Presentation Transcript

1. Income Supports Group

   Prepared for PSCI 12: Public Policy and Administration A Community-Based Learning Course at Drew University In Partnership with the United Way of Northern NJ, Morris County May 2011 Savanna Arabi-Katbi, Thomas Baniszewski, Cody Cummings, Nicole Kuruszko & Alexander Pedinoff
2. Tackling Income Supports Which income supports are the most cost-effective? Family-Wize, Food Stamps, TANF, EITC Which are most needed and could work best in Morris County?
3. Tackling Income Supports Income support programs, welfare and social insurance programs are typically targeted on the basis of some measures of need, such as income, assets, employment circumstances, and family circumstances.
4. Tackling Income Supports It might not be the low wage earner’s fault that they are struggling to pay their bills, because they might be working hard at their places of employment. However, they might be struggling as it depends upon their skills, needs, and risk of illness, family, as well as personal assets, and their ability to secure employment which depends upon the economy.

5. Family Wize

   Cody Cummings And Alexander Pedinoff
6. According to the ALICE report…. In 2005, almost 13 percent of the Morris County’s population was uninsured Use hospital emergency visits to access health care system Unpaid costs incurred represent small percentage of overall costs of charity health care E.g. hospital admissions, outpatient tests, and clinic visits Access to health care for ALICE is diminishing Reduction in employer provided health insurance
7. Prescription Drug Savings Program Aimed at lowering the costs of prescription drugs for children and families without prescription drug coverage Families who qualify request the program’s card Present card to participating pharmacies to receive a discounted rate on prescription drugs Distributed by chapters of the United Way Only requirement for receiving and using the card is not having prescription drug coverage Getting the card does not cost the applying family money
8. Limitations Not a formal health insurance program No governmental involvement. Discounts only available at participating pharmacies Each pharmacy decides independently whether or not it will participate Rate of discount varies among pharmacies It is possible that some families do not live within a reasonable distance of a participating pharmacy Only offers discounts on prescription drug costs The family must still pay the difference
9. Community Benefits Over 55,000 pharmacies within the United States participate in the FamilyWize program, and accept the card The average savings is 20% over standard retail prices $9.25 per prescription Has saved participating families a total of over $190 million
10. Effects Only involves discounts, not reimbursements A very cost effective program. Useful in Morris County Helpful to many college students Aids those who have health insurance that does not cover prescription drugs Beneficial to Morris County Does not cost anything to join Does not involve much work to join the program
11. Cost Effectiveness Extremely cost-effective Major drug companies participating Merck, Johnson & Johnson, Pfizer The United Way and affiliates pay nothing to operate the program Drug companies provide prescription brand name drugs with discounts 20-30% off original price Generic drug savings over 30% off of their retail price
12. Pharmacy Benefits Pharmacies must be in partnership with the United Way and major drug companies Otherwise, purchasing drugs at retail price would cause the pharmacies to lose money Enrollment in the program provides a reimbursement check from the drug companies to the pharmacies makes up for difference in prices Most pharmacies across the nation participate If the local neighborhood pharmacy does not, the Walgreen’s in the next town probably does http://www.unitedwaylebco.org/Family%20Wize%20prescriptions.htm

13. Food Stamps

    Savanna Arabi-Katbi
14. Program Overview Goals: Improve nutrition and health Assist low-income families in purchasing food One in eight Americans receive food stamps More than 355,000 New Jersey households In New Jersey, known as SNAP (Supplemental Nutritional Assistance Program) Switch to EBT in late 1990s Prevents fraud Eliminates coupons
15. Facts and Eligibility Most people receiving food stamps are not on welfare If annual income is below 185% of the Federal Poverty Level, you probably qualify Family of four can receive up to $668 monthly More people than ever are applying and receiving food stamps New Jersey receives nearly $91 million annually for food stamps
16. Income Limits For Food Stamps
17. Concerns More children impacted by the need for food stamps as recession continues 9.4% of New Jersey residents live in poverty 1/3 of New Jersey children living in poverty Outrage over proposal to cut food stamp funding Need funding in order to continue program 16% increase in need for food stamps over past year In 2006, served nearly 27 million nationwide Cost $30 billion to federal taxpayers
18. Pros and Cons Limitations on purchases Can also withdraw cash outside of grocery store Cash benefits Provides aid to thousands Limitations on purchases Can also withdraw cash outside of grocery store Cash benefits Many people are eligible and do not know it Think they need to be on welfare

