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Voices Speaking

November 13, 2017

House Tax Bill’s Child Tax Credit Increase Excludes 68,000 Children in Low-Income Working Families

Ellen Shemitz, J.D.

House leaders highlight an increase in the maximum value of the federal Child Tax Credit (CTC) as their tax bill’s signature benefit for working families, but the provision completely excludes 68,000 children in Connecticut whose parents work in low-paying jobs, according to a new report from the Washington, DC-based Center on Budget and Policy Priorities. Another 94,000 Connecticut children in low-income working families would receive less than the full $600 increase in the credit that would be available to higher income families. Altogether, about 162,0000 Connecticut children in working families would either be excluded entirely or only partially benefit from the increase in the CTC.

Nationally, roughly 23 million children would be partially or entirely excluded from the House plan, even as it newly extends the CTC to families with incomes between $150,000 and $294,000. For example, a single mom of two working full time at the minimum wage would get no benefit from the CTC expansion under the House Republican plan while a married couple earning $230,000 would receive a new $3,200 benefit. Senate leaders have increased the CTC further slightly on their proposal. The basic structure, however, remains the same, so it still provides far larger benefits to higher income families than to families that face difficulties affording the basics.

Helping families that are struggling to make ends meet gives kids a better shot at success. Research suggests that boosting parents’ incomes helps children do better in school, and makes them healthier and more likely to go to college. That’s good for our kids and our economy. Leaving these families out makes no sense. 

House Republican Tax Plan Would Largely Benefit the Wealthy at the Expense of Everyone Else

 

Even as the House tax bill excludes tens of thousands of Connecticut children from its CTC expansion, it spends billions of dollars on large tax cuts for the wealthiest families and profitable corporations. The wealthiest 1 percent of Connecticut residents will receive an average tax cut of $66,020 by 2027, when the plan’s provisions are fully in effect. 

In total, the House bill’s tax cuts would increase the deficit by at least $1.5 trillion over the next decade. Congressional leaders might then use rising deficits to justify seeking large cuts in programs like Medicaid, food assistance for struggling families, education, job training, and college aid – programs that help everyday Americans make ends meet, access health care, and succeed in today’s economy.

The current federal tax proposal excludes millions of low-income working families. But when attention turns to paying for these tax cuts, these are the families that will bear the brunt of cuts in health care, education, job training, and other key programs – a one-two punch that would leave these families worse off overall. Connecticut’s congressional delegation should oppose a tax bill that partially or entirely excludes working families from a CTC increase, provides lavish benefits on the wealthy, and balloons the deficit. Instead, they should pursue a bipartisan tax bill that focuses its benefits on workers and families, doesn’t cut taxes for the wealthy, and doesn’t increase the deficit.

Issue Area:
Budget and Tax
November 9, 2017

Office of Early Childhood Announces Care 4 Kids Program Will Reopen To Provide Crucial Child Care Subsidies to Thousands of Families

Ellen Shemitz, J.D. and Nicole Updegrove

The Care 4 Kids program, a cornerstone of Connecticut’s early care and education system, will reopen enrollment in the coming weeks. New funding included in the recently approved state budget will allow the Office of Early Childhood to reopen the child care subsidy program to some of the 5,769 families on the waiting list for the program. Program administrators mailed applications to the first 1,600 families today as a first step.

The Care 4 Kids program closure more than a year ago was the result of federal regulatory changes that increased program costs without providing additional funding, leading to a budget shortfall. The closure left thousands of families without high-quality care and threatened child care providers across the state who could no longer fill their classrooms. Thanks to the efforts of Connecticut advocates and policymakers, many children and families will regain access to this critical program.

The Care 4 Kids child care subsidy plays a key role in providing quality child care to low-income working families in Connecticut, enrolling an average of about 21,000 children per month in 2016. Connecticut has a high need for affordable child-care, especially for the sixteen percent of children under age five in our state whose families live below the poverty line. Care 4 Kids helps children and families access early care and education programs, which are among the most effective programs for improving the lifelong outcomes for children. Child care programs allow parents to go to work to support their families. Children who have attended high-quality early care and education tend to grow up healthier, do better in school, and earn higher incomes as adults. These improved outcomes have a direct positive impact on the economy in the form of increased wages and productivity, and lower spending on social services.

Securing additional funding for Care 4 Kids for the next two years was part of a bipartisan effort to ensure that children and families remain a priority for state government, building a strong foundation for families and for future economic growth. This funding, however, represents a partial first step. The additional funds cover only a small portion of the existing shortfall. Care 4 Kids will serve more children, but it won’t be able to return to last year’s levels, meaning that not every eligible family will receive the subsidies they need. It is expected that the program will continue to operate with a waiting list. Unfortunately, children’s development cannot wait, and neither do employers who need their employees to come in to work.

The reopening of the Care 4 Kids program, even if partial, is good news for children, families and business across Connecticut. By providing child care subsidies that open the doors to high-quality early care, we not only help parents work and enable young children to thrive but we also lay the foundation for later school success and college and career readiness. Bipartisan support for the program, even in these challenging budget times, sends a strong signal that lawmakers on both sides of the aisle are willing to work to create opportunity and advance inclusive economic growth. We look forward to exploring new ways this coming legislative session to further expand the program to ensure that all children in Connecticut have a meaningful chance to reach their full potential.

Issue Area:
Early Care
October 20, 2017

Voices from the Capitol (XXXVIII): Do We Have a Deal?

Roger Senserrich

In today’s email:

Budget Updates: A Tentative Budget Agreement

House and Senate leaders have announced a tentative bipartisan budget deal.

This is the extent of what has been announced thus far, as details of the plan are under wraps until leaders share them with their respective caucuses. The deal appears to be a positive development; as of October 1st, the lack of a budget and governance by executive order meant deep cuts to many programs and municipal grants. This has led to damaging cuts in key services and has forced cities and towns to consider either deep cuts or tax increases.

It is too early to tell the impact of this budget proposal. What we know is that it includes a tax hike for low-income families, as the Earned Income Tax Credit (EITC) is reduced. We are sure this is the first of many negative impacts, which we will analyze in-depth once budget documents are made public.

For now, however, it is time to speak up about the EITC.

 

Call to Action: Protect the EITC

Connecticut urgently needs a state budget grounded in a commitment to economic growth, equity, and good fiscal governance. The first step to attain these goals is a revenue system that supports working families, instead of seeking to balance the budget on their backs.

The latest budget proposal cuts the EITC. This is a tax credit that benefits low-income working families. In 2015, the Connecticut EITC boosted an estimated 6,600 people over the poverty line and eased poverty for another 99,000. The EITC encourages and rewards working families, promotes positive children's outcomes and partially corrects Connecticut's upside-down tax structure, where low-income households pay a higher proportion of their income in taxes. The newest round of proposed cuts would impose a tax hike on nearly 200,000 Connecticut families who are working hard but not making enough to get by.

The solution to Connecticut’s budget woes should not rely on raising taxes on those who can least afford them. Such decisions might balance the budget this year, but only by putting the very foundation of our prosperity at risk. We need a new approach that makes investing in thriving families, equitable opportunity, and fiscal responsibility a priority. Doing so will require bold action, not raising taxes on the poor.

Call your legislators and tell them we need a budget that moves Connecticut forward toward equitable economic growth, increased opportunity, and sustainable, efficient government. Click here to find your legislator and contact them today. Click here to download our latest brief mapping a path forward for Connecticut using ideas and proposals shared across party lines.

Want More Action Alerts?

As the budget negotiations continue, we will be sending more action alerts to our "Voices from the Capitol" mailing list. Make sure you are subscribed here.

 

Budget Updates: Next Steps

Legislative leaders intend to move quickly in the coming days towards a budget vote. House Democrats and House Republicans are caucusing today; their Senate counterparts will be meeting on Monday. They intend to pass a budget late next week with a broad bipartisan support, perhaps even a veto-proof majority (two-thirds in both chambers). Legislative leaders will meet with the Governor in the coming days and have said they are open to introducing changes in the proposal to avoid a veto, so the proposals are not final yet.

Is this good news? It is hard to say, without knowing much about the full proposal. The budget delay was starting to negatively impact municipal budgets and key services. However, it is too early to tell if the current bill under consideration makes some of the hard choices the state needs to move forward, or if it is little more than a stopgap measure that will force our state to re-live this battle next February.

The Governor's Budget Proposal

Even if legislative leaders intend to pass the budget with a veto-proof majority, yesterday they expressed a willingness to negotiate key details with the Governor before final passage. On Monday, Governor Malloy presented a revised budget proposal that highlights some of his key positions ahead of these talks. You can download our policy brief on the Governor's most recent plan here.

 

CT Voices Update: We Are Hiring!

Connecticut Voices for Children is hiring for three new positions to strengthen and expand our research and advocacy work:

Senior Economic and Fiscal Policy Fellow

Lead research and advocacy on state, federal and municipal tax, budget, and economic development work. View job announcement

Fiscal Policy Fellow

Conduct research and advocacy on tax, budget, and fiscal policy work. View job announcement

Educational Equity Policy Fellow

Lead research and advocacy to advance school readiness, early childhood, college and career readiness, and educational equity. View job announcement

 

Federal Update: Breaking the ACA, Fixing the ACA

Breaking the ACA through regulation

Legislative efforts to repeal the Affordable Care Act (ACA) have largely fizzled, but the healthcare law is still at risk. President Trump announced three measures last week that have the potential to greatly weaken some key pieces of the ACA structure.

