NC Budget and Tax Center

New data: Despite small gains, far too many people in poverty still left behind

New data today released from the US Census Bureau shows that 1.5 million North Carolinians lived in poverty in 2016. At 15.4 percent, the rate of poverty in N.C. has dropped by 1 percentage point from the previous year, yet still remains higher than pre-recession levels.

Income has followed similar trends to the poverty rate. The state’s medium income last year was $50,584, an increase from 2015, but still $1,130 less than the median income in 2007, after adjusting for inflation. This means that although our economy is recovering from the Great Recession, many NC families have yet to share in the state’s economic gains. Additionally, the data points to divides in our state, revealing that not everyone is impacted by poverty in equal ways. Serious barriers such as lack of access to quality education, housing segregation, and job and wage discrimination means some groups struggle economically more than others. Last year, 23.5 percent of African Americans, 27.3 percent of Latinx families, 25.5 percent of Native Americans, and 11.9 percent of Asian Americans experienced poverty compared to 10.8 percent of whites. Additionally, 21.7 percent of children experienced poverty and women experienced poverty at a rate 2.6 percentage points higher than men.

As grim as this data is, it tells an important story. Although we have seen positive gains in measures such as the unemployment rate, far too many North Carolinians are still being left behind in our state’s economic recovery. If we want to build an economy that works for everyone, lawmakers will have to ensure that we make adequate public investments in things such as income supports and higher education.

NC Budget and Tax Center

Approach to disaster relief funding is in need of drastic change

Last week, Congress passed a bill that included over $15 billion in disaster relief funding dedicated to the Federal Emergency Management Agency (FEMA). The bill, which included another provision that extends the debt-ceiling for three months, is in response to a cry from FEMA officials earlier this week who warned that the agency could run out of funds as soon as this weekend. The legislation, which awaits the president’s signature, includes $7.4 billion dedicated to Hurricane Harvey recovery efforts in Texas and Louisiana, another $7.4 billion for community block grants, and $450 million towards Small Business Administration (SBA) loans for damaged businesses.

Although 90 House and 17 Senate Republicans voted against the bill, largely on the grounds of extending the debt ceiling, lawmakers on both sides of the aisle agreed that funding disaster recovery efforts in light of Harvey and ahead of Hurricane Irma is a priority.

This action signals a welcome departure from previous stances Congress has taken toward funding disaster recovery. A recent Slate article details the typical contradiction in lawmakers’ attitudes towards federal disaster relief. In 2005, after Hurricane Katrina hit, then-Rep. Mike Pence expressed his hesitancy in providing disaster relief without spending cuts. In 2012, following Superstorm Sandy, lawmakers in both chambers threatened to withhold relief funding by tying the recovery bill to $17 billion worth of spending cuts.

The way our state and nation are bearing the financial and human costs of natural disasters is drastically changing. In just over the past 30 years, we have seen a significant increase in billion-dollar disasters. In North Carolina, in particular, these events will have disproportionate and catastrophic impacts of many of our poorest and rural communities. And yet without a commitment to investments over the long-term to prepare and plan for these costs, we will be leaving communities aside

After almost a year, Eastern NC is still not whole

Lawmakers have been inconsistent in funding unmet needs for those impacted by natural disasters and have neglected to have serious conversations about ensuring that infrastructure exists to minimize future devastation. This could not be more evident than here in North Carolina where the state was awarded only 1 percent of a $929 million aid request to support recovery and rebuilding efforts for Hurricane Matthew.

It is hopeful that in this emerging bipartisan commitment to helping communities recover, Eastern NC will finally receive some badly needed support. According to the NC Insider, nearly a year after Hurricane Matthew flooded much of the eastern part of the state, almost 3,000 families are still waiting to be bought out of their damaged and flood-prone homes. The state, however, only has enough funding to buy out one-third of the properties. Additionally, only a small number of businesses have received SBA loans and the state lacks funding needed to support low-income homeowners in need of repairs.  The estimated unmet need in the region according to state officials is $450 to $600 million.

We should applaud lawmakers for stepping up and choosing to support communities in the wake of Hurricane Harvey and Irma. But if we hope to build a stronger and more resilient North Carolina, we’ll need more than just disaster relief; we’ll need the investments and choices that ensure everyone, regardless of where they live or how much money they make, live in safe and thriving communities.

Brian Kennedy II is a Public Policy Fellow with the Budget & Tax Center, a project of the North Carolina Justice Center.

NC Budget and Tax Center

Labor Day fact: SNAP helps 1 in 9 NC workers put food on the table

For many working North Carolinians, their wages alone are not enough to make ends meet. The Supplemental Nutrition Assistance Program (SNAP, formerly known as food stamps) is a critical tool many working families rely on in order to put food on the table. According to new analysis from the Center on Budget and Policy Priority, SNAP helps 1 in 9 workers in North Carolina and 495,900 people in working households. SNAP and similar programs are becoming increasingly important as our state economy continues to loose middle-wage jobs. Between 2007 and 2016, North Carolina saw a loss of nearly 81,000 middle-wage occupations and an increase of over 90,000 low-paying jobs.

