Tag: poverty

The long-term benefits of the Earned Income Tax Credit

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May 3, 2013 at 4:33 pmCategory:NC Budget and Tax Center

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Research has long shown that the Earned Income Tax Credit (EITC) for working families significantly encourages work—especially among single mothers—and reduces child poverty more than any other existing policy tool. Although the EITC is largely a temporary support, new research by the Center on Budget and Policy Priorities indicates that this tax credit generates broader benefits that extend well into adulthood for the recipients’ young children. These children perform better in school, are more likely to go to college, and earn more when they reach adulthood.

For instance, a $3,000 boost in income from the EITC during a child’s early years is associated with a boost in educational achievement that is equivalent to an extra two months of schooling. And as illustrated in the infographic below, a boost in income from the EITC during a child’s early years can contribute to a significant increase in earnings in adulthood as well as increased work activity for individuals between the ages of 25 and 37. Read More…

State lawmakers seek to restrict NC Pre-K eligibility based on flawed poverty threshold

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May 1, 2013 at 9:56 amCategory:NC Budget and Tax Center

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Yet again, North Carolina legislators are moving a bill (HB 935) through the House chamber that would limit participation in NC Pre-K, the state’s nationally-ranked public pre-kindergarten program. The bill would lower the “at-risk” eligibility standard to 100 percent of the federal poverty line (FPL), which is $23,550 for a family of four. The current income threshold is set at three-fourths of the state median income, or nearly one-third higher than the FPL for a family of four. Even the existing threshold falls short. Research shows that families up to, and sometimes above, twice the FPL experience many of the same material hardship as families who are poor, meaning they too struggle to make ends meet and secure the basics for their children.

A change in the income threshold would close the door on early learning for approximately one-third—or 10,000—of the children currently enrolled in the NC Pre-K program. There are nearly 11,700 children on the waiting list. Read More…

Governor’s budget wipes out funding for economic development programs in distressed, minority communities

April 11, 2013 at 8:30 amCategory:NC Budget and Tax Center

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Like all budgets, Governor Pat McCrory’s proposed spending plan for FY2013-2015 is based on a set of ideas about how the world works—what spurs economic growth, what creates jobs, and the most effective ways of using state government to achieve these goals.  Unfortunately, his proposal for economic development represents quite a few bad ideas, including the sharp reduction in spending for economic development nonprofits that receive state funding through the Commerce-State Aid portion of the budget.  These nonprofits provide vital economic development resources for historically disadvantaged and persistently distressed communities and minority populations. 

At the same time, he proposes boosting spending on industrial recruitment and other traditional economic development activities that will likely bypass the communities benefitting from the work of these nonprofits, if any meaningful job creation or economic growth is generated at all.  Read More…

New report: Low-wage workers squeezed out of affordable rental housing

March 12, 2013 at 10:12 amCategory:Uncategorized

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This is from a release distributed this morning by the North Carolina Housing Coalition:

High rents make housing unaffordable for many in Raleigh-Cary

Raleigh, N.C. –Renters in the Raleigh-Cary area need to earn $16.88 per hour in order to afford a basic apartment here, according to a report released today that compares the cost of rental housing with what renters can really afford.

The report, Out of Reach 2013, was jointly released by the National Low Income Housing Coalition, a Washington, D.C.-based research and advocacy organization, and the North Carolina Housing Coalition. The report provides the Housing Wage and other housing affordability data for every state, metropolitan area, combined non metropolitan area, and county in the country. The Housing Wage is the hourly wage a family must earn, working 40 hours a week, 52 weeks a year, to be able to afford the rent and utilities for a safe and modest home in the private housing market. Read More…

Prosperity Watch: The Earned Income Tax Credit Benefits Working Families Across North Carolina

February 27, 2013 at 1:32 pmCategory:NC Budget and Tax Center

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As tax filing season rolls around, many North Carolina families and communities across the state will benefit from the Earned Income Tax Credit (EITC), an important tax break designed to reward work and offset federal payroll and income taxes paid by low-wage workers.  But as the latest issue of Prosperity Watch explains, some communities rely on this credit more than other communities, since some are more economically distressed than others.  As a result, there are significant differences across the state’s counties in terms of the percentage of tax filers in each county that claim this credit, and many of the counties with the highest percentage of filers are clustered in one of the state’s poorest regions. See Prosperity Watch for details.