Bringing Leaders Together to Inspire change

1. Bringing Leaders Together to Inspire change Presents A poverty symposium dedicated to the proposition that our leaders and our citizens have the strength and ability to work together to turn despair into hope and hope into action. Dr. Ralph Nunez Tim Smeeding Mayor Tom Barrett Pat Mc Manus Conor Williams

2. Welcome! Presents “Bringing Leaders Together to Inspire Change”

3. Homelessness: Much More Than a Housing Issue Dr. Ralph Nunez President, Institute for Children, Poverty and Homelessness

4. Break

5. How the Safety Net Protected Wisconsin Families from Poverty in 2010 Tim Smeeding Director, Institute for Research on Poverty, University of Wisconsin

6. How the Safety Net Protected Wisconsin Families from Poverty in 20104th Annual Wisconsin Poverty Report Tim Smeeding IRP Director and Distinguished Professor of Public Affairs UW Madison for the Community Advocates Symposium on Poverty Milwaukee, WI October 11, 2012

7. Overview • The Wisconsin Poverty Measure ( WPM) and the Wisconsin Idea in action • Findings from 2012 4th Wisconsin Poverty Report ( Released April 25th, 2012) • What did we find ? • Why did it happen (WI economy vs. benefits) ? • So what does it mean? • Conclusion: the safety net is working in Wisconsin –and likely elsewhere

8. About the Wisconsin Poverty Measure: 2009-2012 and Its Goals • Develop a more comprehensive measure of poverty that reflects federal and state programs aimed at the poor during the recession, especially noncash programs and refundable tax credits (next slide) • Inform the Wisconsin public and its policy makers about the effects of federal and state policies, including the ARRA, on poverty and economic well-being • Tailor this measure to the policies & priorities of Wisconsin citizens, nonprofits and policy makers • Provide a transparent, straightforward model for other states and localities to emulate

9. How Programs to Help Poor in the US (and Wisconsin) Have Changed, 1970-2010 Annual Expenditures, Means-Tested Programs (Billions of 2010 Dollars)

10. A Look Forward : What Do We Find? • Poverty rates in Wisconsin under the Wisconsin Poverty Measure were lower than the official measure rates, and fell by a significant amount from 2009-2010 • The recession-plagued economy drove own Market Income poverty rates higher in Wisconsin in 2009 and 2010 • But the safety net worked very well to protect Wisconsin's low income people from poverty in 2009,and even better in 2010

11. Two Methods of Poverty Measurement: An Overview Official poverty line Developed in 1960s, based on food costs and expected share for food budget, since that time adjusted for prices only Cash income (pre-tax) but including cash government benefits like social security , workers comp., and unemployment ins. Census “family” unit NAS-like Poverty Line Basic expenses food, clothing, shelter, utilities averaged over three years ( next slide) Adjusted for Wisconsin cost of living, housing tenure, & medical expenses More Family Resources Cash income as in left panel: +/- Taxes & tax credits + Non-cash benefits (inc. Food Stamps) - Work expenses (inc. childcare) Expanded Poverty Unit Census family + unmarried partner & foster children; minus college students who do not work Official Measure Wisconsin Poverty Measure Threshold (Economic need) Resources Family considered

12. The 2009 and 2010 WPM Poverty Lines vs. the Official Poverty Line • The official poverty line( for four person family) was $22,113 in 2010 • The WPM line was $25,919, $3800 higher in 2010,reflecting 3 year avg. expenditures on food, clothing, shelter and utilities • The 2009 WPM was $26,235 –a bit higher than the WPM in 2010 • The WPM fell from 2009-2010 due to lower ( national) avg.expenditures on necessities by low income units in the recession

13. Three Resource Concepts for Three Sets of Poverty Rates • Market Income (MI) based poverty rates –including only own earnings and private investment and retirement incomes • Official Measure (OM) poverty rates- which are based only on cash income only • Wisconsin Poverty Measure (WPM)-which includes the effects of housing costs, child care costs, medical costs as well as taxes, refundable tax credits and noncash benefits like SNAP and public housing

14. Figure 1. Wisconsin Poverty Rates Under Three Measures, 2008–2010 Source: IRP tabulations using 2008–2010 American Community Survey data. Notes: Market income includes earnings, investment income, private retirement income, child support, and other forms of private income. Both the market-income measure and the WPM are based on the WPM thresholds, definition of family unit, and treatment of work and medical expenses, which differ from the thresholds and methodologies of the official measure, as described in the methods section below. *Means that the difference between 2009 and 2010 was statistically significant.

