I’ve been asked how the new job-saving measure will affect the District. Here’s what I’ve come up with thus far.
First a brief overview. The amendment will deliver an estimated $16.1 billion of fiscal relief to the states in the form of a phased-down extension of the higher federal match on state Medicaid costs (FMAP). An additional $10 billion will be apportioned among states to preserve jobs in elementary and secondary education. In both cases, states include the District of Columbia.
About 45% of the total costs — $11.9 billion — will be paid for by terminating the 13.6% boost in food stamps that was part of the economic recovery act. End date will be April 2014. As I previously wrote, the boost was expected to end in 2018 and with no benefits loss.
Now for the District.
FMAP Extension. The District’s Fiscal Year 2011 budget assumes a straightforward extension of FMAP, worth an estimated $77.6 million. According to recent estimates by the Center on Budget and Policy Priorities, the District will actually get $54 million. So there could be a budget gap to close, though much smaller than it would have been without the extension.
Public Education. According to estimates developed for the House Labor and Education Committee, the District stands to gain somewhat over $18 million. The funds are said to support an estimated 200 jobs.
As the DC Fiscal Policy Institute reports, the District will lose considerably more in stimulus funding that was part of the economic recovery act. The Fiscal Year 2011 budget will use local funds to make up part of the loss, but some staff reductions could have been in the offing. The new stimulus infusion might avert them. The amendment strictly limits, if not altogether precludes all other uses of the funds.
Food Stamp Benefits. It’s hard to come up with hard numbers for the impact of the premature end of the food stamp boost. What we know is that, in May 2010, about 119,260 District residents were receiving food stamps — nearly 20% of our total population.
Participation in the food stamp program has been steadily increasing. The annual May-to-May increase for the District was 15.5%. So barring some economic miracle, at least 200,000 or so residents will see their benefits drop.
The dollar impact will depend on family size, income and whether the cost of the food plan used to calculate benefits increases before the boost ends. The Food Action and Research Center says that a family of four will lose $59 per month. I’m guessing this reflects a calculation based on some average.
At this point, the maximum monthly per person benefit for a family of four is $167. Many District residents get far less. In Fiscal Year 2009, with the boost in effect, the average monthly per person benefit for District residents was $128.66. Without the boost, it probably would have been $24 less. I believe the figure would be the same for this fiscal year.
It doesn’t mean that District residents will lose, on average, this amount. But it’s clear that the poorest among us will be paying, with a benefits loss they can’t afford, to save jobs they don’t have.