Inside the Statehouse 2014: Week 9

The following is an overview of activity surrounding legislation the Institute is monitoring this week, followed by legislation on next week's agenda. Here is a comprehensive list of all legislation the Institute is tracking this session. Legislative calendars are subject to change. Please check back for updates.

This week was the Third Reading deadline for legislation in the House and Senate and the start of conference committees to reconcile differences in the bills that have passed both chambers. Work Sharing was offered as a Second Reading amendment to HB 1346 Unemployment Insurance by Senator Karen Tallian (D-Portage) but failed on a voice vote. The Senate advanced a bill that would cut business personal property and corporate taxes; strengthen child care safety standards; study and make recommendations on career and technical diplomas; and mandate drug testing of convicted felons receiving TANF. The House voted in favor of a mass transit initiative in Central Indiana; legislation that establishes charter schools for adults, and nixed proposed language that would have set an expiration date on Indiana’s State Earned Income Tax Credit, which, along with the Child Tax Credit, kept over 100,000 Hoosier children out of poverty between 2010 and 2012. 

Next Friday, March 14, is the deadline for the General Assembly to send bills to the Governor for his signature. Anything can happen during conference committee negotiations, so follow us on Twitter @INInstitute and use the hash tag #INlegis for all updates.  

This Week 

HB 1351: Welfare Matters

Description: Welfare matters; drug testing. Requires the division of family resources to establish a statewide program that prohibits Temporary Assistance for Needy Families (TANF) assistance from being used for any food, food product, or beverage that is not permitted to be purchased under the Supplemental Nutrition Assistance Program (SNAP) program. Requires the office of the secretary of family and social services to administer a drug testing program (program) for individuals who have been convicted of a controlled substance offense and are applying for or receiving TANF assistance or receiving TANF assistance on behalf of a child. 

Last Action Taken: Passed the Senate 34-14; House dissented from Senate amendments; in Conference Committee. 
Position - Oppose (see testimony): While barriers to self-sufficiency do include substance abuse and addiction, there are more effective solutions within TANF itself to combat substance abuse. See our recommendations here for policy changes that would instead help Hoosier families transition off of welfare.

HB 1001: State and Local Taxation 
Description: Specifies that if the acquisition cost of a taxpayer's business personal property in a county is less than $20,000 for a particular assessment date in 2016 or later: (1) the taxpayer is not required to file a personal property return for the taxpayer's business personal property in the county for that assessment date; and (2) the taxpayer's business personal property in the county is exempt from taxation for that assessment date. Phases down the corporate income tax rate from 6.5% in 2015 to 4.9% after June 30, 2021. Phases down the financial institutions tax rate to 4.9% in calendar year 2023. 
Last Action Taken: Passed the Senate 33-15; House dissented from Senate Amendments, heads to Conference Committee. 
Position - Oppose.  Taxpayers and communities have already been squeezed to provide essential services and have yet to feel the full impact from previous cuts in the corporate income tax. From the Indiana Fiscal Policy Institute: "Research on the effects of taxes on development is not precise, but most studies find the effects to be relatively small. The associated reductions in public services valued by businesses might also limit the effects on development. the majority of existing alternatives for raising revenue locally will fall on individuals rather than businesses – and could represent yet another shift of the tax burden." 

HB 1020: Economic Development Incentives
Description: Requires the commission on state tax and financing policy to review, analyze, and evaluate state and local tax incentives that are provided to encourage economic development or to alter, reward, or subsidize a particular action or behavior by a tax incentive recipient. Provides that certain income tax credits (which were reviewed by the commission on state tax and financing policy in 2012 and 2013) expire on January 1, 2020. Language that would have let Indiana's EITC sunset was removed. 
Last Action Taken: Passed the Senate 41- 8; House dissented from Senate Amendments, heads to Conference Committee. 

SB 176: Central Indiana Transit
Description: Provides for the establishment or expansion of public transportation services in an eligible county through local public questions placed on the ballot under ordinances adopted by the fiscal body of the eligible county. Provides that Delaware County, Hamilton County, Hancock County, Johnson County, Madison County, and Marion County are eligible counties. Authorizes interlocal agreements, public-private partnerships, and bonding with respect to a public transportation project. Requires that fares must cover at least 25% of the operating costs of a transportation system established or expanded under the bill. Requires that revenue derived from sources other than taxes and fares must cover at least 10% of the operating costs of a transportation system established or expanded under the bill. Requires goals for participation by minority business enterprises, veteran business enterprises, and women's business enterprises in the development of a public transportation project.
Last Action Taken: Passed the House 52-47; Senate dissented from House Amendments, in Conference Committee. 
Position - Support: A step in the right direction towards providing greater accessibility for low-income workers in Indiana to travel to and from work. 

