Reports


Making change: The state budget as a tool for racial and ethnic equity

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mlpp and kids count sept_26_2017 September 2017
Pat Sorenson, Senior Policy Analyst

Budget Brief JPG USE THIS ONE

—  SUMMARY—

The 2018 budget includes several investments that address pervasive, unacceptable and avoidable barriers to opportunity for many of the state’s children of color, but a much more intentional effort is needed to overcome long-standing inequities that can be traced to public policies in Lansing and nationwide. State budgets are not “colorblind”—even if their disproportionate impact is unintended.

Through its Kids Count program, the League documents the well-being of children in Michigan, and advocates for policies that can eliminate the indefensible outcomes experienced by children of color and their families. For every negative outcome there is a backstory—a history of inequities based on race, income and place. Michiganians share a value of opportunity for all children, but the data show us that good intentions have not always resulted in good outcomes.

ECONOMIC SECURITY

Differences in economic security and opportunity are at the core of racial and ethnic disparities in outcomes for families and their children. The systemic barriers to economic security include housing discrimination, the historical impact of redlining on homeownership, segregation in public schools, differences in educational quality and opportunity, racial discrimination in the workplace, and inequities in the ability to accumulate assets and wealth.

These systemic barriers have their roots in historical racism and discrimination, but persist today in part because of budgets and other public policies that do not recognize the extra resources required to overcome the cumulative effects of inequities based on race and ethnicity.
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2018 BUDGET DECISIONS AFFECTING CHILDREN’S ECONOMIC SECURITY:

  1. Expanded funding for food assistance, but more work needs to be done to ensure access to healthy food. In 2018, the state’s “heat and eat” policy will continue, providing more food assistance to nearly 340,000 Michigan residents, including thousands of children of color and their parents. Still lacking is enough support for access to healthy foods for the many children of color who live in “healthy food deserts.”
  2. Continued to endorse policies that have led to the decline in funding for income and family support programs. The Legislature rejected a small increase in the clothing allowance for children receiving income assistance—all of whom are living in deep poverty. Funds were included to expand access to child care services so parents can work, as well as the Pathways to Potential program in schools around the state.

HEALTH

Michigan has a history of effectively covering children through the Medicaid and MIChild programs, and with the Affordable Care Act, the rate of uninsured children dropped even further. However, the state’s children of color still have less access to needed physical and mental healthcare, are more frequently born underweight and likely to die before their first birthdays, and face environmental injustices related to exposure to toxins in their homes and neighborhoods.

BB-Chart 5

As a result of historical and current barriers to a high-quality education and career path for many African-American and Latino parents, their children have less access to private health insurance. Two of every 3 African-American children—and half of Latino children—in Michigan rely on public health insurance programs. Consequently, expansions in publicly funded healthcare coverage can significantly improve equity for children.

2018 BUDGET DECISIONS AFFECTING CHILDREN’S HEALTH:

  1. Supported the Healthy Michigan Plan with both federal and state funding, providing healthcare coverage to 650,000 Michigan residents with low incomes.
  2. Provided funding for Medicaid services for over 390,000 pregnant women and children.
  3. Established pilot projects to integrate the administration of behavioral health services—a controversial move that will begin as a pilot project in Kent County.
  4. Provided a small funding increase to address the need for transportation for families seeking nonemergency healthcare, a persistent barrier to access for many families with low incomes.
  5. Continued to invest in efforts to address the Flint lead exposure crisis, approving a slight decrease in the state portion of the costs of services from $43.7 million this year to $41.5 million in 2018. Still at issue is the prevention of similar crises in other areas of the state, and the Legislature included $1.25 million to begin implementing the recommendations of the Child Lead Poisoning Elimination Board.
  6. Approved $815,000 to prevent dangerous chemical vapor intrusions. The Legislature appropriated the funds to continue a new response program for the intrusion of volatile chemical vapors into homes and buildings.
  7. Continued to underfund local public health services. Funding to local public health departments is approximately the same as it was in 2004.
  8. Eliminated a health innovation mini-grant program. The Legislature eliminated the $1 million Health Innovation Program that provided mini-grants to a range of community agencies for efforts to address the needs of special populations, including families of color.

FAMILY AND COMMUNITY

A long history of racial and economic inequality, along with racial segregation, have led to gross differences in the resources available in the neighborhoods many Michigan children of color grow up in. Too frequently children of color are living in high-poverty areas where safety is a concern, and access to parks, fresh food, and after-school and other enrichment activities is limited. African-American children in Michigan are eight times more likely to live in high-poverty communities than White children.

In addition, the barriers and economic stresses facing parents in lower-income communities of color often affect their ability to provide the support and care their children need. As a result, children of color are overrepresented in Michigan’s child welfare system.

2018 BUDGET DECISIONS AFFECTING FAMILIES AND COMMUNITIES:

  1. Failed to adequately fund revenue sharing payments to cities, villages and townships. The 2018 budget includes $6.2 million in one-time funding for cities, villages and townships, which is not enough to overcome years of lagging funding, resulting in current payments at only 30% of the statutory level.
  2. Provided funding for child protective services and foster care, but continued to underfund services that could prevent child abuse and neglect. Funding is available for child welfare staffing and services needed to move children out of the foster care system and into permanent homes—as required by a settlement agreement stemming from a lawsuit against the state for failures in its child welfare system. However, the lawsuit does not specifically address the disproportionate representation of children of color in the state’s child welfare system or require additional efforts to prevent child abuse and neglect. In fact, the 2018 budget reduces funding for family preservation by $6.1 million.

EDUCATION

A high-quality education is a vital path to equity for children in Michigan, yet the data show that Michigan has a long way to go. Children of color have less access to highquality early learning experiences and face barriers throughout the educational system. Three of every 4 African-American students and two-thirds of Latino students in the state are considered economically disadvantaged, a stark reminder of broader social issues that result in inequities in educational achievement, high school completion and college readiness.

Of great concern are disparities in third-grade reading given Michigan’s new retention law. More than half (56%) of African-American third-graders would have been subject to retention if the policy had been implemented in 2015-16, compared to only 21% of White students. For the retention law to be successful and avoid contributing to racial and ethnic inequities, it is critical that there be sufficient funding for the services needed to address the cumulative impact of inadequate early learning opportunities for children of color, including the early identification and treatment of developmental delays and high-quality child care and preschool.

Further, despite evidence that having at least one teacher of the same race increases the likelihood of school success for children of color, Michigan teachers do not reflect the demographics of their students. In the 2015-16 school year, 67% of Michigan students and 91% of the state’s teachers were White—making Michigan’s teaching workforce less diverse than the national average.

Finally, reflecting diminished opportunities beginning early in life and accelerating during the school years, only 10% of African-American students and 19% of Latino students met or exceeded the SAT benchmark for college readiness in 2015-16. As a result, African-American and Latino youths are less likely to pursue postsecondary education within six months of graduating and are much more likely to require remedial coursework once in college.

2018 BUDGET DECISIONS AFFECTING EDUCATIONAL SUCCESS:

  1. Increased per-pupil spending with larger increases for districts currently receiving the lowest payments. The Legislature approved an increase of between $60 and $120 per pupil, using a formula that benefits districts with lower payments. In the 10 years between 2007 and 2017, the minimum per-pupil payment increased 6%, while the cost of living increased 12.6%.
  2. Increased payments for high school students. The final budget includes $11 million to provide a bonus payment of $25 per pupil in grades nine through 12—recognizing the costs associated with the high school curriculum.
  3. Increased funding for students at risk of educational failure. The Legislature approved an increase of $120 million for the At-Risk School Aid program—bringing total funding to $499 million—and expanded eligibility to an estimated 131,000 students. The At-Risk School Aid program is the state’s best vehicle for addressing the educational challenges faced by children who are exposed to the stresses of poverty and has the potential to help improve equity for children of color.
  4. Failed to provide sufficient funding to address racial and ethnic disparities in early literacy. For 2018, the Legislature approved $3 million in new funds to double the amount available for early literacy coaches to $6 million statewide. Other early literacy funds ($20.9 million) were consolidated to be distributed to districts.
  5. Failed to invest in adult education. Despite a high level of need, state funding for adult education has dropped by 70% since the 2001 budget year. For 2018, the Legislature provided continuation funding of $25 million for adult education programs, along with $2 million for pilot programs focused on career and technical education.
  6. Providing too little financial aid for students with low incomes. Average tuition in Michigan was the sixth highest in the nation during the 2015-16 school year and the state currently spends less than half the national average on needs-based tuition grants. Michigan has also completely eliminated state financial aid for students who have been out of high school for more than 10 years. For 2016, the Legislature: (1) tightened the tuition cap for universities; (2) slightly increased funding for financial aid programs; and (3) failed to reinstate the Part-Time Independent Student Grant for older students.

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Making change: The state budget as a tool for racial and ethnic equity

pdficonPat Sorenson, Senior Policy Analyst
September 2017

mlpp and kids count sept_26_2017

Budget Brief JPG USE THIS ONE

 

The 2018 budget includes several investments that address pervasive, unacceptable and avoidable barriers to opportunity for many of the state’s children of color, but a much more intentional effort is needed to overcome long-standing inequities that can be traced to current and historic public policies in Lansing and nationwide. State budgets are not “colorblind”—even if their disproportionate impact is unintended.

The annual budget has been aptly described as the best measure of the state’s priorities. Each year, lawmakers must distribute state funds in ways that meet basic needs, maintain critical infrastructure, ensure basic health and safety and invest in the future—most critically for children.

How lawmakers divide up the state budget has the potential to help or hinder children’s development and ability to learn, create or limit economic opportunities for families and communities, and protect or threaten public health and safety.

Through its Kids Count program, the League documents outcomes for children and their families, including racial and ethnic disparities. The League has as a primary goal of equity for all children and knows that to get there, policymakers and the public must first understand and acknowledge that inequities exist.

Job one is to educate ourselves and our community leaders, which is only possible if there is adequate data to inform budget and policy decisions. There is a tradition of close and ongoing monitoring of economic data including, for example, Gross Domestic Product (GDP) and the Consumer Price Index (CPI). Our children deserve the same.

But documenting indefensible outcomes for children of color and their families is not enough. For every negative outcome there is a backstory—a history of inequality based on race, income and place. Michiganians share a value of opportunity for all children, but the data show us that good intentions have not always resulted in good outcomes.

Michigan cannot afford to take lightly the undeniable obstacles being faced by its growing number of children of color. To move from indexing inequality to making change, lawmakers and other leaders must be intentional in facing the true impact of the policy and budget decisions they make on children, families and communities of color; they must support investments that help remove the long-standing structural barriers to opportunity for all children.

ECONOMIC SECURITY

Differences in economic security and opportunity are at the core of racial and ethnic disparities in outcomes for families and their children. The systemic barriers to economic security include housing discrimination, the historical impact of redlining on homeownership, segregation in public schools, differences in educational quality and opportunity, racial discrimination in the workplace, and inequities in the ability to accumulate assets and wealth.

These systemic barriers have their roots in historical racism and discrimination, but persist today in part because of budgets and other public policies that do not recognize the extra resources required to overcome the cumulative effects of inequities based on race and ethnicity. The data are clear. Families and children of color are being held back from many of the traditional pathways to economic opportunity and security. Given the growing diversity of the state, this threatens the economic growth all state residents depend on.BB-Chart 1

How Michigan Children and Families Are Faring: Inequities in economic opportunity have a strong and well-documented impact on the next generation of Michiganians. Children who grow up in poverty are more likely to have poor nutrition, live in homes and neighborhoods where they are exposed to environmental toxins, and have untreated health conditions. Their parents struggle to provide the enrichment activities children need in the earliest years of life, including books, toys, activities and high-quality early learning opportunities. Further, the economic stresses faced by parents are linked to depression and anxiety, which raise the risk of substance use disorders.1

BB-Chart 2The rising economy has not lifted all boats. Lower unemployment rates in Michigan have not translated into secure employment for all families. More than half of the state’s African-American children live in families where no parent has full-time, year-round employment, along with 40% of Hispanic/Latino children or those of two or more races.

Children of color are two to three times more likely to live in poverty. Despite overall improvements in the state’s economy, the number of children living in poverty has remained stubbornly high, particularly for children of color. More than 1 of every 5 children in the state lives in poverty, with child poverty rising from 19% in 2007 to 22% in 2015. Most unacceptable is the fact that nearly one-third of Latino children or children of two or more races lives in poverty, as do half of African-American children.

BB-Chart 3Even larger numbers of children are living in homes where it is difficult to make ends meet. The League has estimated that a single parent with two children under age 5 would need to earn approximately $47,000 per year to cover the costs of housing, child care, food, transportation and other personal expenses.2 Almost 3 of every 4 African-American children in Michigan, along with 2 of every 3 Latino children, live in households with incomes of 200% of poverty or less (approximately $48,000 per year).

Many children face the possibility of not having enough food. In 2014, 338,000 Michigan children lived in households facing the possibility of not having adequate food. And despite overall economic growth in Michigan, almost half of the state’s children are eligible for free or reduced-price meals in school. African-American and Latino families experience higher levels of food insecurity, a dynamic that has continued in the aftermath of the Great Recession.3

Housing is unaffordable for many families. Nearly half of African-American children, and over one-third of Latino children or those of two or more races, live in homes where housing costs are particularly burdensome, representing more than 30% of monthly income.

Budget Decisions Affecting Economic Security: Despite continuing high rates of poverty and economic insecurity for the state’s children, and particularly for children of color, state funding for programs to ensure that children’s basic needs are met has plummeted. The result has been continuing struggles for families with children, as well as the shrinking of funding to low-income communities.

BB-Chart 4For example, in the 10 Michigan counties with the highest percentages of children of color, funding for income assistance fell by between 53% and 81% in the five years from 2010 to 2015. Funding for child care subsidies to ensure that parents with low-wage jobs can work to support their children fell by between 20% and 56%. For 2018, lawmakers:

Expanded funding for food assistance, but more work needs to be done to ensure access to healthy food. The budget for the upcoming fiscal year includes:

  • A continuation of the “heat and eat” policy. The final budget authorizes funding for the “heat and eat” policy, which increases food assistance for nearly 340,000 Michigan residents. Four of every 10 recipients of food assistance are children. Given income inequalities based on race and place in Michigan, this expansion is likely to improve the health of thousands of children of color as well as their parents.
  • A small investment in access to healthy food. Federally-funded food assistance does not ensure access to healthy food. The 2018 state budget includes: (1) $750,000 in the current budget year and $380,000 in the 2018 budget to match a three-year federal grant to encourage the use of food assistance dollars for healthy foods; (2) $500,000 ($250,000 in state funds) for the purchase of wireless equipment by farmers markets so families can use their Bridge Cards to purchase healthy food; and (3) an additional $10 million in federal funding for nutrition education programs for persons receiving food assistance. The Legislature failed to fund a Michigan Corner Store Initiative that was intended to provide grants to small food retailers to increase the availability of fresh and nutritious foods in low- and moderate-income areas.

