Steps Toward Helping Low-Income People Get Connected to the Internet

June 22, 2015

You wouldn’t be reading this if you didn’t have swift, reliable access to the internet. You couldn’t be reading it if I didn’t.

We all, I suppose, take our high-speed connections for granted — except when our service is interrupted. Yet costs are apparently a barrier for well over half of our country’s poorest households. And that barrier is a barrier to many opportunities we also take for granted.

Two Democratic Senators and a Congresswoman, also a Democrat, have proposed a bill that could enable low-income people to afford broadband connections. The Federal Communications Commission has just voted to explore a somewhat similar plan the Chairman floated,  thanks to the Democratic majority there.

Both would expand the Lifeline Assistance program, which currently provides low-income households with discounts for landline or cell phone service. It’s what you may have heard of as free Obama phones, an allegedly fraudulent, wasteful use of our taxpayer dollars — another liberal “dole-out to dead beats” on welfare.

But the phone service isn’t free. And though welfare recipients are poor enough to qualify for discounts, eligibility extends to households at or below 135% of the federal poverty line and to some whose incomes are higher, e.g., certain recipients of federal housing vouchers.

The dollars that pay for the discounts don’t come out of our federal taxes. They’re often collected as one of those mysterious charges tacked onto our monthly phone rate. And the Lifeline program dates back to the notoriously liberal Reagan administration.

Both the Democrats’ bill and the FCC Chairman’s plan seek to bridge the so-called digital divide — a marked disparity in ready access to a broadband connection that’s increasingly income based. In 2013, only 42% of the poorest households had high-speed internet service in their homes, as compared to 90% of those with incomes of at least $100,000.*

Don’t suppose I need to say that children are now expected to do homework involving internet use or that it’s all but impossible to find and apply for jobs, except via the internet. Far less possible these days to develop job-related skills and networks — or to keep up with relevant news.

So it would seem that a Lifeline expansion would make it somewhat easier to move up from the bottom of the income scale. It could also lead to better opportunities in other ways, e.g., by creating a broader base of informed, engaged voters.

Neither the FCC Chairman’s plan nor the Congressional Democrats’ seems like quite the right answer, however. Both would require Lifeline beneficiaries to choose between a high-speed connection and phone service.

And the Chairman apparently envisions the same subsidy — just $9.25 a month. That’s obviously less than what companies generally charge for phone service.

It’s a much smaller fraction of a DSL connection, which cost, on average, $59.40 a month two years ago, according to an FCC estimate. Hard to imagine that many poor and near-poor households would pick up the whole cost of phone service, plus anything close to $50 a month.

Harder to imagine many would opt for the ‘net instead of a phone, if for no other reason than safety.

My mother-in-law, for example, is now in her mid-90s and coping with frailities common to someone of her age, e.g., a tendency to lose her balance and fall. She has one of those low-cost phone services, with an automatic dial for emergencies.

It’s been a genuine lifeline for her — and one I’m sure she’ll never swap for the chance to see photos of her grandchildren online or keep up with local news now that her hometown paper is delivered only three days a week.

The Democrats’ bill would direct the FCC to monitor prevailing broadband access prices, as well as some other relevant information, e.g., the prevailing speed households use. The agency would use these findings to set the subsidy rate.

Where the extra money would come from isn’t clear — at least, to me. If from a hike in the Universal Service Fund fee (our contribution to the subsidies), we should expect pushback. If not that, what?

The FCC will probably adopt some fleshed-out version of the Chairman’s plan. But the initiative itself will almost surely into flack on Capitol Hill, as The New York Times has predicted.

Not much enthusiasm for broadband expansion there. Only nine more Senators and House members have signed on to the proposed Broadband Expansion Act. Not a single Republican.

So it’s far from certain that we’ll soon help low-income people gain home-based access to the diverse opportunities the internet offers. And as I’ve suggested, the proposals seem problematic.

On the other hand, some influential policymakers have recognized a problem and come up with an approach to solving it. If it needs tweaks and/or clarifications, well, that’s what rulemaking and legislative processes are for.

So as with many issues affecting low-income people (and others), this one boils down to political will. Which in this case (and others), boils down to how we choose to view those low-income people and our government’s role in helping them surmount barriers that marginalize them.