HB 1213: Career and Technical Education; Dual Credit Courses
Description: Requires the Indiana career council to appoint a subcommittee that includes a member of each council and representatives of high school career and technical education programs, the department of education, community colleges, the commission for higher education, and industry to: (1) review the current Core 40 diploma course offerings; (2) make recommendations to the state board of education concerning changing course requirements, including the total number of academic credits required, changing the types of diplomas offered, and the need for a career and technical education diploma; and (3) examine and make recommendations concerning career and technical education offerings. Makes changes to the provision regarding the number of dual credit or advanced placement courses that must be provided by a high school. Provides that a student who is enrolled in a dual credit course must achieve at least a 2.0 on a 4.0 unweighted grading scale to enroll in subsequent related dual credit course work in the same subject area.
Last Action Taken: Passed the Senate 41-7; Motion to Concur in Senate Amendments: prevailed 87-0. 

HB 1036: Child Care and Development Fund Eligibility. 
Description: Specifies health, education, safety, and training requirements that a child care provider must meet as a condition of eligibility to receive a federal Child Care and Development Fund voucher payment. Provides for decertification of eligibility. Requires certain reporting related to safety of children. Requires certain information to be prepared and distributed concerning the duty to report known or suspected child abuse or neglect. Allows the state department of health to release to certain child care providers information from the immunization data registry.
Last Action Taken: Passed the Senate 36-12; House dissented from Senate Amendments, heads to Conference Committee.

HB 1064: Study of Career & Technical Education Programs
Description: Requires the Indiana career council to complete not later than August 1, 2014, a return on investment and utilization study of career and technical education programs in Indiana.
Last Action Taken: Motion to Concur in Senate Amendments: prevailed 90-0.

Next Week

The General Assembly will continue meeting in conference committees for the final week of the 2014 legislative session. Typically composed of four legislators (aka conferees - one from each caucus in both chambers), conference committees are intended to resolve the differences between amended bills in the House or the Senate (those bills that weren't amended as they traveled through both chambers were sent to the Governor for his signature). After several meetings, the results of these changes will be brought to the House or Senate floor for a final vote on a conference committee report.

Note: we'll send a separate email calling for specific action on particular legislation. For the time being, you can contact your legislator here. To see previous Inside the Statehouse blogs, please visit our archives.

The Increasingly Unequal State of Indiana

By Derek Thomas

Over the past 30 years, the top 1% of Indiana earners captured nearly half of all income increases and saw their incomes grow by nine times that of the remaining 99% of Hoosiers. 

In a new report from the Economic Analysis Research Network - The Increasingly Unequal States of America: Income Inequality by State - Estelle Sommeiller and Mark Price conduct a state-level analysis of income trends from 1917-2011. According to Sommeiller, a socio-economist at the Institute for Research in Economic and Social Sciences: “Our study shows that this one percent economy is not just a national story but is evident in every state, and every region.” Nationally, the authors found that from 1979 through 2007, the top 1% captured 53.9% of the total increase in U.S. income. During this time period, the average income of the bottom 99% grew by 18% while the top 1% saw income growth mushroom by 200%.  

Employing the authors' data, here's a closer look at the increasingly lopsided Hoosier economy, which by the way, was in motion decades before the Great Recession began:

• From 1979 through 2007 the top 1% of Hoosiers seized a disproportionate 46.5% of total increase in income. While 99% of Hoosiers saw incomes grow by 13%, the top 1% saw incomes balloon by 115%. 

• From 1979 through 2011 (the latest data available, and accounting for all losses at all income levels as a result of the Great Recession), the top 1% saw real income grow by 68% while the remaining 99% saw a 6% decline (Figure A). In contrast, worker productivity soared during this period (Figure B). 
• These trends persist in the two years following the Great Recession; the top 1% captured 8.1% of all income growth, while the share for the remaining 99% of Hoosiers has been an almost non-existent 0.4% (Figure C). 

