MLPP Blog: Factually Speaking

I’m done riding the revenue rollercoaster

Added May 18th, 2016 by Rachel Richards | Email This Entry Email This Entry
Rachel Richards

I hate rollercoasters—they make my head hurt and I can never get my feet back under me after riding one. But twice a year, I ride one as I wait to see whether state revenues will come in above projections, below targets or on track. Yesterday’s revenue estimating conference made it clear that we will have some tough budget decisions to make for next year, but the truth is that it shouldn’t be like this.

The good news is that revenues, year after year, are projected to grow. However, Michigan’s growth isn’t as robust as we originally predicted only five months ago. This means that there will be less to work with when deciding funding priorities in next year’s budget, potentially leaving many Michigan residents, communities and schools further behind. Thankfully, Michigan is able to get federal funds for various programs, and lawmakers should review the budget and fund those areas, such as child care and the Heat and Eat program, for maximum impact.

Revenue tax expenditures chart 4Thankfully budgets can be balanced in a single year, but we still need to look at our revenue structure to continue long-term economic growth. While we scrutinize and stress over every dollar spent in each budget annually, Michigan lawmakers neglect to regularly review silent spending. Tax expenditures, like budget expenses, spend state dollars on public purposes but do so through the tax code rather than during the annual budget process. Michigan is currently anticipated to forego $35 billion in state funds through state and local tax breaks, but this spending is rarely reviewed by legislators. In fact, once these provisions get written into our state tax laws, they tend to live on in perpetuity regardless of whether they continue to serve a good public purpose.

A recent report released by the League calls on Michigan’s legislators to review our tax expenditures to help Michigan’s strained revenue structure. The report makes the following recommendations to policymakers:

  • Understand the costs of each tax policy change, including the expansion and creation of restricted funds, to ensure that there is enough funding left to deal with the state’s growing budgetary pressures.
  • Review Michigan’s existing tax expenditures to ensure that their benefits still outweigh the costs to the state, and eliminate those that are no longer meeting their intended purposes or are no longer necessary.
  • Make tax relief strategic and measurable by including measures to allow lawmakers to determine their usefulness, including sunsets, accountability measures or repayments if provisions are violated.

Providing more stability in Michigan’s revenue structure is good policy. It would help us to provide important funds to the things Michigan residents and businesses care most about: high-quality schools, safe communities, good roads and affordable postsecondary education. Unfortunately, unstable fiscal policy will only lead to the inability to address our state’s current crises—like the Flint water crisis and financial crisis in Detroit Public Schools—while creating more in other communities.

Many economists and tax policy experts argue that the best tax policy is one that has a broad base and a low rate. Thanks to unchecked credits, deductions and exemptions, our tax base is riddled with holes that need to be filled in order to ensure a more stable revenue structure. While some fluctuation and risk is involved with every revenue projection, Michigan’s rollercoaster needs to stop.

— Rachel Richards

Children of Michigan immigrants are waiting for an answer

Added May 10th, 2016 by Seema Singh | Email This Entry Email This Entry
Seema Singh

Approximately 43,000 immigrant children in Michigan are currently living in fear of their parents being deported and their families being torn apart. President Barack Obama’s executive orders Deferred Action for Parents of Americans and Lawful Permanent Residents (DAPA) and Deferred Action for Childhood Arrivals (DACA) were positive steps taken to address the large number of immigrants stuck in limbo in Michigan and around the country.

blog MI children affected by Supreme Court actionUnfortunately, in response to these policies, Texas and other states sued the federal government, and a federal district court has halted their enactment. The case has now reached the United States Supreme Court, which heard oral arguments on Monday, April 18th. The Supreme Court will determine whether President Obama’s DAPA and DACA executive actions were lawfully enacted. A decision overruling the Texas injunction and upholding these executive actions would ultimately determine whether millions of immigrants will continue to live in fear and possibly be separated from their families, or be given an opportunity to participate in the economy, boosting revenue to states, and keeping families intact.

The president’s immigration efforts are intended to address the millions of immigrants who have been waiting for immigration reform to no avail. Undocumented children are constantly afraid and under duress, and often have poor educational outcomes because of this stress. Even if undocumented students manage to reach college, they face immense hurdles with limited options for student aid and employment. Studies also show that children with undocumented parents face similar mental, economic, and emotional challenges. Immigration reform would ultimately help thousands of children and spur growth in Michigan.