* The FCC Chairman cites somewhat higher percents, based on the Census Bureau’s American Community Survey. The differences reflect differences in the income bands the ACS analysis and my source, Pew Research, use.


What Could Lift More Seniors Out of Poverty?

May 26, 2015

The senior poverty rate, according to the official measure, is lower than the rate for the U.S. population as a whole and considerably lower than the child poverty rate. It still translates into about 4.2 million people 65 and older whose incomes fell below the applicable poverty threshold last year — just $11,354 for those who live alone.

The more accurate Supplemental Poverty Measure boosts the senior poverty rate to 14.6% — about 2.3 million more people. But for Social Security benefits, the rate would have been a whopping 52.6%. This is why Social Security is justifiably called the most effective anti-poverty program we have.

Yet we do still have some 6.5 million seniors without enough income to live on. And our poverty prevention measures tend to focus on younger people, as Kevin Prindiville, the Executive Director of Justice in Aging, says.

We’ve got a battery of programs to support education and work-related training, for example. And we’ve got a spectrum of programs to prevent — or at the very least, reduce — poverty among those who find work, especially those with dependent family members. In other words, it’s not just younger people our measures focus on, but working families.

All too late, Prindiville observes, for someone in her 70s or 80s who’s struggling now after a lifetime of low-wage jobs. “We cannot just hold up our hands and say we should have helped … [seniors] 50 years ago, or helped their parents a century ago.”

So what would help them now? Prindiville proposes a five-step plan. He’s managed to get them into a single, compact post. I, as usual, want to flesh out the issues and solutions.

So I’ll deal here with the first two, overlapping steps and leave the remaining three for a followup.

Strengthen the Existing Safety Net and Social Insurance Programs*

Social Security, SSI (Supplemental Security Income), Medicare and Medicaid largely account for the 26% drop in the official senior poverty rate since 1960, Prindiville says. First and foremost, we need to protect them.

None of those proposed Social Security benefits cuts, increased Medicare cost-sharing, e.g., through a voucher plan, or tighter limits on Medicaid coverage, which we could expect to see under the Congressional Republicans’ upcoming block grant proposals.

On the strengthening side, I suppose Prindiville would endorse the latest version of what was originally the Strengthening Social Security Act of 2013.

It would change the benefits formula, providing an average of $65 a month more, and base annual adjustments on an as-yet-to-be-completed Consumer Price Index specifically for the elderly. And unlike the 2013 bill, it would ensure that formerly low-wage workers receive benefits at least big enough to lift them over the poverty line, provided they’d worked at least 10 years.

Of course, like its predecessor, the current bill would also keep the Social Security Trust Fund from coming up short on the money needed to pay full benefits past its projected insolvency in 2033.

Rather than simply scrapping the cap on payroll taxes, as some have proposed, it would trigger taxes on all income — not only wage income — over $250,000.

Improve Supplemental Security Income

Let’s just say proposals to boost Social Security retirement benefits won’t go anywhere in this Congress. So we’ll still have seniors in poverty.

We would anyway because not all seniors used to work — or have spouses that did. And even a work history often won’t yield a benefit anyone can live on unless it spans at least 35 years — this because of the way the Social Security Administration calculates benefits.

For the poorest 2.1 million seniors, SSI provides a safety net. But it’s in need of strengthening too. The maximum benefit — currently $733 a month — is nearly $250 less than would be needed to lift a single person over the poverty line.

No benefits at all for individuals whose savings and other “countable resources” are worth more than $2,000. Nor for couples who’ve more than $3,000. So seniors who’ve saved even a modest amount don’t qualify, though they surely need some stash they can draw on for expenses like Medicare deductibles and co-pays.

And as I’ve written before, the formula for SSI benefits adjusts them downward, based on other income beneficiaries receive. The adjustments kick in only if income exceeds a certain amount, however.

We see a preference for income earned from work — understandable, since it encourages SSI recipients to enter (or reenter) the workforce. For other income, the exclusion — or disregard, as Prindiville calls it — is a mere $20 a month, plus the value of a few other public benefits.