• The share of income held by the top 1% has reached levels not seen since the gilded-age of the early twentieth century. Since 1979 their share has increased from 8.6% to 14.4% in 2011 (Figure D).
• In Pulling Apart - a state by state analysis of top, middle and bottom fifth income growth from Economic Policy Institute and Center for Budget and Policy Priorities, the authors found that in Indiana, the "pulling apart" is a result of the "poor getting poorer." From the late 1970's through the mid 2000's, Indiana was among 7 states in which average incomes of the bottom fifth of households declined - only 3 states saw greater declines than Indiana. And, from the mid 1990's through the mid 2000's, the bottom fifth of Hoosier households saw the nation's greatest percent decline in average incomes. 

While the challenges to Indiana's economy over the past several decades are not much different than many rust belt states, and recently, not much different than the rest of the U.S., public policy choices have compounded the plight of working Hoosier families. During this era of lopsided growth, state-level policies have disproportionately benefited higher-income households (shifting the responsibility of funding critical government services toward middle and low-income Hoosiers), and actively weakened our work support and social safety net system. Instead of a rising tide that lifts all boats, just a few are riding high, while most families are anchored underwater.

If Indiana truly wants to be "a state that works" for all Hoosier families, it's more critical than ever that policymakers begin to provide a toolbox of meaningful and significant state policies and investments that restore mobility and raise the standard of living for millions of hard working Hoosiers to strengthen the state's middle class. To do this, lawmakers should reward hard working Hoosiers by ensuring they share in economic growth; strengthen work support programs for our most vulnerable citizens, and; equip all Hoosiers with the opportunity to obtain the skills necessary in order to attract high‐paying, quality jobs that are necessary for a family’s economic self‐sufficiency. 

Figure A: Real Income Growth - Indiana -1979 through 2011

Sommeiller and Price, The Increasingly Unequal States of America:  Income Inequality by State, 1917 to 2011

Figure B: Growth of Real Hourly Median Compensation for Production/Non Supervisory Workers and Productivity - 1979 through 2011
(If the minimum wage had kept up with productivity, it would be near $18.75 today.)

EPI Analysis of Unpublished Total Economy Data from Bureau of Labor Statistics, Labor Productivity and Costs Program; Employment Data from BLS, Local Area Unemployment Statistics; and Bureau of Economic Analysis, State/National Income and Product Accounts .

Figure C: Real Income Growth - Indiana - 2009 through 2011

Sommeiller and Price, The Increasingly Unequal States of America:  Income Inequality by State, 1917 to 2011

Figure D: The Share of All Income Held by the Top 1% - Indiana -1917 through 2011

Sommeiller and Price, The Increasingly Unequal States of America: Income Inequality by State, 1917 to 2011

For more information: 

• Read the full report - The Increasingly Unequal States of America here.
• See the Indiana Fact Sheet here.  
• See Lopsided Income Growth Tables here. 
• See Interactive Graphic of Top Income Shares by State here.
• See More on Income Inequality in Indiana (with a related feature on the Cliff Effect) from 'The Unequal States of America - A Reuters Series'. 
• Infographic: Pulling Apart - Income Inequality Has Grown in Indiana.

Inside the Statehouse 2014: Week 8

The following is an overview of activity surrounding legislation the Institute is monitoring this week, followed by legislation on next week's agenda. Here is a comprehensive list of all legislation the Institute is tracking this session. Legislative calendars are subject to change. Please check back for updates.

This week the Indiana House and Senate wrapped up committee hearings for the 2014 legislative session. Next week will be second reading deadlines.  Work Sharing has still not been given a hearing. The legislature did advance bills that would: allow the Earned Income Tax Credit to expire; benefit students and providers of career and technical education diplomas; establish a Pre-K study commission, and; allow Hoosiers in Central Indiana to vote on a mass transit funding plan. Next week is the deadline for House bills to pass out of the Senate and Senate bills to pass out of the House.  

This Week 

HB 1351: Welfare Matters

Description: Welfare matters; drug testing. Requires the division of family resources to establish a statewide program that prohibits Temporary Assistance for Needy Families (TANF) assistance from being used for any food, food product, or beverage that is not permitted to be purchased under the Supplemental Nutrition Assistance Program (SNAP) program. Requires the office of the secretary of family and social services to administer a drug testing program (program) for individuals who have been convicted of a controlled substance offense and are applying for or receiving TANF assistance or receiving TANF assistance on behalf of a child. 