Accessing healthy food is a challenge for many families, particularly those living in urban communities of color or in more remote rural areas. With few grocery stores in urban areas, many families live in “food deserts,” requiring them to travel to find healthier foods. Fast-food restaurants and other businesses that sell processed foods with little nutritional value have replaced food retailers in these communities. A national study found that low-income, urban neighborhoods of color have the least availability of grocery stores and supermarkets compared with both low- and high-income White communities.4

The lack of access to healthy foods can have long-term effects on children of color concentrated in urban areas. Living closer to sources of healthy food has been shown to decrease the risk of obesity and diet-related illness. In Michigan, 1 in 3 children is overweight or obese, and 70-80% of obese children become obese adults who are more likely to suffer from heart disease, diabetes and some cancers. This comes at a cost to the state: Michigan is expected to spend $12.5 billion on obesity-related health care costs in 2018.5

Continued to endorse policies that have led to the decline in support for income and family support programs. The 2018 budget fails to reverse the state’s dramatic disinvestment in income support programs for families with children, which has pushed the number of Michigan families receiving Family Independence Program (FIP) benefits to its lowest level since 1957. The dismantling of this basic needs program has had a disproportionate effect on children of color, whose parents have been less able to take advantage of economic recovery and job growth in the state. More than 70% of the recipients of FIP are children—many of them very young children of color.

For 2018, the Michigan Legislature:

  • Rejected a small increase in the clothing allowance that was proposed by the governor. The Legislature ultimately rejected a small increase in the school clothing allowance for children in families receiving income assistance through the FIP. The clothing allowance remains at $140 per child per year.
  • Expanded the Pathways to Potential program. The Pathways to Potential program, which places “success coaches” in schools to identify barriers faced by students and their families and makes appropriate referrals for services, is in 259 schools in 34 counties. The final 2018 budget increased the program by a total of $4.9 million. Pathways to Potential is intended to work with families through their children’s schools and in conjunction with community partners. It is a promising model for a two-generational approach to the barriers facing many families of color and parents with low incomes.
  • Increased support for homeless shelters. The 2018 budget increases the rate paid to homeless shelters from $12 to $16 per person, per night at a cost of $3.7 million. Because nearly half of African-American children—and more than a third of Latino children or those of two races—are living in homes where housing costs consume a significant portion of the family income, homelessness is a looming threat for many children of color. An estimated 100,000 people in Michigan are either homeless or imminently at risk of homelessness, and families with children make up half of the homeless population. More than half of people who are homeless in the state are African-American.6

Expanded funding for child care services that parents need to find and keep jobs that can help them support their children. The Legislature increased funding for child care by $19.4 million (including $8.4 million in state funds) to increase reimbursement rates to child care providers, as well as $5.5 million to raise the eligibility threshold for a child care subsidy from 125% of poverty to 130%.

Child care costs are some of the largest that families face, rivaling housing and even the price of a year of college. Without assistance, many parents are either forced out of the workforce or required to rely on relatives or neighbors who may be facing health problems or other hardships of their own. A family with wages of 150% of poverty (approximately $29,000 per year for a family of three in 2016) would need to spend over 60% of its income to place two children in a child care center; a family child care home would consume nearly half of the family’s income.

BB-Chart 5The median family income for an African-American family with children in Michigan in 2015 was $27,200—two and a half times less than the median income for non-Hispanic White families at $71,600.7 The high cost of child care perpetuates disparities in income as more families of color are unable to afford the child care they need to work. High child care costs relative to family income also further hamper children’s development by increasing the likelihood that children of color will be placed in lower quality child care settings.

HEALTH

How Michigan Children and Families Are Faring: Michigan has a history of effectively covering children through the Medicaid and MIChild programs, with the percentage of children uninsured consistently below the national average. With the Affordable Care Act, the rate of uninsured children dropped even further. However, the state’s children of color still have less access to needed physical and mental healthcare, are more frequently born underweight and die before their first birthdays, and face environmental injustices related to exposure to toxins in their homes and neighborhoods.

Fewer children of color have access to private health insurance. As a result of historical and current barriers to a high-quality education and career path for many African-American and Latino parents, their children have less access to private health insurance. Two of every 3 African-American children—and half of Latino children—in Michigan rely on public health insurance programs for healthcare coverage. Consequently, improvements in access to comprehensive publicly funded healthcare coverage can significantly improve equity for children.

BB-Chart 6The number of uninsured children continued to fall after adoption of the Affordable Care Act, and more women had access to healthcare prior to pregnancy, improving birth outcomes. Nationwide, the rate of uninsured children fell from 7.1% to 4.8% between 2013 and 2015—the largest two-year decline on record, which coincided with the implementation of most provisions of the Affordable Care Act.8 Michigan also experienced improvements in coverage, with the number of uninsured children falling from 90,000 in 2013 to 68,000 in 2015. Coverage for parents also improved, and research shows that extending new coverage to parents results in more children obtaining coverage.9

BB-Chart 7Mental health services for parents and children are still insufficient. It is estimated that 1 of every 5 Michigan children (410,000) has one or more emotional, behavioral or developmental conditions.10 Approximately 50,000 are served by Michigan’s public community mental health system.11

In addition, there is strong evidence that maternal depression can have a severe impact on both mother and child, ultimately affecting children’s growth and development, and there has been an increase in the suicide rate for both White and African-American youths.12

BB-Chart 8Fewer women of color are receiving early prenatal care and more of their children do not survive to celebrate their first birthdays. In its recent Kids Count Right Start report, the League documented racial and ethnic disparities in maternal and child health. Among the problems facing mothers and their babies are maternal smoking during pregnancy, preterm births, the lack of access to timely prenatal care and a higher frequency of infants born low-weight.

Of great concern is that African-American, Hispanic and Middle Eastern infants are much more likely to die before their first birthdays. The infants most at risk are those born prematurely with low birthweights, babies born to mothers with low incomes or covered by Medicaid, and babies that are the result of unintended pregnancies.

The reality is that access to healthcare coverage—which has expanded—does not ensure that pregnant women are able to find a provider within a reasonable distance from their home who will accept them as patients; or overcome the many barriers to adequate care, including provider bias or language and transportation issues. As a result of these barriers, African-American and Latina mothers are much more likely to receive late or no prenatal care, and their children are more likely to be born too early and too small.

BB-Chart 9In low-income communities and older urban areas where children of color are more concentrated, the rates of exposure to environmental hazards like lead are higher. The lead poisoning public health disaster in Flint put Michigan in the national spotlight, and brought to the public’s attention the disastrous effects of the state’s failure to invest in basic infrastructure and public health services. But the threats to children from lead and other environmental hazards are not limited to Flint. In the 2016 budget year, over 150,000 children under the age of 7 were tested for lead exposure, and approximately 5,500 (3.6%) had elevated blood lead levels.13

While the number of children tested and found to be exposed to lead was higher in the city of Detroit than any county in Michigan, the counties with the highest percentage of children under age 6 with elevated blood lead levels in 2015 were Lenawee, Mason and Kent.14 Data from Kent County show that African-American and Hispanic children ages 0-5 in the county are more than twice as likely to be exposed to harmful levels of lead.15

Budget Decisions Affecting Children’s Health: While Michigan continues to invest in healthcare coverage for children and families, access to physical and mental healthcare for families with low incomes and children of color remains a problem. In addition, Michigan has failed to invest adequately in the public health infrastructure needed to ensure that all children are born healthy, that pregnant women and new mothers—particularly those of color who are now underserved—have access to healthcare and adequate supports in the difficult job of parenting, and that children are not subject to the types of environmental injustices that made Flint’s lead exposure crisis a national disgrace. The Michigan Legislature made some significant investments to support the health of Michigan’s children, but missed several other opportunities to better care for kids.

Continued funding for Medicaid and the Healthy Michigan Plan. Continued investments in publicly funded health insurance options are critical to improving equity, in part because of discrimination in the workplace that has resulted in very low private coverage for children of color and their families. For 2018, lawmakers:

  • Supported the Healthy Michigan Plan with both federal and state funding. The plan provides healthcare coverage to about 650,000 people with low incomes, but the potential remains for congressional action to gut the program. Increased state funding is required because the federal match, which is at 95% in the 2017 calendar year, will drop annually until it reaches 90% in 2020 and subsequent years.16
  • Provided funding for Medicaid services for pregnant women and children. Children represent 39% of all Medicaid recipients, but account for only 20% of Medicaid expenditures.17 In July of 2017, 391,129 pregnant women and children under the age of 19 were covered by Medicaid.18
  • Established pilot projects to integrate the administration of behavioral health services. The Legislature moved forward on the controversial integration of physical and behavioral health in Michigan by authorizing a pilot project for full integration in Kent County, as well as three demonstration projects that integrate financing. The stated goal is to test how the state can improve outcomes and efficiencies in serving persons receiving behavioral health services.

Provided a small funding increase to address the need for transportation for families seeking healthcare. The governor had proposed an expansion of the current transportation programs in Macomb, Oakland and Wayne counties, where there are contracts for coordinating transportation for persons needing nonemergency care. In other counties, families must rely on local Department of Health and Human Services (DHHS) workers—who are already stretched thin—to coordinate transportation. The final budget includes $1.4 million to expand the use of local public transportation.

Children and families of color are more likely to be covered by public health insurance programs like Medicaid and the Healthy Michigan Plan, but access remains a problem—in part because of difficulty finding providers within a reasonable distance from home, as well as less access to reliable transportation.

Continued to invest in efforts to address the Flint lead exposure crisis. Michigan’s failure to invest in the public health infrastructure needed to prevent lead poisoning has come at a very high human and fiscal cost. Exposure to lead can thwart a child’s growth and development in ways that can last into adulthood, so the true costs are incalculable. However, it is estimated that the state will spend $478 million ($246 million in state funds) on the crisis between the 2016 and 2018 budget years.19 The bulk of those funds were appropriated to the Department of Environmental Quality ($158 million) and the Department of Health and Human Services ($143 million). For 2018, lawmakers:

  • Decreased the state portion of the costs of services to address the Flint water crisis from $43.7 million this year to $41.5 in 2018.20 Within the DHHS, funds are used for health services, food and nutrition services (including Double-Up Food Bucks), case management, education and outreach, child and adolescent health centers and schools, lead testing and abatement, water filters, and lead testing at local food service establishments.21
  • Included $1.25 million to begin implementing the recommendations of the Child Lead Poisoning Elimination Board. The Board was created by the governor in 2016 and made 80 recommendations for state action.
  • Approved $815,000 to prevent dangerous chemical vapor intrusions. The Legislature appropriated the funds to continue a new response program for the intrusion of volatile chemical vapors into homes and buildings.

Continued underfunding of public health services. One of the major goals of Michigan’s public health system is to provide services that address the health issues of populations with high needs in the state, including maternal and children’s health services. Services are provided through the state’s 45 local public health departments. Funding for public health has been relatively flat since 2007, with increases primarily in federal grants for lead abatement and state health system innovations. Funding to local public health departments is approximately the same as it was in 2004.22 For 2018, lawmakers:

  • Added legislative intent that more be done to encourage access to prenatal care. As of 2014, there were 5.1 obstetrician/gynecologists (ob-gyns) for every 10,000 Michigan women ages 15 to 25, which is below the national average, and 28 of Michigan’s 83 counties did not have any ob-gyns—furthering the likelihood that families with fewer resources are unable to find care.23 Because women with low incomes and women of color have less access to prenatal care, initiatives to improve access can also improve equity and outcomes for newborns.

The 2018 budget adds language requiring the DHHS to engage in outreach activities that will encourage early, continuous and routine prenatal care, and promote policies and practices that improve access to prenatal and obstetrical care. Unfortunately, this budget language is not connected to adequate funding.

  • Eliminated a health innovation mini-grant program. The Legislature eliminated the $1 million Health Innovation Program that provides mini-grants to a range of community agencies. Among the current grants are efforts to provide housing for homeless people being discharged from the hospital; increase access to healthy foods for teens, parents and persons with chronic illnesses; add physical activity to summer feeding programs; train students of color to become Certified Nurse Aides or in other allied health careers; promote breastfeeding by African-American women through peer mentoring; and link people in supportive housing to primary healthcare services.

FAMILY AND COMMUNITY

A long history of racial and economic inequality, along with racial segregation, have led to gross differences in the resources available in the neighborhoods many Michigan children of color grow up in. Too frequently children of color are living in high-poverty areas where safety is a concern, and access to parks, fresh food, and after-school and other enrichment activities are limited.

In addition, the barriers and economic stresses facing parents in lower-income communities of color often affect their ability to provide the support and care their children need. High rates of maternal depression with limited access to mental health and substance use disorder services, the scarcity of jobs providing a living wage, problems finding safe and reliable child care, inadequate transportation and substandard housing are all examples of the stresses facing parents.

How Michigan Children and Families Are Faring:

African-American children are eight times more likely to live in high-poverty communities. More than 1 in 6 children in the state lives in concentrated poverty, or census tracts where the poverty rate is 30% or higher, including more than half of African-American children ages 0-17 (55%), and 29% of Hispanic children and youths. Neighborhoods with concentrated poverty tend to have higher rates of crime and violence, higher unemployment rates with fewer job opportunities, and poor health outcomes with increased toxic stress for children and their families.24

BB-Chart 10Four of every 10 African-American children in Michigan have been exposed to two or more adverse childhood experiences, including frequent economic hardship; parental divorce or separation; parental death; parental incarceration; family violence; neighborhood violence; living with someone who is mentally ill, suicidal or has a substance use disorder; or facing racial bias. Research shows that these adverse childhood experiences can have long-term effects on children, including poor health as adults, learning and behavioral issues, and adolescent pregnancy.

African-American children and youths are much more likely to live in unsafe neighborhoods. More than one-third (35%) of African-American children live in neighborhoods that their parents or caretakers describe as sometimes or rarely safe, compared to 26% of Latino children and just 7% of non-Hispanic White children.25

Children of color are overrepresented in the state’s child welfare system. At nearly every point in the child welfare system, children of color have historically been over-represented, although changes in data collection systems at the state level have resulted in data gaps related to outcomes for children of color.26

In 2014, the Michigan Race Equity Coalition found that children of color are more likely to live in families investigated for abuse or neglect, are more likely to be removed from their homes than White children, and are twice as likely to stay in foster care until they age out. Given the known relationship between the lack of a permanent home and a heightened risk of homelessness, unemployment, incarceration, substance abuse and other negative outcomes, the overrepresentation of children of color has dire consequences.27

Contributing to the problem is the high level of family stress resulting from the lack of economic opportunities for families of color and related high child poverty rates. Of the confirmed victims of child maltreatment, approximately 8 in 10 show evidence of neglect—including conditions related to poverty such as a failure to provide adequate food, clothing, shelter or medical care.

