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NC Budget and Tax Center, Poverty and Policy Matters

This is the fourth post in a series that takes a detailed look at the 2013 US Census Bureau poverty data released on September 18th. The first post looked at how North Carolina is faring overall. The second post looked at how poverty varies by race, and the third post compared poverty by counties in North Carolina. 

Children face the highest poverty rate in North Carolina compared to other age groups according to data released last week by the US Census Bureau. After more than five years into an economic recovery, one in four children (25.2%) in North Carolina remained in poverty in 2013 –unchanged from 2012 and higher than the national child poverty rate (22%). At a time when we are experiencing an economic recovery, it is troubling that our state’s child poverty rate is not declining and remains significantly higher than the national average.

The numbers become even more meaningful when considering the disadvantages children in poverty face: less access to early education programs and high quality schools, food insecurity, higher stress levels and higher dropout rates, among other risk factors. Recent findings in brain development research also warn of the impact of toxic stress associated with poverty on a young child’s developing brain. Toxic stress can weaken the architecture of a child’s brain, creating long-term challenges that make it hard for one to be economically secure as an adult. Other numbers are rising for children across the nation and in North Carolina that we certainly don’t want to see on the rise. Infant mortality and child mortality has increased in North Carolina. There has also been a rise in the number of homeless school children, according to recently released national data. Both are indicators of poverty’s tight grasp on America’s and North Carolina’s children.

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Falling Behind in NC, NC Budget and Tax Center

Lawmakers let the state Earned Income Tax Credit expire at the end of 2013, making North Carolina the first state in nearly 30 years to eliminate this proven anti-poverty tool. The state EITC helps promote shared economic prosperity for all North Carolinians. It goes only to working people with modest incomes, offering extra support to pay for basic necessities.

In a new video from the series “North Carolina: First in Flight from the EITC,” Heather Partridge talks about how the state EITC has helped her family. Heather lives with her husband and three daughters in Gibsonville, where she works at Hardee’s and earns $7.55 an hour – just barely above the state minimum wage of $7.25. In past years, the EITC has helped Heather pay for everyday goods for her children as well as pay off debt.  Read More

Falling Behind in NC, NC Budget and Tax Center

As North Carolina continues to recover from the Great Recession, most of the jobs that have been added pay low wages, making affording even basic necessities difficult for many hard-working North Carolinians. Raising the state minimum wage and reinstating a state Earned Income Tax Credit (EITC) are two policy tools that North Carolina state lawmakers can use to help boost wages, widen the path out of poverty, and reduce income inequality, a report released this week by the Center on Budget and Policy Priorities (CBPP) highlights.

Wages for the least paid workers are no higher than they were 40 years ago, the CBPP report highlights. Yet evidence shows that lifting the income of families earning low wages provides a range of benefits, including improved learning and educational attainment and higher future earnings in adulthood for low-income young children. Furthermore, raising the minimum wage and an enhanced state EITC together works to put families and individuals on a path to financial stability and self-sufficiency. Read More

Falling Behind in NC

If you work hard and play by the rules, you deserve a chance to get ahead. This is why the Earned Income Tax Credit was invented: to help families with low-paying jobs make ends meet.

Unfortunately, North Carolina is the first state in 30 years to eliminate its Earned Income Tax Credit. This move abandoned a bunch of our neighbors, people with stories like Kara’s:

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There is no more stark illustration of why tax policy matters. With NC job growth coming primarily in low-wage industries, we’re going to need the Earned Income Tax Credit — and other measures that work for working people — more than ever.

 

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On the first day of a new fiscal year, it appears state Senators are in no rush to wrap-up budget negotiations with the NC House.

On Monday, the Senate rejected the House “mini-budget” that has the blessing of Governor Pat McCrory.  Senate President Pro Tem Phil Berger made it clear that without a more accurate assessment of Medicaid costs, his chamber was not prepared to make other budgetary decisions.

And with political observers now projecting the “short” session will last most of July, advocates are urging lawmakers to take time and reconsider restoring the state Earned Income Tax Credit.

The NC Budget and Tax Center calls the state EITC ‘a highly effective anti-poverty tool‘ with lasting, positive effects on children and low-income working families.

House Minority leader Rep. Larry D. Hall discussed the need to restore North Carolina’s EITC when he appeared last weekend on NC Policy Watch’s weekly radio show News & Views with Chris Fitzsimon. Click below to hear Rep. Hall’s remarks:

YouTube Preview Image Nearly one million families in the Tar Heel state —including 64,000 military families— benefited from the North Carolina EITC last year.