15. The Trend in Wisconsin Poverty • MI poverty rises as the economy worsens and job losses from the recession begin to cut market incomes , especially earnings • OM poverty rises, counting cash incomes alone ( even when including cash benefits like unemployment insurance, for example) • But WPM poverty falls as refundable tax credits and noncash benefits like SNAP( FoodShare) increase to offset declining earnings amongst the poor

16. Why ? : The Wisconsin Economy, ‘FoodShare’ (SNAP) and tax credits(EITC) • The data we use here ( 2010 American Community Survey or ACS ) covers the period January 2009-November 2010 as shown below • During this period the number of jobs in Wisconsin fell by about 5 percent and stayed there . • Benefits from SNAP(‘FoodShare’) rose quickly in Wisconsin in part due to the ( former) Governor Doyle’s poverty task force and active efforts to inform the public of their eligibility • FoodShare beneficiaries increased faster in Wisconsin than in the nation as a whole and especially outside of Milwaukee

17. Figure 2. Number of Individuals Employed and Monthly Job Gains/Losses in Wisconsin, 2007–2011 Source: Seasonally adjusted Bureau of Labor Statistics data on total non-farm employment. Notes: The 2010 poverty rate is based on economic conditions from January 2009 through November 2010, because the American Community Survey (ACS) data for each year are collected throughout the calendar year, and include references to income over the previous 12 months, hence, spanning a total of 23 months, as shown in the chart. For reference, the official recession began in December 2007 and ended in June 2009.

18. Figure 3. Changes in SNAP Benefit Caseloads in Wisconsin and the United States, 2007–2010 Source: Data on SNAP participation are from the FoodShare data website of the Wisconsin Department of Health Services. Notes: The number of cases in Wisconsin is shown on the left-hand scale of the y-axis, while that for the United States is on the right-hand scale of the y-axis.

19. “Food Share” Benefits in Wisconsin , and May 2012 Legislative Audit Bureau Report • In our simulations, we added about $.76 billion in SNAP to the 2010 ACS, close to LAB 2010 totals. • These totals reflect both the growing WI caseload and the ARRA’s 14 percent increase in benefits effective April, 2009 • The 2012 LAB report says: In FY 2011, 1.1 million persons received $1.1 billion in ‘FoodShare’ benefits in WI, with error rates for benefit denial of eligibles and for benefit overpayments both falling to 2.6 percent and 2.0 percent respectively http://legis.wisconsin.gov/lab/reports/12-8highlights.htm

20. Refundable Tax credits in Wisconsin with state EITC –an example • Benefits for workers, subsidy rate as high as 40% up to $20,000 (marrieds), then phased out; expanded in 1980s/1990s • Distributionally, helps those most in the $10K-$30K range • Research: positive effects on LFP of single mothers, zero on men, small negative on hours of married women • Generally taken as a refund and single mothers use to draw down debt

21. EITC and other refundable tax credits in Wisconsin : A summary • The 2009 ARRA increased federal income tax credits by expanding the EITC (new tier for three children) and the refundable Child Tax Credit and by creating the Making Work Pay tax credit. • WI’s state credit was an additional 14 percent of the federal credit in 2009 and 2010. • There was a 21 percent increase in the total amount of EITC credits alone in Wisconsin alone (from $643 million in 2008 to $780 million in 2009 ). • According to our tax calculations using ACS and state administrative data, the total amount of all tax refunds in Wisconsin, both federal and state, increased by 39 percent from $.92 billion to $1.28 billion ( between 2008 and 2009), and remained at about $1.26 in 2010. .

22. More Results: Level and Trend (2008-2010) in Poverty for Vulnerable Groups • Poverty in Wisconsin was lower for children and a bit higher for elders than the OM • Child poverty in Wisconsin is still above average but very close to the overall poverty rate in this state • The trends show that child poverty fell in Wisconsin despite decreases in parents market incomes, especially earnings • Elderly poverty rates were flat and stayed at just under 10 percent

23. Figure 4. Poverty in Wisconsin in 2010Overall and for Two Vulnerable Groups Source: IRP tabulations using 2010 American Community Survey data. Note: Market income includes earnings, investment income, private retirement income, child support, and other forms of private income. Both the market-income measure and the WPM are based on the WPM thresholds, definition of family unit, and treatment of work and medical expenses, which differ from the thresholds and methodologies of the official measure, as described in the methods section above.

