Currently, less than 40 percent of American workers are eligible for an employer-provided temporary disability program. Due to this, as well as the fact that so few American workers are eligible for employer-paid family leave, many people are forced to make an impossible choice: take unpaid leave to care for a sick loved one (or see to their own care) or continue to work to earn the money they need to keep their families afloat. The FAMILY Act would provide working families with a better option, believe advocacy groups like the National Partnership for Women & Families.

On Friday, September 27 Senator Gillibrand stated her support for the bill in a Huffington Post article. She made the case that the FAMILY Act is desperately needed in today’s changing economy, in which forty percent of households with minor children have a woman as the primary breadwinner. (Read more about women’s participation in the American workforce in this fact sheet from the National Women’s Law Center.)

Administered through the Social Security Administration, the FAMILY Act would insure workers for benefits equal to 66 percent of their monthly income (up to a capped monthly amount). Eligibility for the program would be determined by a worker’s eligibility for Social Security disability benefits.

The insurance program is paid for through payroll contributions from both employers and their workers, with an extremely low premium of two cents for every $10 in income. For most workers, this means less than $2.00/week.

Advocates are pushing for passage of the FAMILY Act as an improvement on 1993’s Family and Medical Leave Act (FMLA). The FMLA requires businesses employing fifty or more workers to provide their employees with the option of taking up to twelve weeks of unpaid leave to care for an infant less than one year of age, adopt a child, care for a sick family member, or tend to a personal illness.

Although the FMLA has protected millions of workers from losing their jobs, it only guarantees unpaid leave and fails to cover 40 percent of the US workforce. The FAMILY Act offers a much more comprehensive way of helping workers by providing millions of families as well as young, part-time and low wage workers with a much-needed safety net in times of great distress.

The legislation is expected to be introduced within the next few weeks, delayed temporarily because of the federal government shutdown. Advocates will continue to ramp up support for the bill in the coming weeks.

The post CHN: Family and Medical Leave Insurance Act to be Introduced Soon; Advocates Continue to Build Support for This National Program to Help Working Families appeared first on Coalition on Human Needs.

Direct care work is one of the fastest-growing industries in the nation, and almost two million people will benefit from this policy change.  Aides help America’s elderly and disabled populations by assisting with daily tasks such as dressing or bathing, doing chores and administering medications in their homes.

Currently, home care aides are preempted from receiving the federal minimum wage ($7.25/hour) and overtime protection because they are categorized as “companionship” workers – individuals who provide “companionship services for individuals who (because of age or infirmity) are unable to care for themselves” (as explained in this Huffington Post article). The need for revised regulations was underscored in 2007 when the Supreme Court ruled against Evelyn Coke, a New York home care worker who sued to reverse the federal regulations that exempt home care agencies from having to pay overtime.

Advocates and labor leaders praise this long-awaited measure as a way to ensure that home care workers are provided the same legal protections as nurses who perform similar tasks in a hospital setting.

With more minimum wage battles on the horizon, home care advocates and organizations like the Direct Care Alliance are happy to finally be able to claim victory with these regulations.

The post CHN: Minimum Wage and Overtime Protections Extended to Home Care Workers appeared first on Coalition on Human Needs.

Rep. Roby is quoted in The Huffington Post as saying, “This is about helping working moms and dads, providing the ability to commit time at home.” She and other Congressional Republicans have led a PR campaign touting the bill as worker- and family-friendly, but workers’ rights advocates and Democrats in Congress hold a different view.

Progressive advocates believe that H.R. 1406 is a “smoke-and-mirrors” measure that cuts workers’  pay  while giving them paid time off without the guarantee of when or how they can use it. The bill allows accrual of up to 160 hours of paid time off in a year. At year’s end, workers would be paid in cash for their unused comp time, but employers could defer payment of this sum for up to 13 weeks. Many advocates call this an interest-free loan for the company.

In another twist, there is alarm that the bill could help eliminate of the concept of paid leave time altogether. Political Director for the United Electrical, Radio & Machine Workers of America Union Chris Townsend told The Huffington Post that he worries that employers could ask their employees to “earn” their paid time off instead of automatically offering them a package of two weeks of vacation time plus sick days.

This letter from the National Partnership for Women and Families, signed by 163 organizations from across the nation, denounces H.R. 1406 for its false promises. William Samuel, Director of Government Affairs at AFL-CIO (one of the signing organizations), says “The AFL-CIO is vehemently opposed to the so-called Working Families Flexibility Act, which would amend the Fair Labor Standards Act to allow employer-controlled compensatory time off to be substituted for paid overtime,” as quoted in CQ. “We urge you to vote against this legislation.”

From service groups to union leaders, the progressive community opposes this bill, which would actually encourage employers to request overtime work from employees by providing a cheaper alternative to paid overtime. Neither is H.R. 1406 a good alternative for low-wage workers because it reduces their take-home pay, money which many low-income families rely on to make ends meet.

A Statement of Administration Policy released Monday announced that President Obama’s senior advisors would recommend he veto H.R. 1406 if it came to his desk. There is little chance that will ever come to pass, however. Passage of the bill in the Democratic-controlled Senate looks highly dubious, as Democrats are almost unanimously opposed to the measure and have defeated similar bills twice in the past. Still, Republicans may seek to bring the bill to a vote in the Senate.

The post CHN: New Legislation Gives Working Families a Pay Cut, Not Increased Flexibility appeared first on Coalition on Human Needs.

Rep. Miller seized an opportunity on March 15 to demand a vote on the minimum wage increase in an attempt to derail a bill to revamp federal job training programs (H.R. 803; see article elsewhere in this issue).  He offered a motion that would have added the three-year increase to $10.10 to the job training bill.  The motion was defeated 184-233, with no Republicans favoring it and 6 Democrats joining 227 Republicans to oppose.

According to an analysis by the Economic Policy Institute more than 30 million workers would receive a raise from the bill. Contrary to popular belief, 88 percent of minimum wage workers are adults over age 20, not teens, and the majority of them, 56 percent, are women.  Many of these women are caring for children or the elderly, are cleaning offices, or preparing and serving food while struggling to feed and support their own families. Since 2002 the child poverty rate has increased from 16 to 22 percent.  Parents of 17.5 million children are minimum wage workers. Nearly half are workers of color and over 43 percent have some college education.

A National Employment Law Project report documents that 66 percent of low-wage workers are employed by large corporations with over 100 workers.  The three companies that employ the most low-wage workers are Wal-Mart, Yum! Brands (Taco Bell, Pizza Hut, KFC), and McDonald’s.  The vast majority (92%) of the largest 50 employers of low-wage workers have fully recovered from the recession and were profitable in 2011.  Their top executive averaged $9.4 million in compensation in 2011, and their shareholders received $174.8 billion in dividends or share buybacks between 2007 and 2011.

The minimum wage has lost more than 30 percent of its buying power since its peak in 1968.  If the wage had kept pace with inflation its value today would be approximately $10.56.  The minimum wage today pays only $15,000 per year, $3, 000 below the poverty level for a family of three.  Numerous rigorous studies over the past 20 years have shown that increasing the minimum wage does not cost jobs.  Instead, increasing the minimum wage provides an economic benefit for local businesses and communities, generating new jobs as it puts more money into the pockets of low-wage workers who will spend it.  Nineteen states and numerous cities have minimum wages that are higher than the federal minimum wage.

Some would argue that a more effective way to assist low-wage families is through the Earned Income Tax Credit (EITC).  The EITC provides a tax refund to working families with children (and a small credit to some childless workers).  It supplements the income of low-wage earners and effectively raises some families out of poverty.  However, no alternative proposal to increase the EITC has emerged, either this year or when previous minimum wage increases were considered.  Some in Congress who are likely to oppose an increase in the federal minimum wage also pushed back against extending improvements to the EITC in the January 1, 2013 American Taxpayer Relief Act of 2012.  Advocates know that what is required in fairness to families working hard and still struggling to make ends meet is a ‘both/and’ strategy that includes an increase in the minimum wage and a robust EITC.

As in the past, Democrats acknowledge that they may need to agree to tax incentives for small businesses in order to obtain enough bipartisan support to enact an increase in the federal minimum wage.

The post CHN: Bill to Increase the Minimum Wage is Introduced; Defeated in House First Attempt appeared first on Coalition on Human Needs.

The reduction of assistance to “vulnerable populations” was one of several reasons the Obama Administration issued a Statement of Administration Policy (SAP) opposing the House bill.  The vulnerable groups which the Administration identified as likely to receive fewer services under this bill include “veterans, low-income adults, youth, adults with literacy and English language needs, people with disabilities, ex-offenders, and others with significant barriers to employment.”

Of particular concern is the fact that the legislation would freeze funding levels for 7 years.  Low-income advocates including the National Skills Coalition view the legislation as providing a rationale for deep cuts in job training programs in the Budget Resolution now before the House.

The SKILLS Act passed with a vote of 215-202, with only 2 Democrats supporting the legislation and 14 Republicans opposing it.  It is unclear what action the Senate will take on these workforce programs this year, but the Senate is unlikely to endorse the House bill.

The post CHN: Controversial SKILLS Act Passes in House appeared first on Coalition on Human Needs.

The bill combines over two dozen currently existing federal workforce programs into one single $6 billion Workforce Investment Fund, which would use a formula to distribute money to states – without maintaining a priority of service for low-income individuals or other safeguards. The bill makes many changes to the current WIA program, including eliminating current membership requirements for state/local workforce area boards, requiring states to reserve a maximum of 18 percent of allocations from the Workforce Investment Fund for new State Youth Challenge Grants and cutting the governors’ set-aside for statewide activities from 15 percent to 5 percent of a state’s Workforce Investment Fund allotment. Governors will also be allowed to consolidate funds (including those for Temporary Assistance for Needy Families, adult education and vocational rehabilitation) into a block grant.

In May the Campaign for Youth, a national coalition co-chaired by the National Youth Employment Coalition and CLASP, the Center for Law and Social Policy, issued a letter signed by nearly 300 organizations from across the country in opposition to H.R. 4297, highlighting its damaging effects on youth education and training programs. Specifically harmful is the consolidation of youth funding into the adult-centered Workforce Investment Fund, which contains no requirements that youth be served and terminates the national Job Corps and Youth Build programs.

During the markup of the bill, a substitute amendment offered by Subcommittee Chair Foxx was accepted by a voice vote. This amendment includes the reinstatement of the Job Corps, the complete elimination of the Youth Challenge Grant and the addition of a number of new definitions to the language of the bill. For the complete listing of changes made, see this article from the National Skills Coalition.

Despite improvements in the economy over the last few years, more than 13 million Americans remain unemployed, including a stunning 40 percent who have been job-searching for more than six months. Although there is bipartisan support for updating WIA, which was enacted 15 years ago and has not been reauthorized since, Democrats and Republicans differ on the ways to do so. Before the markup on H.R. 4297, numerous organizations expressed their concerns that the bill does less to improve WIA and more to dismantle it. Many of these same organizations feel that the amendments accepted during the markup would further harm WIA.

Advocates hope that the committee members will do more work to create a bipartisan plan for reforming our nation’s workforce development system – one that protects low-income people and youth – before the bill is brought to the floor for a vote.

The post CHN: Markup on Workforce Investment Improvement Act of 2012 Does More Harm Than Good appeared first on Coalition on Human Needs.

The Paycheck Fairness Act amends the Fair Labor Standards Act of 1938 and updates the Equal Pay Act of 1963 by enabling data collection aimed at better enforcement of pay discrimination laws.  It also creates a grant for a salary-negotiation training program for women, awards employers who make a substantial effort to close the wage gap and creates larger penalties for employers who discriminate. Building on the Lilly Ledbetter Fair Pay Act, which took steps to ensure that women had an appropriate window of time for legal retaliation against pay discrimination, this bill fosters more transparency of salaries and protects employees who sue for pay equity.

In 2011, nearly half of all American workers were female. Women make 77 cents for every dollar men earn for performing the same work. For African American and Latino women, this disparity is even greater. African American women are paid 64 cents, and Latinos women only 56 cents, for every dollar paid to their male counterparts. The gender wage gap puts female workers at a disadvantage in their careers and contributes to the disproportionate poverty among single-mother families. Partisan politics will likely inhibit the bill from moving forward this year.

The post CHN: Senate Republicans Fail to Close the Wage Gap appeared first on Coalition on Human Needs.

Living within the annual caps for appropriations means that “non-security” appropriations drop from $373.6 billion in FY 2012 to $356.8 billion in the President’s FY 2013 request (a 4.5 percent cut, not counting inflation).  These include education, labor, health, many services for children and seniors, housing, transportation, the environment, and many other areas.  “Security” spending, including the Pentagon, international funding, and veterans’ services, bumps up from $684 billion in FY 2012 to $686 billion in FY 2013.

The federal budget includes programs that require annual appropriations by Congress (called “discretionary”) and mandatory programs, such as Social Security, Medicaid, Medicare, and SNAP/food stamps, that spend money based on the laws authorizing those programs without needing Congress’ yearly okay.  The budget also projects revenue levels, and recommends tax cuts and increases to meet its ten-year revenue estimates.  President Obama’s $3.8 trillion budget for FY 2013 projects only $2.9 trillion in revenues, for a deficit of $900 billion, or 5.5 percent of Gross Domestic Product (GDP, or all economic activity).  Below 3 percent is considered a more sustainable level.  The President predicts that the deficit will decline substantially between now and FY 2022, reaching 2.7 percent of GDP in 2018, and then remaining at 2.8 percent over the next few years.

A Focus on Job Creation. The Obama Administration budget calls for $350 billion in new up-front investments to create or save jobs, to be carried out mostly between now and FY 2015.  These include $50 billion in road and transit rebuilding, $30 billion to modernize at least 35,000 schools, $25 billion to hire and retain teachers and $5 billion for first responder jobs.  Another initiative is Pathways Back to Work, funded at $12.5 billion ($8.4 billion in FY 2013) to provide subsidized jobs and training for low-income, low-skilled workers and summer and year-round jobs and training for youth.  A new community college initiative would invest $2.1 billion in FY 2013 and nearly $7.5 billion over 5 years in education/training aimed at helping people get jobs.
In addition, Project Rebuild will hire workers in low-income communities to rehab or renew residential and commercial properties.  The budget also proposes an infrastructure bank (at $9.8 billion over 10 years), the National Affordable Housing Trust Fund ($1 billion, expected to result in production of more than 10,000 units of low-income housing), and various incentives for innovation in manufacturing, including tax credits.

Economic Security Protections. The Administration recognizes that the safety net must be protected, especially during hard times.  It reverses a cut in SNAP/food stamp benefits scheduled to take effect starting in 2013, and assumes the continuation of federal unemployment benefits (without the cutbacks in weeks just adopted for the rest of 2012 (see article in this issue).  The budget also would make permanent the improvements in the Child Tax Credit and Earned Income Tax Credit.  These make the Child Tax Credit available starting with earnings over $3,000 (previously the first $8,500 in earnings was excluded in calculating the CTC) and provide a higher Earned Income Tax Credit for working families with three or more children.  Both these credits are “refundable” – that is, available to families as a refund check even if their earnings are too low to owe federal income tax.

The Administration proposes $2.2 billion over 10 years to modernize child support collections, and provides incentives to states to reduce the loss of income to states when they turn over all child support collected to the families owed, instead of keeping some of it to defray the costs of public assistance.

More modest but important, the Administration also proposes $5 million in new grants to assist states wishing to implement their own paid leave programs.

Under the Appropriations Caps:  Some Gains. Even within the constraints imposed by the caps, the President’s budget manages to invest in certain human needs priorities.  Some of the winners include annual appropriations for Head Start (up $494 million since FY 2011) and child care (up $380 million since FY 2011 and $325 million since FY 2012).  Race to the Top, the Administration’s incentive program for improving K-12 education, is increased by $301 million, or 55 percent above its FY 2011 level.  The maximum Pell grant award rises from $5,550 in FY 2012 to $5,635 in FY 2013; college work-study funding rises 15 percent, from $977 million to $1.127 billion.  Nutrition funding for Women, Infants and Children (the WIC program) grows to $7.04 billion in FY 2013, a one-year increase of $423 million, to support a caseload of 9.1 million.  Programs to assist the homeless are increased from $1.9 billion to $2.23 billion from FY 2012 to FY 2013.  According to the Department of Housing and Urban Development, 1.6 million people were homeless at some point between October 1, 2009 and September 30, 2010.  The Administration requests $75 million to fund affordable units for 10,000 veterans, who are homeless at levels very disproportionate to their numbers.