Budget Decisions Affecting Families and Communities: Michigan lacks a comprehensive strategy to address poverty through an interdepartmental, two-generational approach that focuses on the impact of income and racial inequities that have limited opportunities for many families and children based on race, ethnicity and geography. In fact, investments in communities have lagged and supports to families are inadequate. For 2018, lawmakers:

Failed to adequately fund revenue sharing payments to cities, villages and townships. The 2018 budget includes $6.2 million in one-time funding for cities, villages and townships. This follows years of budgets that did not include the payments to local communities that are statutorily required. State budget and policy changes have reduced the number of cities, villages and townships eligible for state revenue sharing payments. In 2016, only 587 out of 1,772 Michigan cities, villages and townships received payments; in 2001, all were eligible. In addition, the portion of revenue sharing that is not provided through the Michigan Constitution (previously known as “statutory revenue sharing”) has declined almost 70% since the 1998 budget year, and current payments are at only 30% of the statutory level.28

Provided a small increase for social services offered by multicultural organizations. The 2018 budget expands funding for social services programs for a range of organizations, including the Arab Community Center for Economic and Social Services (ACCESS), the Arab Chaldean Council, the Jewish Federation and the Chaldean Community Foundation. Funding for the programs is currently at $13.3 million.

Provided funding for child protective services and foster care, but continued to underfund services that could prevent child abuse and neglect. The Legislature continues to provide funding for the child welfare staffing and services needed to move children out of the foster care system and into permanent homes—as required by a settlement agreement stemming from a lawsuit against the state for failures in its child welfare system. The lawsuit does not address the disproportionate representation of children of color in the state’s foster care system or require additional efforts to prevent child abuse and neglect. For 2018, lawmakers:

  • Increased rates paid to private agencies for foster and residential care for abused and neglected children. The 2018 budget includes $14.2 million for rate increases for providers of foster care, independent living, family reunification and residential services.
  • Expanded funding for the recruitment and support of foster families, as well as the Michigan Youth Opportunities Initiative (MYOI). Because children of color are overrepresented in the state’s foster care system and are more likely to age out of foster care as young adults, efforts to find stable, high-quality foster homes, as well as services to improve the transition to independence are critical in reducing inequities. The Legislature approved the governor’s recommendation to spend $3.6 million to support regional resource teams to recruit, train and support foster families, as well as an expansion of the MYOI programs.
  • Reduced funding for family preservation. In 2018, family preservation programs will be cut by $6.1 million. The funds were used this year for Parent Partner and family reunification programs in Macomb and Genesee counties and are intended to prevent the need for foster care and reunify children with their families when it is safe to do so.

Programs that help build on family strengths, prevent out-of-home placements of children and facilitate reunification can be of special benefit to families of color and families with low incomes—both of which are overrepresented in the state’s child welfare system. Unfortunately, the state has invested far too little in family preservation and prevention services that could help reduce the stresses families with fewer resources face, and enhance parents’ ability to care for and nurture their children—including access to sufficient income supports needed for stable housing and other basic needs.

EDUCATION

A high-quality education is a vital path to equity for children in Michigan, yet the data show that Michigan has a long way to go. Children of color have less access to high-quality early learning experiences and face barriers throughout the educational system.

How Michigan Children and Families Are Faring:

More needs to be done to ensure all children have access to supports that can improve their ability to learn—beginning before birth. Learning begins with a healthy mom and a healthy birth, and is at its peak in the earliest years of life. Michigan has made strides in making sure that 4-year-olds from families with low incomes have access to preschool, but there is no state funded preschool program for 3-year-olds, and funding for services for infants and toddlers and their parents are grossly underfunded.

Statewide, access to a preschool education is more limited for Latino children, with 59% of 3- and 4-year-olds not in preschool.29 The research is strong. Access to high-quality early learning and family support programs—beginning at birth—is one of the best tools we have for overcoming disparities in achievement and ultimately in earnings.

Students of color are more likely to be in families with low incomes. Because of the indisputable connection between family income and student achievement, the high level of economic disadvantage faced by children of color is a stark reminder of broader social issues that result in inequities in educational achievement.

BB-Chart 11Three of every 4 African-American students and two-thirds of Latino students in the state are considered economically disadvantaged because they: (1) are eligible for free or reduced-price school meals; (2) are in households receiving cash or food assistance; or (3) are homeless, in migrant families or in foster care.

Michigan teachers do not reflect the diversity of their students. There is mounting evidence that having at least one teacher of the same race increases the likelihood of school success, including test scores, attendance and fewer suspensions. A recent study also shows that for African-American students, an African-American teacher in elementary school increases the likelihood that male students will graduate from high school, and that both male and female students will aspire to attend a four-year college.30

BB-Chart 12Despite the benefits of teacher diversity, Michigan teachers do not reflect the demographics of their students. In the 2015-16 school year, 67% of Michigan students and 91% of the state’s teachers were White. Nationally, 82% of public school teachers were White in 2011-12, making Michigan’s teaching workforce less diverse than the national average four years earlier.31

Racial and ethnic disparities affect educational out-comes. While there are inequities in educational achievement in all subjects, significant focus has been placed on reading by third grade, including Michigan legislation that allows for retention of students in certain circumstances. In the 2015-16 school year, 20% of African-American students were reading proficiently by third grade, compared to 54% of their White counterparts. More than half (56%) of African-American third-graders would have been subject to retention if the policy had been implemented in 2015-16, compared to only 21% of White students.

BB-Chart 13

Graduation rates vary by race, ethnicity and gender. While the state’s high school dropout rate has been falling, high percentages of children of color are still not graduating, and young men of color are at the highest risk. In the 2015-16 school year, 18% of African-American boys and 11% of African-American girls dropped out of school—significantly above the rates for their White peers at 8% and 6% respectively. Latino youths were approximately twice as likely to drop out of high school as White youths.

BB-Chart 14African-American and Latino young adults are less likely to be ready for college after graduating from high school. Reflecting diminished opportunities beginning early in life and accelerating during the school years, only 10% of African-American students and 19% of Latino students met or exceeded the SAT benchmark for college readiness in 2015-16. As a result, African-American and Latino youths are less likely to pursue postsecondary education within six months of graduating and are much more likely to require remedial coursework once in college.BB-Chart 15

BB-Chart 16Educational inequities persist, affecting success in college. Even when young men and women of color are able to enter college, financial and other barriers to their continued success remain. Four years after graduating high school and directly entering a postsecondary program, 38% of African-American students are no longer enrolled and have not completed a degree program, and only 7% have completed their degrees. By contrast, 23% of White students completed their postsecondary program in four years.

 

Budget Decisions Affecting Educational Success: Michigan’s recent investments in early learning and programs for students in high-poverty communities are a good start, but there is more work to be done to overcome persistent and deep disparities in educational opportunities for Michigan children based on income, race and geography. For 2018, state lawmakers:

Increased per-pupil spending with larger increases for districts currently receiving the lowest payments. The Legislature approved an increase of between $60 and $120 per pupil, using a formula that benefits districts with lower payments. Two of every $3 in the School Aid budget are used to support per-pupil payments, which are the primary source of funding for school operations.

After a cut of $470 per pupil in 2010-2012, per-pupil payments to schools have begun to increase, and additional state funds have been used to hold districts harmless from increasing retirement liability costs. Nonetheless, total funding for foundation allowances and other operational costs is still below the 2007 peak.32 Further, in the 10 years between 2007 and 2017, the minimum per-pupil payment increased 6%, while the cost of living increased 12.6%.33

Increased payments for high school students. The final budget includes $11 million to provide a bonus payment of $25 per pupil in grades nine through 12—recognizing the costs associated with the high school curriculum.

BB-Chart 17

Increased funding for students at risk of educational failure. The Legislature approved an increase of $120 million for the At-Risk School Aid program, bringing total funding to $499 million. The distribution formula for the funds was altered to include “out-of-formula” or “hold-harmless” districts that are not currently eligible even though they may have high numbers of children living in poverty, but payments to those districts were capped at 30%. Finally, the definition of “at risk” was changed to include pupils eligible for free and reduced-price meals; those receiving income or food assistance; or those who are homeless, in migrant families or in foster care. The changes support an increase in eligible pupils of 131,000 due to expansions in both the number of eligible school districts and broader pupil eligibility.34

The At-Risk School Aid program is the state’s best vehicle for addressing the educational challenges faced by children who are exposed to the stresses of poverty and has the potential to help improve equity for children of color. After a decade of flat spending, increases in the current and upcoming budget years have expanded the program by over 60%—a positive and needed move in the right direction.

Failed to provide sufficient funding to address racial and ethnic disparities in early literacy. Proficient reading by the end of third grade is critical. A child’s ability to read by third grade is an important predictor of whether or not he or she will drop out of school, find regular employment or even end up incarcerated. By the time children enter kindergarten, there are already large gaps in vocabulary between students from families with low and higher incomes.

State law now allows for grade retention if children are not reading proficiently by third grade, so the stakes are high—particularly for students of color who are disproportionately at risk of retention. For the retention legislation to be successful and avoid contributing to racial and ethnic inequities, it is critical that there be sufficient funding for the services needed to address the cumulative impact of inadequate early learning opportunities for children of color, including the early identification and treatment of developmental delays and high-quality child care and preschool.

While some improvements have been made in improving access to child care, there is much more work to be done to ensure that children are healthy and ready to learn, to expand the state’s Early On program and other efforts to identify developmental problems early, to improve child care quality as well as access to early learning, and to adequately address reading problems prior to third grade. For 2018, the Legislature approved:

  • Increased funding for early literacy coaches. For 2018, $3 million in new funds will be available to double the amount available for early literacy coaches to $6 million statewide.
  • The consolidation of other early literacy funds. The Legislature consolidated a total of $20.9 million that is currently allocated to early literacy for professional development, screening and diagnostic tools and added instructional time—with funds to be distributed to districts in an amount equal to $210 for every first grade student. Funding for professional development and diagnostic tools are both capped at 5%.

Failed to invest in adult education. Despite a high level of need, state funding for adult education has dropped by 70% since the 2001 budget year. For 2018, the Legislature provided continuation funding of $25 million for adult education programs, along with $2 million for pilot programs focused on career and technical education.

More than half of adult education students read below the eighth-grade level, and over one quarter (27%) list English as their second language.35 Adult education is an important tool for improving educational achievement and adult literacy, which are critical to a two-generational approach for lifting children out of poverty and improving the state’s economy. Sadly, only 5% of Michigan adults who do not speak English “very well” enroll in English as a Second Language adult education programs, and only 7% of the over 210,000 Michigan adults ages 25-44 who lack a high school diploma or GED are enrolled in adult education.36

Continued Michigan’s sad tradition of providing too little financial aid for students with low incomes. College tuition more than doubled at almost every state university between 2003 and 2015, making the state’s average tuition cost the sixth highest in the nation and second highest in the Midwest during the 2015-16 school year.

As a result, 2 of every 3 Michigan college students graduate with debt, which averaged nearly $30,000 in 2014. While there is no state data by race and ethnicity, national studies have found that African-American students and their families owe significantly more in student debt (averaging over $43,000), and Latino parents and grandparents incur the most student debt on behalf of their children.37

Further, Michigan invests far less in needs-based scholarship grants proportional to its student population than most other states, and has completely eliminated state financial aid for students who have been out of high school for more than 10 years. Michigan currently spends less than half the national average of state spending on needs-based tuition grants. Given the barriers that young people of color face in being prepared for and able to afford college, the lack of investment in financial aid is a clear component of the cumulative impact of racial and ethnic disparities in educational achievement and ultimately earnings.

BB pull outThere is a direct correlation between state support for public universities and tuition costs, and between 2003 and 2017, Michigan cut university funding by more than $262 million, a 30% decrease in public support after adjusting for inflation. For 2018, Michigan lawmakers:

  • Tightened the tuition cap for universities. Michigan has adopted a “tuition restraint” policy requiring public universities to limit tuition increases to no more than 3-4% each year in order to receive full state funding. While a small move in the right direction, given the steep tuition increases that universities have already put in place, this change does little to reduce the high cost burden faced by students in Michigan universities, and precludes many young people of color from entering and completing four-year degree programs.
  • Slightly increased funding for financial aid programs. The amount of the grants is still not enough to significantly help students pay high tuition costs, however.
  • Failed to provide financial assistance for students who have been out of high school more than 10 years. The Part-Time Independent Student Grant, which helps older students, was eliminated in 2010. There have been efforts since 2015 by the Legislature and the governor to reinstate the grant, but they have failed to be signed into law. For the 2018 budget year, the governor recommended $2 million for the grant, but the Legislature rejected that proposal.

 

ENDNOTES
BB-Making change endnotes

Poverty improves in 2016 for Michigan, some racial groups

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Peter Ruark, Senior Policy Analyst
September 2017

 

 

Poverty improves in 2016 Michigan_some racial groups_9_22_2017

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Labor Day report: Michigan has lost 326,000 workers since 2000

pdficonPeter Ruark, Senior Policy Analyst
September 2017

THE LOST WORKERS

In July 2017, Michigan’s monthly unemployment rate dropped to 3.7%. This was the lowest jobless rate since 2000, the state’s best economic year in several decades according to most measures. While falling unemployment is certainly something to celebrate, using the unemployment rate alone to gauge Michigan’s economic recovery ignores important long-term trends in Michigan’s employment situation.

The unemployment rate is defined as the percent of the civilian labor force that is unemployed. Two other measures, when added to the unemployment rate, tell a more comprehensive story of the attrition of workers from Michigan’s job market: the labor force participation rate, which measures the percent of the civilian population 16 years old and over that is in the labor force (that is, working or looking for work), and the employment-population ratio, which measures the percent of the population that is actually employed (and will directly reflect the relationship between the unemployment rate and the labor force participation rate).

LDR fig 1Workers drop out of a state’s labor force in several ways: physically leaving the state, death, institutionalization (i.e., incarceration), or stopping both work and the search for work (i.e., retirement, disability, staying home with children, etc.). Michigan’s labor force, after nearly two decades of steadily climbing, reached its numerical peak of 5.16 million in 2000. During the severe economic downturn in the decade that followed, that number fell to as low as 4.7 million in 2011-12 and has risen slightly in the years since then. The size of Michigan’s labor force is now where it was in the mid-1990s, but well below its peak in 2000. In 2016,  Michigan had a net loss of 326,000 workers since 2000 (Figure 1).