Deporting nonviolent residents who pay taxes diverts money and resources from other law enforcement efforts that actually keep communities safer and provide other economic benefits. Almost three-quarters of undocumented immigrants pay taxes, and if DAPA and DACA were allowed to move forward, they would contribute approximately $1.86 billion in revenue. If the Supreme Court’s decision determines the enactment to be lawful, DAPA and DACA would bring our state one step closer towards making Michigan an inclusive and welcoming state and upholding our values that include taking care of our children and families. The Supreme Court’s decision is expected by the end of June.

— Seema Singh

Quit spreading misinformation: Michigan is NOT a high tax state

Added May 6th, 2016 by Rachel Richards | Email This Entry Email This Entry
Rachel Richards

Around the state, a drum is constantly beating for tax cuts. We hear that tax cuts will make Michigan more competitive, that we will entice people to live here and businesses to move here. However, the idea that Michigan is a high tax state simply is not true.

A recent memorandum by the Citizens Research Council shows that Michigan’s tax incidence, or the general amount taxpayers pay, for 2013 is not really that high. The report used Census data and compared states in terms of tax revenue as a percent of personal income and tax revenue per capita. Using both of these methodologies, in terms of overall tax collections, Michigan ranked below the national average and at the bottom of all Great Lakes states. In fact, in terms of overall tax collections, Michigan’s per capita collection of $3,750 is 18% below the U.S. average, and where Michigan’s tax collections grew by $537 in three decades, the U.S. average grew by $1,715 in the same time period.

taxes rankedMany have pointed to Michigan’s “lost decade” of recession as a reason why the state is not feeling the recovery, but not all of the revenue impacts can be blamed on diminished personal income and the burst of the housing bubble. Tax policy changes have compounded the effects of the state and national economy. Following Michigan’s switch from the Michigan Business Tax to the Corporate Income Tax, effective January 1, 2012, the state became a bottom ten state in corporate tax revenues, joining, according to the CRC, “states that tend not to host the same types of industry for which Michigan has typically competed.”

Worse yet, there are more tax policy changes coming including changes made that will ultimately repeal the Personal Property Tax, increase taxes on motor fuels and reduce and potentially eliminate the income tax, and impose sales tax on online sales. At a time in which Michigan is dealing with crisis after crisis, Michigan can least afford reductions in revenue.

We need to quit spreading the myth that taxes are too high. And if low taxes mean less in services, more crumbling roads and low-performing schools, count me out. Taxes help pay for important services, such as police and fire, state parks, libraries, high-quality schools, roads and bridges, and so much more, which help make states more vibrant and help entice businesses and people to relocate. Michigan’s taxes are not too high, and if we want to help save our state and our communities’ struggles, we need to look at ways to bring in more revenue, not less.

— Rachel Richards

Hunger, poverty and the plagues of today

Added May 4th, 2016 by Gilda Z. Jacobs | Email This Entry Email This Entry
Gilda Z. Jacobs

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I recently attended a very special interfaith seder. Part of the Jewish faith, a seder is a ritual in which a community or a family retells the story of the Israelites’ liberation from slavery in ancient Egypt. While seders are always a powerful experience for me, this one was particularly poignant.

That’s because this was a “Hunger Seder,” following materials developed by Mazon, a Jewish organization dedicated to ending hunger. Instead of the traditional focus of celebrating the Jewish people’s freedom, this seder also looked at the people who are still struggling today, in particular veterans, and what we can do to support them. The program for the Hunger Seder said it best, “We come together today with them in mind, determined to realize our vision of a day when we will all be truly free from the oppression of hunger.”

On Passover, the Jewish people read about the 10 plagues unleashed on the Egyptians. Instead of locusts, frogs and boils, there are many modern plagues like hunger, poverty and abuse and neglect affecting those around us. And we need to change that.

