THE CITY COUNCIL made history in June when it overrode a mayoral veto and passed the Equal Benefits Bill, requiring any enterprise with a city contract of $100,000 or more to provide health insurance for domestic partners. But there’s still a major snag: Though the city can mandate that its contractors offer these benefits, it can’t require local insurance companies to provide them.

“For small organizations, if there is no exemption when the insurance is not available, that is a big problem,” says Jon Small, president of the Nonprofit Coordinating Committee of New York, an umbrella organization with 1,300 member groups.

Just ask the Lesbian, Gay, Bisexual and Transgender Community Center. Established in 1983, the center had been using Oxford Health Plans for many years. But when it decided to offer domestic partner benefits to its roughly 50 employees in 2000, Oxford refused, saying it offered this type of service only to groups with more than 100 employees. An Oxford spokesperson didn’t respond by press time, though a customer representative at the company says it has since lowered the cap to 50 employees.

Still, supporters of the law are encouraged by the success of similar laws in other cities, particularly San Francisco. When that city’s Equal Benefits Ordinance took effect in June 1997, there were only 14 insurers in the United States offering domestic partner coverage and only three willing to write policies for small groups, according to the Institute for Gay and Lesbian Strategic Studies. By 2001, however, there were 150 insurers providing the service, with more than one-fifth willing to work with small groups.

“The dilemma here is no different than the dilemma has ever been for small business,” says Joe Tarver, a spokesperson for Empire State Pride Agenda, a civil rights organization that has been the most active supporter of the Equal Benefits Bill in New York. “Once there is a demand for it, the market complies.”

But in California, insurance companies also had a political push. In 2001, after a three-year struggle, the state passed a bill that required them to extend spousal coverage to domestic partners.

New York State Assemblymember Daniel O’Donnell (D-Manhattan) got a similar bill passed in the Assembly in June. At press time, he had yet to find a sponsor in the Senate, but O’Donnell hopes the bill will move quickly. “My bill is narrower than the California one,” he says. “But for the employers who say [the insurers] won’t do it, this would solve the problem.”

–Xiaoqing Rong