LDR fig 2While changes in the actual size of the labor force tell a modest story, far more illuminating is Michigan’s labor force participation rate, which for several years has been at a historic low. As seen in Figure 2, even during the severe recession during the early 1980s when the state’s unemployment rate reached as high as 15%, the labor force participation rate remained steady at around 64% before gradually rising to a peak of nearly 69% in 2000. With the economic downturn of the 2000s, the rate fell to a low of 60% in 2011 and 2000. At 61.4% in 2016, it has not significantly moved since then despite the improving unemployment rate.

In the same way, while Michigan’s 2016 employment-population ratio shows clear improvement since 2011 concurrent with falling unemployment, it is below where it was during the economically difficult years of the early and mid-2000s and the 20 years prior. The unemployment rate tells us the short-term story that more people who are looking for work are finding it. It masks the longer-term story that a smaller share of people in the state are working or looking for work.

LDR fig 3Using Michigan’s peak employment year of 2000 as a baseline, we can measure the number of net “lost” workers against the number of currently unemployed workers in a given year. As mentioned earlier, Michigan in 2016 had 326,000 fewer workers in its labor force than in 2000, and these lost workers outnumbered the 238,000 unemployed workers that year. Between 2009 and 2011, a jaw-dropping 219,000 workers dropped out of Michigan’s labor force, and the number of lost workers has exceeded the number of currently unemployed workers in each year since then (Figure 3).

LDR fig 4In Michigan’s three largest counties, which comprise roughly one-third of the total state population, the net number of workers lost from the labor force since 2000 is considerably higher than the number of currently unemployed workers (Figure 4). And in the sparsely-populated Upper Peninsula, the workforce continues to shrink while the number of lost workers continues to rise LDR fig 5(Figure 5).

For a table of the unemployed and lost workers in each county in Michigan, please see the appendix.

MICHIGAN’S GRAYING LABOR FORCE

Not only has Michigan’s labor force shrunk over time, its composition has begun to shift toward older workers. From 1979 (the earliest year data on worker ages is available) to 1982, the share of Michigan’s labor force that was 55 years of age or older was between 12% and 13.2%, leveling out at 10-12% from 1983 to 2000. Following 2000, however, this age group began comprising a steadily larger share of the workforce, and in 2016 their share (22.2%) nearly doubled that in 2000, while the portion in prime working age decreased from 70.4% to 62.3%. Younger workers, those from age 16-24, comprised a moderately smaller share of the workforce in 2016 (15.4%) than in 2000 (17.9%) but considerably smaller than in 1979, when they accounted for more than a quarter of the workforce (Figure 6).

LDR fig 6To understand Michigan’s shrinking labor force and the shift in its composition, it is helpful to look at the labor force participation rate of each of the three age groups. In recent years, a larger percentage of Michigan residents 55 years and older are participating in the workforce than before. In 1995, participation by this age group was at its ebb (26%), but has risen fairly steadily since then and by 2016, nearly 37% of residents 55 and older were in the workforce either employed or looking for work (Figure 7). The lack of a “big dip” in the participation rate of older workers suggests that the decline in the labor force was not driven significantly by unemployed workers choosing to retire early.

LDR fig 7The higher labor force participation rate for workers 55 years old and over is likely driven by a number of reasons. According to one study, factors include: rule changes in Social Security and pensions that incentivize later retirement, improved longevity, higher levels of education, less physically demanding jobs and the decline of retiree health insurance.1

YOUNGER MICHIGAN RESIDENTS ARE NOT JOINING THE WORKFORCE AS BEFORE

A moderately smaller percentage of prime working-age residents are in the workforce compared to 2000, but the most significant change in labor force participation is with younger workers. In keeping with the pattern of the previous 20 years, 72% of residents aged 16-24 were either working or looking for work in 2000, but that percentage took a sharp and steady plunge over the following decade. By 2011, only a bit more than half of all 16-24-year-olds in Michigan were in the workforce. The percentage has gone up in fits and starts since then, but at 63% remains significantly lower than in any year prior to 2006.

It is quite telling to compare the younger workforce during the Great Recession of the late 2000s with that during previous recessions, particularly the deep recession of the early 1980s. While the employment-population ratio for young people in 1982 plunged to just under 51% and took several years to rebound, the labor force participation rate dipped only slightly (as reflected in the high unemployment rate during those years). The same was true in the milder recession of the early 1990s.

LDR fig 8In the years following 2000, the labor force participation rate for young workers began a startlingly different pattern from previous economic downturns. Not only did the employment-population ratio for young people go down steadily to record lows over the next decade, but so did the labor force participation rate, which fell from 72% in 2000 to 55% in 2011. That year saw a record low of only 45% of Michigan residents age 16-24 employed, and fewer than half employed during the six years from 2008 to 2013, yet the recorded unemployment rate for those years was considerably lower than in the early 1980s (16-19% compared to 21-26%) due to the very low workforce participation (Figure 8).

Michigan is not unique; the declining participation rate mirrors the trend for younger workers nationally. The Bureau of Labor Statistics reports that the age group with the largest decrease in labor force participation since 2000 is teenagers age 16-19, with white teenagers being the racial group with the largest decrease and Black teenagers with the smallest. Among teenagers, the most often cited reason for not working was school attendance. However, while teenagers not enrolled in school are generally more likely to participate in the labor force than those enrolled in school, the labor force participation rate of out-of-school teenagers also fell. The participation rate for adults age 20-24 has also fallen nationally since 2000, but less steeply than that of teenagers.2

For the portion of younger residents who are deferring entering the workforce due to enrolling in postsecondary education, it can be assumed that their foregone wages from not working now will be more than offset by higher wages after completing their education. Younger people not working, looking for work or going to school, on the other hand, are gaining neither educational credentials nor work experience that could help them in the job market. The cause for this lower labor participation rate among young people not in school is not clearly established, but according to the Bureau of Labor Statistics, could include a lack of desire to enter the workforce due to stagnant wages and to competition from low-skilled workers in other age groups.

POLICY SOLUTIONS FOR WORKERS OF ALL AGES

A significant factor, but not the only factor, in the shrinking of Michigan’s labor force is the lower likelihood of residents age 16-24 to participate in it, particularly those under 20. Although a higher portion of older individuals are remaining in the workforce, as they retire there are fewer younger workers to replace them.

The participation rate of younger workers remains low, but it is slowly rebounding. While there may not be easily identifiable policy strategies to encourage more young workers to enter the workforce, Michigan can undertake the following actions to help both younger individuals who are not yet in the workforce and older individuals who are choosing to stay employed at a later age:

  • Make college education less expensive by lowering tuition and increasing financial aid, which will help cut down on student debt;
  • Encourage universities to offer more academically relevant work-study for students with low incomes so that they may gain meaningful work experience;
  • Make postsecondary training for “middle skills credentials” (a short-term or two-year credential such as a license, certificate or associate degree) more accessible to young people, especially those who live in areas with high unemployment and poverty and few available jobs;
  • Provide support services to young single mothers that encourage them to participate in postsecondary education or training and facilitate their completion and success; and
  • Retain Medicaid expansion in order to help provide healthcare for older workers earning lower wages.

ENDNOTES

  1. Munnel, A.H., The Average Retirement Age—An Update, Center for Retirement Research at Boston College, March 2015. (http://crr.bc.edu/wp-content/uploads/2015/03/IB_15-4_508_rev.pdf, accessed on August 7, 2017)
  2. U.S. Department of Labor Bureau of Labor Statistics, Labor Force Participation: What Has Happened Since the Peak?, Monthly Review, September 2016. (https://www.bls.gov/opub/mlr/2016/article/labor-force-participation-what-has-happened-since-the-peak.htm, accessed on August 7, 2017.)

Michigan’s child care assistance program: Challenges and opportunities

pdficonPat Sorenson, Senior Policy Analyst
August 2017

Budget Brief JPG USE THIS ONE

CHILD CARE COSTS ARE HIGH WHILE PROVIDERS STRUGGLE

Access to child care is a necessity for working parents and a foundation for Michigan’s economic growth and vitality. Unfortunately, the high cost of child care has become a major barrier for parents earning low wages, often forcing parents to rely on a patchwork of relatives, neighbors and friends who may be unable to make long-term commitments.

The predictable results for parents are frequent work disruptions that can jeopardize their jobs or force them to leave their children in care they don’t believe is safe or adequate. For employers, the bottom line is a smaller pool of workers for lower-wage jobs, and employee absenteeism and turnover.

Child care costs are some of the largest that families will face, rivaling housing and even the price of a year of college.

  • Cost for one infant in a child care center in Michigan: $10,178
  • Average annualized rent: $9,168
  • Average annualized mortgage: $14,640
  • Average tuition and fees at public colleges: $11,994

Child care costs are high in comparison to wages for many families, but not because child care providers are well paid or their businesses are thriving. Child care providers, who earned an average of just $19,620 in 2015, are some of the lowest-paid workers in the state, with wages that fall below those of veterinary assistants, animal control workers, manicurists and telemarketers—who are similarly underpaid. Nationally, nearly half of child care providers are themselves eligible for some form of public assistance.

MI child care challenges opportunities graph 1

MICHIGAN’S CHILD CARE PROGRAM HAS LAGGED BEHIND OTHER STATES

Michigan ranks among the lowest states in the country in its investments in child care for families with low and moderate incomes—even turning back federal child care funds because of restrictive state policies that prevented families from getting the care they need to work and support their families. In 2003, Michigan’s spending on child care was the 11th highest in the nation; by 2013 the state dropped to the 11th lowest in the country.1

Michigan’s Child Development and Care (CDC) program helps families with low wages who are: 1) working; 2) completing high school/GED courses; 3) participating in job training programs; or 4) engaging in family preservation activities.

Parents can choose from a number of child care settings—provided affordable options exist in their communities and are willing to take children with child care subsidies. The options include licensed child care centers; family/group homes; and relatives, friends and neighbors.

MI child care challenges opportunities graph 2FEWER FAMILIES SERVED ALONG WITH LESS FUNDING TO COMMUNITIES

In part because of Michigan’s restrictive child care policies, the number of families receiving a CDC subsidy has dropped dramatically, along with the dollars flowing to communities to help support working parents, employers and the local economy. In January of 2007, Michigan provided child care subsidies to 57,268 families, including 111,526 children; by January of 2016 only 17,047 families and 30,134 children received child care assistance. Child care payments followed suit, dropping by 80% statewide during this period.

LOW REIMBURSEMENTS AND STRINGENT ELIGIBILITY MAKE IT HARDER FOR FAMILIES

Payments to providers are too low to ensure access to high-quality child care. Rates paid to child care providers depend on the age of the child, the type of child care setting, and the number of stars a provider has in the state’s five-star quality rating system (Great Start to Quality). Federal guidance recommends rates at the 75th percentile of market rates, but Michigan’s rates have fallen significantly below that level. Payments currently range from $1.35 per hour for unlicensed providers to a maximum of $4.75 per hour for infants and toddlers in a five-star child care center, although funds were approved for the 2018 budget to increase child care provider rates.

Michigan’s child care eligibility levels are among the lowest in the country. In 2016, Michigan had the lowest income eligibility level in the nation. Despite a small eligibility increase in 2017 from 120% to 125% of poverty ($25,525 for a family of three), Michigan has remained at the bottom of the states. The budget signed by the governor for 2018 includes an increase in eligibility from 125% of poverty to 130%.

STATE ADMINISTRATIVE POLICIES ARE A BARRIER

In addition to low reimbursement rates, child care providers in Michigan are required to bill for their services hourly—contrary to normal business practices.

MI child care challenges opportunities graph 3MICHIGAN’S CHILD CARE SUBSIDY IS LARGELY FEDERALLY FUNDED

The bulk of the funding for child care subsidies in Michigan comes from the federal government through the Child Care and Development Block Grant (CCDBG). Total funding for child care subsidies in the 2017 budget year is $134 million, with approximately $106 million (79%) coming through the federal CCDBG. Approximately $25.8 million (19%) is from the state General Fund.

The CCDBG gives states wide latitude in setting reimbursement rates and eligibility, and programs vary from state to state. The federal law limits eligibility to 85% of state median income and sets a goal (not a mandate) that rates be set at the 75th percentile of market rate, meaning that the subsidy would cover 75% of the providers in a family’s market area. At 38% of state median income, Michigan’s income eligibility cutoff falls far below that standard.

In 2014, the CCDBG was reauthorized to create several new mandates for states—the first reauthorization in 19 years. Unfortunately, there was little new federal funding attached. Included in the federal requirements are:

  • More extensive requirements related to health and safety in child care, including pre-service and ongoing training of providers, additional licensing requirements, on-site inspections, and comprehensive background checks for all providers, including those who are exempt from licensing (family, friends and neighbors).
  • An increased focus on improving quality, including an increase in the percentage of CCDBG funds that need to be used for that purpose.
  • More family-friendly policies, including a minimum 12-month eligibility period (if income remains below the eligibility limit), and a graduated phase-out of assistance.
  • Payment policies and practices that reflect generally accepted practices for child care providers.

MI child care challenges opportunities graph 4POLICY CHANGES HAVE IMPROVED ACCESS AND QUALITY BUT MORE NEEDS TO BE DONE

A stronger focus on quality. State and federal initiatives have increased attention on the importance of high-quality child care in recent years. When the federal CCDBG was adopted in 1990, followed by national welfare reform in 1996, the goal was primarily to provide child care as a work support—with a focus on access rather than quality.

As scientific research began to prove the importance of the earliest years of life to children’s learning and development, the need for high quality settings became undeniable. In Michigan, public/private partnerships began to spring up to improve the quality of child care, culminating in the launch of the Office of Great Start within the Department of Education, bolstered by the work of the Early Childhood Investment Corporation. The result was a significant increase in funding for the state’s preschool program (Great Start Readiness Program), regional resource centers to improve access to high-quality care, the state’s child care rating system (Great Start to Quality), and other quality improvement initiatives through the state’s Race to the Top Early Learning Challenge grant.

Small increases in child care payments related to Great Start to Quality. Michigan’s last across-the-board increase in child care rates occurred in 2009. In 2011, rates for care provided by families, friends and neighbors who are legally exempt from licensing were reduced if new training requirements were not met.

In July of 2015, rate increases were provided to licensed providers (child care centers and homes) based on the number of stars they earn in the state’s five-star quality rating system—with the full-year cost in the 2016 budget year of $6.1 million in federal funding. While tiered reimbursements can create incentives for quality improvements, the reality is that in Michigan’s grossly underfunded child care system, many child care providers did not receive the higher payment rates.

Michigan has made progress in engaging licensed child care providers in the state’s child care quality rating system. In 2014, 82% of the state’s 9,963 licensed providers were only meeting basic licensing requirements—the absolute floor for safety in care signified by an “empty star” in the state’s five-star system. By May 1, 2017, 57% of providers were only meeting licensing guidelines. Nonetheless, rate increases tied to a provider’s quality rating are currently available to only 3,530 providers, or 42% of licensed providers in the state.