Last Action Taken: Passed Appropriations Committee 7-4; now on Second Reading.
Position - Oppose (see testimony): While barriers to self-sufficiency do include substance abuse and addiction, there are more effective solutions within TANF itself to combat substance abuse. See our recommendations here for policy changes that would instead help Hoosier families transition off of welfare.

HB 1001: Tax Exemption for New Personal Property
Description: Provides that a county income tax council may adopt an ordinance to exempt from property taxation any new business personal property (other than utility personal property) that is located in the county.
Last Action Taken: Passed Tax & Fiscal Policy Committee 8-4; Engrossed. 
Position - Oppose.  Taxpayers and communities have already been squeezed to provide essential services. From the Indiana Fiscal Policy Institute: "Research on the effects of taxes on development is not precise, but most studies find the effects to be relatively small. The associated reductions in public services valued by businesses might also limit the effects on development. the majority of existing alternatives for raising revenue locally will fall on individuals rather than businesses – and could represent yet another shift of the tax burden." 

SB 176: Central Indiana Transit
Description: Provides for the establishment or expansion of public transportation services in an eligible county through local public questions placed on the ballot under ordinances adopted by the fiscal body of the eligible county. Provides that Delaware County, Hamilton County, Hancock County, Johnson County, Madison County, and Marion County are eligible counties. Authorizes interlocal agreements, public-private partnerships, and bonding with respect to a public transportation project. Provides that if a transportation project is approved in an eligible county, transportation services must be provided through the transportation project throughout the eligible county and must be made available under this article to all citizens of the county. Prohibits an eligible county from carrying out a light rail project. 
Last Action Taken: Passed Ways & Means Committee 17-1; Engrossed. 
Position - Support: A step in the right direction towards providing greater accessibility for low-income workers in Indiana to travel to and from work. 

HB 1004: Prekindergarten Study Commission

Description: Establishes the prekindergarten and early learning study commission.

Last Action Taken: Passed the Senate 44-5; Returned to the House with amendments. 
Position - Support: Indiana is among 11 states with zero state funding for 3 and 4 year olds to participate in pre-k, and while the research on the benefits of early childhood education are abundant (particularly for low-income children who face barriers to economic mobility as adults), examining (and implementing) the right design for Indiana is an action that is long-overdue. 

HB 1020: Economic Development Incentives
Description: Requires the commission on state tax and financing policy to review, analyze, and evaluate state and local tax incentives that are provided to encourage economic development or to alter, reward, or subsidize a particular action or behavior by a tax incentive recipient. Provides that certain income tax credits (which were reviewed by the commission on state tax and financing policy in 2012 and 2013) expire on January 1, 2020.
Last Action Taken: Passed the Senate 41- 8. Returned to the House with amendments. 
Position - Oppose: This bill, along with SB 367, includes the expiration of Indiana’s State Earned Income Tax Credit. SB 367 states that a taxpayer may not claim the credit after December 31, 2016 and sets the credit to expire completely from Indiana law on January 1, 2018.  HB 1020 sets the expiration of the credit at January 1, 2020, but does not include an end date for taxpayers to cease filing for the credit.  The Earned Income Tax Credit is one of our most effective anti-poverty tools. According to a projection analysis by the Institute on Taxation and Economic Policy back in 2011 (the last time this tax increase was considered), reducing or repealing Indiana’s EITC could amount to an 82 million dollar tax increase on our most vulnerable families. Thirty-four percent of those in the LOWEST income quintile and 15 percent of all Indiana tax payers will experience a tax increase, meaning more families would fall into poverty if the State EITC were changed. 

SB 330: Better Skills for Adult Learners
Description: Requires the commission for higher education to award part-time student grants totaling at least 50% of the available appropriation each fiscal year to adult students who are pursuing a program of study that will lead to a specific high demand, high wage job. Requires the commission to submit not later than November 1, 2014, to the legislative council a report that provides information about the part-time student population in Indiana, including the population's size, its financial need, its completion rates, and recommendations for increasing the population's completion rates using financial support and student incentives.
Last Action Taken: Passed the House 93-0; Returned to the Senate with amendments.
Position - Support: The study of part-time learners will be a positive step forward for this population, which makes up nearly half of all Indiana college students. This measure is also a policy priority for the Indiana Skills2Compete Coalition.

HB 1064: Study of Career & Technical Education Programs
Description: Requires the Indiana career council to complete not later than August 1, 2014, a return on investment and utilization study of career and technical education programs in Indiana.
Last Action Taken: Passed the Senate 49-0; Returned to the House with amendments. 

