Economic Stability Indicator

>>>Economic Stability Indicator
Economic Stability Indicator2020-07-28T14:58:59-06:00

The Economic Stability Indicator is a project of the Children’s Defense Fund-Minnesota created to illustrate the interaction between wages, public programs, and tax credits/liability in bringing or failing to bring families to economic stability. The dynamic, online tool can be used to demonstrate the gap that exists between low wages and a basic needs budget and the effect public programs and tax credits can play in filling that gap. The tool can be used by policymakers and legislators to evaluate proposed legislative changes to programs and by families to better understand how wages and public programs can improve their pathway to self-sufficiency.

What are the goals of the Economic Stability Indicator?

  • Educate policymakers and legislators on how current and proposed legislation and tax policies create cliff effects (when wages go up and public program benefits are lost and families experience greater economic instability than at lower wages) and other unintended consequences.
  • Demonstrate how work support programs and tax credits can work together to fill the gap between low-wages and basic expenses and make work pay for low-income families.
  • Illustrate the difficult decisions low-income families must make to make ends meet, especially when programs are not fully funded.
  • Educate families about wage and program interaction so they can make informed choices about employment and program use and also pinpoint savings opportunities to help cushion them in their journey to self-sufficiency.

What programs are included in the Economic Stability Indicator?

  • Medical Assistance
  • MinnesotaCare
  • Advanced Premium Tax Credits
  • Child Care Assistance Program (CCAP)
  • Energy Assistance
  • Women, Infants, and Children (WIC)
  • Child Tax Credit
  • Working Family Credit (WFC)
  • Supplemental Nutrition Assistance Program (SNAP)
  • Federal and State Child Care Tax Credits
  • Minnesota Family Investment Program (MFIP)
  • Section 8 Housing
  • School Meal Program
  • Earned Income Tax Credit

The Basic Needs Budget that estimates expenses based on geography and adjustment for what lower income families would afford includes the following expenses:

  • State and federal tax liability
  • Rent & Energy Assistance (HUD Fair Market Rent), including electricity
  • Food (USDA Low-Cost Food Budget)
  • Health Care (insurance premiums and out-of-pocket expenses)
  • Transportation (National Travel Household Survey)
  • Other Necessities (Consumer Expenditure Survey)
  • Utilities (other than electricity)

These expenses are NOT included in the “bare bones” Basic Needs Budget:

  • Internet or cable
  • Cell phone
  • Travel other than to work and school
  • Debt payments (car, credit card, and school loans)
  • Entertainment
  • School supplies other than school meals
  • Diapers, formula, and other infant related expenses
  • Savings

How can I use the Economic Stability Indicator to analyze a policy proposal?

Children’s Defense Fund-Minnesota has the capability to use the Economic Stability Indicator (ESI) to analyze proposed policy changes to the programs included in this site. CDF-MN has used the tool in collaboration with policymakers, advocates and administration officials to analyze dozens of policy proposals including ACA implementation, minimum wage increases, changes to the Minnesota Family Investment Program cash grant, cuts to food programs, and much more. ESI can be used to illustrate changes to income eligibility, introduction or elimination of program entrance and exit levels, increases or decreases to benefit amounts or to reflect other program rules.

How do people learn to use the Economic Stability Indicator?
Children’s Defense Fund-Minnesota (CDF-MN) provides free training to policymakers, advocacy groups, or counselors who work with families on finances and employment to ensure that they are able to use the Economic Stability Indicator to illustrate and analyze the interaction between wages, public work support programs and tax liability. CDF-MN staff can also manipulate program eligibility levels and benefit calculations to provide a more in-depth analysis of proposed program changes and highlight solutions.

Natletha Gorpu SumoOutreach Coordinator
Program Contact
nsumo@childrensdefense.org
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