24. Figure 5. Child Poverty Rates in Wisconsin under Different Poverty Measures, 2008–2010 Source: IRP tabulations using 2008–2010 American Community Survey data. Notes: * = The difference between 2009 and 2010 was statistically significant.

25. Figure 6. Elderly Poverty Rates in Wisconsin under Different Poverty Measures, 2008–2010 Source: IRP tabulations using 2008–2010 American Community Survey data. Notes: The change between 2009 and 2010 was not statistically significant under either measure.

26. What Drove Overall and Child Poverty Rates Down ? Four policy levers that affected WI poverty: • Refundable tax credits like the EITC (federal and state) and child tax credits • Noncash benefits like SNAP (FoodShare) public housing, LIHEAP 3. Work related expenses like child care, affected by CARES, and commuting costs 4. Out of pocket health care costs , affected by BadgerCare

27. Figure 7. Effects of Taxes, Public Benefits, and Expenses on Overall Poverty in Wisconsin, 2008–2010 Source: IRP tabulations using 2008–2010 American Community Survey data. Note: SNAP = Supplemental Nutrition Assistance Program.

28. Figure 8. Effects of Taxes, Public Benefits, and Expenses on ChildPoverty in Wisconsin, 2008–2010 Source: IRP tabulations using 2008–2010 American Community Survey data. Note: SNAP = Supplemental Nutrition Assistance Program.

29. Figure 9. Effects of Taxes, Public Benefits, and Expenses on Elderly Poverty in Wisconsin, 2008–2010 Source: IRP tabulations using 2008–2010 American Community Survey data. Note: SNAP = Supplemental Nutrition Assistance Program.

30. Poverty Within Wisconsin's Borders • ACS big enough to accurately show poverty in areas of 100,00o persons within the state • Poverty varied across counties within the state with two areas having significantly higher poverty rates (Chippewa/Eau Claire and Milwaukee) and many areas having significantly below state average rates (for instance, the northern Milwaukee suburbs Waukesha, Ozaukee, Washington) • But still within Milwaukee county, poverty rates varied from 5 to 36 percent!

31. Map 1. Wisconsin Counties and Multicounty Areas with 2010 WPM Poverty Rates Above or Below the State Rate of 10.3 Percent Source: IRP tabulations using 2010 American Community Survey data. Notes: WPM = Wisconsin Poverty Measure.

32. Map 2. 2010 WPM Poverty Rates within Milwaukee County by PUMA* Source: IRP tabulations using 2010 American Community Survey data. Note: The state poverty rate calculated with the WPM in 2010 was 10.3%. All differences between the regional estimates and the state average as examined here were statistically significant. *Public Use Microdata Areas (PUMAs) are predefined areas designated by the U.S. Census Bureau that have 100,000 or more residents.

33. Our Conclusion: the Safety Net is Working in Wisconsin • In times of need, a safety net that enhances low earnings for families with children, puts food on the table, and encourages self-reliance can make a big difference in combating poverty • All Wisconsinites should be proud of this outcome • The recession surely had substantial negative effects on housing, jobs, debt and incomes of the “middle class”, but the poor were protected • Next year, with some sponsorship, we hope to show that poverty fell because of increased market incomes, as good jobs paying decent wages are the real solution to poverty

34. Anti-Poverty Program Summary and Outlook • The WI economy worsened in 2009-2010 and has stayed in bad shape though 2011 • SNAP(FoodShare) benefits and refundable tax credits rose to met the challenge • In 2011 benefits increased again (SNAP) or remained very high( refundable tax credits) • 2011 numbers will reflect a decrease in the WI state EITC from 14 to 11 percent, the elimination of the making work pay credit, and also the 2011 and 2012 payroll tax reduction of 2.0 percent for all workers

35. Other Avenues to Explore • Racial and ethnic dimensions of poverty in Wisconsin (and within/around Milwaukee) • Effects of the recession on the near poor and the lower middle class, those between 1.0 and 2.0 times the poverty line where 39 percent of children are located nationwide (http://www.census.gov/hhes/povmeas/methodology/supplemental/research/SEHSD2012-18.pdf) • Simulate the effects of budget cuts likely to take place for SNAP and refundable tax credits in 2013