The benefits reduction for other income is dollar-for-dollar — twice as much as for wage income. This isn’t a problem for seniors only. But it’s a big problem for them because they’ll lose as much as they gain from even a piddling increase in Social Security retirement benefits.

Congress hasn’t updated the exclusions since it created the program in 1972. If they’d been adjusted to reflect consumer price increases, the unearned income exclusion would be roughly $112 today.

Bills that died in the last Congress would have addressed these problems, as well as what can be large benefits reductions when a friend of relative helps out with food, housing costs and/or utility bills.

Prindiville says he expects the bills to be introduced again this spring. Nothing thus far, but they probably will be — whether to be better fate remains to be seen. Not holding my breath, folks.

* Prindiville’s top-line recommendation implies that Social Security retirement benefits and Medicare are safety net programs like SSI and Medicaid, but they’re insurance programs because workers pay premiums of a sort, as payroll taxes. I’ve modified the recommendation accordingly because I, among others, feel it’s important to preserve the distinction.


DC TANF Program Short-Changed Core Purposes

April 23, 2015

My last post focused on the “cautionary tale” we can find in how states spent their Temporary Assistance for Needy Families funds. Now here, as promised, is what we learn about the District of Columbia’s TANF spending.*

The figures are somewhat dated, but they’re still relevant to decisions the DC Council must make as it works on the Mayor’s proposed budget for the upcoming fiscal year.

The District reported $254 million spent on TANF in 2013. Twenty-three percent went for cash assistance. This is a tad higher than the percent reported for 2012. But a family of three was still left at 26% of the federal poverty line. And that’s about where it is now, unless it’s one of the 6,300 families whose benefits have been cut three times already.

They’ll get zero, come October if the Council doesn’t approve the Mayor’s proposal to give them a one-year reprieve. Even if it does, our three-person family will have to get along somehow on $156 a month — roughly 9% of the current FPL.

The Bowser administration justifies the reprieve on the basis of continuing weaknesses in the employment component of the District’s TANF program.

I’ve previously reported the results of an audit that focused on outcomes for the parents facing benefit cut-offs who were actually referred to a contractor for job training and/or help in finding a job. Not encouraging.

But there are two other parts to this story. One is that some parents have had to wait for nearly a year to get those job-related services. This may be in part because the Gray administration froze additional funds for them.

And that’s perhaps because the Department of Human Services didn’t spend all the TANF employment funds in its budget, according to the new director. We certainly see what seems to be under-spending in the Center on Budget and Policy Priorities report I’m using here.

Only 15% of TANF funds spent on work-related activities in 2013. And even this was a marked improvement over 2012, when only 7% went for what surely ought to be a top priority for a TANF program.

At the same time, the District spent an unusually low percent of its TANF funds on administration and systems — 2%, as compared to a nationwide 7%.

This matters because the DC Council enacted exemptions from the benefits phase-out for families facing specified hardships, i.e., difficulties, beyond the usual, that parents would face trying to support themselves and their kids.

One, added for the current year, would temporarily stop the time clock for mothers with infants to care for. But the department hasn’t actually granted this exemption. The reason, we’re told, is that it doesn’t have the computer capacity to suspend time-counting for the moms and their babies.

I personally believe that the TANF time limits merit rethinking altogether. DHS itself is looking into a policy that would convert the one-time hardship exemptions for at least some of the designated families and perhaps others into hardship extensions, as federal law has always allowed.

But that’s not even on the drawing board yet. The proposed reprieve is on the Council’s must-decide agenda.

A rollback of the benefits cuts should be too, given what we know about job training waiting lists — and the many months families had to wait for the assessments used to decide what training and/or other services they should get to give them a reasonable chance of success in the workplace.

Beyond these obviously urgent issues, the Council should, I think, take a hard look at how DHS spends its TANF dollars. In 2013, the department spent nearly as much on “non-assistance” as on work activities. What’s in this catch-all category is a mystery. Not the department’s fault, but rather a flaw in the U.S. Department of Health and Human Services’ reporting format.

The new DHS director, unlike her predecessor, shared a break-out of TANF spending with parties interested enough to have attended a recent briefing. Some money here, some there, some someplace else.

