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Key Recommendations: Poverty Task Force

Several Poverty Task Force recommendations have been implemented and have yielded promising results. Examples include proposals to:

  • Establish a Coordinated Strategy to Help Communities Address the Digital Divide: The state allocated $25 million in CARES Act funding for a device purchasing program and distance learning to the Michigan Association of Intermediate School District Administrators. In June 2021, Gov. Whitmer issued an Executive Directive to help bridge the digital divide by establishing the Michigan High-Speed Internet Office (MIHI) to make high-speed internet more affordable and accessible. The office will coordinate and advance the State's efforts to ensure that every home and business in Michigan has access to an affordable, reliable high-speed connection that meets their needs and the skills to use it effectively.
  • Expand Apprenticeship Opportunities for the Incarcerated: Before the end of 2021, the Michigan Department of Corrections will launch six new programs that will be housed at the state's first Vocational Village at a women's prison. A new trade apprenticeship program for male prisoners launches at the Ionia Vocational Village in September. There will be further expansion in 2022 and MDOC continues to work on some strategic employer partnerships to support those new programs. The MDOC is currently partnering with several labor unions, including the Carpenters Union and IBEW, to train offenders for work in high demand fields with the goal of securing good jobs. The MDOC is also continuing conversations with the DOL about DOL apprenticeships as new programs are launched. Currently, 67% percent of Vocational Village graduates are employed, and there have been more than 1,300 Vocational Village graduates since the launch of the program.

However, much work remains still needs to be done. One important way Michigan can help low- wage workers have economic mobility and help businesses who are struggling to hire and retain lower wage workers is by addressing Michigan's benefits cliff. Many low-income Michigan workers rely on state childcare subsidies, health care benefits, food assistance and housing vouchers to provide for their families' basic needs. Unfortunately, these workers are at risk of losing benefits if they accept a job that pays even one dollar more than the income limits for these benefits. As a result, low-wage workers turning down opportunities to work additional hours or staying in dead-end, low- wage jobs rather than moving into higher-paying jobs because doing so could jeopardize their benefits. The good news is that we have had promising movement on this front. For example, the state's 2022 education budget boosts childcare subsidy eligibility, a move that will help parents who used to earn too much money to receive state childcare subsidies get the financial support they need to get their kids into quality childcare programs. This action is designed to help more parents move back into the workforce.

The benefits cliff has been a problem for both workers and the businesses that employ them for far too long. The Poverty Task Force has made five recommendations to address this critical barrier to economic mobility. Corporate leaders and legislators on both sides of the aisle have indicated that addressing the benefits cliff is a legislative priority. It's time to fix this problem.

The PTF has also recommended the establishment of state infrastructure to support the establishment of Children's Savings Account (CSA) programs in Michigan communities. Over the past 20 years, states like Indiana and Nebraska, municipalities and other entities have adopted Children's Savings Accounts, a highly-effective asset-building strategy for low- and moderate- income people. Organizations that run CSAs typically seed accounts and help account holders build their accounts through partnerships and saving matching opportunities. There are currently 15 CSA programs in Michigan.

CSAs are designed to build financial stability among low-income families to help them weather challenges such as job losses and to help them reach the long-term goal of saving for K-12 and college-related expenses. Gov. Whitmer has requested $2 million in the 2022 budget to create urban and rural pilot CSA programs, provide technical assistance and create partnerships with the state Department of Treasury and the banking industry to help expand CSAs in Michigan.

Finally, several of the PTF's recommendations involve boosting access to affordable housing. The PTF recommended a $10 million investment into the state's long-unfunded Housing and Community Development Fund (HCDF), which will give MSHDA a powerful tool to drive innovation and creativity in addressing Michigan's unique housing challenges. The flexibility of the HCDF allows it to be used to provide grants and loans to finance a wide range of housing-related projects, including acquisition, rehabilitation, new construction, development and redevelopment, preservation of existing housing and assistance to organizations and institutions that address homelessness. The expansion of affordable housing stock will address other PTF recommendations. For example, PTF called for the expansion of a partnership between the Michigan Department of Corrections and MSHDA to provide housing vouchers to returning citizens. While more vouchers have been made available, it has been difficult to identify affordable housing options for returning citizens to take advantage of them.