HB 1181: Career & Technical Education Centers
Description: Provides that a school corporation career and technical education center may receive a grant from the Indiana safe schools fund. Provides that a school corporation career and technical education center may receive an advance from the common school fund. 
Last Action Taken: Passed the Senate Education Committee 10-0. 

Next Week

SB 159: Charter Schools 

Description: Adds a definition of an "adult high school." Repeals a provision that prohibits the establishment of new adult high schools. Provides that an adult high school may only be authorized by the Indiana charter school board or the Indianapolis charter school board. Provides that, after June 30, 2014, before an authorizer may grant a charter to establish or renew a charter for an adult high school, the organizer must have the proposal approved by the budget committee. Requires a charter for an adult high school to contain certain requirements. Provides that, with certain exceptions, for state fiscal years beginning after June 30, 2014, an adult high school is not entitled to receive funding from the state unless the general assembly enacts an appropriation for the adult high school. Provides that an adult high school is subject to alternative accountability system established by the state board. Provides that certain authorizers may collect a 3% administrative fee from the amount appropriated to an adult high school. Requires the office of management and budget to study adult high schools and educational alternatives for students who: (1) are at least eighteen (18) years of age; and (2) have dropped out of high school before receiving a diploma.

Last Action Taken: Passed the Education Committee 12-0; Engrossed. 

Hearing Time & Location: Monday, March 3, 2014, 1:00 PM, House Chambers. 

SB 225: Various State & Local Financial Matters 
Description: Eliminates the requirement that excess state general fund reserves are to be carried over each year for purposes of determining a transfer to the pension stabilization fund and an automatic taxpayer refund. Reduces the number of hard copy documents a state agency must provide to the state library. Permits the state library foundation to choose to have its annual audit performed by an independent certified public accountant or by the state board of accounts. Provides that Indiana Academy of Science (Academy) shall the publish the Academy's annual report of the Academy's meetings. Modifies per campus limits on the amount of outstanding bonds that a state educational institution may issue for qualified energy savings contracts.Last Action Taken: Passed Ways & Means Committee 20-0; Engrossed. 
Hearing Time & Location: Monday, March 3, 2014, 1:00 PM, House Chambers. 

Note: we'll send a separate email calling for specific action on particular legislation. For the time being, you can contact your legislator here. To see previous Inside the Statehouse blogs, please visit our archives.

14 Reasons to Raise Indiana's Minimum Wage in 2014

By Derek Thomas

In 2013, 13 states passed legislation to increase the minimum wage. In the spirit of 2014 (this post is a little late, but not too late), we've laid out 14 compelling reasons the Indiana General Assembly should resolve to be the 14th state to reward hard working families by providing them with the raise they deserve: 