I doubt the Council has ever delved into the dispersal of TANF funds. Every dollar may support something worthwhile. But the mechanism is hardly responsible — let alone transparent — budgeting.

And it inevitably diverts funds from cash support for very poor families and from work-related services that can help the parents get to the point where they can pay for their families needs.

These, I think most of us view as core purposes of the TANF program. And both the CBPP report and everything else we know suggests they’re being shorted.

* The TANF funds spent include the District’s federal block grant share and what it claimed as its maintenance of effort, i.e., what it spent of its own funds, plus funds that some nonprofits spent on at least on of the program’s four major goals.

UPDATE: Shortly after I finished this post, I learned of a petition the Fair Budget Coalition has created to drum up Council support for the proposed reprieve. Some on the Council, I’m told, are in need of persuasion. So I hope those of you who are District residents will sign. You’ll find the petition here.


Not Much Spent to Move Families From Welfare to Work

April 20, 2015

Nothing new in the big picture we get from the Center on Budget and Policy Priorities’ update on how states spend their Temporary Assistance for Needy Families funds. But even the same-old is timely, both because of what’s going on at the federal level and because we’ve got things brewing here in the District of Columbia.

I’m going to split these into two posts because the pressing issues are as different as the proclivities of the majorities in the Capitol building and those of the leaders in the city its dome looms over.

State spending and the federal policy implications first.

As you may know, Republicans on Capitol Hill — and conservatives they listen to — still view TANF as the model anti-poverty program. Time limits, rigid work requirements, lots of state flexibility and an ever-diminishing fraction of the federal budget. What’s not, for them, to like?

So we see another House budget plan that would convert both Medicaid and SNAP (the food stamp program) to block grants somewhat like TANF. States would get a fixed amount of funding, no matter what befalls their economies or drives up needs for other reasons. They would have the flexibility to reduce benefits and/or further restrict eligibility so as to manage with what they get.

States have had such flexibility — and then some — since welfare as we knew it ended in 1996. And they’ve received the same dollar amount in block-grant funds ever since.

Most of us, I think believe TANF should do two main things. It should provide a safety net for poor families with children. And it should help the parents get to the point where they can earn enough to pay for their families’ needs.

Yet states spent, on average, 28% of their TANF funds* on cash assistance in 2013, the latest year the U.S. Department of Health and Human Services has reported figures for. Even states that spent higher percents provided benefits too low to lift a family of three out of deep poverty, i.e., above 50% of the federal poverty line.

More remarkably, states spent, on average, just 8% of their TANF funds on work activities and supports to make participating in these activities possible, e.g., childcare subsidies, transportation.

Large disparities among states, as you might imagine. Yet every state spent at least some funds on programs not exclusively — or even primarily — for TANF-eligible families, e.g., child welfare services, Earned Income Tax Credit refunds, early childhood education.

However worthy these may be, states seem to be using their flexibility to shore them up at the expense of essential supports and services for TANF families. A dozen states spent at least half their TANF funds this way.

In short, a “cautionary tale,” as CBPP calls this prime example of the block-granting approach to safety-net programs.

* Here and throughout this post, TANF funds include federal block grant funds and what states claimed as their maintenance of effort, i.e. what they spent of their own funds and, in some cases, funds that nonprofits spent on any of the program’s four major goals.


When the Safety Net’s Ripped, the Babies Will Fall … and the Rest of the Family Too

February 17, 2015

In less than eight months, some 6,000 families in the District of Columbia will have no cash income whatever, unless the parents can land jobs PDQ. Most probably won’t because they would have if they could have.

The families I’m referring to have participated in the Temporary Assistance for Needy Families program for a lifetime total of 60 or more months. The benefits they’ve received have been, at best, extremely low — $428 a month for a parent with two children.

But their benefits have already been slashed. Our three-person TANF family facing a cut-off now receives $152 a month. Is this what a parent would choose over paying work of any legal kind, assuming s/he’s got someone to care for the kids?

Of course not. The parents who’ve perforce depended on TANF for a long time or recurrently often have what are euphemistically called severe barriers to work, e.g., debilitating physical and/or mental health problems, domestic violence trauma, functional illiteracy.