SNAP helps many workers who earn low wages, who have unpredictable schedules and paychecks, and who are in between jobs.

The report finds that:

  • Many workers and their families participate in SNAP while they are working or are looking for work. SNAP’s program and benefit structure supports work. While many participants work while participating in SNAP, many also apply for benefits to support them while they are between jobs.  Thus, many workers participate in SNAP for part of the year and stop participating when they are earning more.  Three-quarters of the working poor who were eligible for SNAP at some time during the year were eligible for only part of the year, an Agriculture Department study found.
  • Millions of Americans work in jobs with low pay. For example, a recent analysis found that up to 30 percent of Americans work in jobs with pay that would barely lift a family above the poverty line, even if they were working full-time, year-round.
  • Occupations that pay low wages are numerous and many are growing. Six of the 20 largest occupations in the country which together employed about 1 in 8 American workers, had median wages close to or below the poverty threshold for a family of three in 2016:  retail salespersons, cashiers, food preparation and serving workers, waiters and waitresses, stock clerks, and personal care aides). And eight of the ten jobs that are expected to add the most new jobs over the next decade have median wages below the national median, and many much lower.

To learn more about how SNAP supports workers, read the full report here.

2018 Fiscal Year State Budget, NC Budget and Tax Center

State lawmakers take positive step in Hurricane Matthew recovery

Today, the NC General Assembly passed The Disaster Recovery Act of 2017 (SB 338). The bill allocates $100 million to help Eastern North Carolina recover and rebuild from the devastating effects of Hurricane Matthew. Causing massive flooding and damage in 50 counties in the Eastern part of the state, the storm displaced thousands of families and impacted hundreds of thousands of homes and business. Ultimately, there was an estimated $2.8 billion in damages and another $2 billion cost in lost economic activity.

This is the second round of disaster recovery funding the state has pursued. In a December special session, the General Assembly passed the Disaster Recovery Act of 2016, allocating $200.9 million. Since then, Governor Cooper, as well as North Carolina’s Congressional delegation, worked hard to secure a federal commitment to fulfill the state’s unmet need. In May, the Trump Administration announced that they would only allocate $6.1 million of the $930 million North Carolina had requested.

The Disaster Recovery Act of 2017 is a key step in attempting to close the gap left wide open by the federal government. In this round of funding, $20 million will be allocated to addressing housing needs, including the repair of homes for low-income homeowners and renters. Another $20 million will go to the Department of Agriculture for dam, soil, and water systems repairs, and $30 million will go to infrastructure projects managed by local governments and non-profits. $2.7 million will help the Community College System deal with enrollment declines resulting from the storm, and, finally, $22.3 million will be allocated as a match for federal disaster grants.

Although this round of funding is not enough to address the unmet need or the total costs of damages incurred in Eastern North Carolina, it is an important step. If we are to help Eastern NC not only recover, but to become resilient, state lawmakers will have to continue to make these types of investments in the years to come.

Brian Kennedy II is a Public Policy Fellow with the Budget & Tax Center, a project of the North Carolina Justice Center.

2018 Fiscal Year State Budget, NC Budget and Tax Center

North Carolina’s leaders are abandoning the victims of Hurricane Matthew

Alamance Community Park, in Robeson County, near Lumberton, NC, remained inundated with flood waters on Oct. 16, 2016. Floodwater from Hurricane Matthew came to the bottom edge of the park signs when the storm first hit. USDA Photo by Lance Cheung.

Alamac Community Park, in Robeson County, near Lumberton, NC, remained inundated with flood waters on Oct. 16, 2016. Floodwater from Hurricane Matthew came to the bottom edge of the park signs when the storm first hit. USDA Photo by Lance Cheung.

If you have been following North Carolina’s response to the damage caused by Hurricane Matthew, then you know it has been a slow and, at times, disappointing process.

If not, here’s a refresher:

On Oct. 8, 2016, Hurricane Matthew made landfall on North Carolina. The resulting flooding impacted 50 counties in the Eastern part of the state, damaging more than 800,000 homes and over 300,000 businesses, displacing 3,744 residents, and causing closures in 34 school systems. In all, the storm caused $2.8 billion in damages and another $2 billion in lost economic activity.

In December 2016, three months after disaster struck, the General Assembly passed the Disaster Recovery Act of 2016 allocating $200.9 million in state dollars for initial relief efforts. The general understanding was that the state would wait for disaster funding from the federal government, re-evaluate the “unmet need,” and step in to fill any remaining gaps. Assuming the federal government would act as they have done in previous disasters and support the state with a significant relief package, Governor Cooper’s budget allocated only $115 million in state funding disaster relief.

On May 10, 2017, nearly six months later, North Carolina finally heard back from the federal government. The Trump administration announced they would provide only $6.1 million of the nearly $930 million in federal funds that the state needed and requested.

The message was crystal clear: North Carolina would have to take care of itself. Yet, despite being fully aware of the $930 million in unmet need in Eastern North Carolina, legislators in both the Senate and House responded by allocating only $150 million in each chamber’s budget.

Now that you’re caught up, you’re probably wondering, “Who will pick up the slack and fund relief in Eastern NC?”

The answer? Not your legislators. Read more