CFPB Proposes Prohibiting Inclusion of Medical Debt on Consumer’s Credit Reports
On August 10, 2023, CCLP celebrated our 25th anniversary, bringing friends new and old to the Carriage House at the Governor's Residence.
Katie Wallat, CCLP’s Senior Attorney, provided testimony at the August 11, 2023, meeting of the Medical Services Board.
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Income & Self-Sufficiency Policy Forum Recap, Part 2: Policy ideation, room for improvement and the challenges ahead
How Can We Make Income More Sustainable and Equitable?
While there are substantial barriers, Ms. Robert provided our audience with some positives about Colorado. Currently, Colorado ranks 2nd to Nebraska in having a high labor force participation at 69.4%, so it’s not a labor force shortage that Colorado is experiencing. Additionally, Colorado has taken advantage of having an automatic adjustment codified in our constitution, so we are not stuck with the $7.25 federal minimum. Today, the Colorado minimum wage is $12.56 and $9.54 for tipped employees. Beginning next year, Denver will join several other cities across the country with a minimum wage of $17 an hour. Currently, the wage sits at $15.87 and will rise to $17.29. Beyond raising minimum wage though, Colorado has more to do to better serve its communities across the state.
Ms. Robert suggested that Colorado cut expenses on basic needs products and instead give out subsidies or governmental assistance. This could be in the form of Medicaid or Obamacare subsidies, having universal kindergarten, or giving residents access to internet services without cost or hassle. Recently, Colorado has even taken steps to reduce income loss through earned sick days or upcoming paid family and medical leave. Advocates on the call are also anticipating legislation around predictable work schedules, which would provide employees with advance notice of their work schedule to minimize any modifications.
Ms. Robert also stated Colorado could also supplement earnings for lower wage workers and others living below the Self-Sufficiency Standard by using tax codes. We have seen positive effects of this through the Earned Income Tax Credit (EITC) and the Child Tax Credit (CTC), which helps low- to moderate- income families and workers get a tax break. Advocates mentioned Colorado could also make a permanent and more progressive approach to TABOR refunds, with this last year being an example of Coloradans receiving a flat $750 check versus those with more money receiving a bigger refund. Only those with an income high enough to owe income taxes tend to benefit; the higher the income, the bigger the benefit. Meanwhile, struggling families get no benefit if their income is too low to owe taxes.
Many advocates agreed with us in opposing the reduction of income tax rates, which happens to be on the ballot this fall. Colorado Proposition 121, the State Income Tax Rate Reduction Initiative, would decrease the state income tax rate from 4.55% to 4.40%. While proponents of tax cuts believe that cuts would help grow the economy by initiating more spending, we argue it also only benefits the wealthy and reduces the necessary government services for lower-income households; for which the saying goes: the rich get richer, and the poor get poorer.
Some of the public benefits or government assistance programs Colorado offers include Supplemental Security Income (SSI), Supplemental Nutrition Assistance Program (SNAP), and Temporary Assistance for Needy Families (TANF). These programs are supposed to be a pathway to help individuals and families out of poverty, but currently, people must choose between getting a public benefit that falls short of meeting basic needs or risk losing the support an individual needs to work. Our audience supported the idea of increasing eligibility thresholds to benefit a multitude of Coloradan families, where many households who are not eligible for public benefits could really use the help to meet their basic needs.
In the third part of our forum, we asked the audience to join the conversation and share their concerns, stories, and solutions for how to better income and self-sufficiency in Colorado. Overwhelmingly, the audience wanted to talk about Guaranteed Income. Guaranteed Income, also known as Universal Basic Income, is an unconditional, no strings attached approach to providing an income base to the most vulnerable households. Through direct cash payments, basic income shortens the path to stable housing and employment.
Ms. Robert shared that in 1967, Martin Luther King Jr. proposed guaranteed income in his speech, “Where Do We Go From Here?” and only two years later did President Richard Nixon propose a negative income tax that would’ve enacted an unconditional income for all poor families. Unfortunately, his rhetoric became twisted, and we saw the country turn away from basic income. Advocates on the call argued opponents of guaranteed income say the approach incentivizes people not to work, the programs are too expensive to fund, the effects of a basic income can be counterproductive, and that these programs would be difficult to replicate nationwide.
However, Ms. Robert countered this argument, saying the U.S. already has a version of guaranteed income through Social Security—though it’s limited to those who have worked for several years. While this is not universal, individuals over the age of 65 can apply for Supplemental Security Income (SSI) to help those with limited income and assets. One advocate in attendance added the U.S. has also tested a version of universal basic income through the stimulus payments given by the federal government to aid in economic recovery from the devastation of COVID-19.
Earlier this month, Denver has stated that 260 people living in emergency shelters or motels will receive a $6,500 payment with an additional $500 per month for 11 months, including payments planned for an additional 560 people. The Denver Basic Income project will be piloting their program in a few months. One resident from Boulder stated that the Boulder City Council has also approved initial funding of $250,000 for guaranteed income. Having a guaranteed income is crucial to achieving racial and economic justice for communities of color.
Cliff Effect, Business, & Housing
Our audience brought up additional thoughts and concerns about how the cliff effect, business, and housing has affected income in Colorado.
The cliff effect occurs when someone receives a pay raise at work that triggers a disproportionate loss of government assistance. As Ms. Robert pointed out, CCLP, alongside the Colorado Children’s Campaign and Clayton Parent Ambassadors, included a provision in the legislation for the Department of Human Services board to adjust the Earned Income Disregard and the TANF Standard of Need to allow people to gain a work footing before being kicked off TANF. It’s an economic model with a legitimate built-in social safety net.
The Center for Community Wealth Building also mentioned they are thinking outside the box of normal business models, by focusing on a cooperative model that advocates for autonomy and independence; gives education, training, and information to other members; and focuses on the concerns of the community for the businesses involved. Another participant stated that we need to support these local, and often marginalized business owners. One way to do this is through Shop BIPOC, a project supported by over 11 organizations across Colorado with the goal of strengthening racial equity. As their website states, buying from BIPOC-owned businesses helps lift our local economy and commits to an allyship to achieve racial equity; doing business with purpose.
As we can see from our last policy forum to this one, there is a direct correlation between affordable housing and income. As many advocates on the call mentioned, Coloradans are facing one of the worst affordable housing crises to date with rising rent and interest rates; investors and developers buying up land and buildings taking away the opportunity for individual homeownership; while also not having enough supply of housing for the demand in need. Ms. Robert told our audience that Colorado Homes for All plans to run a bill in 2023 for local authority to implement rent control. In the 2022 legislature, CCLP and our partners brought forth a bill on Protections For Mobile Home Park Residents that was supposed to include rent stabilization for these communities, but Governor Jared Polis stated he would veto the bill entirely if this was included in the final version. This is unfortunate because low-income housing options include mobile park homes. This same bill was, however, able to extend the amount of days mobile home owners have to make an offer to purchase the park. The option for ownership is presented to residents over developers and investors, which is a huge win for affordable housing advocates.
As with any legislation, there needs to be more accountability for implementation and enforcement. Advocates push for equitable solutions but when it comes time to act, we need a bigger effort from agencies, institutions, organizations, advocates, and the like to come together to do more for low-income communities. Income is a necessary component of self-sufficiency. As a society, we need to ensure that lower-income households still have access to services and programs that will lift them out of poverty. As someone from the forum said, “Living in poverty is a quagmire.”
Interested in learning more about affordable housing in Colorado, check out our last three articles and our Housing Legislation list here: