Not the budget: Other legislation of note

The 2013 regular session of the legislature concluded on midnight Monday. During the course of the session, the Maryland Budget and Tax Policy Institute took positions on a variety of bills related to Maryland’s finances and their effects on low-income and other vulnerable Marylanders.

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Here is the run-down:

Transportation

The legislature enacted a much-needed transportation bill (House Bill (HB) 1515) that gradually increases taxes on gasoline to replenish the state’s transportation fund, allowing Maryland to improve roads, bridges, transit systems, and bicycle and pedestrian passageways.

MBTPI supported this legislation as a responsible compromise. 

However, there are two concerns we have about the bill. One we discussed in yesterday’s blog. The bill calls for a portion of the sales tax to be diverted from general fund purposes (like education, healthcare, and police) to transportation once Congress allows states to collect taxes on internet and catalog purchases.

The other concern we had is that the gas tax places a disproportionate cost on low-income working families. To address this regressive effect, we supported bills to expand Maryland’s earned income tax credit (HB 845/Senate Bill (SB) 703).  Unfortunately, these bills died in committee.

Homeless Youth

MBTPI supported HB 823/SB 764 to create a task force to find solutions for the growing problem of unaccompanied homeless youth.  The legislature enacted these bills. MBTPI will be following the task force’s work closely. We expect the task force to develop creative and effective initiatives to help these teens and young adults.

Making Welfare to Work Workable

MBTPI supported and the legislature enacted SB 686 to establish an earned income disregard pilot program. Currently, Temporary Cash Assistance (TCA) recipients lose 60 cents in benefits for every dollar they earn when they join the workforce, even though those exiting TCA on average earn less than the federal poverty rate. SB 686 creates a pilot program in a rural county to research the impact of reducing the earned income disregard when recipients initially enter the workforce. The pilot program would ease the transition from TCA to self-sufficiency by disregarding (for the purposes of TCA eligibility) 100 percent of their earned income for the first three months of employment, disregarding 60 percent of their earned income for the following six months, and disregarding 40 percent (the current standard) afterwards. A graduated disregard would help TCA parents succeed when they enter the workforce, encouraging personal responsibility and helping families achieve independence. The pilot program will allow this policy to be tested and evaluated.

Tomorrow we'll look at some of the bills we supported that didn't make it through the legislative process.

Welfare Reform Briefing Today

The Joint Committee on Welfare Reform met today to receive briefings from the Department of Legislative Services (DLS), the Department of Human Resources (DHR), and Dr. Catherine Born of the University of Maryland School of Social Work.

From UM School of Social Work, Life After Welfare 2012 Annual Update

DLS presented a review of substance abuse screening and treatment for Temporary Cash Assistance (TCA) recipients. In Maryland TCA applicants are screened for their substance abuse risk level. High-risk applicants are required to submit to a drug test. If they test positive the applicant is required to enter some sort of treatment program. Failure to complete the program, or to submit to screening, testing, or treatment is grounds for denying benefits based on that person's needs (if they are the head of household they may still receive benefits based on dependents' needs). Unfortunately, the data tracking TCA substance abuse referrals is incomplete. DLS recommended improving data collection and the effectiveness of substance abuse treatment services provided to TCA clients.

Secretary Dallas then gave an update on DHS welfare-related activities:

• Welfare caseload growth is slowing, with the exception of food assistance.
• Temporary Cash Assistance enrollment peaked in December of last year.
• DHR placed a record number of clients in jobs in FY 2012.
• Many of those jobs are paid $10/hour or better, although it is unclear if these are part- or full-time jobs.
• Only 7 percent of TCA clients have reached the federal 60 month time limit, well below the 20 percent federal cap.
• The Thompson order has been satisfied, as DHR's monthly application timeliness rates have now exceeded 96 percent for all five assistance programs for almost two years running.
• There is still a Temporary Assistance to Needy Families (TANF) shortfall of $45 for FY 2013, due largely to the ongoing slow economic recovery.
• $229 million in federal TANF dollars for Maryland is at risk if Congress does not reauthorize TANF by the end of this month. Congress is likely to pass a six-month extension soon, but longer-term reauthorization is unlikely before next year.
• Secretary Dallas also touched on child support collection issues, auditing, and non-custodial parent issues.

Dr. Born rounded out the briefing with a presentation on her annual report on Life after Welfare (the September 2012 report isn't up yet):

• The typical TCA case remains an unmarried African-American woman in her 30's, who lives in Baltimore City with one or two children, with a high school education.
• TCA recipients are no strangers to the world of work: 70 percent worked before and after receiving benefits.
• Short spells on welfare are common, particularly after the recession when previously employed individuals flooded TCA. 
• Families that leave TCA and remain independent for at least three years are unlikely to fall back into welfare.

As, Dr. Born stressed in her presentation, the recession and its aftereffects have made it much harder for welfare recipients to exit and stay off TCA. Maryland continues to fare better than other states in many ways, but must continue to treat its most vulnerable residents with compassion and support to advance an economic agenda that benefits and uplifts all Marylanders.