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Action Alert: Tell the Senate Not to Cut Assets for Independence!

By Ezra Levin on 06/14/2016 @ 12:00 PM

Tags: Policy Alerts, Federal Policy, Individual Development Accounts, Matched Savings

IDAs are on the chopping block. Take action now to preserve this critical program!

The Senate Appropriations Committee just moved to zero out funding for the Assets for Independence (AFI) program, which has funded and supported Individual Development Account (IDA) programs nationwide for nearly two decades. Several other programs were also eliminated in the committee’s $160 billion funding bill for education, health and human services and labor programs. The committee vote was nearly unanimous, meaning the bill has wide bipartisan support.

This is a significant development because the committee has never moved to eliminate AFI before. While there are several steps between the committee’s action and the bill becoming law, we need your help to let the Senate know how important AFI is, and to oppose any action that eliminates the program. Please email or call your Senators to make this clear; see instructions below for making your voice heard. Once you have contacted your Senators, please let us know by emailing Ezra Levin, as we will be monitoring developments closely and working to build opposition to this misguided action. When and if the Senate schedules a vote later this year on the bill, we will be reaching out to you again to quickly mobilize opposition to any cuts to AFI.

Take Action

Call your Senators and urge them to protect the Assets for Independence program!

  • Call 202.224.3121 and ask to be connected to your Senator’s office. If you don't know who your Senators are, find out here.
  • Once you're connected, here's what to say:

My name is [your name] from [your organization or coalition], and I’m calling to request that Senator [Senator’s last name] oppose the Fiscal Year 2017 Labor-HHS-Education Appropriations bill (S.3040) because it would eliminate all funding for the Assets for Independence program. Assets for Independence supports innovations in the field and helps low-income workers save their own money and build assets to become self-sufficient. [Add local AFI program details here if applicable]. Since Assets for Independence was enacted nearly 20 years ago, the Senate has never moved to eliminate its funding. Unless funding for Assets for Independence is reinstated, I strongly urge Senator [Senator’s last name] to vote against the appropriations bill when it comes to the Senate floor for a vote. Please let the Senator and the appropriations staffer know that I will be watching this closely and will get in touch again after the vote.

Thank you for everything that you do on behalf of low- and moderate-income Americans everywhere. If you have any questions or need any additional information, please let us know.

Action Alert: Tell Congress to Reject Policy Riders that Weaken Housing & Financial Consumer Protections

By Emanuel Nieves on 06/10/2016 @ 11:00 AM

Tags: Policy Alerts, Assets & Opportunity Initiative, Federal Policy, Economic Inclusion, Housing and Homeownership

Yesterday — as part of the Fiscal Year 2017 Financial Services and General Government Bill — members of the House Appropriations Committee approved a number of harmful policy riders designed to undermine the Consumer Financial Protection Bureau (CFPB) and the work it has done, and continues to do, on behalf of consumers everywhere.

Among the long-list of bad policy riders that were approved were two that would impact consumers of payday lending and manufactured housing:

  • PAYDAY LENDING RIDER: Proposed by Rep. Steven Palazzo (R-MS) would delay the CFPB from promulgating rules to protect consumers against predatory small dollar lending. As you know, consumers have waited long enough for the CFPB to act — which it just did last week — and they’ve lost billions of their hard-earned cash in the process. Congress should not make them wait any longer and should let the CFPB finish the job it started.
  • MANUFACTURED HOUSING RIDER: Proposed by Rep. Fleischmann (R-TN), mirrors text found in the “Preserving Access to Manufactured Housing Act,” as it would roll back vital Dodd-Frank consumer protections, and would be especially harmful to low- and moderate-income families who own or seek to purchase manufactured homes. As we have said in the past, this particularly harmful language is not needed as current CFPB rules already recognize the differences between manufactured housing and other housing types.

Contrary to claims by supporters of these two amendment, these riders would not expand access to responsible credit and would not serve the interests of homeowners and communities. Instead, they would harm already vulnerable individuals and families by stripping away needed protections.

It’s expected that bill will move to the House Floor within the next few weeks for a final vote, so now is the time to make your voice heard.

Take Action

Call your U.S. Representative and urge them to pass a clean Financial Services and General Government bill without harmful policy riders!

  • Call 202.224.3121 and ask to be connected to your Representative's office. If you don't know who your Representative is, find out here.
  • Once you're connected, here's what to say:

My name is [your name] from [your organization or coalition], and I’m calling to request that you oppose the Fiscal Year 2017 Financial Services and General Government Bill as it includes a number of harmful policy riders that would weaken consumer protections against predatory payday lending and manufactured housing practices. I also urge you to call for, support and pass a clean Financial Services and General Government Bill that that does not expose consumers to unnecessary financial harm.

Thank you for everything that you do on behalf of consumers everywhere. If you have any questions or need any additional information, please let us know.

Want to find out first about even more advocacy opportunities? Join the Assets & Opportunity Network today to connect with thousands of advocates and leaders across the country who are working to expand economic opportunity.

CFED Supports Expanding FSS Program at No Cost in 2015 Budget

By Alicia Atkinson on 09/30/2014 @ 06:00 PM

Tags: Federal Policy, Policy Alerts, Housing and Homeownership

Last week, CFED joined with 11 other national asset building and affordable housing organizations in asking Shaun Donovan, Director of the Office of Management and Budget (OMB), to support the expansion of the Family Self-Sufficiency (FSS) program to more families at no cost to the federal government.

CFED is longtime supporter of the FSS program, which provides families that receive federal rental assistance a powerful opportunity to achieve their financial goals and reduce their reliance on public assistance. It combines three services:

  1. Stable affordable housing;
  2. Case management to help families access services needed to pursue employment and achieve other financial goals; and
  3. A savings account that grows as a families’ earnings increase over a five year period.

Over 69,000 households currently participate in FSS. In the Housing Choice Voucher FSS program, 56% of continuing participants have positive escrow balances due to increased earnings. The average escrow at graduation for those with a positive balance is $6,000. Many participants use this money as a downpayment on a house or to help pay for continuing education for themselves or their children.

Despite the FSS program’s well-conceived design and documented success in moving families off public benefits, it currently does not allow families who are in Section 8 Project-Based Rental Assistance (PBRA) to participate. PBRA provides housing to more than 2 million people, a significant proportion of the approximately 10 million people receiving federal rental assistance.

The Senate’s FY 2015 Appropriations bill for Transportation and Housing and Urban Development (S. 2438) would enable PBRA assisted housing residents to participate in FSS, and a similar provision was included in the President’s fiscal year 2015 budget. CFED, as well as other low-income housing organizations and advocates, have asked Director Donovan to support the expansion of FSS eligibility to PBRA as he and Congressional leaders negotiate an agreement to fund the federal government in the next fiscal year.

See full letter here.

Support the ABLE Act as it Nears the Finish Line in Congress!

By Emanuel Nieves on 08/28/2014 @ 11:15 AM

Tags: Policy Alerts

Capitol Hill

Significant Asset Building Policy Nears the Finish Line; Congress Needs to Hear From You!

Early this month, something rare happened—Republican and Democrats on the House Ways and Means Committee unanimously voted to move forward on a meaningful and generous asset-building bill. For people with disabilities and all in the asset-building field, passage of the Achieving a Better Life Experience (ABLE) Act would be a significant victory. The bill would allow people with disabilities to save without fear of losing public benefits.

The bill has strong support in both chambers of Congress (379 co-sponsors in the House and 74 in the Senate). There is cautious optimism that it could be one of the last bills signed by the President this year. But, it will not become law until it is passed by both House and Senate chambers. Your representatives in Washington, DC, need to hear from you!

Congress returns to Washington in early September and may take up this bill soon after—contact your Representative and Senators and tell them to support the ABLE Act!

