Now that the federal tax bill has passed, California’s upcoming budget for fiscal year 2018-19 has been presented by Governor Jerry Brown partly in light of those expected federal tax impacts.
The state budget is a fairly strong one for key portions of spending, notably for K-12 education. That said very little has been done to alleviate the continued scourge of poverty that plagues every county in California.
The Governor has a priority – one we opposed until we have a significant commitment to ending poverty – and that is building the ‘rainy day fund’. We agree that being fiscally responsible is a necessary social good. The slow increase in prosperity over the past 8 years is no longer reliable. Nationally the unemployment figures rose this past month for the first time in years, and anecdotal reports of plant closures, layoffs, and other worrisome signs point to a coming destabilization.
That said, there is a rise in housing costs in California that are the key source for poverty. Not one county finds rents or mortgage costs sustainable with the median incomes for that county, certainly not for those living on minimum wage even in a two-earner household.
CalWORKs. Even with poverty unrelenting, and extreme poverty growing, with homelessness on the increase, none of these issues has been tackled in this year’s budget. For the years of budget shortfalls, CalWORKs, our state’s Welfare-to-Work program, was the ‘cash cow’ milked to supply funds to balance the budget. CalWORKs has a lifetime limit of four years – but too few resources are devoted to providing real training and job skill improvements. Thus people go into it poor and emerge just as poor as they were.
The result is that those seeking CalWORKs assistance to get out of poverty were just more deeply mired. Their cash grants are now less than they were before the 2008 crash even as rents have skyrocketed. Cash grants are variable, but for a family of three with at least one able bodied person who could work, the cash grant – from which rent is paid – is $714. The median rent for a 1-bedroom apartment in Sacramento is $1088. Obviously this does not square up for needy families.
Yes, CalWORKs recipients also get food assistance and health care, but you can’t pay rent with your food allowance.
Housing. There is precious little Section 8 housing in most counties. That’s the Federal Housing program that supplements low-income tenants so they pay 1/3 of their income and the government pays the rest. This assistance is slated to be ended by the federal authority. And then what will people do?
Our state budget has allotted significant funding to the Department of Housing and Community Development, but implementation depends on local actions. Whether the funds are for new construction, conversions of existing buildings, or some other strategy, counties and cities must take advantage of them, and too little is being done. Funds are needed now to jump start creation of permanent supportive housing. The Governor needs to release funds immediately and then increase the use of low-income housing tax credits.
Health Care. One of our biggest concerns is health care. While California continues to enroll and support those using the Affordable Care Act (Covered California), the uncertainty in the new federal tax bill about continued subsidies is deeply worrisome. With the individual mandate removed federally, the subsidy is considered by some to be unnecessary. However, removal of the subsidy put the costs of insurance on either the state or the individuals. It moves us back where we were before the ACA was enacted – the Yoyo principle: You’re On Your Own.
Of more concern is the new threat to take Medicaid (Medi-Cal here) from anyone who isn’t working. That would impact every aged person in nursing homes whose insurance either doesn’t exist or has been used up; children, those with disabilities, and the older homeless populations who never could get hired after the 2008 recession. Medi-Cal has been a huge benefit to the latter group improving the health of the long-term homeless unemployed.
Taking this away guarantees an increase in emergency room costs, uncompensated care payouts to hospitals, and less healthy populations on our streets. Hospitals were notorious about “patient dumping” of the indigent – turning them out onto Skid Row with no resources at all – before Medi-Cal covered the childless adults in those situations.
Unless we want to create Dickensian “work houses” where the aging unemployed do terrible jobs to get health care, we need to be prepared for perpetuating their support with our tax resources. This year’s budget does nothing to get ready for that.
What Will We Need to Do? This current administration has been fairly good to the low-income working population but persistently heartless to those with no resources. It is only from our unrelenting pressure that we ended the maximum family grant that prohibited CalWorks income for children born to people enrolled, that we have increased the housing allotments for low income housing development.
In the coming year California Church IMPACT will fight for a much greater commitment to ending poverty in California. We will address not only new legislation and budget items but talk about implementation of existing programs at the local level.
It will take all of us speaking with and for those in need to find new strategies and solutions to the poverty of our state. In a world of such abundance and wealth as we have in California, we cannot allow inequality to fester and grow. It is up to us as the voice of compassionate faith to be present for justice everywhere we can.
We will keep you posted on actions and advocacy you can assist this coming year. We are seriously challenged as rarely before to put our faith in action for those who need us.