  • Cost-Sharing Reduction (CSR) payments: this is a provision under the ACA that reimburses insurers for providing discounted premiums to low-income families. Due to a drafting error, the ACA does not explicitly appropriate these funds, leaving the door open for the administration to discontinue them. Due to the structure of the ACA markets and tax credits, however, eliminating the CSR will end up both reducing coverage and increasing the costs borne by the federal government, as higher premiums will both make insurance unaffordable for as many as one million people who do not receive tax credits and increase the tax credit amount from the government for low-income families.
  • President Trump also instructed the Department of Health and Human Services to change several ACA regulations that could potentially weaken the individual insurance market. CBPP has more here. It is unclear when the new regulations will be implemented.
  • The final executive order made it much easier for employers to opt out of covering contraception. It is unclear how many employers will opt out, particularly given the low cost and high impact of covering contraceptive options. You can read more here.

A possible fix

Not everything is bad news on the ACA front, however. Two key Senators, Lamar Alexander (R-TN) and Patty Murray (D-WA), have reached a tentative agreement to fund the CSR payments, fund outreach programs to promote enrollment, and provide additional flexibility to the states. CBPP´s Bob Greenstein provides an overview here; it is a bipartisan agreement that would make the ACA work better.

Unfortunately, it is unclear whether the agreement has the votes to pass in Congress. Some Republican Senators have already voiced their skepticism. Speaker Paul Ryan and President Trump have also expressed doubts. As it is a bipartisan effort, it still might be able to gather enough support to pass, but it is a long shot.

 

Save the Date: First for Kids Awards

Thursday November 9, 2017

5:00 p.m. to 7:00 p.m.

Please join us for an evening of music, mingling, and celebration as we honor three outstanding voices for Connecticut’s children.

When: Thursday, November 9, 2017, 5:00 to 7:00 pm

Where: Pond House Café, 1555 Asylum Avenue, West Hartford

The 2017 First for Kids Honorees

  • Sharon Langer: Lifetime Achievement Award
  • Arielle Levin Becker: Media Voice Award
  • Vincent Espino: Youth Voice Award

To register, click here.

 

What We Are Reading

Issue Areas:
Budget and Tax, Health
October 11, 2017

Action Alert - Spending Cap Puts Key Programs at Risk

The spending cap has become a central issue in the current bipartisan budget negotiations. While a spending cap can be vital for preventing runaway spending, an overly restrictive cap would mean that Connecticut can no longer makes opportunity for children and families a priority. Unfortunately, proposed changes to the spending cap would have that effect, limiting the state’s ability to meet vital needs today or key priorities tomorrow.

  • Force the state to choose between vital priorities by including state aid to distressed municipalities under the cap;
  • Hamstring our ability to meet the changing needs of vulnerable populations and restrict the state’s capacity to respond to changes in federal policy;
  • Incentivize legislators to hide federal funds in non-appropriated accounts, making the budget process less transparent;
  • Reduce the effectiveness of state programs by including state money to implement federal programs under the cap; and
  • Accelerate the shrinking of the share of the budget devoted to children by punishing the state for attempting to make up for previous mismanagement of pension liabilities.

If the General Assembly passes a budget with a three-fifths majority vote—a possibility if a compromise budget emerges from current negotiations—the spending cap would affect far more than our funding for two years, as it would likely have constitutional force. We urge you to contact legislative leadership today and call for a spending cap driven by a commitment to meeting vital needs, strengthening our cities and towns, and spurring equitable economic growth.

Click here to find your legislator. Our full report on the spending cap is avaiable here

Issue Area:
Budget and Tax
October 9, 2017

Voices from the Capitol (XXXVII): The Friday the 13th Vote

Roger Senserrich

In today’s email:

Budget updates: The Friday the 13th Vote

As expected, the General Assembly did not overturn Governor Malloy’s veto on the latest budget proposal. Although the House convened Tuesday for a vote, no legislator called for a motion to reconsider the bill. Despite calls from some legislators for a second override session, the Speaker is unlikely to bring this budget back for a vote again, meaning we are truly back in square one.

The plan, for now, is for the General Assembly to convene again on Friday, October 13th - the last possible date to get a budget on the books and signed by the Governor before November 1st. Local governments are already grappling with big budget cuts as several municipal grants were dramatically reduced this month; any further delays in the vote could tip Hartford towards insolvency.

Budget talks continue apace, with taxes, structural reforms and the spending cap being the main sticking points. The CT Mirror has a good overview here; read some additional notes on the spending cap below.

Call to Action: A Budget that Represents Our Values

Connecticut urgently needs a state budget grounded in a commitment to economic growth, equity, and good fiscal governance. Any further delay only weakens our schools, towns, and social services, placing a growing burden on those most vulnerable.

The solution to Connecticut’s budget woes should not look backwards and rely on old ways of doing business. Cutting spending with no new taxes or raising taxes without making strategic spending decisions might balance the budget this year, but it will not address the long-term challenges Connecticut faces. We need a new approach that builds a strong foundation for Connecticut: a state budget that results in thriving families, equitable opportunity, and fiscal responsibility. Doing so will require bold action, fearing not taxes or structural reforms but rather the lost potential of our children, families, and communities.

Call your legislators and tell them we need a budget that moves Connecticut forward toward equitable economic growth, increased opportunity, and sustainable, efficient government.

Click here to find your legislator and contact them today. Click here to download our latest brief mapping a path forward for Connecticut using ideas and proposals shared across party lines.

Want More Action Alerts?

As the budget negotiations continue, we will be sending more action alerts to our "Voices from the Capitol" mailing list. Make sure you are subscribed here.

Implementing the Spending Cap

As reported in the CT Mirror, one of the points of contention between Republicans and Democrats to reach a budget agreement is defining the spending. Both parties included changes to the current statutory cap in the budget proposals. We testified this past legislative session about the importance of the spending cap, warning that a badly designed cap could do more harm than good to the state economy.

Today we are publishing an expanded analysis of both the Republican and Democratic proposals, as well as an assessment on whether a statutory cap is an effective tool to promote good fiscal governance in the state. You can download the report here.

Federal Update: A Tax Cut for the Wealthy, A Health Care Mess

With the ACA repeal finally behind us (at least for now), there are two main issues facing Congress that warrant our attention: the Republican tax proposal, and health care programs that need reauthorization.

The Republican tax proposal:

The White House and Republican leaders in Congress presented their framework for a tax reform last week. The overall picture is a big tax cut overwhelmingly tilted toward the richest taxpayers in the country; working families would be largely an afterthought, with some even seeing a tax increase. In Connecticut, 82.6 percent of the tax cuts would benefit the richest one percent of taxpayers. The Institute on Taxation and Policy has the numbers here.

The tax cuts will have a huge impact on the federal budget, adding $1.5 trillion to deficits over ten years. This could lead to significant cuts to social programs, if they are eventually paid following the budget cuts proposed by Republicans in Congress. CBPP has more.

Health care reauthorizations: CHIP, CHIME and MIECHV

Congress let funding for three critical programs run out last week: the Children´s Insurance Program (CHIP); the Community Health Investment, Modernization, and Excellence (CHIME) Act; and the Maternal, Infant, and Home Visiting Program (MIECHV) program. We explain in some detail what these programs entail here.

If funding is not reinstated soon, program impacts will be severe for Connecticut families. 2,738 children and families receive services under MIECHV; Karen Siegel, our Health Policy Fellow, provides a good overview on how the loss of CHIP funding will impact Connecticut in the coming months. Right now, the Senate and House have two-different bills to reauthorize the programs; the House proposal includes damaging cuts to ACA and Medicare programs funding CHIP. These are bipartisan programs, so we are cautiously hopeful that reauthorizations will pass before next year.

Save the Date: First for Kids Awards

Thursday November 9, 2017

5:00 p.m. to 7:00 p.m.

Please join us for an evening of music, mingling, and celebration as we honor three outstanding voices for Connecticut’s children.

When: Thursday, November 9, 2017, 5:00 to 7:00 pm

Where: Pond House Café, 1555 Asylum Avenue, West Hartford

The 2017 First for Kids Honorees

  • Sharon Langer: Lifetime Achievement Award
  • Arielle Levin Becker: Media Voice Award
  • Vincent Espino: Youth Voice Award

To register, click here.

What We Are Reading

Issue Areas:
Budget and Tax, Health
October 2, 2017

Voices from the Capitol (XXXVI): The October 1st Deadline

Roger Senserrich

In today’s email:

Budget updates: the October 1st Deadline

Back to square one. Governor Malloy vetoed today the budget proposal passed by the General Assembly two weeks ago. In his message, the Governor called the budget “unbalanced, unsustainable, and unwise.” It is unlikely that the General Assembly will be able to override the veto.