  • Call 202.224.3121 and ask to be connected to your Senators’ and Representative’s office. If you don't know who your Representative or Senators are, find out here: House, Senate.
  • Once you're connected, here's what to say:

My name is [your name] from [your organization or coalition]. I’m calling to ask you to support House Bill H.R.647 / Senate Bill S.313, the ABLE Act of 2013, so that people with disabilities are able to save, expand their economic opportunity and have the chance to gain economic self-sufficiency.

Please do it for the people with disabilities in your communities who want to save for a more secure future!

Background on the ABLE Act:

If enacted, the ABLE Act would create a new tax-free “ABLE” account, treated much like existing 529 college savings plans, allowing people with disabilities and their families to save money to cover qualified disability-related expenses, such as education, housing, transportation, employment support, health and other miscellaneous expenses. The ABLE Act also would exclude the first $100,000 saved in an ABLE account from asset limits for all federally-funded public benefit programs.

For more information about the ABLE Act, the World Institute on Disability has a more detailed overview on their website.

Bill to Undermine CFPB, Enable Predatory, High-Cost Home Loans Receives Bipartisan Support in House Financial Services Committee

By Doug Ryan on 05/13/2014 @ 01:30 PM

Tags: Policy Alerts, Federal Policy, Housing and Homeownership

On May 7, the House Financial Services Committee met to debate several housing finance bills, including the “Preserving Access to Manufactured Housing Act” (H.R. 1779). Although the bill would roll back critical consumer protections for buyers of manufactured homes and override recently implemented rules from the Consumer Financial Protection Bureau (CFPB), it has support from 113 Representatives—22 Democrats and 91 Republicans.

Industry lobbyists developed the deceptively-named “Preserving Access to Manufactured Housing Act” to enable manufactured home lenders to bypass new CFPB lending rules that ensure home buyers receive high-quality loans that they can afford to pay back. Before the Dodd-Frank Act, manufactured home lenders were not subject to the Home Ownership and Equity Protection Act (HOEPA), Truth in Lending Act (TILA) and other lending rules. Most manufactured homes are financed with personal property (also known as chattel) loans rather than traditional mortgages, and the chattel market operated largely outside of federal regulators’ supervision. The Dodd-Frank Act brought the manufactured home lending industry into the light by applying many of the same laws and regulations that govern mortgage lending, and giving the CFPB supervisory and regulatory authority within the market. H.R. 1779 would roll back these protections. Importantly, both Dodd-Frank and the new CFPB rules include specific interest rate and cost provisions to account for the differences between chattel and mortgage loans.

Disappointingly, the bill received support from some Democrats who are generally champions of consumer financial protection and safe, affordable homeownership opportunities. The Committee’s Ranking Member, Maxine Waters (D-CA), and Rep. Terri Sewell (D-AL) both spoke in favor of H.R. 1779, putting lenders’ interests above consumers’.

The Democratic support for H.R. 1779 makes this legislation one of the first bipartisan attacks on the CFPB. As a result, this effort will embolden consumer protection opponents to further erode HOEPA, TILA and other laws that protect borrowers. H.R. 1779 is attractive to many House Republicans due to provisions that weaken the CFPB’s ability to regulate and oversee the manufactured housing finance market. The Preserving Access to Manufactured Homes Act would create even larger exemptions that would weaken consumer protections and enable predatory, high-cost loans. Its main provisions are:

  • Exempting more employees of manufactured home retailers from being defined as mortgage originators. This would perpetuate the conflicts of interest and steering that plague this industry and allow lenders to pass additional costs on to consumers.
  • Raising the interest rate caps for HOEPA protections. Under the proposed legislation, a personal property loan of less than $75,000 with an interest rate as high as 10.5 percentage points above the prime rate (thus, the current market would permit an interest rate of about 14% for a 15 or 20-year loan) would not be designated a higher-cost loan. In fact, loans of less than $30,000 could potentially avoid high-cost status even with interest rates as high as 14.5 percentage points above the prime rate (currently about 18%).
  • It would raise the HOEPA limits for points and fees. Right now, loans of less than $20,000 are limited to the lesser of 8% of the loan value or $1,000, while loans of $20,000 or more are limited to 5% of the loan value. Under H.R. 1779, chattel loans under $75,000 would have a points- and fees cap of the greater of 5% of the loan value or $3,000.

Rep. Waters and Rep. Sewell said the bill was necessary to keep credit available to rural and lower-income homebuyers, who make up a significant portion of all manufactured home buyers. Without this legislation, they argued, home retailers and chattel lenders would not be able to charge enough to profit off of loans to the most vulnerable borrowers, and could even stop financing manufactured homes altogether. In reality, rural and lower-income homebuyers have the most to lose if H.R. 1779 becomes law because they have the fewest options for selling or refinancing if they receive a loan they cannot repay. Moreover, Dodd-Frank already recognizes that the manufactured home finance market has some unique characteristics and provides appropriate exemptions for retailers and chattel lenders. H.R. 1779 is not necessary to ensure that manufactured home buyers continue to have access to credit, as the CFPB currently has the power to adjust its rules in the case that credit becomes restricted. The CFPB has promised to review industry data to determine if regulatory adjustments are needed; however, lenders have not provided the CFPB with usable data to make such a determination.

CFED is committed to advancing policies that provide access to affordable financing for manufactured homes—but not at the expense of consumer protections that help ensure that owners of these homes are able to build and preserve wealth through homeownership. Policymakers who want to ensure that rural and lower-income borrowers have access to manufactured home loans should consider alternatives such as finalizing the Duty to Serve (DTS) rule. DTS, a requirement of the Housing and Economic Recovery Act of 2008, would create secondary markets for manufactured home loans, including chattel, and attract new lenders to the market. The Federal Housing Finance Agency developed proposed rules in 2010 but has never finalized the regulations. Doing so would be a win-win for the manufactured home industry and manufactured home buyers alike. In the meantime, legislation such as the Preserving Access to Manufactured Housing Act would only put manufactured home buyers at greater risk.

Housing Finance Reform Can Help Families Build Wealth Through Homeownership

By Katherine Lucas McKay and Alicia Atkinson on 04/08/2014 @ 03:00 PM

Tags: Federal Policy, Housing and Homeownership, Policy Alerts

The Great Recession was devastating to millions of families from all income levels, largely due to the trillions of dollars lost in homeownership. In the aftermath, policymakers, consumers and advocates recognized the need for housing finance reform.

In March, Senate Banking Committee Chairperson Tim Johnson (D-SD) and Ranking Member Mike Crapo (R-ID) introduced the Housing Finance Reform and Taxpayer Protection Act of 2014, which proposed a framework for housing finance reform. As this legislation is considered, it is important that the Senate ensures that homeownership continues to be the leading source of household wealth and a foundation for family financial security.

Source: CBPP, 2013

One of CFED’s biggest concerns in current federal housing polices is that they are skewed towards supporting wealthy households build wealth but do little to support low- and moderate-income and middle-class families. CFED’s report, Upside Down: The $400 Billion Federal Asset-Building Budget, found that the federal government spent $137.6 billion to support homeownership in 2009, but the vast majority of this support went to high-income households in the form of tax expenditures. For instance, of the nearly $100 billion spent on Home Mortgage Interest Deduction every year, 77% goes to homeowners with incomes greater than $100,000.

CFED’s new Federal Policy Brief, “The Role of Asset-Building in Housing Finance Reform,” paints a blueprint for legislators to follow to ensure the benefits of homeownership are available to all while mitigating the risk for the public and private markets.

In short, Congress should support three policy strategies that create widespread access to homeownership, creating pathways out of poverty and strengthening the middle class.

  1. Help first-time homebuyers get a foot in the door by keeping minimum downpayments low, expanding support for downpayment savings through tax incentives and matched savings, and expanding downpayment assistance funds and homebuyer education resources.
  2. Recognize the unique and important role that manufactured housing plays in homeownership for low- and moderate-income households. Open up the secondary market to high-quality chattel loans by creating standards for them to be eligible for securitization. Encourage competition in the manufactured home finance market by incenting lenders to offer conventional mortgage financing to borrowers citing homes on land they already own as well as in resident-owned cooperatives.
  3. Provide incentives for the private sector to invest affordable homeownership. The Johnson-Crapo proposal offers securitization fee discounts for lenders providing high-quality loans to underserved markets and borrowers is a strong approach. This could also be paired with a new Duty to Serve rule that establishes minimum standards.

