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News

Jun 21, 2017

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A Better Budget: Revive education and training

by | Jun 21, 2017

Family Economic Security

President Donald Trump calls his proposed budget for fiscal year 2018, “A New Foundation For American Greatness.” Alternately dubbed the “taxpayer-first budget,” the document proposes $3.6 trillion in cuts over 10 years – largely at the expense of education, health care and services that give low-income individuals and families a chance to maintain financial security – while boosting defense spending and decreasing taxes for the wealthy.

“This Budget’s defining ambition is to unleash the dreams of the American people. This requires laying a new foundation for American Greatness,” the President wrote in his letter introducing the proposal to Congress. The stated goal of Trump’s budget is to push everyone towards work – including those currently receiving disability benefits. The budget reduces or eliminates programs needed to support work when one’s job doesn’t pay a living wage, including Medicaid, the Supplemental Nutrition and Assistance Program (SNAP), student loans, the Federal Work Study Program, HUD Rental Assistance and the food program for Women, Infants and Children (WIC).

In truth, Trump’s proposed budget would demolish any foundation for “American Greatness” by destroying programs that currently help hard-working Americans who can’t make ends meet because their employers don’t pay enough, or they lack the skills to compete in today’s job market. While the administration claims this budget will provide tax relief for middle-class families and reduce taxes on American businesses, it puts moneyed interests — not taxpayers — first. Examining the document closely, it’s hard to imagine how anyone – other than the wealthiest Americans – will benefit from the draconian and inhumane cuts detailed in this budget.

It is clear that last year’s presidential election was a call for a new approach. Americans are growing increasingly frustrated with stagnating wages as the cost of living rises beyond the level they can afford. Trump’s victory was a signal that many economically strained voters rejected “business-as-usual” politics of the recent past and feel their concerns were not being heard. But while President Trump aspires to “shake things up” in Washington by proposing a radical turn from the policies not just of President Barack Obama, but policies embraced by both parties for the past 50 years, Trump’s budget would severely limit the ability of Americans to adapt to the changing workforce and build financial security.

As Congress evaluates the components of the Trump budget, we at Colorado Center on Law and Policy believe that a true foundation for “American greatness” begins with policies and priorities that invest in the future of struggling Americans. To that point, we are launching a series of analyses entitled, “A Better Budget,” which will examine the importance of programs targeted for reduction or elimination under the Trump budget and outline how Congress can support policies that will strengthen – not undermine – support for vital programs that help build an inclusive, fair and just economy that reflects our American ideals and puts more Americans back to work and on a path toward self-sufficiency.

We’ll begin the series with a look at the proposed cuts to education and training programs and explain how America could support under-employed or unemployed Americans so they can secure better jobs and pull their families out of poverty.

Proposed cuts: Education and training
In unveiling “A New Foundation for American Greatness,” President Trump’s budget director Mick Mulvaney proclaimed that more Americans would be incentivized to get back to work if the government reduced or eliminated essential human services that help low-income Americans meet their basic needs.

“If you’re on food stamps and you’re able-bodied, we need you to go back to work,” Mulvaney famously stated, adding “We’re not going to measure compassion by the amount of money that we spend, but by the number of people that we help.”

Yet, Mulvaney either overlooked or ignored the fact that most able-bodied Americans who receive government assistance already work – often more than one job – and still can’t make ends meet without additional support. To find a job, or a genuine career path, many recipients of human-service programs like Medicaid and the Supplemental Nutrition Assistance Program (SNAP) need education and training to provide a bridge to self-sufficiency. Because these individuals and their families lack the financial means pay both for education or training and living expenses, they can be trapped into meeting basic needs with one or more dead-end jobs, leaving little time or money to advance their education. Furthermore, for the approximately 9 percent of Coloradans who lack a high school diploma, far fewer training or employment opportunities exist. Rather than supporting programs that get Americans back to work, or on a better career path, the president’s budget proposes drastic cuts to programs and services that equip people to compete in the job market.

Here are a few ways the president’s budget undermines key supports for low-income students and workers trying to get out of poverty:

* The budget slashes funding for financial aid programs that help low-income student get postsecondary education by $5.2 billion, including $3.9 billion from the Pell Grant program which defrays the high cost of tuition for low-income students. Already, the Pell Grant program covers less than 30 percent of the average cost of college attendance. More than 7.7 million students, most from families that earn less than $20,000 a year, would be affected by the cuts. Unfortunately, these proposed cuts come at a time when tuition costs are rising. Colorado students received about $450 million in federal Pell Grants in 2016.