Legislative leaders and the Governor, then, are back negotiating a budget. It is not clear when the General Assembly will convene again to vote on another proposal. As of now, it seems likely that the state will not have a new budget by October 1st, meaning that the municipalities will face steep cuts to education grants and PILOT payments in the coming weeks. We explained the impacts of local funding cuts here.

Call to Action: A Budget that Represent Our Values

The solution to Connecticut’s budget woes should not look backwards and rely on old ways of doing business. Cutting spending with no new taxes or raising taxes without making strategic spending decisions might balance the budget this year, but it will not address the long-term challenges Connecticut faces. We need a new approach, grounded in a commitment to economic growth, equity, and good fiscal governance. Doing so will require bold action, fearing not taxes or structural reforms but rather the lost potential of our children, families, and communities.

Call your legislators and tell them we need a budget that moves Connecticut forward toward equitable economic growth, increased opportunity, and sustainable, efficient government.

Click here to find your legislator - contact them today. Click here to download our latest brief mapping a path forward for Connecticut using ideas and proposals shared across party lines.

Want More Action Alerts?

As the budget negotiations continue, we will be sending more action alerts to our "Voices from the Capitol" mailing list. Make sure you are subscribed here.

The Budget: Short and Long-Term Fixes

There are some other important news regarding the state budget - one regarding a short-term fix, the other about Connecticut's fiscal health even after a budget passes.  

  • Recent budget proposals have included a hospital tax as a source of revenue. This tax would enable the state to claim additional Medicaid funding that would revert back to the hospitals, and net $365 million on the general fund. It is a complicated scheme that is also under a strict deadline: Connecticut has to claim the funds by mid-October. The Hospital Association has agreed to the plan. The General Assembly will likely vote on the tax increase separately if there is no budget agreement in sight to preserve this funding, although a pending lawsuit might be a stumbling block.
  • In our recent budget analysis, we stated that neither the Republican nor the Democratic budget proposals included the structural reforms needed to put an end to Connecticut´s persistent budget woes. The Office of Fiscal Analysis’ estimate on the long-term impact of the proposals projects that, under the Republican proposal, the state would face a $3.31 billion deficit between 2019 and 2021. Under the Democrat's proposal, the shortfall would be $3.58 billion. The CT Mirror has an overview.

Federal Update: The ACA Might Be Safe for Now

There is a lot going on at the federal level this week  - and for once, there is plenty of good news. Here is an overview of the things we are following:

  • The Affordable Care Act seems to be safe, at least for now. Senate leaders admitted early this week that they did not have enough votes to pass Cassidy-Graham, the latest ACA repeal proposal.
  • Although they might try again with a new repeal bill at a later date, the collapse of this effort is especially significant, as reconciliation instructions expire by the end of the month. As a result, any standalone repeal effort will require 60 votes in the Senate, not the current 50. It’s still possible that Congressional Republicans might try to combine a repeal bill with the upcoming tax reform proposal or chip away at protections through amendments to other bills. The ACA has been declared safe before only for another repeal effort to emerge. We will keep you posted.
  • Congressional Republicans presented their framework for tax reform this week; CBPP has the highlights. The main takeaway is that the proposal would provide a huge windfall to high-income households, with working families being largely an afterthought. One provision, the repeal of the state and local tax deduction, will hit Connecticut taxpayers especially hard.
  • Congress is working on the reauthorization of the Children's Health Insurance Program (CHIP), as funding runs out by the end of the month. For technical reasons, money won't just run out by October 1st; states still have funding from previous payments. Families USA has a good overview; here is our policy brief for Connecticut.
  • Another program pending reauthorization is Maternal, Infant, and Early Childhood Home Visiting (MIECHV). The House passed a 5-year extension to the program that would require states to match the funds in the future; the Senate bill does not include this match.  
  • Finally, there is the  Community Health Investment, Modernization and Excellence (CHIME) Act to provide funding to community health centers. Again, funding runs out by the end of the month. Our partners and Community Catalyst have more.

Save the Date: First for Kids Awards

Thursday November 9, 2017

5:00 p.m. to 7:00 p.m.

Please join us for an evening of music, mingling, and celebration as we honor three outstanding voices for Connecticut’s children.

When: Thursday, November 9, 2017, 5:00 to 7:00 pm

Where: Pond House Café, 1555 Asylum Avenue, West Hartford

The 2017 First for Kids Honorees

  • Sharon Langer: Lifetime Achievement Award
  • Arielle Levin Becker: Media Voice Award
  • Vincent Espino: Youth Voice Award

What We Are Reading

Issue Areas:
Budget and Tax, Health