Equity & Opportunity – Page 11

Addressing the impacts of the cliff effect in Massachusetts

Problem

We know people are working harder and harder but not getting ahead. This problem is particularly salient for our large numbers of low-wage workers depending on public assistance to make ends meet. The Department of Transitional Assistance serves one out of every nine people in Massachusetts with cash benefits and food assistance, but the structure of these programs means that in many cases, benefits are actually contributing to prolonged financial instability. Specifically, eligibility for public benefits has an inverse relationship to income level, which often puts recipients in an impossible position: earning more money can make them worse off if it boosts their income enough to make them ineligible for these benefits. This drop in public benefits that occurs as earnings increase is known as the “cliff effect,” and it explains why some low-wage workers find themselves worse off after a raise.

Solution

We need to offset the disproportionate impact that the cliff effect has on families transitioning out of public assistance and allow them to transition off of benefits without facing an income cliff. My bill, S.119, begins to address this by creating a 3-year pilot program for 100 low-income Western Massachusetts families or individuals who are both working and receiving public assistance. Participants will receive a Massachusetts Earned Income Tax Credit adjustment that rewards work and closes the cliff effect gap during each year of the 3-year program. This bill also includes a savings component of up to $10,000 per participant that would be paid out after the third year of the program. The pilot will test whether the Massachusetts Earned Income Tax Credit can be enhanced to create an effective tool for the state to close the cliff gap in order to ensure that workers are not worse off financially as they move up the income scale.

Maryland Access to Capital Program

Problem

Lending to small businesses has decreased in recent years. Part of the problem is that small businesses without substantial/ solid credit have few options for loans. The same goes for those without adequate collateral or a relationship with a bank. This disproportionately disadvantages low-income residents, immigrants, business owners of color, residents in reentry, etc. Financial exclusion of resource-restricted populations in Marylander is a problem.

Another part of the problem is that non-traditional financial institutions in the business of making loans to these populations face high borrowing costs themselves, minimal incentives to make these loans, and little to no coverage on loan defaults.

Small businesses have been hit extremely hard by the pandemic as they have worked to adapt to a remote environment, comply with pandemic-related requirements, etc. Absent access to credit, small businesses cannot succeed and scale. Job growth and wealth creation are stifled, especially in historically disinvested neighborhoods.

Solution

The Maryland Capital Access Program (MDCAP) encourages banks and other financial institutions to make loans to small businesses – especially those that have been unable to or have had difficulty obtaining loans in the past. MDCAP creates a loan loss reserve program, managed by the Department of Commerce, for financial institutions making qualified loans. Each time a qualifying loan is made to a small business, a percentage of the loan amount is deposited into the loan loss reserve account by the lender, the borrower, AND the State.

The loan loss reserve account mitigates risk loss to a qualifying lender and gives lenders the confidence to be more flexible on collateral and credit requirements. Further, particularly for CDFIs, the loan loss reserve account can decrease the cost of borrowing money. The program motivates lenders to bank a wider band of businesses with the assurance that losses can be recovered from the loan loss reserve account.

This program was the result of legislation sponsored by Maryland Delegate Brooke Lierman and co-filed by Maryland Senator Katie Fry Hester.

Innovation Alabama State Matching Funds Award

Problem

In the State of Alabama, historically there have not been incentives of any kind for startup companies to be attracted to bring their business to the State. The problem was when dealing with STTR and SBIR matching funds, technology startups typically go to the federal level to receive these funds and there are no matching funds that aid them on the State level. In Alabama, when you receive the federal funding that’s all you are eligible to receive. However, in other states there exists a program to match the funds received at the federal level with state funds, creating more of an incentive for businesses to startup in other surrounding states. Through the Innovation Creation Commission created by the Governor of Alabama, I was able to bring HB 609, a bill that would provide matching funds for startups as a means to ensure more businesses stay in the state.

Solution

The solution is simple: ensure that the State of Alabama is able to market itself to viable startups and business, by allowing tech companies to receive additional funding, in this case, up to $100k on the first phase and $250k on the second phase in matching grants.