The District’s TANF program will count time spent receiving services to help overcome such barriers as compliance with its work activity requirements. But it won’t stop the clock ticking toward the cut-off date, except for the relatively few  parents who’ve been shifted out of TANF into a locally-funded program.

Most parents used to be placed in programs designed to get them into the workforce quickly, regardless of their needs and skills. No real attention to whether they could stay in the workforce. Most didn’t, as even the District’s short-term tracking showed.

Then the Department of Human Services revamped the TANF program, providing for individualized assessments and a range of services, including more diverse education and job training options. But time spent in the flawed program still counts toward the 60 months.

And parents who were deemed work-ready, either initially or after some “barrier-removal” services, had to wait for job training because the budget didn’t fund enough slots. Again, the clock kept ticking.

Now Mayor Bowser and the DC Council can let these very poor parents and their children fall into utter destitution or decide that the 60-month limit is, at the very least, too rigid, if not a bad idea altogether.

When they consider the options, as one hopes they will, they should recall that the Council hastily adopted the time limit as part of a budget-gap closing package that then-Chairman Vincent Gray pushed through shortly before he became mayor.

At least some Councilmembers — and we the public — were sold a bill of goods when a less draconian version of the benefits cut-off surfaced in the original gap-closing bill. DHS called it a measure “to more closely align with federal policy.”

But, as I said at the time, nothing in federal policy compels states or the District to cut — let alone end — TANF benefits at the end of five years. The rules only prohibit the use of federal funds to help pay for them.

And not altogether. States and the District may use federal funds to extend benefits for up to 20% of their average monthly caseload based on “hardship or domestic violence.” About 20 states do, in one form or another. The District has taken a pass. It exempts parents from their regular work requirements, but it keeps the clock running. And, as I already said, it set the clock to start when TANF families first enrolled.

So more than 6,100 families lost a portion of their benefits with virtually no warning — and little or no chance to first improve their employment prospects through the new, improved assessment and referral process.

Many would still have faced high barriers — not only those I’ve mentioned, but others that some states count as “hardship,” e.g., the need to care for a chronically ill or severely disabled child.

And then there’s that barrier confronting all local job seekers who don’t have a college degree. Last year, 19% of District residents without a high school diploma couldn’t find work, even part-time. The unemployment rate for those with, but no more was only 1% lower.

So we’ve undoubtedly got TANF parents who’ve been putting in their required work activity hours searching for a job, but to no avail. Yet we’re about to punish them — and their children — further by cutting off their benefits.

The DC Fiscal Policy Institute’s recommendations to the Mayor and Council include a temporary, renewable benefits extension for parents up against the time limit when they can’t find a job that offers enough hours for them to make ends meet.

Some other parents should get extensions too, it says — those who aren’t yet work-ready, for example, and those with the kinds of significant barriers I cited above. It also recommends extensions when families will otherwise suffer “serious hardship,” e.g., homelessness.

One can make lots of arguments, moral and pragmatic, for protecting families from the benefits reductions and cut-offs they face under the current law.

Among the most pressing of both sorts is what’s providing to be an unprecedented homeless family crisis. Stingy TANF benefits help explain it — as, of course, do the even stingier benefits the 60-month families are getting.

But there are still families who’ve managed to stay housed, at least for awhile — by doubling-up (or tripling-up) with other low-income families, for example, or by contributing to the household expenses of a hospitable friend of relative.

These arrangements are by no means ideal for the children, since housing instability of any sort tends to harm them — and in ways that have lasting effects. But they’re better for them than living in the DC General shelter — or on the streets when it’s not cold enough for them to get in.

And they’re better than the cut-offs for the District’s budget too, though I’d like to think our policymakers will take a broader view of their responsibilities when they decide whether to extend a lifeline to at-risk TANF families.

 

 

 

 


DC TANF Families Far Below Poverty Line, Even With Uncut Benefits

November 20, 2014

Shortly before the election, Washington Post reporter Rachel Weiner observed that none of the mayoral candidates had even mentioned “a dramatic change in the city’s welfare program that could drag many poor families into further distress.”

She was referring to the District’s decision to phase out Temporary Assistance for Needy Families benefits to families who’ve received them for a lifetime total of five years. The DC Council suspended the phase-out after the first cut — and for good reasons, as Weiner indicates.