1. Wage Erosion: When comparing the value of the minimum wage today with the minimum wage in 1968 and inflating it to 2012 dollars, the 1968 minimum wage would equate to $10.77. Because the value of the minimum wage has been left to erode due to inflation, more workers are earning poverty wages.
2. Inequality: Reducing the erosion of wages would be a good step towards reducing inequality. Indiana saw the 6th greatest increase in income inequality from the 1990’s through mid‐2000’s. See 'Pulling Apart - an Indiana specific infographic from the Center on Budget and Policy Priorities.
3. Working Harder For Less: Working families have not shared in the gains of productivity. If the wage floor in Indiana were indexed to Hoosier productivity, it would be about $18.75 per hour. From 2009 - 2012 alone, productivity increased by 4.5% for all occupations, while real median wages declined by 2.8%, according to the National Employment Law Project.
4. Race to the Bottom: 5.2 percent of Hoosiers make at or below minimum wage. That's more than all neighbor states (excluding Kentucky - it's a tie) and the U.S. average of 4.7% (5.2% represents 50,000 at minimum wage and 43,000 below minimum wage). 
5. 637,000: That's how many Hoosiers (23.4% of the workforce) would get a raise according to a new report from the Economic Policy Institute. This includes those affected directly (436,000 making less than $10.10) and indirectly (201,000 making just above the minimum wage whose wages would be pushed up due to pay scale adjustments).
6. $1,000,000,000: According to the same analysis, this large scale policy tool for working families would equal a cumulative raise of one-billion dollars.  Like unemployment insurance benefits or tax breaks for low- and middle-income workers, raising the minimum wage puts more money in the pockets of working families when they need it most.
7. 23 Years Without a Raise: Waiters and Waitresses make $2.13 per hour. The last time they saw a raise was 1991. See this analysis from Massachusetts Budget project: in the 7 states that require employers to pay tipped workers the same as all minimum wage workers, poverty is substantially lower.
8. Not All Low-Wage Jobs Are Created Equal: Nationally, nearly 2/3rds of tipped workers are women, and Indiana is 1 of 5 states – along with Alabama, Arkansas, Louisiana and Mississippi – in which more than 7 in 10 minimum wage workers are women. According to this analysis of the EPI report from GovBeat, 20% of female workers in Indiana would be directly affected. 
9. Gender Gap: Suffice to say, with women earning just $0.73 cents to their male counterpart (the 6th largest gender gap in the U.S.), increasing the tipped minimum wage is a good step towards equal pay. 
10. It's Not Just for Teens Anymore: The Wall Street Journal showed this past weekend that less than 12% of those that would benefit are under 20 years old. From Sarah Jackson and Elizabeth at Brookings Institution on the recent shift in low-wage worker demographics: "The typical worker likely to be affected by a raise in the minimum wage today is a woman in her 30's working full-time, with a family to support."  Speaking of families to support, Indiana is among eight states where over a quarter (25.5%) of children have a parent who would benefit from the minimum-wage increase.  
11. Self-Sufficiency: In order to afford the Fair Market Rent for a two-bedroom apartment, a minimum wage earner must work 76 hours per week, 52 weeks per year. Increasing the minimum wage would help a family move closer self-sufficiency. 
12. Falling Behind: According to the Organisation for Economic Cooperation and Development: Among advanced nations, U.S. is near bottom for ratio of minimum wage to median wage (0.38%) - just better than Czech Republic and Estonia.
13. Public Support: American voters support 71 - 27 percent raising the minimum wage.
14. The Results Are In: Opponents claim minimum wage hurts job growth. It's difficult to find an issue that has been studied more exhaustively. Here are just a few examples: "Empirical analysis strongly challenges the conventional wisdom that increasing the minimum wage hampers employment" (Indiana Business Research Center - 2008). And, here's an oft cited "natural experiment" from economist David Card: 'Comparing Regional Variations in Wages to Measure the Effects of the Federal Minimum Wage'. The conclusion: "a rise in the minimum wage increased teenagers' wages [and] no evidence of corresponding losses in teenage employment."  Finally, here's a recent meta-analysis (study of studies)  from John Schmitt at CEPR in which he similarly concludes, "the weight of that evidence points to little or no employment response to modest increases in the minimum wage."

After Hoosiers experienced some of the largest losses in household incomes in the nation, some of the largest increases in poverty and low-income individuals in the U.S., and rising inequality (in a state with a larger share of poverty wage jobs than the U.S. average and all neighbor states), the only question is, why not reward hard working Hoosier families with a quick and easy tool that would begin to make work pay, while not costing taxpayers a dime?

GUEST BLOG: New Scorecard Confirms Nearly Half of Hoosiers in a Persistent State of Financial Insecurity

By Anne Guthrie: Anne is the Center for Working Families (CWF) Program Fellow at the Local Initiatives Support Corporation (LISC) in Indianapolis. In this role she assists in leveraging outcomes for the CWF initiative by developing funding, partnerships, and outcomes management to help low-income working families reach financial stability. As part of this work, she has co-led the development of the Indiana Assets & Opportunities Network.

CFED’s release of the 2014 Assets and Opportunity Score Card revealed that Hoosier families are in a persistent state of financial insecurity. Almost half (43.1%) do not have enough savings to cover their basic living expenses for three months in an event of an emergency, such as a loss of income or health crisis. There are many reasons why Hoosiers struggle to build enough savings for financial security let alone just make ends meet. For instance, 58% of Hoosiers have subprime credit scores, 31% do not have a savings account, and only 50% of Hoosiers have a retirement account. Currently, less than 30% of all jobs pay wages necessary for self-sufficiency, and in the near future, according to studies by the Lumina Foundation and Georgetown University, 63% of all job openings will require some college by 2018, yet almost half (44.7%) of Hoosiers do not have more than a high school diploma.