Establishing a Public Bank in the City of Philadelphia

Problem

As we work to rebound from the devastating effects of the COVID-19 pandemic, we are also seeing with fresh eyes some of the longstanding inequities and disparities exacerbated by this global public health crisis. Equitable economic opportunities and access to capital for many small businesses, particularly minority- and women-owned businesses, are issues that spun out of decades of redlining and systemic racism. Black and Brown neighborhoods in Philadelphia, the poorest of the 10 largest U.S. cities, continue to see increasing levels of poverty and homelessness as a result of lack of equal access to job and entrepreneurial opportunities. Currently, despite Philadelphia having a population that is 43% African American, only 6% of the businesses with employees in the city are Black-owned.

Solution

Creating a municipally owned bank in the City of Philadelphia would enhance the ability of many small businesses and entrepreneurs of color, as well as other grassroots and community organizations to obtain access to capital, establish a lending history, and gain a foothold in generating long-term wealth when existing lenders might otherwise deem them “hard to lend to” or “credit unworthy”.

Community Care Sites

Problem

Wyoming is more than just rural – it is a frontier state that lacks the larger scale infrastructure common in other states. Wyoming lacks a coordinated statewide healthcare system. There is no statewide university system. Opportunities can be scarce for advancement, and women in particular face many barriers to self-sufficiency. Women face hurdles to entering and remaining in the workforce and communities struggle to offer enough child care to meet the demands. When child care is available, affordability is a challenge. Communities are not only isolated but also dispersed, making available infrastructure largely inaccessible. Compound this with a high gender wage gap, workforce recruitment challenges, and a volatile economy subjected to the boom-bust cycles of the energy industry.

Solution

Co-locating child care facilities with community college and agriculture extension offices in communities around Wyoming to create a network of Community Care Sites. This will support affordable child care for parents – especially women – who wish to return to school or work. This will support the growth of an early education workforce to ensure quality and sustainability as students in early education programs can work at the child care facilities. It will attract businesses to the state, helping to diversify Wyoming’s economy, and it will support economic growth as women are able to return to the workforce. Co-locating the facilities also helps expand the idea of institutions of learning as centers for community growth and assists with the often-prohibitive infrastructure costs of building or renovating a site into a code compliant child care facility. It can facilitate easy access to high speed internet for individuals and families that still need those final miles of broadband. It is an opportunity to complete the education circle.

Ascend Birmingham

Problem

Black-owned small businesses lack sufficient resources to create and operate a digital presence and platform, which leaves these businesses to operate exclusively by cash only.

Solution

We are providing black business owners with tools and resources to grow their digital operations with free website software and a free Square terminal to accept digital payments. Ascend Birmingham is the first of its kind in Alabama, and is accomplished through a partnership with Mastercard, Square, Accion Opportunity Fund, and Sunrise by Lendio. The program created an education curriculum that provides active resources to take small businesses to the next level. Ascend Birmingham will help local small businesses pivot and thrive in the new normal of contactless, safe, and socially distanced business practices.

Pop Up Preschool

Problem

Access to quality preschool is an important issue for children in Leon County, especially in our Title 1 neighborhoods where the Kindergarten Readiness Assessment scores are the lowest in the county.

Solution

The Pop-Up Preschool brings a quality child care experience directly to underserved neighborhoods during summer and spring break at no cost to parents. Parents are encouraged to attend with their children to learn how to be their child’s first teacher through engagement, education, and participation in facilitated early learning activities with their child.

Keys to Equity: Building ADUs for Oakland

Problems

Oakland is experiencing a housing affordability and displacement crisis. Over the past decade, rents have increased 72 percent while incomes of Black Oaklanders have decreased by four percent. Black households face a high risk of displacement. 63 percent of Black renters and 45 percent of Black homeowners are considered cost-burdened, the highest of any group. Since 1990, the city’s Black population has decreased by 44 percent.

Accessory Dwelling Units (ADUs) — smaller homes on properties containing a larger, primary house — are an opportunity to provide affordable housing while building homeowner wealth. ADUs typically rent at below-market rates, are cheaper to build, can provide rental income for homeowners, increase property values, provide flexible living arrangements for owners and families, and can help stabilize communities experiencing gentrification. Black Oaklanders would benefit from ADUs but existing structural inequities, including disparities in wealth and access to capital, limit opportunities for ADU development among Black households.