At the Hunger Seder, we read aloud in unison each of these 10 plagues that are all very real today:

  1. A single mother who gives the last bits of food to her toddler while she goes hungry.
  2. A brother and sister in a rural community who live too far away to participate in the summer feeding program and miss meals during the summer months.
  3. A military family who struggles to make ends meet on the salary of a low ranking enlisted soldier and resorts to anonymously getting a monthly food bank at the local pantry to feed their children.
  4. A middle school student who doesn’t take the free school breakfast because he is ashamed of being poor.
  5. A senior who makes painful choices between paying for medicine or food, but doesn’t apply for SNAP because he finds the application process overwhelming.
  6. A recently unemployed mom who is worried about getting a new job that pays enough to cover her child care costs.
  7. A recent veteran facing difficulty transitioning back to civilian life and making ends meet, but isn’t aware of nutrition assistance benefits to help him.
  8. An American Indian family living on a reservation who faces many barriers to healthy eating, including severe poverty and unemployment, limited options for fresh produce, and exceptionally high food prices.
  9. A young family that lives in an urban neighborhood where there is no full-service grocery store, only fast food and convenience stores.
  10. APATHY, the greatest plague of all—the failure to make ending hunger a state and national priority.

Whatever the tenets of your spirituality and morals, religious or otherwise, we all should believe in helping others who are in need. And we all must be particularly vigilant against the plague of apathy and losing our compassion for others. Working at the helm of the Michigan League for Public Policy, I am proud to be part of an organization that is committed to doing this work, and as a supporter, you should be, too. But we also have to remember that we still have a ways to go. Most importantly, we can all take action to make things change.

Mass incarceration and the kids left behind

Added April 28th, 2016 by Alicia Guevara Warren | Email This Entry Email This Entry
Alicia Guevara Warren

Losing a parent to incarceration can be very traumatic for children. Not understanding why a parent is gone and can’t come home, wondering why he or she might be far away, being frustrated because frequent visits might not be possible all while the other parent undergoes tremendous financial and emotional stress.

In Michigan at least 1 in 10 children has been impacted by parental incarceration. This is one of the highest rates in the country—only Indiana (11%) and Kentucky (13%) have higher percentages of children who have had a parent incarcerated. As a result of mass incarceration and the “tough on crime” movement many children and families have been left behind in communities without adequate support and resources.

According to a new KIDS COUNT report by the Annie E. Casey Foundation, A Shared Sentence: The Devastating Toll of Parental Incarceration on Kids, Families and Communities, more than 5 million children in the United States have had a parent incarcerated at some point in their lives, including 228,000 in Michigan. With the recent interest to reform corrections policies, the report’s recommendations emphasize that children’s needs must not continue to be overlooked.

Incarceration destabilizes a child’s life in many ways. It causes stress and can have long-term effects on a child’s well-being. The report points to the trauma of being separated from a parent that when combined with a lack of sympathy or supports can increase mental health issues, like depression and anxiety. Losing a parent to incarceration can leave single mothers or grandparents with unexpected financial responsibilities—on top of the emotional strain—which can make it harder for the caretakers left behind to provide emotional support to the affected children.

Casey Incarceration Report_Michigan_Percent

Additionally, when fathers are incarcerated, the average family income drops by 22% leaving families unable to afford necessities, like food, utilities, rent and medical care for their children. The loss of income is only exacerbated by high court-related fines and fees, telephone calls, and costs to travel to visit since oftentimes the parent is incarcerated far away from home. The report cites research that found that if incarceration rates had not increased so significantly between 1980 and 2004, then the U.S. poverty rate would have fallen by 20% rather than remain steady.

The report points to three broad goals with specific recommendations in each:

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

Michigan has the opportunity to make changes through sentencing reforms to control the prison population, increased funding for prisoner education and training, support for “ban the box,” removing our 17-year-old children from the adult prison system, improved reentry support and by facilitating access for affected families to financial, legal, child care and housing assistance.

Bottom line: as discussions to reform the criminal justice system continue, the needs of children must be prioritized as systems make decisions about sentencing parents in order to minimize the impact that incarceration has on children. All kids should have a fair chance to thrive.