A small increase in income eligibility thresholds for those applying for child care assistance. In 2017, Michigan increased its entry eligibility threshold from 120% to 125% of poverty, but remains at the bottom of the states. An increase to 130% of poverty is included in the 2018 budget.

A new policy that allows some families to keep their child care assistance if their wages increase. In compliance with the reauthorization of the federal CCDF, Michigan increased its “exit” income eligibility threshold to 250% of poverty in July of 2015. To receive child care assistance, families still have to be eligible at the lower “entry” eligibility level (now 125% of poverty), but once receiving a subsidy could earn up to 250% of poverty and still receive a subsidy. This avoids the steep eligibility cliff that could increase child care costs for a single mother with two children in care from approximately $2,900 per year to over $18,000 because of a small pay raise.2

Adoption of 12-month continuous eligibility. Also beginning in 2015 and in response to the federal CCDBG reauthorization, Michigan implemented 12-month continuous child care eligibility after enrollment for child care assistance—at a full year cost in the 2016 budget year of $16 million in federal CCDBG funding. This change is intended to avoid child care disruptions for working parents and children.

MI child care challenges opportunities graph 5The hiring of additional child care licensing consultants to improve oversight. In the 2016 budget year, the state approved $5.6 million in federal funding to hire an additional 39 child care licensing consultants. Michigan’s child care oversight had been hampered by very high caseloads, resulting in two federal audits that found the state could not consistently ensure basic health and safety in licensed child care settings. This increase is particularly important in light of tightened federal requirements for oversight and on-site visits.

Updating of payment policies. The Office of Great Start has made changes to help payments to providers and parents flow more quickly and easily. Included are a shortened timeframe for determining eligibility (from 45 to 30 days) and a policy allowing child care payments for up to 208 hours for children who are absent from care.

THE 2018 BUDGET INCLUDES ADDITIONAL CHILD CARE IMPROVEMENTS

In recognition of the connection between child care and work for families with low wages, as well as the state’s failure to use all available federal funds, the governor recommended an increase of $6.8 million in the current budget year (2017) as well as $27.2 million ($8.4 million in state funds) in the 2018 budget to increase rates paid to child care providers. The final 2018 budget approved by the Legislature and signed by the governor includes the following:

  • A total of $19.4 million ($11 million of federal CCDBG and $8.4 million of state General Fund) to increase reimbursement rates to child care providers based on the number of stars in the state’s quality rating system.
    • Licensed/registered centers and homes will receive the following increases: 25 cents per hour for those who have 0, 1 or 2 stars; 50 cents per hour for those at 3 or 4 stars, and 75 cents per hour for 5-star centers or homes.
    • Unlicensed family, friends and neighbors will receive an increase of 25 cents per hour if they are at the Tier 1 training level, while those at Tier 2 would receive an additional 75 cents per hour.
  • An increase of $5.5 million in federal funding to raise the program’s eligibility threshold from 125% of poverty to 130%.
  • An additional $1.4 million in federal funding to increase monitoring of license-exempt family, friend and neighbor care as required in the federal reauthorization, as well as $800,000 for staff in the Department of Licensing and Regulatory Affairs to do newly required background checks and fingerprinting of providers.
  • $1 million in federal funding for TEACH scholarships for child care providers working to increase their quality star rating.

2017 Supplemental Spending: Also passed by the Legislature was a supplemental budget bill for the current year that includes:

  • An increase of $4.9 million total ($2.8 million CCDF and $2.1 million in state General Fund) to implement the reimbursement rate increase for child care providers in the current year.
  • Funding to ensure that Michigan complies with new federal requirements related to the monitoring of child care settings, including: 1) $7.1 million for comprehensive fingerprinting and background checks of all child care providers and others in child care settings with unsupervised access to children; and 2) $1.5 million for technology improvements needed to implement new changes.

FEDERAL BUDGET UNCERTAINTIES ARE A CLOUD OVER STATE CHILD CARE INITIATIVES

Michigan relies heavily on federal funding for child care and other basic needs programs. With 42% of its total budget coming from the federal government, Michigan is second most reliant on federal funds of all states. Federal budget cuts in Washington, D.C., could threaten Michigan’s progress in providing child care to families with low wages.

The President’s 2018 budget maintained CCDBG at 2016 levels, eliminating a $95 million increase in the current year. In addition other funding sources that can be used to fund child care—Temporary Assistance for Needy Families (TANF) and the Social Services Block Grant (SSBG)—are on the chopping block, with TANF reduced by 10% and the SSBG eliminated.

Congress has not yet adopted a 2018 Budget Resolution, but the House Appropriations Committee is moving forward. The House proposal includes an increase of only $4 million for the CCDBG, and includes the following cuts: 1) elimination of the Child Care Access Means Parents in School (CCAMPIS) program, which is the only federal grant supporting child care services for low-income parents on college campuses; and 2) a $191 million cut in the 21st Century Community Learning Centers program, which funds afterschool activities including child care in low-income communities.

Also in the mix at the federal level is tax reform and vague proposals to reduce child care costs through tax and regulatory changes. During the campaign, President Trump advocated for a tax deduction for child care expenses, as well as a limited credit for some families with lower incomes and child care savings accounts. The Tax Policy Center found that the 70% of the benefits of the campaign proposals would go to families with incomes above $100,000, and more than 25% to those with incomes over $200,000.3

More recently, discussions have turned to Dependent Care Assistance Plans, Dependent Care Savings Accounts and tax credits for employers and businesses that provide child care, which disproportionately advantage wealthier families.

There are tax policies that could be adopted at the national level that could benefit families with low wages including: 1) an increase in the amount of the Child Tax Credit to better reflect the cost of raising young children, as well as lowering the earned income threshold for families to be eligible to receive a refund through the Additional Child Tax Credit; and 2) making the Child and Child and Dependent Care Tax Credit refundable so more low-income families could benefit, as well as changes in the credit’s sliding scale and increases in the child care expense limit to better reflect the actual cost of child care.

The President’s tax plan and budget call for requiring a Social Security number to qualify for the federal Earned Income Tax Credit (EITC) and Child Tax Credit. The IRS already requires a taxpayer to have a Social Security number to receive the EITC, so this is not a policy change but instead simply fuels the anti-immigrant rhetoric. Furthermore, by targeting assistance that is currently intended to benefit children—and which studies have shown have long-lasting positive impacts on the lives and well-being of children—this only hurts many U.S. children who have no control over their parents’ immigration status.

MI child care challenges opportunities graph 6

Final decisions about federal tax reform will be significant for working families in Michigan. The Trump Administration’s proposal to overhaul the federal tax code would provide the wealthiest 1% of taxpayers in Michigan with over half of the state’s tax cuts. The richest 1% of Michigan taxpayers would receive an average tax cut in 2018 of over $120,000, compared to on $830 for the middle 20%, and $100 for the bottom 20%.4 Tax reforms could also reduce the revenues available for programs that would assist families who most need help with the high cost of child care, including adequate funding for the CCDBG that provides direct subsidies and improves child care quality and safety.

WHAT MICHIGAN NEEDS TO DO MOVING FORWARD

Increase eligibility for child care subsidies so more families with low wages can find and keep jobs. The League estimates that a single parent of two children would need to earn over $47,000 a year to meet the family’s basic needs for housing, child care, food, transportation, healthcare and personal needs.5 Setting the state’s child care eligibility level at 200% of the federal poverty level ($40,840 for a family of three) should be the state’s goal if it is serious about encouraging work and full employment. Michigan should incrementally increase eligibility to meet that standard, beginning with an increase to 150% of poverty ($30,630 for a family of three).

Increase access to high-quality providers through rate increases. Michigan should continue to adopt rate increases until it reaches the national CCDF standard of the 75th percentile of market rates. Without adequate payments, parents with low wages will continue to have difficulty finding high-quality care and many child care providers will have insufficient resources to improve quality.

Support early childhood businesses and the child care workforce through appropriate business practices. As a first step, Michigan should follow most other states and move away from hourly billing, opting for billings to half- or full-day care, or weekly—similar to the process used by many for non-subsidized children. Without predictable income, it is difficult for providers to maintain their small businesses and accept children with subsidies.

Improve the supply of care for families needing off-hours or infant care, as well as care for children with special needs. An additional approach Michigan should take is to establish contracts with providers for care—a funding mechanism used in some other states to ensure capacity and increase stability in the child care market. Instead of making payments for hours of child care provided, contracts can be used to ensure slots for children from families with low incomes. As part of the contractual process, the state could focus on expanding the supply of high-quality care for underserved communities and populations, including parents needing evening and weekend care, children with special needs, and infants and toddlers.

Expand eligibility to children and families in high-poverty communities. An innovative alternative to contracts that could target specific underserved communities is the model used in the National School Lunch program of community eligibility, where all children in a high-poverty area are eligible for school meals without applying.6 Michigan was one of the pilot states that experienced a significant increase in the number of children receiving school meals as a result of the program.

Use what is learned about high-quality child care through the investments of the philanthropic sector to guide statewide investments of public dollars. The philanthropic sector has had a sustained interest and investment in early childhood services including child care. The United Way for Southeastern Michigan supported Early Learning Communities—a community-led effort to increase kindergarten readiness by providing two-generational services and connecting families to social and other local services. More recently, the W.K. Kellogg and Kresge Foundations have promoted a community-driven partnership to strengthen and grow early childhood services in Detroit, beginning with a citywide action plan to create coordinated, high-quality early childhood systems that ensure children are born healthy, prepared for kindergarten and ready for success in third grade and beyond. These efforts should help guide public-sector responses to the needs of young children and families for child care and other early childhood services.

ENDNOTES

  1. Child Development and Care (CDC) Program, presentation by Lisa Brewer Walraven, Director, Child Development and Care Program, Michigan Department of Education to the House School Aid and Education Appropriations Subcommittee (February 21, 2017).
  2. Testimony of Lisa Brewer Walraven, Director, Child Development and Care Program, Michigan Department of Education to the House Appropriations Subcommittee on Education (March 9, 2016).
  3. Who Benefits from President Trump’s Child Care Proposals? Tax Policy Center, Urban Institute and Brookings Institution (February 28, 2017).
  4. Trump Tax Proposals Would Provide Richest One Percent in Michigan with 53.2 Percent of the State’s Tax Cuts, Institute on Taxation and Economic Policy (July 20, 2017).
  5. Making Ends Meet in Michigan: A Basic Needs Income Level for Family Well-Being, Michigan League for Public Policy (May 2017).
  6. Building a Better Child Care System, prepared by Public Sector Consultants for the Michigan Department of Education Office of Great Start (September 2016). 

 

Still hungry: Economic recovery leaves many Michiganians without enough to eat

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August 2017
Julie Cassidy, Policy Analyst

 

 

The economic gains of Michigan’s recovery from the Great Recession have not been equally distributed, and families at the lower end of the economic scale continue to struggle more than others with unemployment, underemployment and low wages.1 While unemployment has decreased substantially and median household income has risen since the Recession officially ended in 2009, the poverty and food insecurity rates have not yet declined to their pre-Recession levels, indicating that the employment and income gains among those with low incomes are too small to overcome rising food prices and other barriers to healthy food access.

Still hungry blog graphic 1Under these conditions, proposed budget cuts to the Supplemental Nutrition Assistance Program (SNAP) and other federal programs that many families rely on to make ends meet would leave millions of people without access to the fuel their bodies need to lead healthy, productive lives. These cuts would disproportionately affect children, people with disabilities, people of color, seniors and rural residents. Policymakers should preserve and expand existing nutrition programs that have proven effective and implement other state and local reforms that protect public health and the economy from the costly impacts of hunger.

NEARLY 1.5 MILLION MICHIGANIANS ARE FOOD INSECURE

Food insecurity: Limited or uncertain availability of nutritionally adequate and safe food; limited or uncertain ability to acquire acceptable food in socially acceptable ways.

The causes of food insecurity and hunger include:

  • Insufficient funds to buy food;
  • Unavailability of nutritious food in a given area (a “food desert” or “food swamp”);
  • Lack of transportation;
  • Unaffordable utility bills; and
  • Poor oral health.

Hunger: A potential consequence of food insecurity that, because of prolonged, involuntary lack of food, results in discomfort, illness, weakness or pain that goes beyond the usual uneasy sensation.

Source: U.S. Department of Agriculture, Economic Research Service

Still hungry blog graphic 2WHO’S ESPECIALLY VULNERABLE TO HUNGER?

Children: Households with children, particularly those headed by single parents, are less food secure than those without children. Hunger creates an intergenerational cycle: it’s difficult for parents to raise healthy children to reach their full potential when they don’t have enough to eat themselves. In Michigan, about 338,000 children experienced food insecurity in 2014.2 Hunger peaks during the summer when kids no longer have access to the daily meals and snacks provided at school; for example, summer nutrition programs in Michigan serve only about one-twelfth of the children who receive free or reduced-price lunch during the school year.3

Still hungry blog graphic 3Rural Residents: Although Wayne County is the least food secure of all Michigan counties, a number of rural counties also report high food-insecurity rates, especially in Northern Michigan.4 In these areas, poverty is higher than average, full-service grocery stores may be rare and dental providers may be scarce. The lack of public transit magnifies these challenges. Ultimately, rural Michiganians may struggle with issues of food availability, accessibility and affordability even more than some of their city-dwelling counterparts.

People With Disabilities: Due to educational, mobility and workplace barriers as well as discrimination, adults with disabilities face lower employment rates, less consistent employment, longer periods of unemployment and lower earnings than adults without disabilities. At the same time, they often have increased medical costs and other expenses of living in a world that’s not designed to meet their basic needs. Thus, households including people with disabilities are more likely to experience food insecurity and to feel it the most severely of all food-insecure households.5

People of Color: A long history of public policy shaped by racism, from slavery to redlining to mass incarceration, has led to inequities that persist long after the removal of explicit racism from American law. For example, the median wealth of White households currently is 14 times that of Latino households and 16 times that of African-American households.6 As a result, African-Americans and Hispanics in Michigan experience higher levels of food insecurity than Whites and Asians do, a dynamic that has continued in the aftermath of the Great Recession.

Still hungry blog graphic 4

Seniors: Aging is often accompanied by increased healthcare needs, income limitations and mobility challenges. As medicine advances, people are living longer but may not have the resources to maintain a basic living standard, especially after suffering losses in the Great Recession. More than 160,000 Michigan seniors struggle to pay for all of their essentials, including food.7 Furthermore, they don’t take full advantage of all available anti-hunger resources—nationwide, it’s estimated that only 41% of eligible seniors have enrolled in SNAP, compared to 83% of the entire SNAP-eligible population.8

WE ALL PAY THE HIGH PRICE OF HUNGER

Still hungry blog graphic 5

 

Stigma compounds the negative health and economic impacts of food insecurity, as those living with hunger may feel shame over their situation and decline available food assistance.

Hunger would be even more widespread if it were not for a number of public agencies and nonprofit organizations that provide food and funds for vulnerable households. SNAP and other federal programs such as Women, Infants, and Children, The Emergency Food Assistance Program; the National School Lunch Program; and the Child and Adult Care Food Program attack the hunger problem through various local avenues—schools, food pantries, child and adult day care centers, emergency shelters, etc. State- and local-level partnerships involving government, nonprofit organizations, farmers and grocers further help fight hunger while boosting Michigan’s agriculture industry.

Still hungry blog graphic 6

A number of state and local initiatives to fight hunger in our communities depend on federal funds or are otherwise connected to federal programs, so structural changes and budget cuts at the federal level can put Michigan’s efforts at risk. For example, converting SNAP from an entitlement program to a block grant, as has been proposed, could cut benefit levels, restrict eligibility and make the program less responsive to economic crises.

All of these services help many families achieve food security, keep people out of poverty and stimulate our economy—for example, every $5 spent in new SNAP benefits generates up to $9 in economic activity.9 These resources, however, aren’t sufficient to serve everyone in need and address all of the root causes of hunger, so society continues to incur billions of dollars in avoidable costs every year through poor health and a less dynamic workforce. Ensuring access to adequate healthy food presents one of the most cost-effective opportunities to strengthen our state’s greatest resource—its people—and promote our state and national prosperity.

Still hungry blog graphic 7 report

ENDNOTES

  1. Ruark, P. & Singh, S. Michigan League for Public Policy. (2015, September). Labor Day report: Economic recovery eludes many Michigan families. Retrieved from http://www.mlpp.org/wp-content/uploads/2015/09/Labor-Day-Sept-2015.pdf.
  2. Annie E. Casey Foundation, Kids Count Data Center, http://datacenter.kidscount.org/data/tables/5201-children-living-in-households-that-were-food-insecure-at-some-point-during-the-year?loc=24&loct=2#detailed/2/24/false/869,36,868,867,133/any/11674. Accessed June 22, 2017.
  3. Food Research & Action Center. (2017, June). Hunger doesn’t take a vacation: Summer nutrition status report. Retrieved from http://frac.org/wp-content/uploads/2017-summer-nutrition-report-1.pdf.
  4. Feeding America, Map the Meal Gap: Food Insecurity in Michigan, http://map.feedingamerica.org/county/2015/overall/michiganhttp://map.feedingamerica.org/county/2015/overall/michigan. Accessed July 21, 2017.
  5. Food Research & Action Center. (2015, July). SNAP matters for people with disabilities. Retrieved from http://frac.org/wp-content/uploads/snap_matters_people_with_disabililties.pdf.
  6. Center for Global Policy Solutions. (2016, January 11). Racial wealth gap. Retrieved from http://globalpolicysolutions.org/resources/infographics/racial-wealth-gap/.
  7. Elder Law of Michigan, MiCAFE Network, http://www.elderlawofmi.org/micafe. Accessed July 3, 2017.
  8. Feeding America, The Senior SNAP Gap, http://www.feedingamerica.org/take-action/campaigns/solve-senior-hunger/the-senior-snap-gap.html. Accessed July 3, 2017.
  9. United States Department of Agriculture, Economic Research Service. (2016). Supplemental Nutrition Assistance Program (SNAP) linkages with the general economy. Retrieved from https://www.ers.usda.gov/topics/food-nutrition-assistance/supplemental-nutrition-assistance-program-snap/economic-linkages/.

Parental incarceration takes devastating toll on children

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  July 2017
  Mallory Boyce, Kids Count Project Intern

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Parental incarceration takes devastating toll graphic 1

The nature of the parent-child relationship is a crucial factor for a child’s overall well-being, both during childhood and extending into adulthood. When a parent is incarcerated, that relationship is threatened and children are often left in an unstable environment, causing them to suffer the consequences of their parent’s incarceration in myriad ways.

During criminal justice proceedings, the crime and its punishment are all too often the only two factors considered—overlooking the consequences that sentencing and geographic prison placement will have on the children or family of the accused. This is an unfortunate oversight as the effects of having an incarcerated parent can be equally as traumatic for a child as experiencing divorce, abuse or domestic violence.6

Considering the rapid growth of both the federal and state prison populations across the country in more recent history, it is essential to understand the effects that a parent’s incarceration has on a child. Simply put, higher prison populations mean that more parents are incarcerated and that more children are negatively affected.

Parental incarceration takes devastating toll graphic 2While the effects of a parent’s incarceration vary based on a child’s specific situation and the supports available to them, negative consequences have been echoed in conversations with family after family.

IMMEDIATE CONSEQUENCES

Financial Burden: A family’s income drops by an average of 22% when a father is incarcerated, and on average remains 15% lower even when the father is released from prison.7

Sense of Shame: Shame is often induced by judgment from a child’s peers or other members of their community.8

Strained Relationship With Incarcerated Parent: Around 60% of parents in state prisons are held over 100 miles from their previous residence.9 This makes it difficult for a child to maintain regular contact with their parent, which could otherwise help minimize the trauma associated with a parent’s incarceration.

Parental incarceration takes devastating toll graphic 4Behavioral Problems: Behavioral concerns may arise during this tumultuous period of a child’s life.10 However, it is important to note that perpetuating the stigma that the child themselves is now destined for a “life of crime” can be damaging, and communities should instead work to properly support struggling children.

CONSEQUENCES FOLLOWING INCARCERATION

Difficulties in Transition: Parents returning from their incarceration might have difficulty adjusting to life at home and could find themselves to be emotionally distant from family members, including their children.

Criminal Justice Debt: With the average conviction-related costs (including fees, fines and other payments) for one person being $13,607, up to 85% of people return from prison with criminal justice debt12—money that they owe for being convicted of a crime which also accrues at a time when they have little to no income. This results in fewer resources for the family and children, placing an additional strain on the household.

Lifelong Consequences: The detrimental effects of parental incarceration continue into adulthood as well. It is one of several adverse childhood experiences that can be associated with higher rates of poor health, low life satisfaction, depression and anxiety among other concerns.13

Parental incarceration takes devastating toll graphic 3VULNERABLE POPULATIONS

The children most likely to have an incarcerated parent are often already the most vulnerable—children from families with low incomes and from communities of color. This disparity is due to a number of factors, one being the systemic racism encompassed by the more recent “War on Drugs.” In fact, African-Americans are around three and four times more likely to be arrested for possessing and selling drugs, respectively, despite being no more likely to sell or use drugs than Whites are.14

HOW CAN WE HELP?

It must be our priority to meet the needs of children who are faced with the many challenges caused by having an incarcerated parent. There is much that community members and policymakers can do to offer proper support to these children:

  • Communities and individuals must ensure that families are able to care for children both during and after a parent’s incarceration while also crafting an environment where children feel free from judgment and instead feel safe sharing their experiences and emotions.
  • Schools, faith-based organizations and other local groups must work closely with families and the criminal justice system to create multidimensional support for children and their families.
  • The criminal justice system must work to preserve the family unit—considering the child’s well-being during the arrest and sentencing, allowing children reasonable access to their parent during incarceration, and utilizing prison time to empower the parent to be able to provide for their family after their incarceration.

In their policy report, A Shared Sentence: The devastating toll of parental incarceration on kids, families and communities, the Annie E. Casey Foundation offers these policy recommendations to alleviate the consequences faced by children of incarcerated parents:

  1. Ensure children are supported while parents are incarcerated and after they return.
  2. Connect parents who have returned to the community with pathways to employment.
  3. Strengthen communities, particularly those disproportionately affected by incarceration and reentry, to promote family stability and opportunity.

Download A Shared Sentence: www.mlpp.org/kids-count/michigan/a-shared-sentence.

ENDNOTES

  1. The Sentencing Project. State-by-State Data. Washington, DC: Author. Retrieved June 13, 2017 from http://www.sentencingproject.org/the-facts/#map.
  2. The Annie E. Casey Foundation (2016, April). A Shared Sentence: The devastating toll of parental incarceration on kids, families and communities, 2. Baltimore, MD.
  3. Michigan Department of Corrections. (2016, August 23). 2015 Statistical Report. Retrieved June 13, 2017 from https://www.michigan.gov/documents/corrections/MDOC_2015_Statistical_Report_-_2016.08.23_532907_7.pdf.
  4. United States Census Bureau, Quick Facts Table: Michigan. Retrieved June 13, 2017 from https://www.census.gov/quickfacts/table/RHI125215/26.
  5. The Prisoner Reimbursement to the County Act, Mich. Comp. Laws. 801.83 (1984).
  6. Hairston, C.F. (2007). Focus on the children with incarcerated parents: An overview of the research literature. Baltimore, MD: Annie E. Casey Foundation, 18.
  7. The Pew Charitable Trusts. (2010). Collateral costs: Incarceration’s effect on economic mobility. Washington, DC: Author.
  8. Hairston, C.F., op. cit.
  9. Mauer, M., Nellis, A., Schirmir, S.; Incarcerated Parents and Their Children – Trends 1991 – 2007, The Sentencing Project, Feb. 2009.
  10. Allard, P., Greene, J.; Children on the outside: Voicing the pain and human costs of parental incarceration, Justice Strategies, Jan. 2011.
  11. The Annie E. Casey Foundation, op. cit.
  12. Saneta deVuono-powell, Chris Schweidler, Alicia Walters, and Azadeh Zohrabi. Who Pays? The True Cost of Incarceration on Families. Oakland, CA: Ella Baker Center, Forward Together, Research Action Design, 2015.
  13. Mersky JP, Topitzes J, Reynolds AJ. Impacts of adverse childhood experiences on health, mental health, and substance use in early adulthood: a cohort study of an urban, minority sample in the U.S. Child Abuse Neglect. 2013;37 (11):917–25.
  14. Rothwell, J. (2014). How the war on drugs damages black social mobility. Washington, DC: Brookings Institution.

 

Highlights of the 2018 state budget

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July 2017

Budget Brief JPG USE THIS ONE

The 2018 state budget bills have passed the Michigan Legislature and are awaiting Governor Rick Snyder’s signature into law. Though there are still concerns about certain elements of the final budget, it was largely created with the well-being of residents in mind and included several hard-fought victories for the people of Michigan. Below is a list of some of the major highlights in the 2018 budget, along with some of the remaining issues. The League will be preparing a more thorough analysis of the final budget once it is signed.

HUMAN SERVICES

Access to Healthy Food

  • “Heat and eat” policy continued. The governor recommended $6.8 million in state funds to continue the “heat and eat” policy that increases food assistance benefits for nearly 340,000 Michigan residents. The final budget includes $2.5 million for “heat and eat” with the intention of using unexpended funds from this year’s budget that can carry over to the 2018 budget year.
  • “Double Up Food Bucks” program increased in current budget year. The Legislature included $750,000 in the current budget year and $380,000 in the 2018 budget to match a three-year federal grant to encourage the use of food assistance dollars for healthy foods.
  • Federal funding for nutrition education to increase. The budget designates an additional $10 million in federal funding for nutrition education programs for persons receiving food assistance.
  • Incentives for farmers markets serving families receiving food assistance. The budget includes $500,000 ($250,000 in state funds) for the purchase of wireless equipment by farmers markets so families can use their Bridge Cards to purchase healthy food.

Income and Family Support

  • No increase in school clothing allowance for children in families receiving income assistance. The governor recommended an increase from $140 to $200 per child annually. The final budget retains the current allowance of $140 per child.
  • Pathways to Potential program expanded. The governor recommended an increase of $5.6 million ($3.3 million in state funds) to provide human services to families through local schools. The final budget increased the program by a total of $4.9 million ($2.9 million in state funding).
  • Increased support for homeless shelters. The Legislature approved the governor’s recommendation to increase the rate paid to homeless shelters from $12 to $16 per person, per night at a cost of $3.7 million.

Child and Adult Safety

  • Expanded funding for the recruitment and support of foster families, as well as the Michigan Youth Opportunities Initiative (MYOI). The Legislature approved the governor’s recommendation to spend $3.6 million to support regional resource teams to recruit, train and support foster families, as well as an expansion of the MYOI program that helps young people make the transition from foster care to independent living.
  • Prevention funding reduced. The Legislature approved the governor’s proposal to cut $6.1 million from the current year expansion of the Parent Partner and Family Reunification programs. The expansion funds are currently being used in Genesee and Macomb counties, and are intended to prevent the need for foster care and reunify children with their families when it is safe to do so.
  • More resources for adult protective services. The Legislature approved the governor’s recommendation for an additional $11.3 million for 95 new adult services staff who can respond to reports of abuse, neglect or exploitation of adults.

HEALTHCARE

Medicaid and Healthy Michigan

  • Healthy Michigan Plan continues. The Legislature and the governor continue to support the Healthy Michigan Plan with both federal and state funding. The plan provides healthcare coverage to over 660,000 people with low incomes. It is important to note that the Healthy Michigan Plan faces great risks should Congress move forward in repealing and replacing the Affordable Care Act.
  • Nonemergency medical transportation expansion altered. The governor had proposed an expansion of the nonemergency medical transportation program into additional counties. Currently, a contracted program is available in Macomb, Oakland and Wayne counties. Other counties rely on local Department of Health and Human Services (DHHS) field staff workers to coordinate nonemergency medical transportation. The final budget, however, does not include expansion of the private program and instead includes $1.4 million to expand the use of local public transportation entities to coordinate nonemergency medical transportation.

Behavioral Health

  • Increased wages for direct care workers. The Legislature approved the governor’s recommendation for a $.50 per hour wage increase for direct care workers. The wage increase is expected to help recruit and retain direct care staff.
  • Behavioral health integration moves forward. The final budget updates Section 298 to require a pilot project for full integration of physical and behavioral health in Kent County as well as three pilot projects to integrate financing. DHHS would be required to begin the process of implementation of the pilot projects by October 1, 2017, with full implementation by March 1, 2018. The language requires that all benefits and savings from integration be reinvested into behavioral health services. The stated goal of the pilots and demonstrations is to test how the state can improve outcomes and efficiencies. The budget includes $3.1 million to support implementation of the pilot projects including project facilitation, evaluation costs and modifications to state contracts.
  • State psychiatric hospital staffing increased. The Legislature supported the governor’s recommendation to increase staffing at state psychiatric hospitals. Total costs are $7.2 million, which will support the hiring of additional employees.