* The budget eliminates Supplemental Educational Opportunity Grants (SEOG), which help cover college grants for more than 1.6 million high-need students. Nearly all SEOG grantees also receive a Pell Grant, adding insult to injury for low-income students who are already financially struggling to further their education and training. In Colorado, the program covers 15,129 people, providing $13.8 million total support with an average grant of $914.

* The budget would cut almost 40 percent of funding for the Workforce Innovation and Opportunity Act (WIOA). Charged with providing employment, career and training services, WIOA passed Congress in 2014 with overwhelming bipartisan support. WIOA collaborates with employers to provide youth and adults with job training. Although the budget suggests that states, localities and employers use their own resources in funding these programs, there is no source for that local funding in Colorado. Total cuts from the WIOA program, including youth activities, dislocated worker employment and training, and adult education amount to more than $14.58 million in Colorado.

* The budget reduces funding for the federal Work-Study program by $488 million. This would eliminate employment opportunities for more than 300,000 low-income students working their way through college, about 25 percent of whom earn less than $12,000 annually. In Colorado, a 51 percent reduction would cut funding by $7.2 million.

*The budget cuts funding for adult education for those who lack a high school diploma by 16 percent. For Colorado, this means a cut of over $1 million, which is more than all the current state funding for adult education. Because most of these training programs require a diploma or at least 9th grade reading and math skills, many workers simply can’t advance to a better career path without adult education. Currently, the Federal Adult Education and Literacy Act provides $7 million in funding to Colorado as part of WIOA. Still, the program serves less than 2 percent of Coloradans who lack a high school diploma.

Overall, these cuts would have a devastating effect on local communities seeking to address the skill gap between prospective workers and potential employers. These cuts would diminish the ability of low-income workers, whether in rural and urban Colorado, to obtain the education and training needed to succeed on the job and in life.

Combined with proposed cuts to SNAP, Medicaid and other supports, how would low-income families prosper – let alone survive – if Trump’s cuts became reality?

Furthermore, if approved, Trump’s budget would destabilize state and local budgets across the country. If states tried to fill the holes such a budget would create, that would dig deeper holes on other critical areas of investment such as health care, K-12 education and transportation.

What Congress should do
Members of Congress should reject the president’s budget because it would increase inequality and stifle career mobility for low-income students. But we’d also encourage members of Colorado’s Congressional Delegation to pursue an alternative path that builds a solid foundation for our present and future workforce.

In November, 2016, the National Skills Coalition outlined an agenda to put millions of Americans on the pathway toward good-paying, middle-skill jobs that would build strengthen companies that need and want to hire workers to fill skilled positions.

Published just before the election, the “Skills for Good Jobs” report set a challenge for elected officials to reboot and reorient the nation’s skills investment in coordination with students, workers, regional industries, educators and service providers.

Among the recommendations:

* Form a White House Skills Cabinet based in the Office of the Vice President. The office would ensure that federal agencies are coordinating and tracking progress on industry workforce partnerships and supporting programs that lead to industry-recognized credentials for community colleges.

* Encourage new policies directed at both students/workers and businesses to support the development of 5 million new apprenticeships. Apprenticeships let workers and families support themselves while earning a license or postsecondary credential – without pursuing a traditional four-year degree and incurring substantial debt. Despite the effectiveness of apprenticeships in starting a career, there’s only one working apprentice for every 40 full-time college students. The National Skills Coalition set the goal of supporting a target of one working apprentice for every four full-time college students by 2020. The coalition also suggested promoting apprenticeships as a wage-earning learning activity to fulfill requirements for those receiving Temporary Assistance for Needy Families (TANF). To his credit, Trump signed an executive order expanding apprenticeships and calling for $90 million to go toward apprenticeship programs. More funding is needed and we hope that future actions will establish “industry-recognized” apprenticeships that uphold the program’s current job quality and equal opportunity standards as well as a nationally recognized credential that is portable among employers within an industry; a hallmark of the current Registered Apprenticeship system.