There are encouraging signs that the Johnson-Crapo legislation incorporates some of these strategies, though many questions remain. Moving forward, policymakers need to continue to ensure that all families at all income levels have supportive policies to build assets through homeownership.

Bipartisan Legislation Supports Innovative Strategies to Help Working Families Save

By Ezra Levin on 10/29/2013 @ 03:00 PM

Tags: Policy Alerts, Federal Policy, News

Yesterday, Senator Jerry Moran (R-KS) was joined by Senator Sherrod Brown (D-OH) to introduce the American Savings Promotion Act (see Sen. Moran’s press release here). Representative Derek Kilmer (D-WA), joined by Representatives Tsongas (D-MA) and Cotton (R-AR), led the way in the House of Representatives with a companion bill introduced today as well (see Rep. Kilmer’s press release here). This commonsense legislation will encourage the growth of Prize Linked Savings (PLS) accounts, which have already succeeded in increasing the financial capability of working families in many states and have the potential to spread throughout the country.

“Prize-linked savings” is the brainchild of former Harvard Business School professor and now Dean of Oxford University’s business school Peter Tufano. Doorways to Dreams (D2D) has worked the last several years testing the theory on the ground by partnering with local credit unions to run “Save to Win” programs in four states. These programs allow savers to open a 12-month “Save to Win share certificate” (essentially a certificate of deposit). For each $25 deposit, savers are entered into both a monthly drawing for small cash prizes and an annual drawing for a grand prize of $10,000 or more.

For savers the math is simple: they get a chance to take home cash prizes while saving for the future—it’s a win-win. D2D research has found that these prizes encourage healthy savings behavior, and the results are impressive. In less than five years since its inception, the number of participating credit unions has grown from eight in Michigan to more than sixty in four states. In just two of the states where Save to Win operates—Michigan and Nebraska—42,000 people have opened accounts and saved $72 million.

Many of these accounts are opened by families who have never had significant savings before. This includes former non-savers, families who are asset poor, and families who are low- and moderate income. In short, without a dime of government subsidy, Prize Linked Savings accounts are helping families enter the financial mainstream and attain financial security. What a deal!

Unfortunately, federal law prohibits banks from offering Prize Linked Savings products, which is why only credit unions in some states have participated so far. This is where the American Savings Promotion Act comes in. This legislation would remove the regulation banning banks from the Prize Linked Savings field, allowing these savings products to spread further and faster throughout the country. It’s no wonder why this legislation has attracted support from a wide range of groups and an ideologically diverse group of Senators and Representatives—it just makes sense.

Policy Alert: Tell Congress to Keep State Flexibility to Lift Asset Limits

By Emanuel Nieves and Jeremie Greer on 07/24/2013 @ 02:00 PM

Tags: Federal Policy, Policy Alerts

After failing to pass a Farm Bill in early July, House Republicans last week managed to pass a pared-down Farm Bill without the Supplemental Nutrition Assistance Program (SNAP), previously known as food stamps. The 216-208 vote was mainly along on party lines with all Democrats and 12 Republicans voting against the measure. Last week’s vote is also noteworthy as it’s the first time in 40 years that SNAP has not been a part of a Farm Bill, a strategy that House leadership adopted in order to persuade more conservative members to vote for the measure.

The House Agriculture Committee chairman, Rep. Frank Lucas (R-OK), and House leadership have indicated plans to work on a SNAP-only bill, although the precise timeline and extent of SNAP cuts in that bill remain unclear.

Last month’s failed Farm Bill included a $20.5 billion cut to the SNAP program, with 60% of these cuts coming from elimination of “broad-based categorical eligibility,” which since 1996 has given 36 states the flexibility to eliminate asset limits in SNAP. Had this policy been enacted it would have reversed 17 years of state-level progress and would have caused up to two million Americans to lose benefits altogether. One of the biggest reasons for the failure of last month’s farm bill was that a large number of Republicans (64) voted against that measure because they felt that SNAP cuts were not deep enough. This does not bode well for a future SNAP-only bill.

The Senate passed its Farm Bill with strong bipartisan support, which includes modest cuts to the SNAP program but does not separate it from the overall bill. Importantly, the approved Senate cuts would not affect states’ flexibility to remove asset limits in the SNAP program.

It remains unclear at this point what will happen next, legislatively speaking. There is a strong possibility that both chambers will go to conference and begin working to resolve disagreements between the two versions, which will almost entirely revolve around SNAP. Democrats are holding to their position that SNAP should remain in the Farm Bill with only modest cuts. In addition to Democratic opposition, nutrition and asset-building advocates, as well as the farm lobby, do not support the split and are advocating for the farm and SNAP titles to remain part of a single bill.

While we wait until the path forward is clearer, you can still make your voices heard back home as Members of Congress will soon begin their August recess. Schedule a meeting with your Member’s district office to express your concerns over the Farm Bill and what this will mean for your asset-building work. Members will also hold numerous town halls and other local events while they are back home and you should try to attend at least one event so that you can express your concerns over this debate directly to your Member of Congress.

Take Action! House of Representatives to Vote on SNAP Cuts, Asset Tests

By Katherine Lucas McKay on 07/09/2012 @ 10:15 AM

Tags: Federal Policy, Policy Alerts

On July 5, the House Agriculture Committee unveiled its draft Farm Bill legislation with some very bad news for assets advocates: the Supplemental Nutrition Assistance Program (SNAP, formerly food stamps) is targeted for a $16 billion cut. Most of the savings will come from eliminating Broad Based Categorical Eligibility, which allows states to set their own or waive the assets test. Unfortunately, that provision has support not only from Committee Chairman Frank Lucas (R-OK) but also from Ranking Member Collin Peterson (D-MN).

On July 11, the Agriculture Committee will consider amendments to the bill and vote to advance it to the full House of Representatives. Once the bill clears the Committee, its next stop is the House floor.

Advocates should contact their Representatives now to prevent these cuts. More than 40 states use Categorical Eligibility to waive the SNAP asset test for all applicants, allowing millions of low-income families to build the savings they need to successfully lift themselves out of poverty. If the House Agriculture Committee's proposal becomes law:

  • Every state that currently uses Categorical Eligibility will have to reinstate its SNAP asset test.
  • States will incur a significant administrative burden because they will have to verify the assets of all SNAP applicants.
  • Some two million individuals will lose their SNAP benefits entirely.
  • The decade of progress that the assets field has made to enable low-income benefits recipients to save will be undone.

Your support can make a difference! You can learn more and send a message to your Representative, through CFED’s Advocacy Center.

EITC Gains and Losses: 2012 Legislative Update

By Elvis Guzman on 06/07/2012 @ 12:15 PM

Tags: Assets & Opportunity Initiative, EITC, Local Policy, Policy Alerts

The Earned Income Tax Credit (EITC) is one of the strongest public benefit programs that help to reduce poverty and is mainly intended to increase the incomes of low-wage families with children. Over 27 million families claimed the federal EITC in 2009. The amount of the credit depends on the recipient’s income, marital status, and number of dependent children. In 2010, the federal EITC lifted 6.6 million people (including 3.3 million children) out of poverty. Twenty-five states, plus the District of Columbia, supplement the federal credit with their own state-level versions of the EITC. States typically calculate the credit as a percentage of the federal EITC and most programs are refundable.

For years this program has been praised by both major political parties; in fact, the federal EITC was first proposed by the Nixon administration and was later expanded by administrations from both parties. State EITCs, however, continue to face political challenges. Following is a brief overview of changes or proposals to state-level EITC programs in the past year.