19. Temporary Assistance For Needy Families(TANF)

    Nicole Kuruszko
20. Program Overview Fixed block grant Aid to Families with Dependent Children 1935-1996 TANF’s predecessor American Recovery and Reinvestment Act of 2009 Congress created a new TANF Emergency Fund Funded at $5 billion and available to all states Subsidized employment States created nearly 250,000 adult & youth jobs
21. Four Goals of TANF Provide assistance to needy families so that children may be cared for in their homes or in the homes of relatives End the dependence of needy parents on government benefits by promoting job preparation, work, and marriage Prevent and reduce the incidence of out-of-wedlock pregnancies and establish annual numerical goals for preventing and reducing the incidence of these pregnancies Encourage the formation and maintenance of two parent families
22. Current Policy & Organizational Landscape WorkFirst NJ- NJ’s Temporary Assistance for Needy Families NJ one of only a few states that also provides cash benefits and support services to individuals and couples with no dependent children Services under WFNJ are limited to five years: could be eligible for SAIF TANF Recipients: Entire U.S. Population 1999: 6,836,093 Entire U.S. Population 2008: 3,791,678 NJ 2003: 102,657, 1.20% of state population NJ 2008: 79,565, 0.92% of state population
23. Center on Budget & Policy Priorities
24. Diagnosis of Policy Problems Time Limit & Eligibility Recipients must work as soon as they have a job ready or no later than two years after coming on assistance Maximum of 60 months of TANF benefits Accommodates increased need at a slower rate than food-stamps Cost-Effectiveness: Expensive Federal Program: Fourth largest source of federal funding for employment & training services in FY 2009 Fixed block grant 17 states receive supplemental grants Rules and Measure of Success Measure work-program performance by number of participants extremely high participation quotas and expectations 90% of TANF recipients are women States have broad discretion in some respects
25. Policy Alternatives Financial reforms Spending cuts Examine the funding level and rules for the program Benefits need to be accounted for in times of inflation/recession Encourage partnership between agencies TANF and WIA New Focus on TANF Content Education/ Training Programs Transportation Costs Affordable Housing Elimination of discrimination based on family structure Raise benefits to an adequate level
26. Policy Alternatives: Pros and Cons New Focus on TANF content High Deficit spending- hinders implementation of new ideas Administration costs Specialized experts to redefine rules Legislative process, time consuming Unemployment TANF and WIA partnerships: Pro of partnerships: Leverage each agency’s relative strength WIA system’s close connections to employers Con of partnerships: Different program expectations Outcomes are measured differently

27. Earned Income Tax Credit(EITC)

    Thomas Baniszewski
28. Context of Policy Issue Federal government’s largest cash-assistance program for low-income families Centerpiece of anti-poverty programs in the United States 15% of households nationwide qualify for the EITC Administered through the income tax filing process Reduces potential stigma associated with the program Aids in ensuring high participation Approximately $43 billion allocated to 22 million families in the United States in 2007 Compares to $16.5 billion spent on more traditional welfare programs like TANF
29. Context of Policy Issue (cont’d) Targets families with children Money received increases with the addition of each child E.g., households with two children earning $15,000 annually could receive $4,824 in federal earned income credits A childless single filer can receive only one-tenth of this amount $438 Full refundability ensures a substantial addition to income.
30. Cost Effectiveness Designed to augment income while encouraging work Tax credit increases with earnings for low levels of household income EITC is a negative tax on earnings Often constitutes a significant portion of after-tax wage income Successful in helping the working poor get out of poverty Encourages work Combined federal and state EITC helps families rise above the poverty line Estimated to have helped five million people out of poverty in 2005 2.6 million children Raised the standard of living for low-income households Keeps administrative costs relatively low
31. Provides Relief to Families 60% of EITC recipient households are single Equal distribution of single households having zero, one, two or more children Contrasts with two-parent households majority of receiving households have two or more children Amount of relief varies significantly across household types Single-parent households with two children receive the most EITC 15% of annual income $2,728 Households without children receive much less EITC 6% of annual income
32. Effectiveness of the Program Has the largest impact on households with children Tax credit much larger for these households more than seventy-five percent of recipient households have children Single households represent the majority 60% Tend to be more educated than married EITC households Contrasts with the general population Recipient households much less likely to have two earners than non-recipient households.
33. Financial Constraints Single households Lower credit card balances Late payments on credit cards Less likely to have a checking account Married households with children Very high late payment frequencies 13% of married households with one child have a late repayment, compared to 5% of non-recipients
34. Policy Alternatives Contribute to a retirement savings plan Encourages the working poor and other low-income workers to invest in retirement savings The employer match has not succeeded in increasing the participation rate of the working poor and other low-income workers Need to encourage workers to save money Dollar for dollar match Households should receive as much as they make Put a cap on amount of money allocated to each household

35. Conclusions and Recommendations

36. EITC as Most Beneficial to Morris County Great potential in New Jersey Low- and moderate-income workers in Morris County lost out on more than $123 million in federal and state earned income tax credits in 2009 40% of Morris County residents eligible for tax credits 11,755 tax filers claimed EITC in 2009 $18.7 million to county’s residents who filed Average return of $1,591 Total return would be $141.8 million Eligible incomes range from $13,460 to $43,352 for a single person or a single person with children From $18,470 for a married couple aged 25 to 64 with no children to $48,363 for a married couple with three or more children
37. Easy to Access EITC Help Thirty sites in Morris County that can help taxpayers file for the tax credit Chatham, Whippany, Wharton, Kinnelon, Mount Olive, Boonton, Chester, and Jefferson Libraries Madison and Chatham Senior Citizen Centers
38. What can United Way Can Do to Expand the EITC? Print Fliers or brochures in English, Spanish, and in other languages and leave them at Public Libraries, Municipal Buildings, and Senior Citizens. Print Ads in local Newspapers, for example, Parsippany Patcher, Madison Eagle, etc. to raise awareness. Send out mailings to past EITC recipients to encourage their families or friends to apply or to potential recipients who failed to apply.
39. What can United Way Can Do to Expand the EITC? Ask local religious leaders in the community to spread the message about EITC either through word of mouth, parish bulletins, etc. Hand out fliers at local schools, explain to students to give these to their parents and make sure that students persuade their parents read them.
40. What can United Way Can Do to Expand the EITC? Make sure that brochures and fliers emphasize the following about the EITC; The program does not stigmatize you Money from the tax credit can be used for any need of the family or individual Applying, filing, and receiving information on whether one is eligible is free of charge These centers that are free of charge are numerous and one is guaranteed to be near you