  

These numbers are no surprise to the Centers for Working Families network in Indianapolis. Centers for Working Families (CWF) are neighborhood centers where low-income working families can access financial, employment, and income supports to help them achieve long-term financial stability. The good news is that this model is working; since 2011, 852 people found employment, 539 people increased their net-income, and 268 people increased their credit scores. However, despite gaining employment, most individuals are making about $10 an hour and are working at least two jobs just to make ends met. With no financial cushion, a simple crisis sends a family into a cycle of debt – for instance, afraid of losing his job, John took out payday loan (around 250% APR) when his car broke down so that he could get to work that day.

Even for families climbing the earnings ladder, it can become devastating when losing benefits such as child support. According to the Institute for Working Families, this is the “The Cliff Effect” where a 50-cent increase in hourly wages leads to the complete termination of a benefit. For instance, Brenda works as a legal assistant making about $3,000 a month; however with two young children she needs to make at least $3,510 monthly (child care alone is $1,072 a month). Her benefits allow her to close this gap. When her employer offered her a raise, she turned it down because if she lost her benefits she would not make enough money (even with her raise) to meet all her monthly living expenses.

Low- and middle- income families are working harder than ever, but are failing to reach financial stability. The solutions to this problem lay in the ability of the public and private sectors to work together. For instance, the government can expand matched savings accounts such as the Individual Development Account program and offer Children Savings Accounts. Government can also provide public benefits that encourage family assets building while they strive to advance their earnings. Employers can strive to increase profits by increasing employee financial stability, such as offering retirement accounts and paid sick days and building career ladders by providing apprenticeships and offering credentials towards living-wage jobs. Schools can work with local employers in creating sector-based skills training opportunities. Financial institutions can create safe and affordable financial products steering low-income families away from predatory lenders and connect to local Bank On programs.

The Assets and Opportunities Network has the opportunity to advocate on behalf of those who are working hard, but still fall short of achieving the “American Dream” by bringing policy, non-profit and for-profit leaders together in restoring economic mobility for Hoosier families.

Inside the Statehouse 2014: Bills we are following

Of the bills that are posted on the General Assembly's website, the following are those that the Institute is tracking. As a reminder, each Friday we'll keep you posted on activity surrounding these bills.

In the Senate:

• SB 20: Proprietary educational institutions 
• SB 25: Income tax exemption for military income
• SB 35: Straight ticket voting 
• SB 38: Tax credit for hiring certain individuals
• SB 42: Unemployment insurance overpayments
• SB 48: Child care regulation
• SB 90: Various Education Matters
• SB 103: Office of minority health.
• SB 104: Dissolution of political subdivision
• SB 136: Redistricting commission
• SB 140: Home rule powers of certain units
• SB 141: Applicability of federal law in Indiana
• SB 142: Administration of Medicaid
• SB 144: Protected taxes and school corporations
• SB 148: Direct wine sales
• SB 158: Property taxes
• SB 159: Charter schools
• SB 163: Property tax circuit breaker replacement grant
• SB 165: Indiana new markets job act
• SB 171: Community corrections pilot project
• SB 175: Credit score disclosures and credit inquiries
• SB 176: Central Indiana transit
• SB 190: Teacher bargaining and voting
• SB 197: Higher education funding
• SB 200: Income tax credit for hiring returning veterans
• SB 211: New employer tax credit
• SB 213: Countywide public transit.
• SB 224: Education standards
• SB 225: Various state and local financial matters
• SB 233: Pharmacy technicians
• SB 240: Aircraft repair sales tax exemption
• SB 244: Health care professional registry
• SB 258: County income tax council
• SB 264: Choices for teachers program
• SB 266: Assessment of real property
• SB 275: Mandatory full-day kindergarten
• SB 277: Student information
• SB 279: Resident tuition rate
• SB 282: Choice scholarship
• SB 283: Assessed value cap for veteran's deduction
• SB 284: Teacher contracts
• SB 286: SNAP and TANF benefits
• SB 287: Food stamp assistance after drug conviction
• SB 290: Medical debt collection procedures
• SB 297: SNAP and TANF
• SB 300: Veterans' employment preference
• SB 307: Tax credits for logistics investments
• SB 315: Minimum wage
• SB 318: Enforcement of wage requirements
• SB 321: Charter school funding
• SB 322: Schools receiving choice scholarships
• SB 327: Minimum wage
• SB 330: Better skills for adult learners
• SB 331: Second service for veterans
• SB 341: Eligibility for child care voucher
• SB 342: Eligibility for child care voucher payments
• SB 347: Personal property taxes and state tax credits
• SB 353: Interim study committee on communities
• SB 355: Election of state board of education members
• SB 369: Implementation of federal Affordable Care Act
• SB 370: Payment of insurance premiums under Medicaid
• SB 371: Fair pay in employment
• SB 372: Medicaid mailings
• SB 385: Voter registration; absentee voting
• SB 389: Preschool education
• SB 392: Redistricting
• SB 406: Medicaid false claims
• SB 411: Economic development incentive accountability
• SB 412: Improper worker classification
• SB 413: Removal of asset limits for TANF and SNAP eligibility
• SB 418: Redevelopment commissions.
• SB 419: State department of health issues.