* Build a diverse workforce to rebuild the nation’s infrastructure. As the Trump administration promises to build the nation’s roads, bridges and public transit, the country must invest in the skilled workforce needed to actually build this infrastructure. According to the National Skills Coalition, every $1 billion spent on infrastructure creates between 13,000 and 27,800 jobs. But to make this investment pay off for American families and the economy, we need a workforce equipped to meet the challenges of rebuilding our infrastructure.

In addition to the aforementioned recommendations, we encourage policymakers to support adult-education programs on a national and statewide level. While Colorado has done a better job in recent years harnessing the scant federal resources available for adult education, more funding is still needed. Without additional “on-ramps” to career pathways through adult education, too many Coloradans without high school degrees will continue struggling to turn their hard work into upward mobility.

Although we agree with the Trump budget’s premise that putting people back to work is the best way to fight poverty, the proposed cuts to education and skills training will make it harder for low-income individuals to move forward. These programs have historically enjoyed broad bipartisan support because they invest in workers and businesses. To that point, the best way to put Americans back to work is to strengthen – not weaken — public assistance programs so they provide meaningful education and training opportunities that help people get jobs and support their families and get on a career path that leads to self-sufficiency.

Ask your Congressional representatives to invest in education, training and support services that give workers a path to gainful employment while giving employers the workforce they need for the future.

-Bob Mook

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HEALTH:
HEALTH FIRST COLORADO (MEDICAID)

Health First Colorado is the name given to Colorado’s Medicaid program. Medicaid provides public, low-cost health insurance to qualifying adults and children. It is an entitlement program funded by the federal, state, and county governments and is administered by counties in Colorado. Those who are required to pay must pay a small co-pay when receiving certain health care services.

State Department: Department of Health Care Policy and Financing

Eligibility: Most adults 18 to 64 are eligible for Medicaid in Colorado if their household income is at or below 133% of the federal poverty limit (FPL). Pregnant women are eligible with incomes of up to 195% FPL, while children under 18 may be eligible if the live in a household with income at or below 142% FPL. Some adults over 65 may also be eligible for Medicaid.

Program Benefits: Through Medicaid, low-income Coloradans are eligible for a range of health care services at little to not cost. Services provided include doctors visits, prescription drugs, mental health services, and dental care. Co-pays for certain individuals may be needed for certain services.

Program Funding and Access: Colorado funds our Medicaid program through state and federal dollars. Medicaid is an entitlement program, which means that all who are eligible for Medicaid can access the program, regardless of the funding level in a given year. This does not mean that it is always easy to access Medicaid, even when eligible. And since the program is administered by counties, funding levels for county staff and other administrative roles can make it easier or harder for Coloradans to access the program. On top of this, not all medical providers accept Medicaid which limits the ability of Coloradans to seek health services even if enrolled, such as if the nearest provider is a 2+ hour drive away.

Note: This data is from before the pandemic and does not reflect changes in enrollment rules during the COVID-19 pandemic and public health emergency.

Statewide Program Access 2015-19: Over the study period of this report, an average of 89.0% of the population at or below 133% of FPL (i.e., the population who is likely to be eligible for Medicaid) were enrolled in Medicaid in Colorado.

FOOD SECURITY:
SUPPLEMENTAL NUTRITION ASSISTANCE PROGRAM (SNAP)

The Supplemental Nutrition Assistance Program or SNAP helps low-income Coloradans purchase food by providing individuals and families with a monthly cash benefit that can be used to buy certain foods. SNAP is an entitlement program that is funded by the federal and state governments and administered by counties in Colorado.

State Department: Department of Human Services

Eligibility: Currently, Coloradans qualify for SNAP if they have incomes below 200% FPL, are unemployed or work part-time or receive other forms of assistance such as TANF, among other eligibility criteria. Income eligibility for SNAP was different during the study period of this report than today—it was 130% FPL back in 2019 for example. The US Department of Agriculture uses the population at or below 125% FPL when calculating the Program Access Index (or PAI) for SNAP. We follow this practice in our analysis despite Colorado currently having a higher income eligibility threshold.

Program Benefits: SNAP participants receive a monthly SNAP benefit that is determined by the number of people in their household and their income. Benefit amounts decrease as income increases, helping households avoid a sudden loss of SNAP when their incomes increase, even by a minor amount. Benefits are provided to an Electronic Benefit Transfer (EBT) card that can be used to purchase eligible food items, such as fruits and vegetables; meat, poultry, and fish; dairy products; and breads and cereals. Other items, such as foods that are hot at their point of sale, are not allowable purchases under current SNAP rules.