Public Health

  • Child Lead Poisoning Elimination Board recommendations funded. The Child Lead Poisoning Elimination Board, created by the governor in 2016, recommended 80 actions the state should take. The budget includes $500,000 to begin implementation of these recommendations.
  • Vapor intrusion response program continues. The final budget includes an increase of $815,000 to continue a new response program for vapor intrusion of volatile chemicals into homes and buildings.

Senior Services

  • In-home services funding increased. The Legislature approved the governor’s recommendation of an increase of $2.1 million intended to address demand and waiting lists for additional in-home services for seniors.
  • Meals on Wheels waiting lists addressed. The final budget includes an additional $3.2 million, including $1.5 million in state funding, to provide senior in-home meals through Meals on Wheels.

EDUCATION

Per-Pupil Spending

  • Per-pupil spending increased. The Legislature increased the per-pupil payment to schools by between $60 and $120, with larger increases for districts currently receiving the lowest payments. This is above the governor’s recommended increase of $50 to $100 per pupil.
  • Increased payments for high school students. The final budget includes $11 million to provide a bonus payment of $25 per pupil in grades 9 through 12. The governor had recommended a $50 per pupil high school bonus payment at a cost of $22 million.
  • No new funding for schools with declining enrollment. The Legislature rejected the governor’s proposal to provide $7 million in transitional funding to schools with rapidly declining enrollment.
  • Funding for cyber schools and shared-time nonpublic/homeschooled students will continue. The Legislature largely rejected the governor’s proposed cuts in funding for cyber schools and shared-time programs for nonpublic and homeschooled students. The governor’s proposal would have saved $55 million in funding reductions for shared-time programs and $16 million for cyber schools. The final budget leaves cyber school funding at current levels (100% of the minimum per-pupil foundation allowance), and caps shared-time programs for a savings of only $2 million.

At-Risk School Aid

  • Increased funding for at-risk students. The Legislature approved an increase of $120 million for the At-Risk School Aid program, bringing total funding to $499 million. The governor had recommended an increase of $150 million to a total of $529 million. Both the governor and the Legislature changed the distribution formula and expanded the definition of “at risk” to include economically disadvantaged students—including those eligible for free- and reduced-price meals; pupils receiving income or food assistance; or those who are homeless, in migrant families or in foster care.
  • Funding available for “out-of-formula” or “hold-harmless” districts that are not currently eligible. These are districts that have combined state and local per-pupil foundation allowances that are higher than the basic amount, even though they may have a high number of children living in poverty. While the governor recommended full funding for eligible students, the final budget caps payments for newly eligible hold-harmless and out-of-formula districts at 30%.

Early Literacy

  • Funding for early literacy programs increased—with a new funding formula. The Legislature agreed with the governor to increase funding for early literacy coaches from $3 million to $6 million. The Legislature also increased funding for the Michigan Education Corps—a program the governor had recommended eliminating—from $1 million to $2.5 million. A total of $20.9 million in early literacy funding that is currently allocated to professional development, screening and diagnostic tools, and added instructional time is combined and distributed to districts in an amount equal to $210 for every first grade student. Funding for professional development and diagnostic tools are both capped at 5%.

Partnership Districts

  • New funding available to support state partnerships with high-poverty and struggling schools. The governor recommended $3 million in School Aid funds (along with staffing in the Michigan Department of Education budget) for a new effort to develop partnerships with school districts and communities to determine what intensive supports are needed to overcome low educational achievement and prevent unnecessary school closures. The final budget includes $6 million for the program.

Early Childhood Education and Care

  • Child care payments and eligibility increased. The Legislature approved $19.4 million total ($8.4 million in state funds) to increase hourly rates paid to child care providers based on the Great Start to Quality rating system. In addition, $5.5 million in federal funding is appropriated to increase the entrance income eligibility threshold for child care assistance from 125% of poverty to 130%. Funds were included in the 2017 budget to increase rates before October.
  • Funding provided to comply with new federal requirements related to safety in child care settings. The Legislature approved $7.1 million for comprehensive fingerprinting and background checks of child care providers and others with unsupervised access to children in child care settings in the current budget year, as well as $800,000 for staffing to complete checks in 2018, and $1.4 million for oversight of license-exempt family, friend and neighbor care.

Flint Water Emergency Funding

  • School Aid funds for the Flint water emergency reduced. The Legislature approved the governor’s recommendation to reduce School Aid funds for the Flint water emergency by $1.4 million (from $10.1 million to $8.7 million). Remaining funds are to be used for: 1) expanded eligibility for the Great Start Readiness Preschool program ($3 million); 2) school nurses and social workers in Flint schools ($2.6 million); 3) Intermediate School District support for students that attend districts other than Flint ($2.5 million); and 4) nutrition programs ($605,000).
  • Provided funding to address health and safety concerns. The Legislature approved funding for additional water testing, food and nutrition services, health services at child and adolescent health centers and schools, and water filter cartridges and replacements, though it was $1.1 million below what was included in the 2017 budget. Increased funding of $380,000 was included for nutrition services in Flint through the Double Up Food Bucks program.

Adult Education

  • Adult education funding remains stagnant. The Legislature provided continuation funding of $25 million for adult education programs, and provided $2 million for pilot programs focused on career and technical education.

HIGHER EDUCATION

Financial Aid

  • Still no state financial aid for students who have been out of high school more than 10 years. The governor recommended $2 million for the Part-Time Independent Student Grant, with added language that it could only be used at community colleges. The Legislature did not include funding for the grant.
  • Increase for Tuition Incentive Program (TIP) serving students eligible for Medicaid. The Legislature approved the governor’s recommendation for $5.3 million in new Temporary Assistance for Needy Families (TANF) funding for the grant, bringing total funding to $58.3 million (a 10% increase), which is expected to support 18,500 students in the upcoming school year. The Legislature also approved replacing $4.7 million in General Fund dollars with TANF funding, making TIP 100% funded by TANF.
  • Increases for the Michigan Competitive Scholarship and Michigan Tuition Grant. The Competitive Scholarship is currently 100% TANF-funded and the Tuition Grant 90% TANF-funded, but all new funding comes from the General Fund. The governor recommended an increase of $8 million from the General Fund for the Competitive Scholarship, a merit- and need-based grant based on ACT/SAT score and estimated family contribution, and an increase of $3 million from the General Fund for the Tuition Grant, which helps students attend private not-for-profit institutions and is based on estimated family contribution. The Legislature concurred with the governor’s increases for both grants.

Tuition Restraint

  • Tuition restraint cap is tightened. The Legislature supported the governor’s recommendation to lower the tuition restraint cap from 4.2% to 3.8% or $475 per student, whichever is greater.
    School Aid Fund for Postsecondary Education
  • All community college funding is from the School Aid Fund. The governor’s budget continued the practice of using a portion of School Aid Fund (SAF) dollars to fund Michigan’s universities and community colleges, but for the first time, nearly all total state funding for community colleges is appropriated from the SAF. The governor’s budget used $231.2 million in SAF dollars for universities and $319.1 million in SAF dollars for community colleges, taking a record $550.2 million out of the funding meant for K-12 schools. The Legislature approved these appropriations.

CORRECTIONS

Prison Operations

  • Small cut in prison operations. The governor funded prison operations at a total of approximately $1.2 billion, spread across the state’s 29 prison facilities and including regional support systems for those facilities. The Legislature cut $6.5 million from prison operations by permanently closing housing units at five prison facilities.
    Incarceration Alternatives and Occupational Training
  • Wayne Residential Alternative to Prison is expanded to West Michigan. The Wayne Residential Alternative to Prison program provides low-risk probation violators an opportunity to avoid going to prison and instead enter a residential program in which they receive occupational training and cognitive behavioral programming. The governor continued funding this program at $500,000, and added $1.5 million to replicate it in 13 counties on the west side of the state. The Legislature supported the governor’s proposal.
  • Funding for training is maintained. The governor retained $2 million in current funding for the Vocational Village program in Jackson, which trains prisoners in the skilled trades, but eliminated $1.5 million in current funding for Goodwill Industries’ Flip the Script program in Wayne County, which provides education, job training and mentoring to 16- to 39-year-olds in the criminal justice system. The Legislature retained current funding for both programs.

Health-Related Services

  • Increase in Hepatitis C treatment. The governor requested a $13.9 million transfer from the current year DHHS budget to expand drug treatment of prisoners with Hepatitis C, which the Legislature approved at $10 million. Assuming the DHHS transfer would go through, the governor reduced the 2018 Corrections appropriation for this program by $3.19 million to $11.7 million, bringing the total funding for Hepatitis C treatment to $25.6 million. The Legislature reduced the 2018 appropriation to $6.7 million, for a total of $16.7 million when the transfer is included—an increase of $1.8 million over the current budget.
  • Increase for cancer (oncology) treatment. The governor added $2.3 million for oncology treatment for a total of $73.9 million, reflecting the fact that the number of inmates treated for cancer increased by 48% from 2015 to 2016, and that the growth is expected to continue. The Legislature approved the transfer.
  • Small increases for mental health and substance abuse services. The Legislature approved the governor’s $778,000 increase for mental health services (for a total of $61.2 million) and the very small increase of $5,700 for substance abuse testing and treatment for prisoners.

 

School aid and education conference committees include expanded funding for early learning and high-poverty schools

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Pat Sorenson, Senior Policy Analyst
June 2017

Budget Brief JPG USE THIS ONE

Joint House/Senate conference committees have resolved differences between the House and Senate School Aid Fund and Department of Education budgets for 2018, and the budgets contain several much-needed expansions in funding for high-poverty schools, as well as child care services for working families with low wages.

K-12 EDUCATION

BB School Aid and Ed Conf Committees Include Expanded FundPer-Pupil Spending: Two of every $3 in the School Aid budget are used to support per-pupil payments, which are the primary source of funding for school operations. For 2018, the governor recommended an additional $128  million to raise per-pupil spending by between $50 and $100, with districts currently receiving the lowest payments per pupil receiving the largest increase. The goal is to further reduce the gap in state funding between the lowest-funded districts and the highest.

The governor also proposed higher per-pupil payments for high school students, reduced payments to cyber schools, and a cap on funding for instructional programs for nonpublic and home-schooled students (cutting total funding by $55 million).

  • The Senate increased per-pupil payments to between $88 and $176—using $100 million currently provided to districts to offset teacher retirement costs under the Michigan Public School Employees Retirement System (MPSERS). The Senate rejected the governor’s proposal for higher per-pupil payments for high school students, as well as the cuts in payments to cyber schools. The Senate cut programs for nonpublic/home-schooled pupils by only $2 million.
  • The House provided an across-the-board increase for all districts in the state of $100 per pupil—rejecting the use of the formula that provides higher payments for the districts that currently receive lower per-pupil foundation allowances. The House rejected the governor’s proposals to increase payments for high school students, as well as cuts for cyber schools and nonpublic/home-schooled student programs.
  • The conference committee: 1) increased per-pupil payments by $60 to $120, with the biggest increases going to districts with the lowest funding currently (total cost of the increase is $153 million); 2) rejected the governor’s proposal to provide higher per-pupil payments for high school students; 3) rejected the governor’s proposals to reduce payments to cyber schools; and 4) reduced the governor’s recommended cut of $55 million for programs for nonpublic and home-schooled students to $2 million.

The League supported increases in school funding that help raise the quality of education and mitigate the impact of inflation and fixed costs on school operating funds. In the last decade, the minimum K-12 per-pupil foundation allowance rose 5.7%—less than half the rise in inflation at 15.1%.1

Declining Student Enrollment: Since Proposal A, the reliance on a per-pupil foundation allowance for public school operations has meant that schools with rapidly declining enrollments can face at least short-term difficulties in adjusting to large funding losses. In recognition of the impact on local schools and students, the governor included $7 million for two years of supplementary funding for districts that have experienced large enrollment declines (more than 5% over two years).

  • Both the Senate and the House rejected the governor’s proposal for supplementary funding for schools with declining enrollments.
  • The conference committee rejected the governor’s proposal to provide funding for schools with rapidly declining enrollments.

The League supported funding to ameliorate the impact of declining enrollments on local schools and their students.

Funding for Students Academically at Risk: The At-Risk School Aid program is the state’s best vehicle for addressing the educational challenges children who are exposed to the stresses of poverty bring through the schoolhouse doors. The governor recognized the need to focus on high-poverty schools by recommending an additional $150 million in At-Risk funding for 2018 and by expanding eligibility. The governor also established a new set of goals and metrics for districts, including chronic absenteeism rates; English language proficiency in third grade; math proficiency in eighth grade; and the rate of enrollments and completions in career/technical education, advanced placement and dual enrollment programs.

Currently, the At-Risk program provides state funds to schools based on the number of children receiving free school meals (130% of poverty). Under the governor’s proposal, districts could receive funding for children up to 185% of poverty. In addition, the governor would provide funding to “out-of-formula” or “hold-harmless” districts that are currently not eligible. These are districts that have combined state and local per-pupil foundation allowances that are higher than the basic amount, even though they may have a high number of children living in poverty. The governor projects that with these changes an additional 131,000 children could be served.

  • The Senate increased At-Risk spending by $100 million and agreed with the governor on changes in student eligibility. The Senate altered the allocation formula as follows: 1) $5 million of the new funding would be earmarked for English language learners; and 2) districts that are currently eligible for At-Risk funding would be guaranteed at least as much per pupil as they are receiving in the current school year (applied to the broader base of economically disadvantaged students), with the remaining new funds (estimated to be approximately $41 million) awarded to all districts, including those currently not eligible.
  • The House increased At-Risk funding by $129 million and agreed with the governor on changes in student eligibility. The House also adopted the governor’s proposal to expand eligibility to “hold-harmless” and “out-of-formula” districts but capped the per-pupil At-Risk payment to those districts at 50%. The House added budget language indicating an intent to use a portion of 2019 At-Risk funds to reimburse school districts that provide transportation to pupils enrolled in schools of choice or charters.
  • The conference committee: 1) increased At-Risk funding by $120 million to a total of $499 million; 2) included the governor’s changes in student eligibility and funding formulas for currently-eligible districts; and 3) capped payments to newly-eligible “hold harmless” and “out-of-formula” districts at 30%. Under the conference agreement, currently-eligible districts will receive an estimated $777 per eligible pupil, while newly-eligible districts would receive $233. The conference committee did not adopt the governor’s new goals and metrics for the At-Risk program.

The League supported full funding of the At-Risk program, as well as expansion of eligibility to all children who are economically disadvantaged or at risk of educational failure.

Reading by Third Grade: Michigan law now allows for grade retention if children are not reading proficiently by third grade, making the need for early literacy programs even more critical. The governor proposed doubling funding for early literacy coaches at Intermediate School Districts (ISDs) from $3 million to $6 million. The governor also eliminated funding ($1 million) for the Michigan Education Corps. The largest component of the state reading initiative—funding for additional instructional time for children who are behind in reading—was retained at $17.5 million by the governor.