In the wake of the recent economic recession, state EITCs have been part of several public programs targeted for possible austerity. Recent fiercely contested battles in Kansas and Oklahoma demonstrate the strong opinions surrounding the credit. Kansas Governor Brownback proposed to eliminate the EITC and Child and Dependent Care Tax Credit (CDCTC), along with the state’s income tax. Ultimately, legislative negotiations resulted in a “compromise” where the EITC was left intact, while the CDCTC and other provisions were eliminated. Similarly, Oklahoma Governor Fallin proposed to eliminate the state’s EITC, CDCTC and Child Tax Credit (CTC), to help fund the elimination of the state’s income tax. After similar bills passed the House and Senate, groups advocated critically against these cuts. Ultimately, both chambers could not come to an agreement and no tax reform was passed in the recent legislative session.

EITC programs in other states faced similar legislative challenges. In 2011, Michigan legislators voted to decrease the state’s EITC rate from 20 to 6 percent of the federal credit. Earlier this year, House Bill 5407 was introduced to amend these changes but has made little progress. North Carolina’s EITC is set to expire at the end of this year. After the legislature proposed eliminating the credit in 2011, this year a bill was introduced and is under consideration in the House and Senate to extend the EITC, CTC and CDCTC. In Iowa, the Senate passed Senate File 2161 to increase the EITC from the current 7 percent to 20 percent of the federal credit by 2014. Governor Branstad, gave his support for an increase in the EITC if commercial and industrial property taxes were cut in a reform package. The state legislature ended its session in May with no agreement on a bill.

Wins and Opportunities
While the economic recession has posed threats to existing state-level EITC programs, some states have proposed or enacted legislation to improve this credit. After a long push by local advocates dating to 2003, in late 2011 Illinois passed a bill that doubled its credit to 10 percent of the federal EITC over the next three years. The measure also increased the personal exemption and indexed it to inflation. In New Jersey, Governor Christie pledge to slowly increase the state’s EITC back to 25 percent, after he reduced the rate to 20 percent in 2010.

Legislatures in Maryland and Utah proposed measures to improve or create EITC programs, however both sessions ended with unsuccessful results. The Maryland state Senate proposed to increase the state EITC to 30 percent of the federal credit, along with an increase in the income tax, however the house failed to pass this package. The Utah state Senate passed a bill to create a state EITC at 5 percent of the federal credit, but the session ended with no resolution. While these pushes were not successful, they demonstrate that there is clear support for state EITCs and have opened the window for local advocacy groups and policymakers to take future action.

Federal Threats
There are a few upcoming political battles that may affect the federal EITC during the lame-duck session, including the extension of the Bush tax-cuts, the cuts in the Budget Control Act and the looming debate over raising the federal debt ceiling. Advocates are closely watching these highly-contested issues since they may result in cuts to the federal credit.

Benefits of the EITC
States often see cutting tax credits for low- and moderate- income families as an easy way to reduce spending. However, legislators frequently fail to see the benefits tax credits provide to working parents and their children. Enacting state-level EITCs is linked to better health related outcomes for children, including higher rates of private insurance and less reliance on public health programs, such as Medicaid and the Children’s Health Insurance Program (CHIP), (Baughman, 2012). This research also indicates that parents receiving the EITC are more likely to move into better paying jobs with more benefits, particularly health care. Other studies indicate the EITC increases employment, shifting dependence away from cash and food assistance programs; between 1993 to1996, economists estimate over a half million families moved from AFDC and the food stamps program to employment (Greenstein, 2005). Millions of hard-working families and children thrive with EITC assistance and it’s counterintuitive to cut these essential programs.

To help protect the federal and state EITCs, keep yourself updated on legislative changes. Lend your voice to local advocacy groups and contact your state’s elected officials. We must continue to act in unison to ensure low- and moderate-income families are not left behind.


By Sean Luechtefeld on 05/16/2012 @ 12:30 PM

Tags: Federal Policy, Policy Alerts

Yesterday, DCist indicated that world-renowned Manhattan chef and talk show host Mario Batali announced he is taking the “Food Stamp Challenge.” In short, the Food Stamp Challenge involves people – typically of greater-than-average means – subsisting on the $31 that would be provided to low-income families by SNAP, the Supplemental Nutrition Assistance Program. To be sure, Batali isn’t the first well-known figure to take the Challenge.

In the DCist piece, Batali shares (in rather gruff terms) the struggles that he has had subsisting for a week on what a single meal costs in his own restaurant. These problems go well beyond having to give up free-range chicken. “I’m [freaking] starving,” Batali notes.

The good news for Batali and others who take the Food Stamp Challenge is twofold. First, the Challenge only lasts seven days. For the low-income families that rely on SNAP every week, there’s no end to the lack of nutritious (or altogether lack of) food. Second, and more importantly, folks taking the Challenge don’t need to worry about qualifying for food stamps; they simply need to budget based on what they would earn if they did need food stamps.

Low- and moderate-income families, on the other hand, aren’t so lucky, and their ability to qualify for food stamps might be in further jeopardy given a recent proposal to eliminate Broad-Based Categorical Eligibility. In short, such a policy would reinstate asset tests for SNAP, meaning that up to three million people would lose their food stamp benefits altogether. While $31 per week isn’t much, it’s still better than the $0 that could be coming to the families who acquire enough assets to make them “just not quite poor enough” to be eligible.

While this is bad news for these families, there’s good news for you: there are things you can do to help that don’t require you to take the Food Stamp Challenge. First, visit CFED’s Advocacy Center to send a message to your legislators. Second, share this blog post on your Facebook and Twitter feeds to encourage your friends and colleagues to let Congress know that it’s not okay to strip hardworking individuals of these important benefits.

Self-Employment Assistance Program Sees Major Expansion

By Katherine Lucas McKay on 02/22/2012 @ 11:45 AM

Tags: Entrepreneurship, Federal Policy, Policy Alerts

Program receives boost; grants available

For the past two years, CFED has kept you up-to-date on an innovative proposal to expand access to entrepreneurship training through the Department of Labor’s (DOL) Self Employment Assistance (SEA) Program. Today, we have great news: Senator Ron Wyden (D-OR) included a major expansion of SEA in the recently signed legislation to extend Unemployment Insurance (UI)! As a result, thousands more unemployed workers will be able to unleash their entrepreneurial talents while they receive unemployment benefits and training to help their businesses succeed.

The nation has been struggling with an unemployment rate higher than eight percent for more than three years and nearly half of all unemployed workers have been out of work for more than six months. For some job seekers, starting a business provides a way to create their own jobs. For more than 20 years, SEA has allowed UI recipients in seven states to work full-time on starting a business while receiving unemployment benefits. SEA has been evaluated and found effective but has had limited reach because it was difficult for states to participate.

Senator Wyden’s SEA reform legislation is based on a bill he introduced in the Senate last year, with support from Senators Carper (D-DE) and Casey (D-PA). It allows a state to opt in easily, through a formal agreement between the Governor’s administration and the U.S. Department of Labor (DOL). A critical feature of the legislation is that it authorizes and appropriates $35 million in one-time funding for states; the grants are to be used to set up new SEA programs or improve existing ones, including through the development and implementation of entrepreneurship training resources for UI recipients.

Specific provisions include:

  • States can extend a maximum of 26 weeks of SEA benefits to unemployed workers interested in entrepreneurship
  • Limits participation to one percent of a state’s total pool of UI recipients. This will prevent the program from adding to the budget and is based on average take-up rates in the states that currently offer SEA
  • Establishes reporting and evaluation requirements to track total jobs created, participants’ business income over time, and tax revenues associated with SEA
  • States can provide training and resources to SEA participants through partnerships with nonprofit organizations that have expertise in business development services

We anticipate that microenterprise development organizations across the nation will have opportunities to expand their services through partnerships with state workforce agencies. CFED will keep you informed as DOL rolls out the new rules and requirements for the state grant funding. Meanwhile, if you hope to see a new or improved SEA program in your state, now is the time to contact your state workforce agency!