But Some Losses. However, cabinet departments that include many of the discretionary programs of importance to low-income people are cut substantially.   The Department of Health and Human Services’ funding declines from $84.4 billion in FY 2010 to $76.7 billion in FY 2013, as requested by the President.  Taking inflation into account over that period, HHS funding would decline nearly 15 percent.  The Department of Labor drops from $13.5 billion in FY 2010 to $12.0 billion in the President’s FY 2013 request, although $448 million of that loss is from the movement of Community Service Employment for Older Americans to the Administration on Aging at HHS.  Adjusting for that change and for inflation, the DOL cut would be just under 14 percent from FY 2010 to FY 2013.  The Department of Housing and Urban Development drops from $42.8 billion in FY 2010 to $35.3 billion in the President’s FY 2013 budget, although some of the drop is offset by an anticipated $4.4 billion in increased receipts from increased fees from borrowers and others.  With reductions like these, services needed by low-income people do not escape painful cuts.  Within HHS, the Low Income Home Energy Assistance Program (LIHEAP) drops from $3.472 billion in FY 2012 to $3.02 billion in the President’s plan.

According to the National Energy Assistance Directors’ Association, this cut will deny heating or cooling assistance to 1 million low-income households.   The Administration continues its attack on the Community Services Block Grant, once again recommending that its funding be cut in half (from $677 million in FY 2012 to $350 million in FY 2013).  CSBG provides funding to about 1,100 community action agencies nationwide, which administer programs such as Head Start, emergency food, LIHEAP, and job training, and provide an entry point for low-income people to receive a broad range of anti-poverty services.   Congress did not go along with this request last year; with stringent deficit reduction targets to meet, it is not clear what will happen this time.

Also within HHS, there are reductions in mental health and substance abuse funding.  Mental health funds decline from $1.022 billion in FY 2011 to $952 million in the President’s FY 2013 request.  Substance abuse treatment and prevention decline by $117 million over the same two year period, a nearly 10 percent cut, not counting inflation.  The Administration hopes to maximize effectiveness despite reduced funding both through competitive grants and because the gradual implementation of the Affordable Care Act will provide additional funding for these services.  Still, on top of substantial recent cuts made in state funding, it is hard to be confident that no loss in services will occur, at least in the short run.

Within HUD, although finding adequate funding to cover existing households in subsidized rental housing was a top priority, the Administration does so in part by increasing the minimum rents paid by very low-income tenants to a mandatory $75 a month.  Now, Public Housing Authorities may charge a minimum rent of $50, but many do not choose to do so.  For families or disabled or elderly individuals with extremely low incomes, paying the $75 will prove very difficult.  The Community Development Block Grant is level-funded at $2.95 billion, a disappointment to many community agencies who make use of its funds for diverse services including child care and help for victims of family violence.  Housing for low-income elderly (Section 202) is up from a low $375 million in FY2012 to $475 million in FY 2013, but well below its $825 million in FY 2010 funding.  Housing for persons with disabilities (Section 811) is down from $165 million in FY 2012 to $150 million in the President’s proposal; it was funded at $300 million in FY 2010.  Still, these combined funding levels are estimated by HUD to allow 5,300 new supportive housing units as compared to the current year.

With the Department of Labor, the Job Corps program is reduced from $1.7 billion in FY 2012 to $1.65 billion in the President’s request.  In FY 2012, the total appeared larger (nearly $2.4 billion total) because all of the program costs were paid for within the fiscal year; more typically, a substantial portion is “advance-funded” into the next fiscal year.  The Administration has apparently returned to the use of advance funding, but even taking that into account, Job Corps loses about $50 million. DOL plans to close sites it does not believe are effective, but will open new sites in New Hampshire and Wyoming.  Unemployment Insurance Administration is also cut by $245 million (down to $2.93 billion in the President’s FY 2013 request).  The Administration judges that the amount will serve 13.7 million beneficiaries.  There is a contingency reserve requested in case the workload grows beyond these expectations.

Most training programs are funded at about the same level as FY 2012, but the proposed addition of $8.4 billion in FY 2013 Pathways Back to Work funding, as well as investments in community colleges, would provide more job training and employment opportunities for low-income workers than have been available since the economic recovery act legislation funding ran out.