Program Funding and Access: SNAP, like Medicaid, is a federal entitlement program. This means that Colorado must serve any Coloradan who is eligible for the program. As such, funding should not be a limit to how many Coloradans can be served by the program. However, funding for administration of SNAP at the state and county level can limit the ability of county human service departments to enroll those who are eligible. Other program rules and administrative barriers can make it difficult for Coloradans to receive the benefits they are legally entitled to receive.

Statewide Program Access 2015-19: Over the study period of this report, an average of 61.1% of the population at or below 125% of FPL (i.e., the population who is likely to be eligible for SNAP) were enrolled.

FOOD SECURITY:
SPECIAL SUPPLEMENTAL NUTRITION PROGRAM FOR WOMEN, INFANTS AND CHILDREN (WIC)

The Special Supplemental Nutrition Program for Women, Infants, and Children, also know as WIC, provides healthcare and nutritional support to low-income Coloradans who are pregnant, recently pregnant, breastfeeding, and to children under 5 who are nutritionally at risk based on a nutrition assessment.

State Department: Department of Public Health and Environment

Eligibility: To participate in WIC you must be pregnant, pregnant in the last six months, breastfeeding a baby under 1 year of age, or a child under the age of 5. Coloradans do not need to be U.S. citizens to be eligible for WIC. In terms of income, households cannot have incomes that exceed 185% FPL. Families who are enrolled in SNAP, TANF, Food Distribution Program on Indian Reservations (FDPIR), or Medicaid are automatically eligible for WIC. Regardless of gender, any parents, foster parents, or caregivers are able to apply for and use WIC services for eligible children.

Program Benefits: WIC provides a range of services to young children and their parents. These include funds to purchase healthy, fresh foods; breastfeeding support; personalized nutrition education and shopping tips; and referrals to health care and other services participants may be eligible for.

Program Funding and Access: WIC is funded by the US Department of Agriculture. The state uses these federal funds to contract with local providers, known as WIC Clinics. In most cases, these are county public health agencies, but that is not the case in all Colorado counties. Some WIC Clinics cover multiple counties, while others are served by multiple clinics. Private non-profit providers are also eligible to be selected as a WIC Clinic.

Statewide Program Access 2015-17: Between 2015 and 2017, an average of 52.2% of the population eligible for WIC were enrolled in the program in Colorado.

Financial Security:
Colorado Works

Colorado Works is the name given to Colorado’s program for Temporary Assistance to Needy Families or TANF. It is an employment program that supports families with dependent children on their path to self-sufficiency. Participants can receive cash assistance, schooling, workforce development and skills training depending on the services available in their county.

State Department: Department of Human Services

Eligibility: In general, Coloradans are eligible to enroll in TANF if they are a resident of Colorado, have one or more children under the age of 18 or pregnant, and have very low or no income. For example, to be eligible to receive a basic cash assistance grant through TANF, a single-parent of one child could not earn more than $331 per month, with some exclusions—and would only receive $440 per month (as of 2022). That said, there are other services provided by counties through TANF that those with incomes as high as $75,000 may be eligible for. In addition to these, participants in TANF are required to work or be pursuing an eligible “work activity” or work-related activity. Any eligible individual can only receive assistance if they have not previously been enrolled in TANF for a cumulative amount of time of more than 60 months—this is a lifetime limit that does not reset. Counties may have additional requirements and offer benefits that are not available in other counties in Colorado.

Program Benefits:  While the exact benefits that one is eligible for under TANF can vary, all qualified participants are eligible to receive a monthly cash payment, call basic cash assistance. Other than cash assistance, counties are have a lot of choice in how to use their TANF funding; generally a use of TANF funds is appropriate so long as it advances one or more of the four purposes of the program: (1) provide assistance to needy families so that children can be cared for in their own homes or in the homes of their relatives; (2) end the dependence of needy families on government benefits by promoting job preparation, work, and marriage; (3) prevent and reduce the incidence of out-of-wedlock pregnancies; and (4) encourage the formation and maintenance of two-parent families.

It is important to note that those eligible for TANF are also eligible for many of the other programs we’ve included in this report, such as SNAP, Medicaid, and CCCAP.

