September 29, 2009 Michael Cassidy, Executive Director

1. September 29, 2009 Michael Cassidy, Executive Director The Commonwealth Institute for Fiscal Analysis

2. 14 Commissions or Task Forces 8 Poverty Reduction Targets 3 Legislative Caucuses 11 Summits 8 Poverty Reduction Targets

3. United States Virginia

12. Putting Poverty in Perspective • Richmond International Raceway (RIR): home to Virginia’s largest sporting events • Seating capacity: 107,097 • RIR could be filled more than twice with the number of Virginia children living in poverty • RIR could be filled almost 7 times with the number of Virginians living in poverty

17. Unemployment Insurance Recipiency:Only 4 States Extend Fewer Benefits

20. Medicaid Spending:Only 3 States Spend Less

21. Medicaid Eligibility:Only 7 States Have More Stringent Rules

25. State EITCs • Virginia’s started in 2006: 20% of federal • 24 state have enacted EITCs • Includes over half of the 42 states with income taxes • All but 3 are refundable • Momentum: In 2007 and 2008, • 3 new state EITCs passed • 10 states expanded existing EITCs

26. Virginia’s Earned Income Credit (EIC)

27. What’s so great about the EITC/EIC? • Reduces poverty: • The most successful anti-poverty program in the nation • The federal credit alone lifts 4.5 million people out of poverty each year, mostly children • Highly targeted: 95% to families with children • Good for the state economy • Increases workforce participation • May increase uptake of federal EITC • Likely to be spent locally • Partially offsets the high taxes low-income families pay

28. Recommendations: • Make VA Earned Income Credit refundable • Expand Medicaid coverage • Raise minimum wage • Reform unemployment insurance • Expand food stamps • Improve TANF