May 4, 2016

Recent articles

TABOR stymies efforts to increase affordable housing

by | May 4, 2016

Most of us agree that shelter ranks very high on the list of basic needs, along with food and water. Empirical evidence shows that investing in safe and affordable housing improves health, school achievement, and employment stability.

Yet, while shelter is clearly among the most basic of basic needs, Colorado is in the midst of a serious (and growing) affordable housing crisis. For many people housing consumes the majority of their income, pushing them to the brink of homelessness or forcing them to skimp on food and medicine in order to pay their rent.

Consider these numbers:

* Since 2007, average rent in Colorado has increased by 21 percent while income for the median renter household has only increased by 1.1 percent.

* The estimated average wage for a renter is $15.43 an hour—well below the hourly wage of $19.89 an hour needed to afford the Fair Market Rent of a two-bedroom apartment in Colorado.

* An estimated 164,600 households in Colorado pay more than half of their monthly income on rent. One-third of those households consist of elderly or disabled residents and 35 percent are families with children.

Recognizing that public funds are a critical component to creating affordable housing, CCLP has been working to introduce legislation during the 2016 session that would dedicate new funds towards construction and preservation of affordable housing and rental assistance for some of Colorado’s most challenged low-income residents. Unfortunately, the constitutional amendment commonly known as the Taxpayers Bill of Rights (or TABOR) makes it nearly impossible to inject new funding into the state budget to help finance construction of affordable housing, even when those funds don’t come out of taxpayers’ pockets or require a decrease in funding for other essential services.

Some background on the Unclaimed Property Trust Fund (UPTF): Since 1987, financial institutions, life insurance companies, and a host of other entities that hold other people’s money, have been required to turn those funds over to the state treasurer after they are deemed abandoned; that is, when there has been no activity on the account for a certain period of time and the holder has been unable to locate the owner despite repeated efforts.  The state keeps those funds until the owner steps forward to claim them.  Every year, the state Treasurer receives about three times more than it pays in claims, and there is a balance of over $200 million in the fund, which is growing by about $11 million a year.

In 2016, the Treasurer will require a reserve of over $115 million in the UPTF in case there is a flood of claims. Even so, this year’s balance of $85 million could be put to use addressing pressing problems without compromising the Treasurer’s ability to reunite people with their lost funds. Indeed, $35 million per year has been used in the past for Colorado’s high-risk insurance program and about $30 million per year is now being used to provide dental care to people on Medicaid.

CCLP’s legislation was originally designed to draw down a portion of the available balance every year for five years, resulting in about $100 million invested in housing. But the state determined that by moving these funds from the UPTF into the state’s budget, they would count towards the spending limit imposed by TABOR.  With the booming economy already requiring refunds in fiscal year 2016-17 and beyond, using these unclaimed funds would have increased the size of refunds, which would have been paid by reducing spending on other important services.

But an opportunity arose to use those surplus funds in this fiscal year. Despite having TABOR refunds in fiscal years 2014-15, 2016-17 and beyond, the state’s economists forecasted that revenues in fiscal year 2015-16 would be between $80 and $112 million below the TABOR spending limit. CCLP began to recraft our bill to make one large transfer of surplus funds this year. But the Joint Budget Committee, facing the same problem regarding future transfers for dental care, beat us to it: transferring $42 million from the UPTF in 2016 to spend in future fiscal years.

The effect of this action was to reduce the surplus in the UPTF to $43 million and reduce the gap between appropriated funds and the TABOR spending limit available for affordable housing to less than $40 million. Allowing a reasonable margin of error for unexpectedly strong revenue in the second half of the fiscal year, House Bill 1466 will only make a one-time allocation of $30 million to affordable housing. Ironically, TABOR will not allow transfers in the future unless our economy sours and revenues decrease.

Though $40 million would make a difference to thousands of Coloradans seeking affordable housing, there’s clearly something wrong with this picture overall. The UPTF is an available source of funding for this important community need. Without impinging on the UPTF reserve or requiring reductions in spending on other essential publicly funded services, we could be dedicating as much as $100 million to affordable housing over a five-year period. Yet, TABOR requires us to let that money sit unused at a time when the need is greatest.

That’s a shame.

– Claire Levy

Recent articles

HEALTH:
HEALTH FIRST COLORADO (MEDICAID)

To maintain health and well-being, people of all ages need access to quality health care that improves outcomes and reduces costs for the community. Health First Colorado, the state's Medicaid program, is public health insurance for low-income Coloradans who qualify. The program is funded jointly by a federal-state partnership and is administered by the Colorado Department of Health Care Policy & Financing.