Program Funding and Access: Colorado funds its TANF program through funds received from the federal government through the Temporary Assistance for Needy Families block grant. Most of the federal funds are allocated by the state to counties, which are required to provide a 20% match of state funding. Federal and state rules allow the state and counties to retain a portion of unspent funds in a TANF reserve.

Statewide Program Access 2015-19: Over the study period of this report, an average of 50.7% of the population at or below 100% of FPL (i.e., the population who is likely to be eligible for TANF) were enrolled in TANF in Colorado.

EARLY LEARNING:
COLORADO CHILD CARE ASSISTANCE PROGRAM (CCCAP)

The Colorado Child Care Assistance Program provides child care assistance to low-income families and caregivers living in Colorado in the form of reduced payments for child care. It is a program funded by the federal, state, and county governments and is administered by counties in Colorado. The share owed by parents/caregivers is determined on a sliding scale based on the family’s income.

State Department: Department of Early Childhood Education

Eligibility: Counties set eligibility for families separately, but must serve families with incomes at or below 185% of the Federal Poverty Limit. Families accepted to the program are no longer eligible once their income exceeds 85% of the state median income. Parents or caregivers must be employed, searching for work, or engaged in another approved activity to be eligible for CCCAP. Parents and caregivers enrolled in Colorado Works (Temporary Assistance to Needy Families or TANF) or in the child welfare system are also eligible to participate in CCCAP. Generally, CCCAP serves families with children under 13, although children as old as 19 may be eligible under certain circumstances.

Program Benefits: If a family is eligible for CCCAP and has income, they may likely have to pay a portion of their child’s or children’s child care costs each month. The amount that families owe is based on their gross income, number of household members, and the number of children in child care in the household. As such, households tend not to experience a benefit cliff with CCCAP when they see their incomes increase

Program Funding and Access: Colorado funds the CCCAP program using federal dollars it receives from the Child Care and Development Block Grant program. The state allocates federal and state funds to counties using a formula that takes into account factors like current caseloads and the number of eligible residents. Assistance is available until the county’s funds are spent, so the number of families that can be served is often a function of how much funding is available and the income and composition of the household that applies. It is not uncommon for counties to overspend or underspend their allocations of funds. The state reallocates unspent funds from counties who underspent to those who overspent. While underspending could indicate a problem with the way a county administers its CCCAP program, it could just as likely be a sign that there are few providers in the county who participate in CCCAP—or a lack of providers generally.

Statewide Program Access 2015-19: Over the study period of this report, an average of 10.8% of the population at or below 165% of FPL and younger than age 13 (i.e., the population who is likely to be eligible for CCCAP) were enrolled in CCCAP.

Housing:
HUD rental assistance programs

The US Department of Housing and Urban Development (HUD) has three housing assistance programs that we look at together: Housing Choice Vouchers (Section 8), Project-based Section 8, and Public Housing. In Colorado, these programs provided assistance to over 90% of the households who received federal housing assistance from all HUD programs. Through federally funded, local or regional public housing agencies (PHAs) are the agencies that administer these programs, through not all are available in all counties. These are not the only programs available in Colorado that assist households afford the cost of housing, such as units funded through federal and state tax credit programs.

State Department: Department of Local Affairs

Eligibility: Generally, households with incomes under 50% of the area median income (AMI) of the county they live in are eligible for these rental assistance programs, although PHAs have discretion to select households with incomes at higher percentages of AMI. That said, HUD requires that 75% of new vouchers issued through the Housing Choice Voucher/Section 8 program in a given year are targeted to households with incomes at or below 30% of AMI. PHAs are also able to create criteria that give priority to certain types of households who are on waiting lists for these programs.

Program Benefits: These rental assistance programs help households afford the cost of housing by reducing their housing costs to around 30% of their household income. In the case of the Housing Choice Voucher program, the PHA pays the voucher holder’s landlord the remaining portion of the rent.

Program Funding and Access: Funding and access are both challenges for these rental assistance programs. In addition to limitations on the number of public housing units or housing vouchers a PHA can manage or issue, lack of funding compared to the need constrains the ability of PHAs to assist low-income households. In 2020, Coloradans were on waitlists for Housing Choice Vouchers for an average of 17 months. Waitlists also exist for the other rental assistance programs.

Statewide Program Access 2015-19: Over the study period of this report, an average of 21.1% of renter households with incomes at or below 50% AMI (i.e., the population who is likely to be eligible for HUD rental assistance programs) were living in subsidized housing.