November 28, 2018

How State and Local Fiscal Policies Impact Racial Equity

The Center for Budget and Policy Priorities has released a new report about how state and local fiscal policies impact racial equity and makes recommendations to overcome longstanding inequities. Michael Leachman, Senior Director of State Fiscal Research, in a blog post, explains:

“States and localities can do more to help undo the harmful legacies of racism and the damage of continuing racial bias and discrimination, a major new Center report finds. If state policymakers can design their budget and tax policies to better address these harms and create more opportunities for people of color, state economies would be more equitable and likely stronger, which in turn could benefit many state residents of all backgrounds.

States and local governments account for nearly half of all domestic public-sector spending, and most of the funding for education and certain other investments important for economic growth. As such, how states and localities raise and spend revenue, including what services they finance, has major implications for racial and ethnic equity. Yet, while people of color have made progress in many areas in recent decades, state and local fiscal policies too often haven’t contributed to that progress and, instead, have extended or cemented racial disparities in power and wealth.”

(Continue reading here).

The report highlights a number of ways that states, including Connecticut, can mitigate racial inequities, such as expanding tax credits for low-income families, ensuring sufficient funding for public schools, and improving the budget rules that artificially restrict the ability of policymakers to fund critical services for children and families.   

Connecticut took an important step in improving racial equity with the passage of  S.B. 256 this year.  Under this new law, legislators may request a racial and ethnic impact statement of any proposed legislation, recognizing the need to evaluate bills through a racial equity lens. 

Issue Area:
Budget and Tax
Tags:
budget, disparities, income tax, property tax, taxes