— Alicia Guevara Warren

House Appropriations Committee takes major step to strengthen food assistance

Added April 25th, 2016 by Peter Ruark | Email This Entry Email This Entry
Peter Ruark

We are happy to announce that yesterday, thanks to the work of Representative Jeff Irwin (D-Ann Arbor), the Michigan House Appropriations Committee unanimously voted to include $3.2 million in the state budget to restore $138 million in federal food assistance benefits for approximately 150,000 low-income households. These individuals’ benefits were reduced by an average of $76 per month due to changes in the “heat and eat” policy. Many of these households include elderly and disabled individuals.

The Michigan League for Public Policy has been working with legislators and state officials to remedy this issue for several years. It was eighteen months ago that the Michigan Department of Health and Human Services declined to pony up some state money in order to continue federal Supplemental Nutrition Assistance Program (SNAP) benefits for many Michigan residents. In 2014, Congress increased the amount from $1 to $21 that states would need to spend on heating assistance for certain households in order for them to receive higher food support benefits, saying the states in the “heat and eat” program were exploiting a loophole to increase some households’ food assistance by paying only $1 in heating assistance to those households.

bag of groceriesAlthough 12 of the 16 “heat and eat” states agreed to pay the higher amount in order to continue drawing down the federal dollars, Michigan was one of four states that chose to leave the federal money on the table. Rep. Irwin’s amendment funds and requires the state to spend the $21 per household to increase the SNAP benefits.

While some have argued that it is bad policy to use a loophole to increase food assistance benefits for certain low-income households, the League supports doing so because, simply put, SNAP benefits are too low. As long as Congress stalls in updating food assistance benefits to reflect the real cost of nutritious food for a family, states are justified in filling the gap in any way possible. As a moral issue, the well-being of vulnerable Michigan residents must take priority over “purity of policy.”

Fortunately, lawmakers from both parties agree, as shown by the unanimous vote on the House Appropriations Committee supporting the Irwin budget amendment. The Senate Appropriations Committee, on the other hand, has not added the money for “heat and eat.” The next step is to convince the other lawmakers in the Michigan Legislature to support the Irwin amendment. We urge readers to call their representative and senator to urge them to support adding $3.2 million for “heat and eat” when it comes to a vote on the floor of their respective chambers.

— Peter Ruark

State budget on the fast track

Added April 20th, 2016 by Pat Sorenson | Email This Entry Email This Entry
Pat Sorenson

Early in my career, I heard a state legislator say that on a critical tax bill he had received two constituent letters for it and two against, and he was tired of being “whipsawed” on the issue. The message, while made partly in jest, has always stayed with me. Many legislators hear very little from their constituents directly, and when they do, they take note.

One of the most essential legislative tasks needing constituent input is the state budget. The budget reflects the Legislature’s values and priorities, and it is critical that it addresses the needs of all constituents—including low- and moderate-income families and their children. To that end, throughout the budget process the League provides information to policymakers and communities.

money 4 PNGThis year, lawmakers are moving quickly to finalize the 2017 state budget with the goal of putting it on the governor’s desk by the end of May (the budget takes effect in October of this year). Most state department budgets will be approved by both the House and Senate by the end of next week. In the middle of May, state budget experts will meet with the House and Senate Appropriations Committees to make final estimates on the amount of tax revenue that will be available next year, and those figures will guide the final joint House/Senate conference committees working out differences in the budgets approved by each body.

There is much at stake for Michiganians as state lawmakers craft a final 2017 budget.

Health and human services: Investments in Flint continue to be critical and to date both the House and Senate have adopted the governor’s proposal for just over $15 million in the Department of Health and Human Services for nutritional services, child and adolescent health centers, community mental health, and lead investigations and abatement. Still to be decided is the legislative response to the governor’s proposal to expand the clothing allowance for children receiving public assistance and boost funding for family preservation programs for children in the state’s foster care system (both reduced by the House and Senate).

On a positive note, both the House and Senate agree to complete the expansion of the Healthy Kids Dental program statewide next year, and the Senate includes $23 million to address the shortage of dentists for adults with Medicaid coverage—a longstanding problem that has landed many Medicaid patients in emergency rooms and created barriers to employment.

Education: While there is agreement on general spending per-pupil, there is work left undone related to the Detroit Public Schools as well as a number of much-needed investments supported by the League including the expansion of child care eligibility from 121% to 150% of poverty, full funding for students at risk of educational failure, and an increase in the grossly-underfunded adult education system in Michigan.