Policy Alert: Support Automatic IRA Legislation

By Inemesit Imoh, Guest Contributor on 02/17/2012 @ 02:00 PM

Tags: Federal Policy, Policy Alerts

Automatic IRA legislation will improve financial security for millions of workers who are facing retirement with little savings.

Inadequate savings for retirement present a serious threat to the future of American prosperity. Even before the recession, half of all households headed by someone aged 55-59 had less than $13,000 in retirement savings. This anemic level of savings threatens to leave retirees struggling with financial insecurity throughout their elder years. Social Security benefits, of course, fill part of the gap, but in 2011, the average benefit paid to retired workers was a meager $1,177 a month (just over $14,000 per year). Despite a difficult legislative environment, the case for addressing retirement security is gaining steam.

Congressman Richard Neal of Massachusetts, following the lead of New Mexico’s Jeff Bingaman in the Senate (S. 1557) and the Obama Administration’s proposal in the FY 2013 Budget Request, has introduced legislation to address this problem: the Automatic IRA Act (H.R. 4049) will make employer-sponsored retirement savings accounts available to many of the 78 million employees who currently do not have access.

Today, households rely heavily on personal assets, pensions and 401(k) accounts to help them make ends meet, even before both spouses retire. However, according to the 2012 Assets & Opportunity Scorecard, only 44.9% of Americans participate in their employer-sponsored retirement plan and almost 50% of the American workforce currently does not have access to a work-based plan at all.

Why is that so critical? Because employer-sponsored retirement plans are one of the main ways Americans are able to save for retirement. However, many small businesses and lower wage industries do not offer retirement plans to their employees. For those that do have the option to enroll, many are discouraged from ever doing so due to complex rules and investment options.

To make financial security for older Americans a reality, policymakers need to make sure that families have the tools they need to save for their later years today. Congressman Neal (D-MA) recognizes this fact and has reintroduced the Automatic IRA Act (H.R. 4049), which he says “provide common-sense reforms that will help Americans prepare for a financially secure retirement.”

The bill would enable nearly all employees who work for a private business with more than 10 workers to contribute to retirement savings through payroll deductions into an IRA. In addition, the bill provides employers with a tax credit to cover the administrative costs of setting up the IRA. Automatic IRA is a low-cost and effective way to reach millions of Americans struggling to build a nest egg for themselves.

This legislation is one of the few proposals that could break the gridlock in Congress. Despite the strong partisan differences between the parties, proposals for Automatic IRA have had bipartisan support in the past. Nods from the AARP, Brookings Institute, Aspen Institute for Financial Security and Heritage Foundation all support Automatic IRA policies similar to what is included in H.R. 4049.

CFED will track this bill and similar legislation as it moves through Congress. Despite the challenging political environment and the upcoming elections, we hope that this sensible and employer-friendly legislation will find broad support among lawmakers.

President’s 2013 Budget Supports Investments in Working Families’ Financial Security and Asset-Building Opportunities

By Inemesit Imoh, Guest Contributor and Katherine Lucas McKay on 02/14/2012 @ 02:10 PM

Tags: Federal Policy, Policy Alerts

Proposal is a strong start but reduces support for some critical programs

Yesterday, the Administration rolled out its budget proposal for Fiscal Year (FY) 2013 (October 1, 2012 to September 30, 2013). The President delivered this budget request to Congress, which must now decide on and vote to approve funding levels for each agency. His accompanying letter to Congress portrays a relentlessly-squeezed American middle class which faces a tipping point: “For many Americans, the basic bargain at the heart of the American Dream has eroded.”

In response, the President’s FY 2013 budget proposal aims to ensure that America will continue to be “a country where working people can earn enough to raise a family, build modest savings, own a home and secure their retirement.” In essence, the Administration sees this budget as a blueprint for advancing financial security and asset-building opportunities for American households. But to what extent does it achieve this objective?

One major limiting factor is that billions of dollars in budget cuts are, under laws passed in 2011, set to take effect in FY 2013. Under deals struck between House Republicans and the Obama Administration, the cuts will focus on discretionary domestic programs—specifically, the 18% of the federal budget that remains after accounting for national security spending and entitlement programs such as Medicare, Medicaid and Social Security. For FY 2012, the President proposed a total of $458 billion in discretionary domestic spending; this year’s request is just $410 billion. This means that nearly every agency faces some reduction in total funding, including cuts to many programs that support low-income families who are working hard to make ends meet, save and invest in their futures. On the other hand, the budget proposal emphasizes investments in infrastructure and education, support for the housing sector and incentives to spur job creation—including entrepreneurship. In short, it’s a mixed bag for asset builders and the families we serve.


Tax Policy: The President asks Congress to take several concrete steps on tax policy and establishes principles to guide future work on comprehensive tax reform. He rejects today’s upside down policies that benefit “the people who have done fantastically well over the last few decades” but neglected “the middle class [and] those fighting to get into the middle class.” The budget includes several tax incentives that would provide significant support to low- and moderate-income families that are making tough choices today to build wealth and invest in their futures.

Specifically the budget:

  • Makes permanent the American Opportunity Tax Credit, a partially refundable credit that helps families pay for their students’ higher education.
  • Extends tax preferences that reward small businesses for hiring new workers and spur those businesses to make capital investments.

It compensates for the cost of these measures by curtailing some tax preferences that only benefit the affluent:

  • Institutes new taxes on the largest financial institutions and households earning more than $1 million per year.
  • Eliminates several corporate tax loopholes and the Bush tax cuts for families earning more than $250,000.

Retirement Security: The budget once again supports Automatic Individual Retirement Accounts (Auto IRA), a policy that would require businesses with more than 10 employees who do not currently sponsor retirement plans to enable their employees contribute to IRAs through payroll direct-deposit. The vast majority of these employers already use payroll systems that support direct deposit into IRAs, and the Administration’s proposal includes a tax credit to offset the cost of upgrading for those businesses that need to. This will make retirement savings accounts available to as many as 40 million of the 78 million American workers who currently do not have access to a retirement plan at work. Employees would be automatically enrolled at a low contribution rate but could opt out at any time. They would also retain the right to change their savings levels, and reallocate their investment portfolios. The Administration proposal echoes legislation introduced by Senator Bingaman (D-NM).

Assets for Independence (AFI): AFI, the primary source of federal funding for Individual Development Accounts, provides savings opportunities and incentives for low-income families who are saving to purchase homes, go to college and start businesses. The FY 2013 request of $19.9 million increases funds for program evaluation; it would also fund an estimated 47 AFI grantees and strengthen ongoing program administration and support. The Administration requests that HHS be granted authority to recapture funds that grantees have not used after three years, and that they be able to reallocate those funds to new grantees in order to expand the program’s reach with its existing budget.

Furthermore, the AFI funding request indicates the Administration’s support for program reauthorization and improvements, similar to those that have been proposed by Congressman John Lewis (D-GA) in the Stephanie Tubbs Jones AFI Reauthorization Act.

Funding Levels for Specific Agency and Department Programs

Of course, the devil is in the details. While the big-picture view of the budget is largely positive, some specific programs that support asset-building opportunities for low-income families are targeted for cuts. Funding levels for a variety of these programs are below:

Department of Agriculture:

  • RD 502 Direct Loans (Rural Housing): $653 million, down from $900 million in funding for FY 2012.
  • Rural Business Enterprise Grants: $30 million, an increase of $6 million from last year’s enacted level.

Department of Education:

  • Race to the Top: $850 million, up from the FY 2012 funding level of $550 million.
  • Promise Neighborhoods: $100 million, a $40 million increase above FY 2012 funding.

Health and Human Services:

  • Assets for Independence: $19.9 million, level with the funding authorized for FY 2012.
  • Community Services Block Grant maintains funding levels of $350 million from the FY 2012 Budget request, but is a cut of more than 50% of the $714 million that was enacted for FY 2012.
  • Low Income Home Energy Assistance Program (LIHEAP): $3.02 billion, down $450 million from FY 2012.

Department of Housing and Urban Development:

  • Family Self-Sufficiency program: $60 million, equal to FY 2012 funding.
  • Housing Counseling: $55 million, $10 million above FY 2012.
  • Community Development Block Grants maintained funding at $3 billion.
  • Resident Opportunities for Self-Sufficiency maintained its FY 2012 funding at $50 million.

Small Business Administration:

  • Microloan loans: $18 million, a 28% reduction from the FY 2012 level of $25 million.
  • Microloan technical assistance: $19.8 million, slightly below the FY 2012 enacted level of $20 million.
  • The Administration again targeted the Program for Investment in Micro-Entrepreneurs (PRIME) was again targeted for elimination. In FY 2012 PRIME is funded at $3.5 million.
  • The Administration proposes a new training and technical assistance program for disadvantaged entrepreneurs, focused exclusively on veterans, to be funded at $7 million.

U.S. Treasury:

  • Community Development Financial Institutions (CDFI) Fund: $221 million, level with FY 2012 funding.
  • Bank On USA would be funded through the CDFI Fund, authorized at up to $20 million.

Rep. Chu (D-CA) Introduces Entrepreneurship Legislation

By Sean Luechtefeld on 12/12/2011 @ 02:45 PM

Tags: Entrepreneurship, Federal Policy, Policy Alerts

Federal legislation based on CFED’s Self-Employment Tax Initiative (SETI)

Last week, Representative Judy Chu of Los Angeles introduced the Entrepreneur Startup Growth Act, a bill designed to provide low-income self-employed people with tax support and business development. CFED is thrilled to support this legislation as it is based on our Self-Employment Tax Initiative, which you can read more about here.

Click below to watch the video of Rep. Chu’s address on the legislation, and then read the press release from Rep. Chu’s office below. As always, we appreciate your support in bringing business development assistance to low- and moderate-income entrepreneurs!

Rep. Chu Introduces Bill to Drive Economic Opportunity for Entrepreneurs

Young startup companies, our nation’s real job creators, would benefit from the Entrepreneur Startup Growth Act

WASHINGTON – On Tuesday, Rep. Judy Chu, D-Calif., introduced a bill to provide low-income start-up companies with financial and business assistance. The Entrepreneur Startup Growth Act provides self-employed individuals with tax support and business development.

"Economists point to young developing businesses as the key drivers of economic growth. On average each year about one third of the jobs created in this country are a result of new startup businesses. These entrepreneurs take risks and make it on their own," Chu said. "The most critical time of the year for these new owners is tax season as they learn how to comply with the different tax standards for businesses. The Entrepreneur Startup Growth Act turns this tough time into an opportunity by offering affordable business tax assistance in conjunction with business development services so these companies can continue to grow and create jobs."

The Entrepreneur Startup Growth Act builds on the Self-Employment Tax Initiative launched by CFED, a nonprofit economic opportunity organization. The legislation creates a grant program that would offer free business tax preparation services to low-income self-employed individuals who file a schedule C tax return. This will help their businesses grows and it promotes asset-building for low-income households.

"This program will help entrepreneurs save money and ensure that they access all the tax credits for which they are eligible,” continued Chu. “By building their economic security and helping them grow their business we drive American job growth.”

9.8 million self-employed individuals – nearly two-thirds of all self-employed people – are operating business startups: unincorporated businesses less than five years old that are still in their developing stages and feature just one employee, the business owner himself. Startups in their first year of existence create an average of 3 million jobs per year. Nearly all net job creation since 1980 has occurred in small business startups less than five years old.

American Jobs Act Provides Resources for Start-up Businesses, Replacing Outdated Homes and Aid to Unemployed

By Katherine Lucas McKay on 09/13/2011 @ 04:46 PM

Tags: Policy Alerts, Federal Policy, Entrepreneurship, Financial Capability

Ask your legislators to support the American Jobs Act!

Last week, President Obama delivered a $447 billion package of job creation proposals to a joint session of Congress. The proposals have been packaged into legislation, called the American Jobs Act, that Congressional leaders will consider in the coming weeks. Details of the proposed legislation are below.

The proposals will not only spur job creation and economic growth, they will also deliver substantial benefits to low-income working families, microenterprises and new entrepreneurs. CFED is thrilled that one key element is the expansion of the Self-Employment Assistance Program (SEA), which enables aspiring entrepreneurs to utilize unemployment insurance money to fund their businesses for up to 26 weeks, providing roughly $10,000-$13,000 in assistance. Currently only seven states provide this benefit. The proposal makes the program available to all states. In addition to expanding SEA, the President's proposals reflect several other CFED priorities for job creation and new business formation.

The economic research firm Macroeconomic Advisers says that the American Jobs Act would boost GDP by 1.3% and increase employment by 1.3 million jobs by the end of 2012. The legislation would achieve this through a combination of new spending to support cash-strapped state and local governments and invest in infrastructure improvements as well as $250 billion in tax cuts to employers and employees.

Key tax measures include:

  • Cut in half the payroll taxes that businesses pay on their first $5 million in employee wages and salaries. As 98% of U.S. firms have payroll expenses under $5 million, this tax cut will provide significant, targeted assistance to the small firms that drive job creation. This cut applies to all employers including nonprofit organizations, which employ 11 million workers.
  • Provide a 100% payroll tax holiday for employers for newly added workers and increased wages paid to current employees.
  • Extend and increase the current payroll tax holiday by cutting payroll taxes by 50% for 160 million workers in 2012. The average American household will receive a $1,500 tax cut.
  • Offer a $4,000 tax credit to employers that hire long-term unemployed workers. We are unsure if this credit applies to nonprofits, which do not have a federal tax liability.

The American Jobs Act also includes key provisions to help small business owners better access capital and finance investments in their businesses. Two in particular will deliver benefits to microenterprise owners:

  • Allow firms to raise capital through crowd-funded investments (numerous small-dollar investments up to as much as $1 million solicited and bundled through websites such as Kickstarter). Currently, money raised through crowd-funding is counted as donations; allowing supporters to invest instead could greatly expand the amount of funding that entrepreneurs can raise.
  • Extend through 2012 firms' ability to deduct 100% of business expenses.

The Act also includes support for unemployed workers who are seeking new jobs and those who are starting their own businesses:

  • Extend emergency unemployment compensation to prevent 5 million Americans who are looking for work from losing their benefits.
  • Allow states to implement wage insurance to help reemploy older workers and programs that make it easier for unemployed workers to start their own businesses--including expansion of the Self-Employment Assistance Program (SEA) and changes to the Workforce Investment Act. The plan proposes increasing the number of states that have programs including a one-stop mechanism to enable states to connect entrepreneuers with mentoring and access to capital through the SBA and other resources.
  • Prohibit employers from discriminating against unemployed workers when hiring.
  • Encourage Work-Sharing by permitting workers whose employers choose work-sharing over layoffs to receive unemployment compensation.
  • Create a new “Bridge to Work” employment retraining program based on a controversial Georgia state program.
  • Establish a fund to support for successful approaches for subsidized employment, innovative training programs and jobs for low-income youth.

Finally, the American Jobs Act also supports job-creating infrastructure and facilities investments:

  • Provides $15 billion in investments to rehabilitate and refurbish hundreds of thousands of vacant and foreclosed homes. We will work with the HUD Secretary to ensure that replacing outdated mobile homes with ENERGY STAR manufactured homes could be an eligible use.
  • Support salaries of up to 280,000 teachers as well as police and firefighters to prevent layoffs that would harm our children and diminish public safety.
  • Modernize and renovate 35,000 public schools across the country, including community colleges. 40 percent of these funds will be directed toward the 100 largest high-need public school districts.
  • Establish a National Infrastructure Bank to ensure that America's future infrastructure investment needs will be met and our nation can support the activities of a competitive, growing economy.
  • Make immediate investments in U.S. roads, railways, airports and waterways while putting hundreds of thousands of unemployed construction workers back on the job.
  • Support public-private partnerships to rehabilitate homes and communities.

