. Acceptance of gay communities signals cultural openness and attracts highly educated people and innovators, Florida wrote in his 2002 book “The Rise of the Creative Class.”
“States that recognize the rights of gay and lesbian households, they provide a signal to other people that those are the kind of places that they want to be in,” Florida said. “For many highly skilled, highly educated people, this is a nontrivial factor in decision making.”
Following the Supreme Court ruling, gay couples legally married in one state can access some benefits regardless of where they live, because recognition is based on the law of the place where the ceremony took place, said Amanda Goad, a staff attorney with the American Civil Liberties Union in New York. Green-card sponsorships and federal student aid are among the privileges that follow this standard. Some other programs, including Social Security, look to the law of the state where people reside, Goad said, so living in a state that doesn’t recognize the marriages of same-sex couples might bar them from receiving those benefits.
The U.S. is divided between areas that are high-income, high-education and more progressive and those that have lagged in development and remained more traditional in their outlook, Florida said. As states “dig in their heels” and defend their bans on gay marriage following the Supreme Court ruling, “those divides get bigger, not smaller. It simply reinforces a long-standing process of divisions that we’ve seen.”
It is persuading some couples, such as Bernhard and Null, to consider moving. It may be easier to relocate to places that are geographically close and have legalized same-sex marriage, according to Gary Gates, a demographer at the Williams Institute at University of California, Los Angeles School of Law, which conducts studies on sexual orientation and gender identity law and public policy.
Couples with access to federal benefits tied to marriage might rely less heavily on state programs, so “there’s some evidence that states could save a little money,” he said.
Some state officials are hoping it might make them a little money as well. The legalization of same-sex marriage in Rhode Island will do more than just honor “critical basic civil rights,” Governor Lincoln Chafee, a Democrat, said in an Aug. 7 statement.
“As our reputation for tolerance and equality spreads beyond our borders and throughout Rhode Island, the long-term benefits of marriage equality will start attracting talented and creative minds from all over the world,” he said. “New employers will want to put down roots in a state where they can find the brightest who want to work free of the distraction and worry of inequality.”
Some Wall Street executives, including Goldman Sachs Group Inc. Chief Executive Officer Lloyd C. Blankfein, have helped champion the cause. In a June 2011 op-ed article on the website of Crain’s New York Business, John Mack, who was then chairman of Morgan Stanley, said marriage equality is another way New York City can attract talent “to remain a global economic leader.”
Others argue extending federal advantages to same-sex couples may increase the burden on some companies as they become responsible for the spouses and families of gay employees.
“Whatever economic benefits that there might be because of gay marriage will be erased by a tsunami of health-care costs, and businesses will bear the brunt of those increased costs and that is bad for the nation’s economy,” said Bryan Fischer, director of issue analysis at the American Family Association, a Tupelo, Mississippi-based evangelical Christian group that supports heterosexual marriage.
States analyzed by the Williams Institute would see economic benefit from legalizing same-sex marriage, based on research that pre-dates the Supreme Court ruling.
“The states that recognize same-sex couples and allow them to marry are likely to be in a better budget position, they may find that they’re more attractive places to live,” Research Director M.V. Lee Badgett said, though effects such as improved productivity and worker loyalty are “really hard” to quantify.
One of the more tangible economic benefits for states allowing same-sex marriages comes from gay weddings and related tourism. Some 866 in-state same-sex couples chose to marry in the year after Iowa’s April 2009 decision to legalize such unions, while an additional 1,233 out-of-state pairs traveled to the state to get a marriage license, according to data obtained by the Williams Institute.
That translated into as much as an additional $12.9 million from wedding spending and tourism for state and local economies and as much as about $936,600 in tax revenue, the group estimated in a report.
In neighboring Illinois, where same-sex marriage is banned, legalization would generate as much as $103.2 million in wedding and tourism spending in the first three years, according to the Williams Institute.
While there is no state-level campaign in Iowa aimed at attracting gay couples and travelers, the Quad Cities region is considering advertising in gay-friendly publications and plans to track the economic impact of the population, according to the area’s convention and visitors bureau. The region, comprised of five cities that straddle the Mississippi River where it divides Iowa and Illinois, became a local destination for marriages and receptions following legalization.
After an initial surge of weddings subsided, interest is starting to rekindle as more states legalize the marriages and after the high court’s ruling, said Dan Gleason, director of sales at the bureau. Gleason, 28, and his partner tentatively plan to wed next year in hopes that same-sex marriage will by then be recognized in Illinois, where they just bought their “dream house,” he said. Otherwise, the couple will host both the wedding and reception in Iowa.
Nationwide estimates of how much states win or lose in light of the ruling are tough to create, Gates said. The gay population is small, making economic benefits limited. An October 2012 Gallup poll found that 3.4 percent of the nation’s adults identify lesbian, gay, bisexual or transgender. Additionally, the number of couples who would consider relocating to a different state is probably limited, he said.
North Carolina’s 2012 amendment, the most recent constitutional ban in the U.S., has caused gay individuals to question moving there for jobs as it starkly contrasts with national developments, said James Miller, executive director of the LGBT Center of Raleigh.
People contact the center “probably twice a day” saying that they work for “a great company” such as Cisco Systems Inc., Citrix Systems Inc., Bank of America Corp., Wells Fargo & Co. and Blue Cross & Blue Shield Association and are concerned about coming to the state for a job or want clarification on state policies, Miller said.
Welcoming all people is necessary for states that want to “flourish economically and be an engine for innovation,” Chris Hughes, co-founder of Facebook Inc. and a native of Hickory, North Carolina, said in an e-mail. Hughes, now the editor-in-chief and publisher of the New Republic magazine, wrote an open letter to the North Carolina General Assembly in 2011 opposing the constitutional amendment banning same-sex marriage.
“Entrepreneurs are very careful when deciding where to start a company,” said Hughes, who now lives in Shokan, New York, with his husband Sean Eldridge. “Building a business in a state that denies basic rights to LGBT couples is difficult to justify to potential employees -- straight or gay.”
The ACLU is pursuing federal court cases in North Carolina, Pennsylvania and Virginia to challenge same-sex marriage bans, according to a statement. That gives Null and Bernhard enough reason to stick around for another year or two, the couple said. If the law doesn’t change, the decision to leave will be easier, Bernhard said.
“We’d be moving away from both of our respective families, for one, and we’d be moving away from our respective jobs,” Bernhard said, yet the prospects of gaining a legal marriage could outweigh those costs. “I’ve told Mitch several days recently, let’s sell our property here and move to Maryland.”
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