Options for Savings. The 1,600+ groups that signed the original Strengthening America’s Values and Economy for All Statement of Principles called for deficit reduction that protects low-income people and that invests in job creation, while reducing the deficit substantially through fair revenue increases and cuts in military spending. The President’s budget is in agreement with these basic principles, although some tax and military experts argue that more savings in both these areas are possible, and would leave more room for meeting needs as well as reducing the deficit.  The President proposes $525 billion in base Pentagon spending, plus another $88 billion for war costs in FY 2013.  The non-war funding Defense Department funding declines by a little over 1 percent; counting related expenditures, such as defense nuclear capacity under the Department of Energy, the reduction is about 2.6 percent.  Either way, this is a much smaller reduction than the overall cuts to domestic spending.   The Obama Administration has committed to making 10 years of cuts to discretionary programs called for in the deficit reduction plan that passed Congress, including defense, international, and domestic programs.  The Administration shows $487 billion in defense savings over ten years as a result of the reductions imposed in the FY 2013 budget (these savings do not count reductions in the Iraq and Afghanistan war efforts).  However, respected analysts have pointed to about a trillion dollars in Pentagon savings that can be made without jeopardizing national security.  Lawrence Korb, a former Reagan Administration defense official, has estimated over $100 billion in defense cuts that could take effect in FY 2015 alone.

In addition, many revenue increases have been proposed beyond the $1.5 trillion the President recommends over the next 10 years.  If capital gains were taxed at the same rate as other income, it would bring in hundreds of billions over the next decade.  The Obama budget modestly raises the tax on capital gains for upper-income taxpayers, but only raises $36 billion for the same time period.  The Obama budget captures $147 billion from reforming U.S. treatment of companies with overseas profits.  Ending the rule allowing U.S. corporations to “defer” U.S. taxes on foreign profits would save well over $500 billion.  There are many other examples of revenue options greater than those proposed in the Obama budget – for example, the President previously had proposed $90 billion in higher taxes on the financial industry.  His FY 2013 budget proposes $19 billion in new finance industry taxes.  The provisions that are included in the President’s budget are welcome, and are a marked contrast to the intransigence of Republicans and a few Democrats in Congress in opposing any tax increases.  So far, no tax increases have been enacted either to reduce the deficit or to contribute to economic recovery.  Continuing on this course will result in harsh cuts that will stall economic growth – and hurt vulnerable people.

The post CHN: The President’s FY 2013 Budget: Despite Tight Funding Caps, Some Human Needs Priorities Maintained appeared first on Coalition on Human Needs.

The legislation calls for phasing in a reduction in the number of weeks of UI available to unemployed workers. Currently in states with unemployment rates of 9 percent and above a worker can receive a maximum of 99 weeks of UI. By September those workers will receive a maximum of 73 weeks of UI. Workers in states that have from 7 to 9 percent unemployment rates will receive a maximum of 63 weeks of UI. Workers in states whose unemployment is in the 6-7 percent range will see their maximum number of weeks shrink to 54 weeks, and for states with rates under 6 percent the maximum will be 40 weeks. In each category between 19 and 36 weeks of UI are lost.

Some of the onerous provisions in the original House-passed bill are not in the final agreement. The final bill does not require UI recipients to have completed high school or be in a GED program. Nor does it allow states to require drug testing for all UI applicants. The bill does allow states to drug screen and test anyone who lost their job because they failed or refused an employer drug test or is seeking a job that requires a drug test. This provision overturns a decades-long Department of Labor law banning states from screening and testing UI applicants for drugs. Recipients of federal UI benefits are required to participate in reemployment assessments to determine what services and activities they need to return to work and they, like recipients of state UI benefits, must engage in job search. H.R. 3630 also contains a waiver which allows up to 10 states to operate programs that provide subsidies to employers who hire UI beneficiaries and provide them with training. The subsidies would offset the cost of the wage provided which must be greater than the UI benefit. Advocates are concerned that this could set a precedent for diverting UI funds to subsidize low-wage work, undermining the social insurance quality of the program and potentially opening the door to mandatory work requirements for UI recipients.

The payroll tax cut extension means that workers will pay 4.2 percent instead of 6.2 percent of their income under $110,100 in Social Security tax. For the average family this represents an annual savings of about $1,000. Revenue lost to the Social Security Trust Fund is reimbursed through general Treasury funds.