Ask your Senators and Representative to support the American Jobs Act!

  • Click the "Take Action" link to send an email to your legislators.
  • Follow up with a call to their offices. Call the Capitol Switchboard at 202.224.3121 and ask to be connected.
  • Say that you want them to support the American Jobs Act because it will support job creation and economic growth while strengthening supports for low-income working households, new entrepreneurs, and microenterprises and should be paid for by tax increases as proposed.
  • Share this alert with your colleagues and friends.

Federal Policy Update: Debt Ceiling Deal and Economic Development

By Carol Wayman on 08/02/2011 @ 02:00 PM

Tags: Federal Policy, Policy Alerts

Moments ago, the Senate voted to approve a plan that would increase the debt ceiling and decrease the federal deficit by roughly $1 trillion over the next ten years. The plan, which earned approval from the House yesterday, will go to President Obama to sign into law by the end of the day today.

While a much-needed step in ensuring the U.S. government avoids defaulting on debts, the plan does not go far enough given the needs of low- and moderate-income Americans. In order for a deficit reduction plan to truly do what is needed for these disadvantaged communities, a reduction in spending is needed alongside increases in revenue. Those revenue increases, however, are missing from the bill.

In other federal policy news, my opinion piece calling for greater investment in economic development activities by the Federal Home Loan Bank system was published in the 36th anniversary edition of Shelterforce Magazine. Read the piece here, and then use the comments section below to weigh in on how the FHLB’s Affordable Housing Program can serve as a model for expanding the nation’s economic development system.

CFED Joins 246 Organizations to Oppose the Balanced Budget Amendment

By Carol Wayman on 07/14/2011 @ 10:45 AM

Tags: Federal Policy, Policy Alerts

In a letter released yesterday, CFED joined 246 leading national organizations urging members of Congress to oppose a balanced budget amendment to the Constitution. Both the House and Senate are expected to vote on such an amendment next week.

Dear Representative/Senator:

The undersigned national organizations strongly urge you to oppose any balanced budget amendment to the United States Constitution.

A balanced budget constitutional amendment would damage the economy, not strengthen it. Demanding that policymakers cut spending and/or raise taxes, even when the economy slows, is the opposite of what is needed to stabilize a weak economy and avert recessions. Such steps would risk tipping a faltering economy into recession or worsening an ongoing downturn, costing large numbers of jobs while blocking worthy investments to stimulate jobs and growth and address the nation's urgent needs in infrastructure and other areas.

Furthermore, the version of the balanced budget amendment that the House Judiciary Committee recently approved (H. J. Res. 1) would impose an arbitrary and severe cap on total federal spending, which, remarkably, would require much deeper cuts than the draconian cuts in the Ryan budget resolution. The bill also would require supermajority votes in the House and Senate to increase the debt limit, waive the balanced budget requirement — or to raise any taxes, including closing the most egregious tax loopholes. This irresponsible requirement would create an extremely steep hurdle to raising any revenues — effectively blocking revenue measures even as part of packages to restore long-term solvency to Social Security and Medicare — while protecting the more than $1 trillion a year in "tax expenditures" and forcing severe program cuts.

In short, this amendment is a recipe for making recessions more frequent, longer, and deeper, while requiring severe cuts that would harshly affect seniors, children, veterans, people with disabilities, homeland security activities, public safety, environmental protection, education and medical research. It would almost certainly necessitate massive cuts to vital programs including Social Security, Medicare, Medicaid, veterans' benefits and other programs, and, as noted, lead to even deeper cuts than the House-passed budget.

A responsible deficit reduction plan must embrace both spending cuts and new revenues, including curbing special-interest tax loopholes, not a one-sided reliance on spending cuts.

A balanced budget amendment has no place in the Constitution of the United States. Our Constitution has served the nation well because it represents enduring principles that are the foundations of our government. It should not be used as a substitute for real leadership on fiscal policy.

We strongly urge you to oppose any constitutional balanced budget amendment.


