1. Families at Work Families at Work Houston Conference on Children June 15, 2005 Don Baylor Policy Analyst Celia Hagert Policy Analyst Center for Public Policy Priorities

2. Introduction Family Security Index – “Making It” Tough Choices Report Families at Work Need: –Good Jobs –Pathway to Better Jobs through Education –Work Supports (Child Care, Nutrition/Cash/Health Benefits) –Asset Building (Savings, Financial Literacy) Of Note in the 79 th Legislature Next Steps

3. Family Security Index Alternate Measure of Family Economic Security (vs. “Federal Poverty Level”) Based on the Cost-of-Living (Housing, Health, Food, Child Care, Transportation, Miscellaneous) 27 MSAs, 8 Family Types Compares Wages Necessary to Meet Basic Needs vs. Actual Wages (as Percentage of FPL) Family Security Portfolio = Wages/Benefits, Work Supports, Private Assistance

4. Center for Public Policy Prioritieswww.cppp.org Alternate measure of family economic security (vs. “Federal Poverty Level”) Based on the cost-of-living (housing, health, food, child care, transportation, miscellaneous) 27 MSAs, 8 family types Compares the gap between

5. Center for Public Policy Prioritieswww.cppp.org Alternate measure of family economic security (vs. “Federal Poverty Level”) Based on the cost-of-living (housing, health, food, child care, transportation, miscellaneous) 27 MSAs, 8 family types Compares the gap between

6. Texans at Work FSI: Families Need Twice to Three Times FPL in Income just to Pay for the Basics One-Third of Working Families are Low-Income (1.2 million) 46 Percent of Children Live in Low-Income Families (1.5 million) 59 Percent of these Families have Earnings that Place them above the Official Federal Poverty Level 200% of FPL = $32,180 for a Family of Three in 2005

7. Tough Choices So, What Does it Mean to Earn so Little? Tough Choices Conducted in-depth Interviews with 6 Families with Income Below 200% of FPL: –Urban/Rural –One - and Two - Parent/Adults without Children, –Racially/Ethnically Diverse Family/Employment History; Difficulties Making Ends Meet; Social Services (Public and Private) used; and “Social Capital” (Help from Family and Friends)

8. Tough Choices Center for Public Policy Prioritieswww.cppp.org Hardships: Housing/Utilities, Transportation, Food, Child care, Crises “Earning More, Keeping Less” Phenomenon Coping Strategies: Two Jobs/Odd Jobs, Public/Private Assistance, Reliance on Friends/Family, Short-Term Loans/Pawn Shops Consequences: Never get Ahead; no Savings (Treadmill Effect); Stress

9. Tough Choices Families 6: Report Trouble 1) Affording Housing Costs; 2) Making Ends Meet Due to Emergencies or Unanticipated Expenses; 3) Stress and Emotional Hardship Caused by Constant Money Worries 5: Report Working More than One Job or Combining Regular Employment with Odd Jobs to Piece Together Enough Earnings to Pay the Bills 4: Have Unpaid Medical Bills or have Postponed Medical Care Because they can’t Afford it 3: Report Unpaid Child Support 2: Have Children under 18 who Contribute Earnings from their Jobs to Augment the Family’s Income

10. What Help do Working Families Need? Center for Public Policy Prioritieswww.cppp.org Good Jobs and Higher Wages (Workforce/Economic Development) Pathway to Better Jobs through Education (Public Schools, Community Colleges) Work Supports (Child Care, Nutrition/Cash/Health Benefits) Asset Building (EITC Outreach, Savings Opportunities, Financial Literacy)

11. What is Economic Development? Incentives (Cash-based, tax-based)? Mega projects? Free the Markets? Workforce Development, Community Development, or Asset Development? Education and Training? Minimum Wage?

12. Of Note in the 79 th Legislature: Work Supports Center for Public Policy Prioritieswww.cppp.org 78 th Cuts: What got Restored, What Didn’t Medicaid/CHIP (see “Children’s Health Care and More”) Bill to Repeal TANF Full-Family Sanctions Failed Bill to Allow Drug Felons to Receive Food Stamps Failed Child Care Subsidies for Working Families CUT from 87,000+ kids served now t0 84,000+ by 2007

13. Of Note in the 79 th Legislature: Workforce/Economic Development Center for Public Policy Prioritieswww.cppp.org Enterprise Fund: Accountability & Reporting Employment Training Investment Assessment (Skills Development Fund Increased) Minimum Wage Bills—Failed Community College Cuts Restored Workers Compensation Reform

14. Of Note in the 79 th legislature: EITC Center for Public Policy Prioritieswww.cppp.org HB 401 Requires the Attorney General to Inform Child Support Obligors of “VITA” Services; Health and Human Services Commission Required to Provide EITC Educational Materials, Tax Forms, and VITA Site Information to HHS Clients Despite some Good Effort, no Bill Restricting the Activities or Fees of Paid Tax Preparers or Refund Anticipation Loans

15. Of Note in the 79 th Legislature: Financial Literacy Center for Public Policy Prioritieswww.cppp.org HB 900 Requires the Texas Workforce Commission to Distribute Financial Literacy Materials to their TANF and Workforce Clients HB 492 Requires High Schools to Incorporate Financial Literacy Instruction into One or More Courses that are Required for Graduation

16. Of Note in the 79 th legislature: Individual Development Accounts Center for Public Policy Prioritieswww.cppp.org Bills filed (HB 2450/SB 1538) to Establish/Fund Statewide Individual Development Account Program Didn’t Pass Despite Unanimous, Bipartisan Support (Amended to HB 2233, Died on Unrelated “Point of Order” on Last Day of Session) Groundwork Laid to Advocate for IDA Program During the Next Session

17. Of Note in the 79 th legislature: Predatory Lending Center for Public Policy Prioritieswww.cppp.org Industry-backed “Payday” Loan Bill (HB 846) Defeated by CPPP/Consumer/Religious Coalition Bill would have Tripled Payday Loan Interest Rates Allowed under Texas Law What’s a payday loan? A payday loan is a short-term, high-interest loan that some low-income Texans rely on when they have trouble paying their bills between paychecks. These storefront lenders charge exorbitant interest rates — sometimes as high as 800 percent — in addition to high “rollover” fees that extend the loan when borrowers can’t repay it on time. Payday loans take advantage of low-income families desperate for fast cash and can trap borrowers in a spiral of debt.