Inside the Statehouse: Week 3
This week, a bill to smooth out the child care cliff is having it's first hearing. Plus, a provision to strengthen the state's Earned Income Tax Credit (EITC), continued budget hearings, the wage assignment bill, unemployment insurance, and a committee vote on STEM education bill that creates an associate degree pilot program.
As a reminder, legislative calendars are subject to change so please check back for updates. Here is a complete list of all legislation affecting working families that we are tracking. We'll send a separate email calling for specific action on legislation as necessary. For the time being, you can contact your legislator to support or oppose any of this week's activity here.
HB 1616: Eligibility for Child Care Voucher
Description: Provides that a child who is otherwise eligible for participation in the federal Child Care and Development Fund voucher program may continue to participate unless the child's family income exceeds 250% of the federal income poverty level.
Last Action Taken: First Reading: Referred to Committee on Family, Children and Human Affairs
Hearing Location & Time: Wednesday, January 28, 8:30AM, RM 156-A
Our Position: SUPPORT - The ‘exit‐level’ threshold in the Childcare Development Fund (CCDF) design is responsible for the economic phenomenon known as the childcare ‘cliff effect’ - which occurs when a $0.50 increase in hourly wages leads to the complete termination of the benefit and a dramatic net loss of resources. This creates a disincentive towards economic mobility; a parent or guardian turns down the raise due to the prohibitive cost of childcare, or does accept the hard‐earned increase but is now financially worse off. By reforming income thresholds in the childcare development fund, policymakers can restore the most basic incentive for hard work - a raise that results in an increase in net resources - and provide Hoosier families with a smooth landing into economic self‐sufficiency. See our infographic video here.
SB 438: Various Tax Matters
Description: Specifies that federal earned income tax credit used for purposes of calculating the Indiana earned income tax credit is the same as the federal earned income tax credit allowed under the Internal Revenue Code.
Last Action Taken: First Reading: Referred to Committee on Tax and Fiscal Policy
Hearing Location & Time: Tuesday, January 27, 9:00AM, RM 431
Our Position: SUPPORT: Indiana’s State EITC eligibility guidelines were decoupled from the federal guidelines which prevented families of three or more children from receiving the benefit from a larger EITC payment and reinstated the “marriage penalty” that had been eliminated in the federal program. Naturally, this decoupling also added “complexity and administrative burden” to Indiana’s tax code, according to the Department of Revenue's Recommendations from the Indiana Tax Competitiveness and Simplification Conference. The federal EITC is considered the nation’s most effective anti-poverty program for working families it has lifted more than 100,000 Hoosiers, including 51,000 children, out of poverty each year between 2011 and 2013. The state EITC builds on this success and is a relatively small investment that can make a big difference in the lives of working families and their children, particularly at a time when poverty is still on the rise and incomes are stagnating. Recoupling Indiana’s EITC is part of the 'Working Families Tax Cut Package' we offer in our Status of Working Families report; a package that moves Indiana toward a more fair tax system and provides meaningful relief to low- to middle-income working Hoosiers.
SB 438: Various Tax Matters
Description: Specifies that federal earned income tax credit used for purposes of calculating the Indiana earned income tax credit is the same as the federal earned income tax credit allowed under the Internal Revenue Code.
Last Action Taken: First Reading: Referred to Committee on Tax and Fiscal Policy
Hearing Location & Time: Tuesday, January 27, 9:00AM, RM 431
Our Position: SUPPORT: Indiana’s State EITC eligibility guidelines were decoupled from the federal guidelines which prevented families of three or more children from receiving the benefit from a larger EITC payment and reinstated the “marriage penalty” that had been eliminated in the federal program. Naturally, this decoupling also added “complexity and administrative burden” to Indiana’s tax code, according to the Department of Revenue's Recommendations from the Indiana Tax Competitiveness and Simplification Conference. The federal EITC is considered the nation’s most effective anti-poverty program for working families it has lifted more than 100,000 Hoosiers, including 51,000 children, out of poverty each year between 2011 and 2013. The state EITC builds on this success and is a relatively small investment that can make a big difference in the lives of working families and their children, particularly at a time when poverty is still on the rise and incomes are stagnating. Recoupling Indiana’s EITC is part of the 'Working Families Tax Cut Package' we offer in our Status of Working Families report; a package that moves Indiana toward a more fair tax system and provides meaningful relief to low- to middle-income working Hoosiers.
SB 259: Stem Education
Description: Establishes the dual credit STEM (science, technology, engineering, and mathematics) associate degree pilot program.
Last Action Taken: First hearing. The Institute testified in support of the bill.
Hearing Location & Time: Wednesday January 28, 1:30PM, Senate Chamber
Our Position: SUPPORT - We support any effort to increase awareness of the great opportunities that exist in high-wage, high-demand occupations. Such efforts are bound to improve the under-supply of STEM credentials coming out of Indiana’s talent supply pipeline, ultimately boosting both Indiana’s workforce and its economy.
HB 1001: State Budget
Description: State Budget
Last Action: First Reading: Referred to Committee on Ways and Means
Hearing Location & Time: Monday January 26, 10AM, RM 404
HB 1186: Unemployment Insurance
Description: Provides that any part of an unemployment insurance surcharge not used to pay interest on the advances made to the state from the federal unemployment trust fund must be credited against the total amount of benefits charged to the state's unemployment insurance trust fund before determining each employer's share of those benefits. .
Last Action Taken: First Reading: Referred to Committee on Employment, Labor and Pensions
Hearing Location & Time: Tuesday January 27, 8:30AM, RM 156-A
HB 1469: Wage Payment and Wage Assignment
Description: Provides that an employer who fails to make timely payment of wages to an employee may, in addition to the wages due, pay liquidated damages, court costs, and a reasonable fee for the employee's attorney. Provides that an employee may assign wages for: (1) the purchase, rental, or use of uniforms or equipment necessary to fulfill the duties of employment; (2) reimbursement for education or employee skills training; (3) an advance for payroll or vacation pay; and (4) meals eaten by the employee at a location provided by the employer.
Last Action Taken: Committee discussed amending the wage payment and consignment statute on the books. Giving the court some discretion with the shall provision of the statute.
Hearing Location & Time: Monday January 26, 10:30AM, RM 156-D
Description: Provides that reemployment services and reemployment and eligibility assessment activities provided to an unemployed individual by the department of workforce development may include job skills assessments as needed.
Last Action: First Reading: Referred to Committee on Employment, Labor and Pensions
Hearing Location & Time: Tuesday January 27, 8:30AM, RM 156-A
Last Week
SB 259: Stem Education
Description: Establishes the dual credit STEM (science, technology, engineering, and mathematics) associate degree pilot program.
Last Action Taken: First hearing. The Institute testified in support of the bill.
Our Position: SUPPORT - We support any effort to increase awareness of the great opportunities that exist in high-wage, high-demand occupations. Such efforts are bound to improve the under-supply of STEM credentials coming out of Indiana’s talent supply pipeline, ultimately boosting both Indiana’s workforce and its economy.
SB 332: Wage Assignments
Description: Allows a wage assignment for the purchase price of goods and food offered by an employer and sold to the employee for the employee's benefit, use, or consumption.
Last Action Taken Passed out Labor and Pensions Committee 9-0
HB 1054: Education Co-op and Internship Programs
Description: Establishes the Indiana cooperative education pilot program. Establishes the Indiana cooperative education pilot program fund.
Last Action Taken: Committee report: amend do pass, adopted. Referred to committee on Ways and Means pursuant to House Rule 127
HB 1438: Adult High Schools
Description: Provides that the department of education shall distribute funding for adult high schools to the adult high school's organizer. Provides that an adult high school may be authorized by the executive of a consolidated city.
Last Action Taken: Second reading ordered, engrossed
Last Action Taken: Second reading ordered, engrossed
HB 1469: Wage Payment and Wage Assignment
Description: Provides that an employer who fails to make timely payment of wages to an employee may, in addition to the wages due, pay liquidated damages, court costs, and a reasonable fee for the employee's attorney. Provides that an employee may assign wages for: (1) the purchase, rental, or use of uniforms or equipment necessary to fulfill the duties of employment; (2) reimbursement for education or employee skills training; (3) an advance for payroll or vacation pay; and (4) meals eaten by the employee at a location provided by the employer.
Last Action Taken: Committee discussed amending the wage payment and consignment statute on the books. Giving the court some discretion with the shall provision of the statute.
Last Action Taken: Committee discussed amending the wage payment and consignment statute on the books. Giving the court some discretion with the shall provision of the statute.
Inside the Statehouse: Week 2
This week there are a handful of budget hearings to establish Indiana's priorities moving forward. There are hearings on the wage assignment bill and a STEM education bill that creates an associate degree pilot program.
As a reminder, legislative calendars are subject to change so please check back for updates. Here is a complete list of all legislation affecting working families that we are tracking. We'll send a separate email calling for specific action on legislation as necessary. For the time being, you can contact your legislator to support or oppose any of this week's activity here.
SB259: Stem Education
Description: Establishes the dual credit STEM (science, technology, engineering, and mathematics) associate degree pilot program.
Last Action Taken: First Reading: Referred to Education and Career Development
Hearing Location & Time: Wednesday January 21, 1:30PM, Senate Chamber
Our Position: Support- We support any effort to increase awareness of the great opportunities that exist in high-wage, high-demand occupations. Such efforts are bound to improve the under-supply of STEM credentials coming out of Indiana’s talent supply pipeline, ultimately boosting both Indiana’s workforce and its economy.
SB 332: Wage Assignments
Description: Allows a wage assignment for the purchase price of goods and food offered by an employer and sold to the employee for the employee's benefit, use, or consumption.
Last Action Taken: First Reading: Referred to Pensions and Labor
Hearing Location & Time: Wednesday January 21, 10AM, RM 233
HB 1001: State Budget
Last Action Taken: First Reading: Referred to Pensions and Labor
Hearing Location & Time: Wednesday January 21, 10AM, RM 233
HB 1001: State Budget
Description: State Budget
Last Action Taken: First Reading: Referred to Ways and Means
Hearing Location & Time: January 21, 9AM, RM 404, January 22, 9AM, RM 404
HB 1054: Education Co-op and Internship Programs
Description: Establishes the Indiana cooperative education pilot program. Establishes the Indiana cooperative education pilot program fund. Makes an appropriation.
Last Action Taken: Committee on Education voted 11-0 to amend the bill to get rid of appropriations and to cap the amount of the grant at $100,000.
HB 1438: Adult High Schools
Description: Provides that the department of education shall distribute funding for adult high schools to the adult high school's organizer. Provides that an adult high school may be authorized by the executive of a consolidated city.
Last Action Taken: Bill passed committee as amended 12-0
Last Action Taken: Bill passed committee as amended 12-0
15 Reasons to Raise Indiana's Minimum Wage in 2015
By Derek Thomas:
On New Years Day, workers in Indiana joined a shrinking minority whose states' minimum wage is still equal to the federal (bare) minimum wage of $7.25. On January 1st, 2015, 3.1 million workers in 20 states received raises. For 2015, we've updated our blog with new data and added a 15th reason why the Indiana General Assembly should resolve to be the 30th state in the nation to reward hard working families by providing them with the long-overdue raise they deserve.
- Outdated: In no county in Indiana does the federal minimum wage of $7.25 support a single adult according to inflation adjusted data from our Self-Sufficiency Standard. The low is Vermilion County at $7.97, the high is $11.21 in Hamilton County and the statewide weighted (for population) median is $9.26.
- 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 $10.96 in 2014 dollars. Because the value of the minimum wage has been left to erode due to inflation, more workers are earning poverty wages.