9to5, National Association of Working Women
African American Health Alliance
AIDS Alliance for Children, Youth & Families
AIDS Foundation of Chicago
AIDS Project Los Angeles
AIDS United
Alliance for a Just Society
Alliance for Excellent Education
Alliance for Retired Americans
Alliance to End Hunger
American Association of Classified School Employees (AACSE)
American Association of Colleges for Teacher Education
American Association of Community Colleges
American Association of School Administrators (AASA)
American Association of University Women (AAUW)
American Counseling Association
American Dance Therapy Association
American Educational Research Association
American Federation of Government Employees, AFL-CIO
American Federation of School Administrators, AFL-CIO
American Federation of State, County and Municipal Employees (AFSCME)
American Federation of Teachers, AFL-CIO
American Humane Association
American Medical Rehabilitation Providers Association (AMRPA)
American Network of Community Options and Resources
American Postal Workers Union, AFL-CIO
American Public Health Association
American School Counselor Association
Americans for Democratic Action
The Arc of the United States
Asian & Pacific Islander American Health Forum
Association for Career and Technical Education
Association of Assistive Technology Act Programs (ATAP)
Association of Education Service Agencies (AESA)
Association of University Centers on Disabilities (AUCD)
Autism National Committee
Bazelon Center for Mental Health Law
Bread for the World
Building and Construction Trades Dept., AFL-CIO
B'nai B'rith International
CAEAR Coalition
Campaign for America's Future
Campaign for College Affordability
Campaign for Community Change
CANN - Community Access National Network
The Cave Institute
Center for Law and Social Policy (CLASP)
Center for Medicare Advocacy
Center on Budget and Policy Priorities
Child Welfare League of America (CWLA)
Children's Defense Fund
Children's Dental Health Project
Citizens for Responsibility and Ethics in Washington
Citizens for Tax Justice
Clinical Social Work Association
Coalition of Labor Union Women
Coalition on Human Needs
Committee for Education Funding Common Cause
Communications Workers of America (CWA)
Community Action Partnership
Community Food Security Coalition
Community Organizations in Action
Consortium for School Networking (CoSN)
Corporation for Enterprise Development (CFED)
Council for Exceptional Children
Council for Opportunity in Education
Council of the Great City Schools
Dab the AIDS Bear Project
Defenders of Wildlife
Democracy 21
Department for Professional Employees, AFL-CIO
Direct Care Alliance
Disability Rights Education and Defense Fund
Easter Seals
Every Child Matters Education Fund
Families USA
Federally Employed Women (FEW)
Feminist Majority
First Focus Campaign for Children
Food & Water Watch
Food Research & Action Center (FRAC)
Friends Committee on National Legislation
Friends of the Earth
Gay Men's Health Crisis
Generations United
Gray Panthers
Growth & Justice
Half in Ten
Health & Disability Advocates
Health Care for America Now
Health GAP (Global Access Project)
HIV Law Project
Horizons for Homeless Children
Housing Works
Interfaith Worker Justice
International Association of Fire Fighters
International Association of Machinists and Aerospace Workers
International Brotherhood of Boilermakers, Iron Ship Builders, Blacksmiths, Forgers, and Helpers, AFL-CIO
International Brotherhood of Teamsters
International Federation of Professional & Technical Engineers (IFPTE)
International Reading Association
International Society for Technology in Education
International Union of Police Associations, AFL-CIO
International Union, United Automobile, Aerospace & Agricultural Implement Workers of America (UAW)
Knowledge Alliance
Laborers' International Union of North America, (LiUNA!)
Latino Commission on AIDS
The Leadership Conference on Civil and Human Rights
League of Conservation Voters
League of Women Voters of the U.S.
Learning Disabilities Association of America
Main Street Alliance
Medicare Rights Center
Mennonite Central Committee U.S., Washington Office
Mental Health America
National Academy of Elder Law Attorneys
National Active and Retired Federal Employees Association (NARFE)
National Advocacy Center of the Sisters of the Good Shepherd
National AIDS Housing Coalition
National Alliance for Partnerships in Equity
National Alliance of HUD Tenants
The National Alliance to Advance Adolescent Health
National Asian Pacific American Women's Forum
National Assembly on School-Based Health Care
National Association for Children's Behavioral Health
National Association for College Admission Counseling
National Association for Music Education
National Association for State Community Services Programs (NASCSP)
National Association for the Education of Young Children
National Association of Area Agencies on Aging (n4a)
National Association of Councils on Developmental Disabilities
National Association of County Behavioral Health and Developmental Disability Directors (NACBHDD)
National Association of Federally Impacted Schools
National Association of Government Employees/SEIU
National Association of Housing and Redevelopment Officials (NAHRO)
National Association of Letter Carriers
National Association of Nutrition and Aging Services Programs (NANASP)
National Association of People with AIDS (NAPWA)
National Association of Postal Supervisors
National Association of Secondary School Principals
National Association of State Head Injury Administrators
National Black Child Development Institute
National Center for Law and Economic Justice
National Coalition for LGBT Health
National Coalition for Mental Health Recovery
National Coalition of STD Directors
National Committee to Preserve Social Security and Medicare
National Congress of American Indians
National Consumer Voice for Quality Long-Term Care
National Council for Community and Education Partnerships (NCCEP)
National Council for Community Behavioral Healthcare
National Council of Jewish Women
National Council of La Raza (NCLR)
National Council of Women's Organizations (NCWO)
National Council on Independent Living
National Disability Rights Network
National Education Association (NEA)
National Employment Law Project (NELP)
National Family Caregivers Association
National Family Farm Coalition
National Federation of Federal Employees
National Gay and Lesbian Task Force Action Fund
National Health Care for the Homeless Council
National Health Law Program
National Hispanic Council on Aging (NHCOA)
National Housing Trust
National Immigration Law Center
National Indian Head Start Directors Association
National Latina Institute for Reproductive Health
National Law Center on Homelessness & Poverty
National Low Income Housing Coalition
National Minority AIDS Council (NMAC)
National Organization for Women (NOW)
National Partnership for Women & Families
National Postal Mail Handlers Union (NPMHU)
National Priorities Project
National Respite Coalition
National Rural Education Advocacy Coalition (NREAC)
National Rural Education Association (NREA)
National School Boards Association
National Senior Citizens Law Center
National Senior Corps Association (NSCA)
National Title I Association
National Treasury Employee Union
National Urban League
National WIC Association
National Women's Conference Committee
National Women's Law Center
National Women's Health Network
Natural Resources Defense Council (NRDC)
NETWORK, A National Catholic Social Justice Lobby
Not Dead Yet
OMB Watch
Our Bodies Ourselves
OWL-The Voice of Midlife and Older Women
People For the American Way (PFAW)
Pension Rights Center
PHI – Quality Care through Quality Jobs
Population Action International
Progressive States Action
Promise the ChildrenPublic Citizen
Racial and Ethnic Health Disparities Coalition (REHDC)
School Social Work Association of America
Service Employees International Union (SEIU)
Services and Advocacy for GLBT Elders (SAGE)
Sisters of Mercy Institute Justice Team
Southeast Asia Resource Action Center
Stewards of Affordable Housing for the Future (SAHF)
Sudden Cardiac Arrest Association
Sugar Law Center for Economic and Social Justice
Teaching Strategies, Inc.
Transportation Trades Department, AFL-CIO
Treatment Access Expansion Project
Trust for America's Health (TFAH)
Union for Reform Judaism
United Cerebral Palsy
United Church of Christ Justice and Witness Ministries
United Food and Commercial Workers, International
United for a Fair Economy
The United Methodist Church – General Board of Church and Society
United Mine Workers
United Spinal Association
United Steelworkers (USW)
U.S. Labor Against the War (USLAW)
US Psychiatric Rehabilitation Association (USPRA)
Voices for America's Children
Voices for Progress
Wider Opportunities for Women (WOW)
The Wilderness Society
The Women of Color Policy Network, NYU Wagner
Women of Reform Judaism
Women Together for Change (WTFC)
Women's Institute for a Secure Retirement (WISER)
Women's Institute for Freedom of the Press
World Knowledge Bank
YouthBuild USA

Growing Support for Matched Savings Legislation

By Inemesit Imoh, Guest Contributor on 06/28/2011 @ 12:30 PM

Tags: Matched Savings, Policy Alerts

Matched savings accounts have been proven to be successful financial products that help low-income households save and build wealth. Since its inception in the early 1990s, matched savings accounts (often called Individual Development Accounts) have helped working poor families buy homes, pursue higher education and start their own businesses, improving their financial security.

CFED has been working to provide savings incentives for low-income households on the Federal level for several years. This Congress, there have been several bills introduced that help low-income families save and they are both increasing in support.

Congressman John Lewis (D-GA) introduced the Stephanie Tubbs Jones Assets for Independence Reauthorization Act (H.R. 6354). The bill proposed to update and simplify the Assets for Independence program. Three legislators recently signed on as cosponsors: Congressmen Bobby Rush (D-IL), Steven Rothman (D-NJ) and Tim Ryan (D-OH).

Congresswoman Jenkins and Congressman Kind introduced bipartisan legislation to expand the Saver’s Credit to include 529 College Savings Accounts. The bill, the Savings Enhancement for Education in College Act, recently gained the co-sponsorship of Congressman Lynch (D-MA).

CFED will continue to work to expand matched savings accounts to Americans across the country. Please visit our website at to learn more about CFED’s federal policy priorities and to send letters to your legislators asking them to support these bills and other savings policies.

Bill to reform the asset limit test of the Supplemental Security Income program proposed

By Kristin Lawton on 06/03/2011 @ 10:38 AM

Tags: Federal Policy, Policy Alerts, Financial Capability

Reform would enable people with disabilities to open bank accounts, work and save towards financial self-reliance

Today, a bill that would enable and encourage low-income people with disabilities to work, save and build wealth, and open bank accounts was introduced in the U.S. House of Representatives.

People with disabilities face significant challenges to building wealth and achieving financial self-reliance. Nearly 50 million Americans have a disability and close to 60% of these are asset poor, meaning they have insufficient assets to survive at the poverty level for three months. This population of people is often dependent on public assistance; however, the asset limits of these programs pose serious obstacles for low-income families trying to become self-reliant.

This is particularly true for recipients of the Supplemental Security Income (SSI) program, where eligibility is limited to those who have no more than $2,000 in assets for an individual and $3,000 for a couple. If they have an emergency—a family member dies, a car breaks down, a roof needs repair—they are allowed little in savings to fall back on, leaving them vulnerable to predatory lenders and deeper poverty, and requiring them to ultimately rely on greater government assistance. These outdated rules pose as a serious obstacle to becoming financial self-reliant.

The SSI Savers Act of 2011 (H.R. 2103), introduced by Congressman Tom Petri (R-WI) and Congresswoman Tsongas (D-MA), will reform the asset limit test of the Supplemental Security Income program. H.R. 2103 would help people with disabilities on SSI by reducing disincentives and allowing recipients to build a financial cushion while retaining their benefits.

The SSI Savers Act of 2011 proposes the following:

  • Increase asset limits from $2,000 (single) and $3,000 (married) to $5,000 and $7,500 respectively, and indexes those limits to inflation.
  • For recipients younger than 65, the bill excludes retirement accounts, education savings, and individual development accounts from counting against the limit.
  • For recipients 65 and older, it allows retirement accounts up to $50,000 (single) / $75,000 (married) to reduce SSI benefits accordingly instead of creating an immediate cut off.

Take Action!

Take action by asking your legislators to become cosponsors of the SSI Savers Act of 2011 (H.R. 2103).

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