But the cuts have gone forward again. They’re likely to leave more than 6,000 families with no cash assistance whatever come next September — unless the Council and soon-to-be Mayor Bowser agree to change the law.

But what about families whose benefits haven’t been cut? Not much of a safety net for them, as the Center on Budget and Policy Priorities’ recent state-by-state update on the benefits shows.

CBPP looks at the maximum cash benefit a single parent with two children can receive. That was $428 in the District when the Center did its analysis.

A provision in the latest Budget Support Act, i.e., the package of legislation that’s paired with the budget proper, provides for a cost-of-living adjustment this fiscal year, based on the Consumer Price Index.

That, I’m told, will boost benefits by 1.5% — just making up for what our three-person family’s benefit lost in value due to inflation during the July 2013-14 period.

The family will still have an income at about 26% of the federal poverty line. And it will be considerably worse off than three-person families were when TANF began.

Adjusting for inflation, the maximum benefit for our D.C. family has lost about a third of its real-dollar value. Losses were smaller in more than half the states.

And, as we all know, the cost of living here is higher than in most places. CBPP provides just one measure — the gap between the maximum TANF benefit for three-person families and the fair market rents the U.S. Department of Housing and Urban Development set for a modest two-bedroom apartment.

The pre-COLA maximum benefit for our D.C. family is 29.1% of the FMR for the apartment. In other words, the family couldn’t come anywhere near to paying for it, even if it spent its entire benefit on rent.

This is true for families in every state, but the rent shortfall is greater than the District’s in only two — Mississippi and Tennessee. Not, I suppose, states the District would choose as benchmarks.

Rankings of this sort aren’t nearly as relevant as the measures of how woefully inadequate TANF benefits are — and how more woefully in adequate they’ve become over time.

So far as housing is concerned, the maximum for our D.C. family would have covered nearly 44% of the FMR in 2000 — still a very large shortfall, but smaller because the benefit was worth more and rents in our area hadn’t skyrocketed.

Now, it’s true that some TANF families in the District have more cash income than the maximum benefit indicates because our local program exempts a fair amount of earned income when setting benefit levels.

Also true, however, as indicated above, that many families are receiving far less than the maximum. The phase-out alone has left some three-person families with as little as $152 a month.

Most, if not all of the families, however, receive a separate cash-equivalent benefit from SNAP (the food stamp program). Yet the cash value of SNAP benefits still leaves TANF families far below the poverty line.

CBPP shows this by combining the average monthly SNAP benefit for TANF families with the maximum the three-person family can get from TANF. With the two benefits, so defined, our D.C. TANF family was at 54.4% of the FPL in July.

But, says CBPP, this is probably an overstatement for many families because the average SNAP benefit it calculated assumes housing, plus utility costs high enough to qualify families for the maximum.

No such costs for the families in the DC General shelter, most of whom depend on TANF benefits. And lower costs, if any that families can claim if they’re doubled-up with accommodating friends or relatives.

There could be fewer homeless families if the District substantially increased TANF benefits now, as originally proposed, and modified the phase-out to preserve benefits for families who’d otherwise become destitute, even though the parents had done everything they were told to.

These could include families with a parent who’s working, but not able to earn enough to support herself and her kids and those with a parent who isn’t working because jobs she could qualify for are just too scarce.

And then perhaps there are parents who didn’t do everything they were told to because they couldn’t, e.g., those with certain intellectual disabilities or PTSD that caseworkers had failed to identify.

But such exemptions would still leave some families subject to phased-out benefits that would sink them even deeper in poverty than they already are — and less likely to achieve the self-sufficiency that TANF is supposed to promote.

How can you focus on preparing for — or seeking — work when you’re trying to figure out where you and your kids will spend the night or how you’ll feed them now that you’ve run through your monthly SNAP benefit?

Problems even for parents who are still within the rigid time limit now.

 


Bills Would Bring Income Support for Low-Income Seniors and People With Disabilities Into the 21st Century

August 18, 2014

Nearly 8.4 million poor and near-poor people in this country depend, at least in part, on SSI (Supplemental Security Income) benefits to make ends meet. Most are people under 65 who have severe disabilities, but roughly 2.1 million are seniors.