In the House:

• HB 1001: Tax exemption for new personal property
• HB 1004: Early Education Vouchers 
• HB 1020: Study of economic development incentives

• HB 1028:  Dropout Recovery Schools 
• HB 1034: Public mass transportation. 
• HB 1035: Regional economic development. 
• HB 1036: Child care and development fund eligibility.
• HB 1040: Proprietary educational institutions.
• HB 1055: Hoosier business investment tax credit
• HB 1064: Study of career and technical education programs.
• HB 1065: Assessment of real property.
• HB 1077: Insurance credit scoring
• HB 1084: Deferred tuition pilot
• HB 1087: Prohibition on labor peace agreements
• HB 1091: Personal leave for employees
• HB 1105: Welfare benefits
• HB 1118: Work sharing unemployment benefit
• HB 1124: Local income tax laws
• HB 1126: Wage payment and wage assignment
• HB 1138: Twenty-first century scholars program
• HB 1156: Child care study
• HB 1164: Veteran's property tax deductions.
• HB 1165: Employment or training priority for military. 
• HB 1166: Veterans education center of excellence.
• HB 1167: LIFE scholarships.
• HB 1169: Public meetings
• HB 1177: RITE program grants
• HB 1181 Career and technical education centers
• HB 1186  Privacy of student records
• HB 1194 Circuit breaker LOIT option
• HB 1195 Personal property tax deduction
• HB 1201 Tax credit for top STEM graduates
• HB 1205 Civil proceeding advance payment transactions
• HB 1209 Tax credit for hiring new employees
• HB 1210 Teacher loan repayment
• HB 1211 Indexing family tax exemptions
• HB 1213 Career and technical education diploma
• HB 1215 Tax credits
• HB 1218 Drug treatment and reporting
• HB 1223 Personal identification cards
• HB 1225 Local option income taxes
• HB 1234  Property tax matters
• HB 1238 Indiana new markets job growth tax credit
• HB 1245 Various financial institutions matters
• HB 1251 Tax credit for tuition expenses
• HB 1256 Tax credit for federal tax on medical devices
• HB 1259 Licensing of diabetes educators
• HB 1261 Education expense tax credits
• HB 1262 Redistricting commission
• HB 1263 Property tax matters
• HB 1266 Local government finance issues
• HB 1267 Consolidation of township governments
• HB 1269 HEA 1006-2013 follow-up
• HB 1276 Barber licensing
• HB 1281 Administration of county income taxes
• HB 1286 Annual transportation reports
• HB 1292 EARN Indiana program
• HB 1294 Tax credits for hiring certain individuals
• HB 1309 Medicaid matters
• HB 1311 Renter's deduction
• HB 1313 Student loan assistance
• HB 1319 Education matters
• HB 1320 Student records
• HB 1327 Unemployment insurance
• HB 1329 Lobbyist code of conduct
• HB 1331 Elimination of township boards
• HB 1332 Office of small business and entrepreneurship
• HB 1335 High cost case management
• HB 1338 Work sharing unemployment benefits
• HB 1346 Unemployment insurance
• HB 1351 Welfare matters; drug testing
• HB 1352 Various education matters
• HB 1354 Property taxes
• HB 1356 State health insurance exchange
• HB 1369 Garnishment of state tax refunds
• HB 1396 Local taxes
• HB 1398 Property tax exemptions
• HB 1405 Circuit breaker CAGIT and LOIT options
• HB 1406 Application of federal Affordable Care Act
• HB 1411 Repeal of state income tax on individuals
• HB 1419 Repeal of common construction wage statute

Upcoming Events
January 29, 2014 from 1-4 PM: Restoring Economic Mobility at the Indiana Statehouse, stay tuned for additional details.