- Low- to Mid-Wage Workers Earning Less: Real (inflation-adjusted) median hourly wages are down $0.84 since 2007, and 20th percentile wages are down $0.73. See interactive data here.
- 637,000: That's how many Hoosiers (23.4% of the workforce) would get a raise in 2016 if Congress raised the wage to $10.10 per hour, according to a 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). Fortunately, Indiana lawmakers can give a raise to Hoosier workers, instead of waiting for Congress to act.
- $1,000,000,000: According to the same analysis, this large scale policy tool for working families would equal a cumulative raise of nearly one-billion dollars for Hoosiers. Like 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.
- Quality of Life: Local economies win when families with the highest propensity to spend are able to spend money to meet their basic needs. Standard and Poor's cites rising income disparity as "contributing to weaker tax revenue growth", making it more difficult for state and local governments to invest in education and infrastructure.
- Inequality: Reducing the erosion of wages would be a good step towards reducing inequality. The U.S. Conference of Mayors cited the "dramatic decline" in the value of the minimum wage in their recent 'Income and Wage Gaps Across the US' report.
- It's Not Just for Teens Anymore: Contrary to common perception, less than a quarter of workers earning the minimum wage or close to it are teens; 56 percent are women, 28 percent are raising families and 44 percent have at least some college education. According to the Brookings Institution, "the 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."
- Gender Gap: Women earn just $0.73 cents to their male counterpart (the 6th largest gender gap in the U.S.). Because 2/3rds of minimum wage workers are women, raising the wage (and the tipped wage) is a good step towards equal pay. According to a GovBeat analysis of EPI's report, 20% of female workers in Indiana would be directly affected.
- Falling Behind: Measuring the ratio of the minimum wage to median wage is useful in determining the strength of the minimum wage. The average minimum-to-median wage ratio was 39 percent in Indiana in 2013 compared to 52 percent in 1979. According to the OECD, among advanced nations, U.S. is near bottom for minimum-relative-to-average wages of full-time workers - just better than Czech Republic and Estonia.
- 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 more than $19 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.
- 24 Years Without a Raise: Waiters and Waitresses in Indiana make $2.13 per hour (29% of the minimum wage). The last time they saw a raise was almost a quarter-century ago (1991), even as the industry has seen strong growth. According the National Women's Law Center, gender gaps and poverty rates for tipped workers are smaller in states whose tipped minimum wage are equal to the minimum wage.
- Race to the Bottom: 6.2 percent of Indiana's 1,731,000 hourly workers make at or below minimum wage. That's an increase from 5.2% and a larger share than all neighbor states and the U.S. average of 4.3% (6.2% represents 61,000 at minimum wage and 47,000 below minimum wage).
- Working Full-Time in Poverty: At $7.25 per hour, one person working full‐time (40 hours per week, 52 weeks per year) would earn just over $15,000 per year – so little that with one child they would be below the federal poverty line.
- Self-Sufficiency: In order to afford the Fair Market Rent for a two-bedroom apartment, a minimum wage earner must work 77 hours per week, 52 weeks per year. Increasing the minimum wage would help a family move closer to economic self-sufficiency.
A minimum wage that reflects the increased cost of living is fundamental to economic self-sufficiency. Recognizing this, more than half of all U.S. states now have minimum wages higher than the federal minimum for the first time ever. This year, several other states will be considering increases as well. Hard working Hoosiers don't deserve to be in that shrinking minority.
Inside the Statehouse 2015: Bills We Are Tracking
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 Monday we'll keep you posted on activity surrounding these bills.
In the Senate:
- SB 5: Uniform Powers of Appointment Act.
- SB 478: Public transportation corporation funding.
- SB 509: Scholarships and grants.
- SB 541: Sentence modification.
- SB 549: Removal of asset limits for SNAP food assistance program.
- SB 555: HERO plan.
In the House:
- HB 1001: State budget.
- HB 1015: Benefit corporations.
- HB 1019: Common construction wage.