Benefits of the program include behavioral health, dental services, emergency care, family planning services, hospitalization, laboratory services, maternity care, newborn care, outpatient care, prescription drugs, preventive and wellness services, primary care and rehabilitative services.

In tandem with the Affordable Care Act, Colorado expanded Medicaid eligibility in 2013 - providing hundreds of thousands of adults with incomes less than 133% FPL with health insurance for the first time increasing the health and economic well-being of these Coloradans. Most of the money for newly eligible Medicaid clients has been covered by the federal government, which will gradually decrease its contribution to 90% by 2020.

Other populations eligible for Medicaid include children, who qualify with income up to 142% FPL, pregnant women with household income under 195% FPL, and adults with dependent children with household income under 68% FPL.

Some analyses indicate that Colorado's investment in Medicaid will pay off in the long run by reducing spending on programs for the uninsured.

FOOD SECURITY:
SUPPLEMENTAL NUTRITION ASSISTANCE PROGRAM (SNAP)

Hunger, though often invisible, affects everyone. It impacts people's physical, mental and emotional health and can be a culprit of obesity, depression, acute and chronic illnesses and other preventable medical conditions. Hunger also hinders education and productivity, not only stunting a child's overall well-being and academic achievement, but consuming an adult's ability to be a focused, industrious member of society. Even those who have never worried about having enough food experience the ripple effects of hunger, which seeps into our communities and erodes our state's economy.

Community resources like the Supplemental Nutrition Assistance Program (SNAP), formerly known as Food Stamps, exist to ensure that families and individuals can purchase groceries, with the average benefit being about $1.40 per meal, per person.

Funding for SNAP comes from the USDA, but the administrative costs are split between local, state, and federal governments. Yet, the lack of investment in a strong, effective SNAP program impedes Colorado's progress in becoming the healthiest state in the nation and providing a better, brighter future for all. Indeed, Colorado ranks 44th in the nation for access to SNAP and lost out on more than $261 million in grocery sales due to a large access gap in SNAP enrollment.

See the Food Assistance (SNAP) Benefit Calculator to get an estimate of your eligibility for food benefits.

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

Every child deserves the nutritional resources needed to get a healthy start on life both inside and outside the mother's womb. In particular, good nutrition and health care is critical for establishing a strong foundation that could affect a child's future physical and mental health, academic achievement and economic productivity. Likewise, the inability to access good nutrition and health care endangers the very integrity of that foundation.

The Special Supplemental Nutrition Program for Women, Infants and Children (WIC) provides federal grants to states for supplemental foods, health care referrals, and nutrition information for low-income pregnant, breastfeeding and non-breastfeeding postpartum women and to infants and children up to age five who are found to be at nutritional risk.

Research has shown that WIC has played an important role in improving birth outcomes and containing health care costs, resulting in longer pregnancies, fewer infant deaths, a greater likelihood of receiving prenatal care, improved infant-feeding practices, and immunization rates

Financial Security:
Colorado Works

In building a foundation for self-sufficiency, some Colorado families need some extra tools to ensure they can weather challenging financial circumstances and obtain basic resources to help them and their communities reach their potential.

Colorado Works is Colorado's Temporary Assistance for Needy Families (TANF) program and provides public assistance to families in need. The Colorado Works program is designed to assist participants in becoming self-sufficient by strengthening the economic and social stability of families. The program provides monthly cash assistance and support services to eligible Colorado families.

The program is primarily funded by a federal block grant to the state. Counties also contribute about 20% of the cost.

EARLY LEARNING:
COLORADO CHILD CARE ASSISTANCE PROGRAM (CCCAP)

Child care is a must for working families. Along with ensuring that parents can work or obtain job skills training to improve their families' economic security, studies show that quality child care improves children's academic performance, career development and health outcomes.

Yet despite these proven benefits, low-income families often struggle with the cost of child care. Colorado ranks among the top 10 most expensive states in the country for center-based child care. For families with an infant, full-time enrollment at a child care center cost an average of $15,140 a year-or about three-quarters of the total income of a family of three living at the Federal Poverty Level (FPL).

The Colorado Child Care Assistance Program (CCCAP) provides child care assistance to parents who are working, searching for employment or participating in training, and parents who are enrolled in the Colorado Works Program and need child care services to support their efforts toward self-sufficiency. Most of the money for CCCAP comes from the federal Child Care and Development Fund. Each county can set their own income eligibility limit as long as it is at or above 165% of the federal poverty level and does not exceed 85% of area median income.

Unfortunately, while the need is growing, only an estimated one-quarter of all eligible children in the state are served by CCCAP. Low reimbursement rates have also resulted in fewer providers willing to accept CCCAP subsidies.