Corrections: The League supports increased funding for reentry programs that can help return prisoners successfully to their communities and families. Over the past 30 years, Michigan’s prison population has grown dramatically and the state now spends more of its General Fund on corrections than it does on higher education.

Serious decisions will be made in the next six weeks that affect low-income children and families, persons with disabilities and Michigan’s aging population. The League will continue to provide you with information about the issues under debate, and we hope that you will do your part by contacting your legislators about the issues that affect your community and the state as a whole.

— Pat Sorenson

A thank you note to Michigan taxpayers

Added April 18th, 2016 by Rachel Richards | Email This Entry Email This Entry
Rachel Richards

It’s Tax Day! Today is the day that we acknowledge and celebrate all that you do for your state, your community, your neighbors and your families!

I realize that no one likes to pay taxes. The time it takes to find all of your documents and fill out the forms. The frustration over paying at the end of the year if you did not withhold enough. The constant stress over whether you did them right. It is frustrating. But it is also incredibly important.

The Upside of Taxes

The Upside of Taxes

n paying taxes, you provide our state with so much. Taxes pay for good schools, maintained roads, parks, public safety, a trained workforce, libraries, safe food, and so much more—and I wanted to take today to thank you for all of this.

Thank you for investing in our schools. My husband and I recently started enrolling our son in kindergarten at a local public elementary school. I am thankful that he will be taught by trained teachers who will provide him with a high-quality education so that he can succeed later on in life.

Thank you for helping fix and maintain our roads. The orange barrel season is upon us, but I know that road repairs will mean less in car repairs coming out of my pocket—fewer potholes mean fewer flat tires and alignments.

Thank you for ensuring that my community is safe. Knowing that I can call the police or fire department if I need them provides me with the security I need to live comfortably in my house.

Thank you for providing my family with fun activities to do all year long. Whether camping at a state park, playing at the local playground, swimming at the public beach or curling up with a new book from the library, your taxpayer dollars provide us with things to keep my family and me healthy, active and constantly learning.

And there is so much more to be thankful for.

Paying taxes should not be something to dread; paying taxes should be looked at as a privilege. We pay taxes so that we can invest in things that we need to have great communities, so that we can encourage business growth and create a place where people want to live. We, as taxpayers, provide these important services and should be applauded for doing so.

Thank you!

— Rachel Richards

Immigrants particularly hurt by Flint water crisis

Added April 15th, 2016 by Seema Singh | Email This Entry Email This Entry
Seema Singh

Allowing families of any background, including undocumented immigrants, to drink poisoned water is unconscionable. But immigrants have often been overlooked in the Flint water crisis, and to this day many are afraid to get help.

Three months after the governor declared a state of emergency, undocumented immigrants were still drinking tap water. Parents were saddened to learn that they missed information regarding the dangers of Flint tap water due to limited translated materials. Many didn’t know lead was a toxic contaminant or thought that boiling would purify their water. Boiling actually concentrates lead.

Other problems arose for immigrants once they did find out about the lead crisis and sought assistance. A few bottled water stations were initially asking undocumented residents for ID before handing out water, deterring residents from accessing water and raising fears of deportation. It was not until community members organized to draw attention to this abominable situation that the state announced no IDs were required to receive water.

FlintImmigrantInfoToday, while immigrants have received assurances that they will not be under threat of deportation for seeking clean water, many remain afraid. Flint residents at large lost their trust in the state government over the course of the past year as they received information now proven false about the purity of their tap water and the state’s measures to treat the Flint River water.

For undocumented immigrants who live in fear of deportation, reports of community members being asked for identification along with water being distributed by officers in uniform raised alarms and heightened fears of detainment and deportation. For now, these families must trust community groups and grassroots organizations that have worked diligently to inform them of their rights and provide them with correct information. For the immigrants left too long in the dark and who allowed their young children to drink the seemingly innocuous tap water, this is all too little too late.

This crisis illustrates why it is so important to provide basic services including healthcare to immigrants regardless of immigration status. While most families now have access to clean water, they still have limited access to healthcare due to lack of health insurance and cultural barriers in accessing the small number of community clinics that may take those without insurance. The Affordable Care Act did not extend insurance coverage to undocumented immigrants.

