Study: State rated low in work-support funds

0 Comments | Gazette, The (Colorado Springs), Jul 11, 2007 | by PERRY SWANSON THE GAZETTE

Earning a paycheck is only part of the problem for many families struggling to work their way out of poverty.

Even after paychecks start coming in, families are often stretched to cover expenses such as child care, food and medical care, say advocates for the poor.

Government programs can help people stay on the job and off welfare, the advocates say, but in Colorado those programs receive some of the lowest funding in the nation.

A study issued Tuesday of the main so-called "work support" programs found Colorado spent $2,434 per person in low-income families to fund them in 2005. That ranks Colorado No. 38 among 44 states included in the study, conducted by the Urban Institute, a Washington-based think tank.

The programs include help paying for child care, food stamps, tax credits and medical insurance for the poor.

Absent help in those areas, the consequences can be dire for poor families, said Denise Krug, vice president of rehabilitation and community services for Goodwill Industries of Colorado Springs. The agency handles many of the government's welfare-to-work programs in El Paso County.

"Families do not stay together, substance abuse comes into play, lots of bad things start happening if those basic needs aren't met," Krug said Tuesday.

The cost of child care alone can be a make-or-break issue for some, Krug said. It can run as high as $429 per month for each child at a licensed company in El Paso County. That can take a huge chunk out of the paycheck for an unskilled worker, and combined with other problems it sometimes leads a parent to abandon work.

"If you were put in a situation where your entire paycheck went to day care, what kind of a decision would you make about that? You would stay home, wouldn't you ?" Krug said.

Low-income families in some states receive thousands of dollars more in government aid so they can work, the Urban Institute study found. The study defined low-income as up to double the federal poverty level, which was $19,350 in 2005 for a family of four.

The highest-funded state was Maine, where low-income families received assistance worth $6,401 per person on average in 2005. The lowest was Utah, at $1,712 per person. The national average was $3,264.

Colorado could do more to help low-income families by reviving its earned income tax credit, said Rich Jones, director of policy and research for the Bell Policy Center, a Denver think tank. The state's tax credit is suspended and won't return until at least 2011.

Another way to help would be expanding the number of people eligible for low-income health insurance programs, Jones said.

Those moves would help breadwinners in poor families stay in jobs long enough for a raise, new job skills or other developments that lead to financial security, Jones said.

CONTACT THE WRITER: 636-0187 or perry.swanson@gazette.com

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Despite working hard, thousands of families in the Pikes Peak region struggle financially. Their incomes exceed the official poverty line, which eliminates them from some welfare programs, but they earn too little to make ends meet.

In upcoming stories, The Gazette will examine how these families are getting by or losing ground, and how they can become financially secure.

We want to hear your stories about the struggle to cover rent, health care, child care, gas, debt payments and other costs. Which strategies are successful, and which failed? E-mail perry.swanson@gazette.com or call 636-0187.

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Read the Urban Institute study on state work support policies: gazette.com