  • The Senate agreed with the governor and increased funding for ISD early literacy coaches by $3 million.
  • The House slightly reduced total funding for early literacy and allocated remaining funds ($25.4 million) through grants to districts, with an estimated $245 per first-grade pupil.
  • The conference committee agreed with the governor on the $3 million increase for early literacy coaches in ISDs, but increased funding for the Michigan Education Corps, from $1 million to $2.5 million. The conference committee consolidated all other early literacy programs and required that those funds be allocated to districts based on the number of first-grade students. Funding for professional development and diagnostic tools are both capped at 5%.

The League supports increased investments in early literacy, including programs that address learning in the earliest years of life such as early intervention through the Early On program, expanded home visitation programs, and a state-funded preschool option for 3-year-olds in high-risk schools and communities.

Adult Education: Despite a high level of need, state funding for adult education has dropped 70% since the 1997-2001 budget years. The governor recommended flat funding of $25 million for adult education programs in 2018.

  • The Senate agreed with the governor on flat funding for adult education and provided $2.5 million for career and technical education pilot projects in the state’s five prosperity regions.
  • The House agreed with the governor on flat funding for adult education.
  • The conference committee provided continuation funding for adult education programs of $25 million, and provided $2 million for the Senate-proposed expansion of career and technical education pilot programs.

The League supports an increase in funding for adult education of at least $10 million for $35 million total, which would help nearly 8,000 additional students and serve as an important tool for improving educational achievement and adult literacy—part of a two-generation approach to improving the state’s economy.

CHILD CARE AND EARLY EDUCATION

Child Care Subsidies: The number of Michigan parents with low wages who received assistance with their child care costs fell by over 70% between 2003 and 2016—in part because of the state’s stringent income eligibility standards and low child care payments. In addition to forcing parents to either stay out of the workforce or find care that isn’t suitable for their children, the state’s child care policies made Michigan one of only a handful of states that had to turn away federal child care funds because of a lack of state matching dollars. In recognition of the need for high-quality child care, the governor included an increase of $6.8 million in the current budget year (2017), as well as $27.2 million ($8.4 million in state funds) in the 2018 budget to increase rates paid to child care providers.

  • The Senate provided $23.8 million ($7.1 million in state funds) for increased child care provider rates, as well as $5.8 million to increase the income eligibility threshold from 125% to 130% of poverty. Rate increases would be based on the number of stars a provider has in the state’s quality rating system, ranging from a maximum increase of 50 cents per hour for providers with no stars to $1.50 per hour for child care centers with a five-star rating. Unlicensed providers (family, friends and neighbors) who care for infants or toddlers could receive an increase of 25 cents per hour.
  • The House agreed with the governor to include $27.2 million for rate increases for child care providers.
  • The conference committee included: 1) $19.4 million total ($11 million in federal Child Care and Development Block Grant funding and $8.4 million in state General Fund money) to increase child care reimbursement rates based on the Great Start to Quality rating system; 2) $5.5 million in federal funds to increase the child care eligibility level from 125% to 130% of poverty; and 3) $1 million for TEACH scholarships for child care providers trying to increase their quality ratings.

The League supported payment increases for child care providers as well as a boost in income eligibility levels, both of which are needed to ensure that parents can secure and keep their jobs while children are in safe and supportive settings that encourage optimal learning. In addition, the League supports efforts to bolster the supply of high-quality child care businesses, including the movement away from hourly billing to biweekly or monthly payments, which make it easier for providers to care for children from families with low wages.

Great Start Readiness Preschool Program: The governor recommended level funding for the Great Start Readiness Program ($243.6 million) which provides a high-quality preschool education for 4-year-olds from families with low incomes. Currently, the program is for children from families with incomes below 250% of poverty, but districts can expand it to children with incomes of up to 300% of poverty if they can demonstrate that all children with lower incomes who want to participate have had the opportunity to do so. For 2018, the governor restricted eligibility to children in families with incomes of 250% of poverty or less, and required that 100% of children meet that income eligibility level, rather than 90% as currently required. In addition, the governor changed the allocation formula to ISDs.

  • The Senate agreed with the governor on spending levels and on the new allocation formula, but retained the option of serving children in families with incomes of up to 300% of poverty.
  • The House adopted the governor’s recommendations for the Great Start Readiness Program funding and allocations.
  • The conference committee retained current funding and income eligibility levels for the Great Start Readiness Program, allowing children living in families with incomes of up to 300% to be enrolled—if all children at 250% of poverty and below have been served. Children from families with incomes above 250% of poverty would be subject to tuition on a sliding scale basis. Districts would still be required to contract with nonprofit and for-profit community-based providers for at least 30% of the children served.

FLINT WATER EMERGENCY

Given the long-term damage lead exposure can inflict on children, the need for ameliorative services and supports for Flint is ongoing. While there are investments in other state budgets, the governor recommended that School Aid funds for the Flint School District and the Genesee ISD be reduced by $1.4 million in 2018. Total funding in the School Aid budget would be cut from $10.1 million to $8.7 million, with remaining funds allocated to expand Great Start Readiness preschool program eligibility ($3 million), school nurses and social workers ($2.6 million), ISD support to Flint residents that attend districts other than Flint ($2.5 million), and nutrition programs ($605,000).

  • The House, Senate and conference committee agreed with the governor on the $1.4 million cut in School Aid funding for the Flint water crisis.

_________________
1. K-12 Schools Minimum Foundation Allowance History, Senate Fiscal Agency (Oct. 1, 2016).

 

Human services conference committee budget falls short in reducing poverty

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Pat Sorenson, Senior Policy Analyst
June 2017

Budget Brief JPG USE THIS ONEA joint House/Senate conference committee has resolved differences between the House and Senate human services budgets for 2018, and while funding for several League priorities was retained—including the “heat and eat” policy for food assistance—overall the budget fails to address long-term disinvestments in children and families living in poverty.

BB-Joint House Senate_Bdg fall graphicACCESS TO HEALTHY FOOD

Effective this year (the 2017 budget year), the Michigan Legislature approved $6.8 million in state funding to reinstate the “heat and eat” policy that allows Michigan to leverage additional federal funds and increase food assistance benefits for nearly 340,000 Michigan families, seniors and people with disabilities.

  • The Senate used federal energy assistance money to continue the “heat and eat” policy.
  • The House agreed with the governor to provide continued state funding for “heat and eat” food assistance benefits. The House also added language that prohibits the state from seeking a waiver to exempt able-bodied adults without dependents from food assistance work requirements in areas with high unemployment.
  • The conference committee: 1) agreed to continue the “heat and eat” policy using federal energy assistance funds; and 2) included House language to eliminate waivers from work requirements for able-bodied adults without dependents.

The League supported state funding for “heat and eat” as a way to prevent hunger for children, families, seniors and people with disabilities. The League opposed work requirements for persons in areas of high unemployment.

Increasing Access to Healthy Foods:

  • The Senate included an increase of $380,000 for the Double Up Food Bucks program in Flint.
  • The House included a placeholder for a new “Michigan Corner Store Initiative,” which if funded would provide grants to small food retailers to increase the availability of fresh, nutritious foods in lower-income neighborhoods.
  • The conference committee: 1) included a place-holder for the Michigan Corner Store Initiative; 2) provided $500,000 to help farmers markets purchase wireless equipment that will allow them to accept food assistance payments; and 3) included an increase of $380,000 for the Double-Up Food Bucks program in Flint.

The League supported state efforts to improve access to healthy foods in lower-income neighborhoods.

INCOME AND OTHER SUPPORTS TO STABILIZE FAMILIES

Family Independence Program (FIP) Benefits: The number of Michigan families receiving FIP is at its lowest level since 1957, and the governor and Legislature are projecting that it will continue to fall to only 17,000 in 2018. As a result of falling caseloads, the FIP budget is expected to drop from $98 million this year to only $76 million in 2018—a reduction of 22%.

With fewer children being served by FIP and benefit levels stalled (maximum of $492 per month for a family of three with average monthly payments of $366), children are living in deep poverty, and parents are finding it hard to both care for their children and find and keep work. In recognition of this hardship, the governor proposed an increase in the FIP yearly clothing allowance from $140 per child to $200 for a total cost of $2.7 million in federal Temporary Assistance for Needy Families (TANF) funds.

  • The Senate rejected the increase in the annual FIP clothing allowance.
  • The House included under $900,000 to increase the yearly benefit from $140 to $160.
  • The conference committee failed to increase funding for the FIP clothing allowance, leaving it at the current yearly benefit level of $140 per child.

The League supported the governor’s recommendation to increase the annual FIP clothing allowance as a small step toward addressing the insufficiency of income assistance programs for children and their parents.

Expand the Pathways to Potential Program: The governor recommended $5.6 million to expand the Pathways to Potential program that places “success coaches” in schools to identify barriers faced by students and their families and make appropriate referrals for needed services. The program is currently in 259 schools in 34 counties.

  • The Senate did not fund the expansion but included a $100 placeholder to ensure continued discussions in the joint House/Senate conference committee.
  • The House rejected the governor’s recommendation to increase funding for Pathways to Potential.
  • The conference committee rejected the governor’s proposal to expand Pathways to Potential funding, but added budget language requiring the Department of Health and Human Services to dedicate 29 new public assistance field staff to the Pathways to Potential project.

The League supported the governor’s recommendation to expand Pathways to Potential, which is a promising model for meaningful school/community partnerships and a two-generation approach to school success for all children.

Increased Support for Homeless Shelters: An estimated 100,000 people in Michigan are either homeless or imminently at risk of homelessness, and families with children make up half of the homeless population. More than half of the state’s homeless are African-American, and the senior homeless population continues to grow significantly each year.1

In recognition of the problem, the governor increased the daily rate provided to emergency homeless shelters from $12 per night per person to $16, at a total cost of $3.7 million in state general funds. The governor indicated that he intends to recommend another $4 per person increase in the 2019 budget year.

  • The Senate rejected the governor’s increase in payments to homeless shelters, but included a $100 placeholder to ensure continued discussions in the joint House/Senate conference committee.
  • The House agreed with the governor to increase funding for homeless shelters, using both state general funds and federal TANF dollars.
  • The conference committee included the rate increase for homeless shelters, using both state general funds and federal TANF dollars.

The League supported increased funding for emergency homeless shelters, as well as policy and budget changes that could prevent homelessness such as: 1) increases in income assistance payments; 2) housing policies that could prevent homelessness; and 3) tax changes that benefit workers with low wages including a restoration of the Michigan Earned Income Tax Credit.

CHILD AND ADULT SAFETY

Child Abuse and Neglect Programs: More than 1 of every 100 children in Michigan lives in a family that has been investigated for potential child abuse or neglect and over 37,000 are confirmed victims.2 As of February 2017, the Department of Health and Human Services was responsible for the supervision of 12,800 children in out-of-home care, with the majority placed with relatives, in licensed foster homes, child caring institutions or emergency shelters.3

While most families with low incomes are not more likely to abuse or neglect their children, living in poverty can limit the ability of parents to provide for their children’s basic needs. The vast majority (81%) of confirmed victims in Michigan’s child welfare system are there because of “neglect,” which can include a failure to provide adequate food, clothing, shelter or medical care.

More than a decade ago, the state was sued by a national child advocacy organization for its failure to move children quickly into safe, stable and permanent homes; provide children in foster care with adequate medical, dental and mental health services; and prepare children who age-out of the foster care system. To comply with a court settlement agreement resulting from that lawsuit, the state has increased resources for “tail-end” child welfare services, but relatively little has been done to prevent child neglect, including efforts to move children out of poverty.

For 2018, the governor recommended an additional $3.6 million for: 1) regional resource teams to recruit, train and support foster families; and 2) to expand the Michigan Youth Opportunities Initiative (MYOI) to all Michigan counties (currently in 64 of Michigan’s 83 counties). The MYOI helps young people who are in or have recently exited foster care make a successful transition to independent living through housing, education, employment and community engagement services.

The governor also cut “one-time” funding of $6.1 million—approved in the 2017 budget year—to expand the Parent Partner and Family Reunification programs. Funds are being used this year in Genesee and Macomb counties to prevent the need for foster care, ensure that children are more quickly reunified with their families when it is safe to do so and assist parents after children are returned home.

  • The Senate rejected the governor’s recommendation to increase funding for regional resource teams and the Michigan Youth Opportunities Initiative by $3.6 million, but included a $100 placeholder to ensure further discussion in the joint House/Senate conference committee. The Senate agreed with the governor to reduce prevention funding by $6.1 million.
  • The House agreed with the governor on regional resource teams and the Michigan Youth Opportunities Initiative, increasing funding by $3.6 million. The House also reduced prevention funding by $6.1 million, and further cut funding for the Fostering Futures program by $750,000.
  • The conference committee: 1) adopted the governor’s proposal to include $3.6 million for foster parent support through regional resource teams, as well as additional funding for the Michigan Youth Opportunities Initiative; 2) included $1 million in state funding to increase payments for licensing relatives as caregivers (not in the governor’s budget); 3) cut family preservation programs by $6.1 million; and 4) retained funding for the Fostering Futures program.

The League strongly advocated for increased funding for services that can strengthen families, prevent child neglect and reduce the need for out-of-home placements for children. The state’s efforts to improve its child welfare system as required by the court settlement agreement are important, but more needs to be done to prevent child abuse and neglect by strengthening families—including ensuring parents can meet their children’s basic needs and have access to mental health and other services.

Adult Services: As Michigan’s population ages, the need for services for seniors and people with disabilities continues to grow. A 2014 audit found that Michigan was unable to respond quickly to reports of abuse, neglect or exploitation of adults—in large part because of staffing shortages.

In response, the governor recommended $11.3 million to hire 95 new workers who could assist adults with high needs by providing protective services, independent living services and adult community placement assistance.

  • The Senate reduced the number of new adult services workers to 71 (with a delay in their hiring), resulting in total spending of $1.9 million in the 2018 budget year.
  • The House cut the number of new adult services workers in half to 47, at a cost of $5.6 million.
  • The conference committee approved only 35 new adult services staff for 2018, at an additional cost of $4.2 million.

The League supported the governor’s expansion in funding for adult services workers to ensure that seniors and people with disabilities are safe. Between 2002 and 2015, the number of adults needing protection from the state more than tripled, while the number of staff fell by 14%.

ENDNOTES

  1. Ending Homelessness in Michigan: 2015 Annual Report, Michigan Coalition Against Homelessness and the Michigan State Housing Development Authority.
  2. 2017 Kids Count in Michigan Data Book: A Michigan Where All Kids Thrive, Michigan League for Public Policy.
  3. Children’s Services Agency: Foster Care Overview, Presentation to the House Committee on Families, Children and Seniors, Michigan Department of Health and Human Services (March 9, 2017).

 

 

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