Solutions

Keys to Equity is an initiative of the City of Oakland, the Chan Zuckerberg Initiative, Richmond Neighborhood Housing Services and Self-Help Federal Credit Union to develop affordable homes and increase wealth for Black homeowners in Oakland by facilitating the development of ADUs. The program provides one-on-one project management services to homeowners, educational resources, complimentary ADU designs, permit streamlining, access to innovative financing products and a discounted construction process with a pre-selected general contractor. Although anyone can apply to the program, community-based program partners will conduct outreach efforts to target lower and middle-income Black homeowners.

The program’s goals are to (1) produce more housing that is affordable, (2) build wealth for Black homeowners, (3) stabilize communities at risk of gentrification and displacement and (4) create a scalable model by proving the efficacy and impact of ADU financing and development.

New Standards for Police Use of Force

Problem

Over the last year and a half, the over policing of certain segments of our communities, particularly for Black and Brown residents, has reached a point of reckoning. Communities across the county have faced terrible incidents of excessive use of force at the hands of police, and Montgomery County, Maryland has not been immune. Here in Montgomery County the data demonstrates disparities. While Black residents make up about 20 percent of the county, they make up 55% of use of force incidents. With Latino residents included, that accounts for over 75% of use of force incidents by police. Unfortunately, we have had incidents of police killing black residents and have also had very public incidents of excessive use of force. But for cell phone and body cameras, these incidents would not have come to light.

Solution

We drafted a law to amend the police use of force policy. This policy prohibits a police officer from using deadly force except when absolutely necessary, when no other alternatives are available. This includes prohibiting neck or carotid restraints and striking a restrained individual. The bill bans no-knock warrants and shooting from or at moving vehicles, unless the vehicle is being used as a weapon and the circumstances would authorize the use of deadly force.

The policy must provide guidelines protecting individuals without regard to race, sex, gender identity or sexual orientation. Rules must protect vulnerable community members and populations disproportionately impacted.

The law requires officers to stop or attempt to stop the use of excessive force or the commission of a crime by another officer. Officers who intervene must not be retaliated against or disciplined for taking action.

Equal Access to Justice for Victims and Witnesses of Violent Crimes and Human Trafficking

Problem

The U and T visa programs were created back in 2000 with bipartisan support in Congress to benefit both victims and witnesses as well as law enforcement agencies. Certifications from law enforcement agencies assist victims and witnesses in applying for immigrant protections, and facilitate cooperation with law enforcement from communities that are sometimes wary of law enforcement. Victims and witnesses of crime and trafficking have to submit the certification in order to start the application process. While many agencies and jurisdictions have processes in place for victims and witnesses to obtain certifications, many others do not, and several have not encountered these requests before. As a result, many victims will wait years to get a certification, and many will wait indefinitely, not getting a response at all.

Solution

This idea increases victim and witness participation in the criminal legal system and promotes public safety and assistance to law enforcement by creating a consistent victim certification process for vulnerable immigrant victims and witnesses of crime and trafficking, and standardizes the process for law enforcement, prosecution, and investigatory agencies to provide victims who have been helpful in an investigation or prosecution of serious crimes, described in the federal Violence Against Women Act, the certification form they need to help them apply for a U-visa or a T-visa. It does not require that a law enforcement agency provide certification. It only requires that a decision be made within ninety days. If there are extenuating circumstances, the agency must provide a written explanation for the delay and projected timeline for the issuance of a decision.

Addressing the impacts of the cliff effect in Massachusetts

Problem

Solution

Maryland Access to Capital Program

Problem

Solution

Innovation Alabama State Matching Funds Award

Problem

Solution

Establishing a Public Bank in the City of Philadelphia

Problem

Solution

Community Care Sites

Problem

Solution

Ascend Birmingham

Problem

Solution

Pop Up Preschool

Problem

Solution

Keys to Equity: Building ADUs for Oakland

Problems

Solutions

New Standards for Police Use of Force

Problem

Solution

Equal Access to Justice for Victims and Witnesses of Violent Crimes and Human Trafficking

Problem

Solution

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