Other provisions in H.R. 3630 include extensions of the Transitional Medical Assistance for low-income families moving into employment through the end of the year and the Temporary Assistance for Needy Families (TANF) program through September 30. No funding is provided for TANF supplemental grants which provide additional funding to poorer states. A provision was added that blocks access to TANF funds on electronic benefit transfer cards at ATMs in liquor stores, strip clubs and casinos.

Conferees struggled to reach agreement on how to find $60 billion to pay for the non-payroll tax provisions in the bill. A leading source of offsets comes from requiring federal workers hired beginning next year to contribute more to their pension benefits. Other sources of funding will come from auctioning broadband spectrum now controlled by television broadcasters for high speed internet, reducing payments to Medicare providers and reducing funding for prevention activities in the Affordable Care Act. Advocates were pleased that a cut in the refundable Child Tax Credit for low-income working families was dropped as an offset.

There is ongoing and growing concern among some members of Congress and advocates that as legislation passes requiring offsets, wealthy individuals and corporations have not been asked to contribute. One outcome of this legislation is that the nearly $100 billion cost of the payroll tax cut will be added to the debt, likely moving up the vote on raising the debt ceiling to the end of this year rather than next year.

The post CHN: Congress Passes an Extension of Unemployment Insurance and the Payroll Tax Cut appeared first on Coalition on Human Needs.

Initially the House refused to accept the Senate short-term extension, insisting that the Senate acquiesce to their version.  With no deal, it appeared that with the new year, the unemployed would lose jobless benefits and those with paychecks would lose the payroll tax holiday.  But after receiving backlash from constituents and the media as soon as they went home for Christmas break, the House relented and on December 20th agreed to the Senate’s short-term extension.  The $40 billion cost  of this extension was almost entirely paid for by increasing the fees charged by Fannie Mae and Freddie Mac for guaranteeing loans for mortgages. The President signed the two-month extension into law (PL 112-78) on December 23.

Having lost the fight in December, early indications were that House Republicans would work for a quick resolution and the programs would be extended to the end of 2012.  Those hopes seem to be fading.  As in December, sticking points include how to pay for the bill and what, if any, changes to make to the UI program.  Last year a maximum of 99 weeks of UI benefits were available to unemployed workers in states with high unemployment rates.  The Extended Benefits program which provides the last 20 weeks in states with high and rising unemployment was not renewed in December so currently the maximum number of weeks of UI eligibility is 79.  The original House bill called for slashing the number of weeks to 59.  Advocates stringently opposed cutting below 79 weeks and would instead like the full 99 weeks restored.  House Republicans are pushing to include in the long-term extension provisions in their original bill to limit eligibility to UI by requiring drug testing and a high school diploma or GED or enrollment in classes as conditions for receiving benefits.  They are also pressing to allow states to request waivers that would surely result in fewer benefits for recipients.  These provisions comprise a particularly harsh affront to unemployed workers who have become unemployed through no fault of their own.  (For more information about the House UI provisions, see the National Employment Law Project report, “Sticking to Principles: Congress Should Oppose Barriers to Unemployment Insurance and Instead Provide Meaningful Reemployment Tools.”)

The cost of extending the programs in the bill to the end of 2012 is approximately $160B.  Advocates and many Democrats believe that if Republicans insist on paying for the extensions – typically unemployment insurance was considered ‘emergency’ spending and has not been paid for– new tax revenues ought to be in the mix.  While Republicans remain uncompromisingly opposed to the Democratic proposal to increase taxes on millionaires, they did propose one offset in December that would restrict eligibility for the refundable Child Tax Credit, targeting low-income children in immigrant families.   The typical taxpayer harmed by this proposal earns $21,240 per year and would experience an 8 percent increase in their taxes owed, amounting to a loss of $1,800 in the family’s income.

If Congress does not act on a full extension or another short-term extension by February 29, the programs will expire.  According to the Department of Labor nearly 1.3 million unemployed workers would lose their benefits by the end of March. It will also put in jeopardy TANF and TMA. If they do not finish their work on this bill before February 17th they will have only three days after returning from a February 20-26 recess to pass a short-term extension or year-long bill.

The post CHN: Congress Up Against Deadline to Extend Unemployment Insurance and Payroll Tax Cut appeared first on Coalition on Human Needs.