CARA Convention10/12/08Page No. 1 “I see one-third of a nation ill-housed, ill- clad, ill-nourished… The test of our progress is not whether we add more to the abundance of those who have much; it is whether we provide enough for those who have too little.” Franklin Roosevelt's second inaugural speech, from January 20, 1937

CARA, October 12, 2008 Lenny Goldberg Executive Director California Tax Reform Association Susie Smith Director, Californians for Economic Security Insight Center for Community Economic Development ( (510) x108 The budget disaster: Why it happened and Where to go from here

CARA Convention10/12/08Page No. 3 Presentation Overview The good, the bad and the ugly: Budget Cuts (Susie) Structural Budget Problems (Lenny) What to do about it? (Lenny) Introducing a new tool to fight the cuts: the Elder Economic Security Standard & Coalition (Susie) Discussion – Q&A

CARA Convention10/12/08Page No Budget Woes: “War on Seniors!” MAJOR cuts to safety net programs Many cuts will result in loss of federal match dollars Permanent TAX CUT = $965 million in lost revenue, starting 2011 Permanent suspension of state SSI COLA in 2008 and % of SSI recipients are disabled, 2% blink and 29% aged

CARA Convention10/12/08Page No Budget Woes: “War on Seniors!” Health-related issues: -Keeps 10% cut to Medi-Cal provider rates, until 3/1/09 (temporarily crt restraining order to implement) -Requires paperwork 2x/yr for children in Medi-Cal -Increases Healthy Families Program premium contributions for some families by $2-$3 per child/month -APS, line-item veto cut of $11.4 million Allows caps as low as $1,500 per child per yr for dental coverage provided to kids in Healthy Families Program -Reduces rates to health, dental, and vision plans that provide coverage thr the Healthy Families Program by 5%

CARA Convention10/12/08Page No Budget Woes: “War on Seniors!” Eliminates $11.7 million for the California Discount Prescription Drug Program $13.2 million reduction to CDA programs -Senior Community Employment Program -Multipurpose Senior Services Program -Alzheimer’s Day Care Resource Centers -Home Delivered Meals Programs -Senior Legal Hotline

CARA Convention10/12/08Page No Budget Woes, cont’d CalWORKS -Suspended COLA for CalWORKS grants for low-income families, 4 th year in a row! -$70 million line-item veto cut to funding that counties use to provide child care and help parents find work Other major cuts in Child Care & Development, K-12 Education, Higher Ed & Transportation!

CARA Convention10/12/08Page No. 8 How did we get here? Revenue background Long-term structural deficit: $6 billion from “car tax” cut Plus: $3 billion in paying off previous bonds (how we got through the last time) Plus: other transfers of funds from GF (Prop 42, 1A) Plus: good fortune for Schwarzenegger: abusive tax shelters and tax amnesty Plus: slowdown in growth = $15 billion

CARA Convention10/12/08Page No. 9 Budget agreement Cuts of $10 billion, including $3.3 in education from expected growth Vetoes: Senior rental and homeowner assistance Revenue accelerations, and future large corporate tax cuts: “carry backs” and credit manipulation “Securitizing” the lottery Future budget restrictions

CARA Convention10/12/08Page No. 10 Political environment Why so different from 1991 re 2/3 vote: -Few mod. Republicans (Wilson, Maddy,etc) -Term limits -Safe seats -Gingrich/Norquist takeover of Republican party: “no new taxes” as article of faith -The pledge -A perfect storm? Vs. Majority vote T4CF Organizing effort: Revenue and Republicans

CARA Convention10/12/08Page No. 11 What’s next? Lottery and budget restrictions on special election ballot, likely June 2009 Revenues also? Budget re-opened now, revenues and cuts? Already $3-5 billion in deficit Planning the turnaround, for the June 2010 ballot

CARA Convention10/12/08Page No. 12 Where do we go from here? Revenues: repeal permanent loopholes, add new revenues on the June 2010 ballot Short term revenue options: top brackets, loophole closing, oil, services Change 2/3 vote for taxes: “Taxpayer Right to Vote” as solution? Longer term (November 2012): reassess commercial property for cities, counties and schools = $5 billion [Option : Constitutional Convention]

CARA Convention10/12/08Page No. 13 What will it take to get there? Unity: labor, seniors, education, health care, public safety, etc The fiscal recovery/turnaround of California has to become a widely-shared priority Can we get there?

CARA Convention10/12/08Page No. 14 Elder Economic Security Standard: A New tool can help reframe the budget battle!! The Elder Economic Security Initiative is.. National, statewide, and local data- driven coalitions to help families and seniors make ends meet Part of a national movement, with grass- roots component Guided by state and regional steering committees

CARA Convention10/12/08Page No. 15 County-specific cost-of-living index for retired people 65 and older Min. Income needed for housing, food, health care, transportation, other basic needs Individual and Couple 3 Housing Types Based on public data sources CA Elder Economic Security Standard Index: New Tool for Round 2 of the Budget Battles

CARA Convention10/12/08Page No. 16 Elder Standard Examples San Francisco and Humboldt Counties Monthly Expenses San Francisco CountyHumboldt County Owner w/o Mortgage Renter, One Bedroom Owner w/o Mortgage Renter, One Bedroom Housing$418$1,239$368$551 Food$308 $231 Transportation$202 Health Care = Good$293 $378 20%$244 $236 Elder Standard Index Per Month $1,465$2,286$1,415$1,598 Elder Standard Index Per Year $17,580$27,432$16,985$19,176

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CARA Convention10/12/08Page No. 19 How the Standards Are Used As a budget & advocacy tool for advocates and policymakers Make case to protect against cuts (e.g. LAO’s office) Elder Standard demonstrates we need MORE, not less Media briefings Assembly Member Beall’s food hearing Create responsible and effective public policy SF, LA & statewide resolutions to modernize FPL CARA Resolution – thank you!!

CARA Convention10/12/08Page No. 20 But why not use the FPL to fight the budget cuts? Developed in , by Mollie Orshansky of the Social Security Administration Food Survey = 1/3 of after tax income on food -USDA thrifty food plan (designed for temporary or emergency use) x 3 = poverty Varied by family size, but not age Same amount in every state

CARA Convention10/12/08Page No. 21 Why not use the FPL to fight the budget cuts, cont’d? Based on 1950’s consumption patterns Incorporates outdated and inadequate food measure Measure of deprivation, not stability The inflation adjustment (CPI)

CARA Convention10/12/08Page No. 22 Building the Movement for Change Expand Coalitions Advance national momentum -Bloomberg’s recalculation of NYC poverty -Congressional hearings -Obama endorsement -Villaraigosa interest -CA Joint Resolution Unite family and elder economic security coalitions Expand research (e.g. demographic, LTC) Join the movement! Listserv, advisory committees

CARA Convention10/12/08Page No. 23 For more information on CFES, contact: Susie Smith or Jenny Chung Californians for Economic Security (CFES) Insight Center for Community Economic Development Oakland, CA or (510) 251- To find the Family and Elder Standards for your county, go to: 1)Elder Standard: standard-county standard-county 2)Family Standard: Contact Information