March 15, 2011

EITC: Tax refund helps struggling families, boosts local economies

A bill to increase taxes on low- and moderate-income working families could get a hearing before the House Finance Committee this week. House Bill 93 would eliminate the refundable nature of the state Earned Income Tax Credit, which provides an important tax break to more than 800,000 low- and moderate-income working families in North Carolina.

The EITC plays a fundamental role in the fight to help struggling families by delivering tens of millions of dollars in economic benefit to counties across North Carolina. Regions with high poverty rates and soaring unemployment experience widespread benefits from the EITC as families spend their tax refunds close to home, pumping dollars into their local economies. Some of the most economically depressed areas in the state have the highest percent of state EITC returns filed and are receiving the highest total refund dollars.

Check out our new interactive maps of county-level EITC data.

Find out how many people in your county benefit from the EITC and how much it brings to local businesses... then email your state legislators and let them know!

It is deplorable to think of increasing taxes on working families during a time when legislators contemplate lowering taxes on profitable corporations. Maintaining the EITC refundability will help countless families throughout North Carolina, as well as contribute to the greater good of the state’s economy.

HEALTH CARE: Advocates prevail against BCBSNC bill, for now

Last week, advocates for consumer-focused health reform came from all over North Carolina to Raleigh to stand in opposition to House Bill 115. This bill would give insurance companies a hand in regulating themselves in meetings that are closed to the public.

The federal health reform law requires that states create health insurance marketplaces that would also serve as consumer watchdogs. HB 115 would put an enormous amount of the power of North Carolina’s marketplace in the hands of the state’s largest insurance company, NC Blue Cross.

Not long ago, it seems like HB 115 was on the fast track for legislative approval. But members of the House Health and Human Services Committee listened to consumer groups and delayed consideration of the bill. In addition, NC’s Commissioner of Insurance presented a compromise proposal at last week’s committee meeting that would put experts in health care economics, markets and policy in charge of the health exchange, with numerous advisory committees, including one for insurers.

NC Blue Cross hopes this controversy will die down and the bill will move ahead. But health advocates are vowing to prevent that from happening.

VOTER ID: Bill adversely affects low-income, elderly, minority voters

Nearly half a million North Carolinians could lose their right to vote if a proposal that would require them to produce government-issued photo ID in order to vote in an election becomes law. The proposal HB351 is a constitutional, moral and financial debacle.

The proposal cuts clearly across gender, racial, economic, and political lines. Elderly, poor, handicapped and young voters are the most likely to lack a driver’s license—or even the means to acquire a state ID. According to Democracy NC, active black voters are 48% more likely to not have a current ID than other active voters, and female and Democratic voters are more likely to not have a current ID than men and Republicans.

Is such a law even necessary? The State Board of Elections found that only five votes per million cast in North Carolina from 2004 to 2010 involved voter fraud, and the U.S. Department of Justice finds only one incident of fraud per every two states each year. Furthermore, a full-scale voter ID program could cost state taxpayers $20 million or more.

The voter ID legislation would not improve the electoral process. Instead, it would have a ruinous impact on what’s supposed to be a constitutional right.

MORE AT FOUR: Budget cuts puts childrens' education at risk

Early childhood programs such as More At Four are currently facing the guillotine in North Carolina’s budget battle.

More At Four, which is at risk of losing funding altogether, improves academic performance and readiness in four-year-old children from low-income and disadvantaged families. The program pays for itself many times over, as research shows dollars spent on high-quality pre-kindergarten programs saves dollars later in welfare, education and health costs. In short, it is one of the cornerstones of public education in North Carolina.

Cutting More At Four and similar programs would mean the loss of jobs for those working in early childhood education, and it would hurt the thousands of parents who are able to work full-time thanks to child care programs. Cuts would sever an essential limb of the public education system, one that protects child welfare and builds a critical foundation for children who would otherwise be at risk of falling behind.

It’s time for North Carolina’s lawmakers to reaffirm the state’s commitment to one of the most fundamental public investments in the state.

DIVERSITY: Join Uniting NC for screening of "Talking Through Walls"

Last week, a Congressional committee held a hearing on the “radicalization of Muslim Americans.” Thankfully, outcry from progressive lawmakers and numerous organizations forced those who were hoping for an opportunity to vilify Islam to tone down their bigotry, at least while the cameras were rolling.

In order to encourage informed, respectful conversations and a growing appreciation for North Carolina’s diversity, Uniting NC and the Islamic Association of Raleigh will host a screening of “Talking Through Walls,” next Wednesday, March 23, at Galaxy Cinema in Cary. This documentary is about a small town that became divided when Muslim residents decided to build a mosque. Amid the furor, a group of people from all backgrounds and faiths came together to heal the divisions and build a stronger community. It is a model for the kind of work Uniting NC wants to do in North Carolina.

UNEMPLOYMENT: Short-sighted tax cuts in '90s created crisis today

A strong unemployment insurance system is critical in an economic downturn. Unemployment benefits buoy consumer demand and help to create jobs. Without the UI system, the latest recession would have been much worse.

But North Carolina’s UI system is in trouble, and a new report from the Justice Center’s Budget & Tax Center explains why. The system is supposed to work under the principle of "forward financing"—employers contribute to a UI trust fund in good times so that in tough times, when benefit payouts increase and payrolls shrink, funds are available. But during the "good years" of the 1990s, North Carolina lawmakers drastically cut how much employers must contribute to the trust fund.

North Carolina, like 30 other states, had to borrow from the federal government to sustain the day-to-day delivery of unemployment benefits during and after the Great Recession. It is critical that state leaders develop a solvency plan that rectifies the tax changes made in the 1990s and ensures that all employers are contributing to this critical program that supports families, business and communities in tough times.