Without health insurance or identification, many immigrant families are not even able to have their kids tested for lead, let alone receive medical services. Among the many things the state must take responsibility for, it is imperative that every single child and family in Flint that was devastated by this manmade disaster, regardless of immigration status, is cared for and provided with immediate assistance and long-term health care.

— Seema Singh

Do kids really count in Michigan?

Added April 7th, 2016 by Alicia Guevara Warren | Email This Entry Email This Entry
Alicia Guevara Warren

Over the past year our state has received a significant amount of attention from the Flint water crisis—exposing an entire city to poisonous lead—and the deplorable and dangerous conditions of the Detroit Public Schools. These two incidents alone beg the question of whether kids really do count in Michigan. State leaders have become extremely focused on the bottom line and reducing spending so much that basic needs like clean air, safe drinking water and quality schools have become issues.

coverThe Kids Count in Michigan Data Book 2016 reveals further evidence of the lack of attention to the needs of all children and families. In 2014, the latest year of data available, nearly half a million Michigan children lived in poverty. That is a 23 percent rate increase from 2006. Child poverty also increased in 80 of 83 Michigan counties since 2006, showing it is an issue in every corner of the state. In fact, all three measures of economic security examined in the book showed that more families are struggling to make ends meet.

We know that poverty affects every aspect of a child’s life, harming their education, physical health, socioemotional health and long-term financial security. That means that we must ensure that every child has the ability to reach their potential in order for Michigan to have a vibrant future. But significant economic disparities exist by age and race and ethnicity. Younger children are more likely to live in poverty. Almost half of African-American and nearly one-third of Latino children live in poverty. There are clearly still many structural and institutional barriers to opportunity and access that inordinately hurt people of color, and these must be eliminated to improve the well-being of all children.

The data also show that since 2006, more children are living in families investigated for child abuse and neglect—up 52 percent—and more are also being confirmed as victims. In 2014, nearly 15 of every 1,000 kids suffered from abuse or neglect, an increase of 29 percent since 2006. However, after a lawsuit resulted in a consent decree to improve safety, permanency and well-being for children in the child welfare system, the state has had fewer children placed in out-of-home care due to abuse or neglect. Compared to 2006, the out-of-home care rate has declined by 31 percent. It is apparent that targeted efforts in foster care have worked. But more needs to be done to prevent child abuse and neglect upfront to keep children out of the system altogether.

A few other startling statistics from the 2016 Kids Count Data Book include:

  • 32 percent of children live in a household where no parent has secure employment;
  • Nearly 80 percent of young children (ages 0-5) had both parents in the workforce;
  • On average, monthly child care consumed almost 40 percent of 2015 minimum wage earnings; and
  • 17 percent of children in Michigan live in high-poverty neighborhoods, including 18 percent of American Indian, 55 percent of African-American and 30 percent of Latino children. These rates for Michigan are some of the highest in the country.

There are some bright spots in the data. Michigan is doing a better job at the teen birth rate—although it is still higher than in any other industrialized nation and more work needs to be done. The infant mortality rate improved by 10 percent over the trend period; however, while the gap is closing, the rate for African-American or Black babies is still much higher than average. Plus, troubling trends are emerging for Hispanic and Asian or Pacific Islander infant mortality rates.

These numbers illustrate the current landscape Michigan kids are living in. But now what?

Clearly there is much work to be done to improve the lives of kids and their families. Nationally, Michigan has fallen two years in a row in our overall child well-being rank to 33rd in 2015 and we rank last in the Midwest.

For 25 years now, the Michigan League for Public Policy has been producing the Kids Count report to make sure Michigan kids have a voice in the policies that are affecting them. Our goal is to have these books in the hands of local advocates and state policymakers, not collecting dust on a shelf.

It’s time to take action before Michigan becomes an unrecognizable place where we do not want our kids to grow up. We urge lawmakers and concerned residents to take a look at this report, especially the numbers in your county, and act on our recommendations. Kids still count in our book, but a lot more needs to be done to make them count in the State Capitol.

— Alicia Guevara Warren

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