36. An Important Note on Poverty Thresholds: Timing Matters • Semi-relative poverty thresholds like the NAS Wisconsin line can actually fall in bad times • Longer time periods (e.g. a 5 year threshold such as with the national SPM ) would mean higher semi-relative thresholds over the 2008-2010 period, but may fall when the bad time years (2009-2011) are added on and the good times years (2006-2008) are dropped in the coming years • Using an ‘anchored’ poverty line - taking the WPM WI line for 2008, and increasing it by prices only to 2010 - means a higher WI poverty threshold (rising by 1.3 %) and a fall of only .2 percent in the 2010 WI poverty rate • But even with the anchored line, WI child poverty fell by 2.0 percentage points in 2010

37. Where to find the report? • Online at: http://www.irp.wisc.edu/research/WisconsinPoverty/pdfs/WIPovSafetyNet_Apr2012.pdf • With additional information and longer methodological and technical reports on WPR at: http://www.irp.wisc.edu/research/wipoverty.htm Also of interest, an IRP Fast Focus ‘consumers guide’ to poverty measures: http://www.irp.wisc.edu/publications/fastfocus/pdfs/FF14-2012.pdf

38. Acknowledgements • The Wisconsin Poverty Measure Team: Yiyoon Chung, Julia Isaacs, Timothy Smeeding, and Katherine Thornton • Funding from U.S. HHS (ASPE) and Census Bureau , but now expired/extinguished/done • Invaluable assistance from others: -Input from stakeholders in Wisconsin -National, state and local experts on poverty -Use of state administrative data housed at IRP to allocate full noncash benefits and tax credits

39. Lunch

40. Poverty In Milwaukee Mayor Tom Barrett City of Milwaukee

41. Break

42. Poverty in the African American Community in Milwaukee: Time, Place and Race Does Matter Pat McManus President/CEO, Black Health Coalition of Wisconsin

43. Community AdvocatesPoverty Symposium Poverty in the African American Community In Milwaukee: Time, Place and Race Matter Patricia McManus, PhD, RN, GCNPM October 11, 2012 Black Health Coalition of Wisconsin, Inc.

44. Life Course Theory • The study of people's lives, structural contexts, and social change. In particular, it directs attention to the powerful connection between individual lives and the historical and socioeconomic context in which these lives unfold. • The life course perspective elaborates the importance of time, context, process, and meaning on human development and family life • The family is perceived as a micro social group within a macro social context—a "collection of individuals with shared history who interact within ever-changing social contexts across ever increasing time and space" (Bengston and Allen 1993, p. 470). Black Health Coalition of Wisconsin, Inc.

45. Life Course Theory • Life course theory, more commonly termed the life course perspective, refers to a multidisciplinary paradigm for the study of people's lives, structural contexts, and social change. • This approach encompasses ideas and observations from an array of disciplines, notably history, sociology, demography, developmental psychology, biology, and economics. • In particular, it directs attention to the powerful connection between individual lives and the historical and socioeconomic context in which these lives unfold. Black Health Coalition of Wisconsin, Inc.

46. Life Course Theory • As a concept, a life course is defined as "a sequence of socially defined events and roles that the individual enacts over time" (Giele and Elder 1998, p. 22). • These events and roles do not necessarily proceed in a given sequence, but rather constitute the sum total of the person's actual experience. • Thus the concept of life course implies age-differentiated social phenomena distinct from uniform life-cycle stages and the life span. Black Health Coalition of Wisconsin, Inc.

47. Life Course Theory • Life span refers to duration of life and characteristics that are closely related to age but that vary little across time and place. • In contrast, the life course perspective elaborates the importance of time, context, process, and meaning on human development and family life (Bengtson and Allen 1993). The family is perceived as a micro social group within a macro social context—a "collection of individuals with shared history who interact within ever-changing social contexts across ever increasing time and space" (Bengston and Allen 1993, p. 470). Black Health Coalition of Wisconsin, Inc.

48. Life Course Principles • Social historical and geographical location • Timing of lives • Heterogeneity or variability • Linked lives and social ties to others • Human agency and personal control and • How the past shapes the future. Black Health Coalition of Wisconsin, Inc.

49. Human Agency and Personal Control • According to life course perspective, individuals are active agents who not only mediate the effect of social structure, but also make decisions and set goals that shape social structure. • Individuals are assumed to have the capacity to engage in planful competence, which refers to thoughtful, proactive, and self-controlled processes that underlie one’s choices about institutional involvements and social relationships. Black Health Coalition of Wisconsin, Inc.

50. Human Agency and Personal Control • However, it should be recognized that the ability to make specific choices depends on opportunities and constraints. • The concept of control cycles suggest that families and individuals modify their expectations and behavior in response to changes in either needs or resources. Black Health Coalition of Wisconsin, Inc.