SSI benefits are extremely low — currently a maximum of $721 a month for individuals and $1,082 for couples, when both spouses qualify. They’re the only source of income for more than half the people who receive them.

This is one, though probably not the only reason that the poverty rate for working-age adults with disabilities is more than 16% higher than the rate for those without them.

It’s also probably one reason that nearly one in seven seniors lives in poverty, according to the Census Bureau’s latest Supplemental Poverty Measure report.

Bills introduced in Congress would improve the financial circumstances of many SSI recipients — and in several ways. They’d also enable more low-income seniors and people with disabilities to qualify.

The maximum benefit would still inch up annually, based on increases in the consumer price index the Social Security Administration uses.

But the bills, as their title suggests, would restore SSI by updating and then indexing to a consumer price measure the dollar amounts of three provisions that haven’t been adjusted for a very long time — in two cases, not since the program was created in 1972.

The bills would also wholly eliminate a provision that may deter friends and family members from lending a helping hand — and penalizes beneficiaries when they do.

Further explanation of some pretty complicated stuff.

Exclusions. SSI benefits are adjusted down from the maximum based on two types of income SSI recipients may receive. But in both cases, the adjustments begin only if the income exceeds a certain amount. This is known as an exclusion.

One exclusion applies to income earned from work. At this point, it’s $65 a month — about nine hours at the federal minimum wage. Any earnings above the amount reduce benefits at a rate of 50 cents for every dollar earned.

The proposed Supplemental Security Income Restoration Act would immediately raise this exclusion to $357, nearly restoring the value it originally had.*

It would thus also restore the incentive to work, when possible. So it would, among other things, encourage recipients to see whether they could “graduate” from SSI by engaging in substantial gainful activity.

The second exclusion applies to certain other types of income, e.g., retirement benefits, interest on savings or some combination thereof. It’s currently $20 a month. Anything more reduces benefits on a dollar-for-dollar basis. The bills would initially raise this exclusion to $110.

Assets. To become — or remain — eligible for SSI, a senior or severely disabled person can have no more than $2,000 in savings or other resources that could readily be converted to cash, e.g., a life insurance policy, heirloom jewelry (unless the recipient wears it). The asset limit for couples is $3,000.

Neither limit has been adjusted since 1989, when dollars went a whole lot further than they do now.

The very low limits pose significant problems. From one perspective, they exclude people who genuinely need the benefits. From another, they keep SSI recipients from saving enough to cope with all but the most minimal emergencies.

As a benefits coordinator at Bread for the City notes, moving costs alone may exceed the limit. So it can keep recipients stuck in housing they can’t afford — or perhaps in supportive housing they no longer need.

She also notes the perverse incentive to spend down savings, even on things not needed — and also to rapidly spend down the lump sum back-payments the SSI program frequently makes because the approval process tends to be slow.

The bills would increase the asset limits to $10,000 for an individual and $15,000 for a couple. Then, as I said, they would annually rise to preserve their real-money value — just as the exclusions would.

In-Kind Support and Maintenance. Some very complicated rules apply when recipients don’t pay the full costs of their food and shelter, with or without SNAP (food stamp) benefits and housing assistance.

Even the Social Security Administration finds the rules “cumbersome to administer” — and both burdensome and intrusive for recipients.

Basically, SSI benefits are reduced, up to a third, when recipients live with someone else and don’t pay their full share of food and housing costs. Exceptions here if the someone else is a spouse or the recipient a minor-age child.

But when the child turns 18, the benefit cuts kick in — and they come on top of any cuts due to income exceeding the exclusions.

Benefits are also reduced if, for example, a friend or relative pays a utility bill — or buys some groceries when, as so often happens, SNAP benefits run out before the end of the month.

The SSI Restoration Act would repeal this part of the law — and with it, the unintended undermining of what we like to think of as America’s family values.

I don’t suppose I need to tell you that the bills are going nowhere in this Congress. But perhaps they’ll spur some movement toward reforming a good program that sorely needs revisions to bring it into the 21st century.

* The value would have been fully restored, with a little extra if Congress had passed the SSI Restoration Act last year, when it was introduced in the House. This is also true for the general income exclusion.

 


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