The Districts Dime

New Calculator Shows DC is an Extremely Expensive Area for Families; Stronger Supports Are Needed

August 26th, 2015 | by DCFPI Staff

The cost of living in the District of Columbia is extremely high, a new report finds, which highlights importance of having a strong minimum wage as well as additional programs to help families meet basic needs.

The new Family Budget Calculator from the Economic Policy Institute (EPI) finds that expenses contributing to the extremely high cost of living in DC include:

  • The highest child care costs in the nation, with care for a two-child family costing $2,600 per month. This is nearly 25 percent higher than the next most expensive area for child care, New York City (about $2,000 per month).
  • Very high food and housing costs. The cost of food in DC is the third highest in the country, at $782 per month, and housing costs of $1,469 are the thirteenth highest in the nation (and this housing cost estimate is likely very low, due to EPI’s methodology).[1]

Fortunately, the District has some policies that help to mitigate certain expenses. For example, most residents have access to affordable health insurance. Residents with incomes up to 200 percent of the poverty line ($48,500 for a family of four) qualify for DC’s Medicaid program, many others get health insurance through an employer, and the remainder have access to affordable health plans through the DC Health Exchange. As a result, typical health care costs are only $747 a month, less than that of 445 out of the 618 jurisdictions studied by EPI.

DCFPI also has a very generous earned income tax credit for people with children; a two-parent family of four is eligible for income tax refund of up to $2,200. The helps residents near or below the poverty line deal with the high cost of living.

However, in a city where expenses are so high, these policies are not enough. Working families need good-paying jobs, as well as additional support services, to make ends meet. Such policies can include:

  • $15 minimum wage. Although the District recently passed a law to increase the minimum wage to $11.50 by July 2016, this does not go far enough to provide a living wage for families, given the extremely high cost of living. A ballot initiative for the November 2016 election would gradually raise the District’s minimum wage to $15 per hour; this initiative will be on the ballot if supporters can collect sufficient valid signatures from DC residents.
  • Affordable child care. Working families need to have access to quality and affordable child care. But DC’s extremely high child care costs, coupled with low reimbursement rates, makes it hard for families to find decent care. Child care subsidies should be increased for low-income families.
  • Paid family leave. Currently, very few employers offer paid time off for the birth of a child or care of a sick family member. However, research shows that paid family leave enables workers to make ends meet during times of personal need, and encourages women to stay at jobs that they might otherwise leave in order to provide care.
  • Increased housing assistance. Housing assistance isn’t reaching everyone who needs it. Some 47,000 low income households spend more than 50 percent of their income just to have a roof over their heads. The District should expand housing assistance to help mitigate the high cost of housing for working families.

[1] EPI uses the HUD Fair Market Rent (FMR), which is the 40th percentile rent for the whole metropolitan area. DC proper has much higher rents. It is for this reason that the DC Housing Authority sets is own neighborhood-based FMRs, which are usually higher than HUD’s.

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New Guidelines Will Ensure Affordable Housing Programs Better Serve DC’s Homeless and Low-income Families

August 13th, 2015 | by Claire Zippel
Photo by Ted Eytan, Flickr

Photo by Ted Eytan, Flickr

Affordable housing funding this fiscal year will be better directed to DC’s lowest-income and most vulnerable residents, thanks to new guidelines set by Mayor Bowser.

The Department of Housing and Community Development (DHCD), which allocates most funding for affordable housing, released these new criteria in its 2015 Request for Proposals.

Here’s what’s new in how DHCD will distribute FY16 affordable housing funds.

  • Housing for very low income families will be prioritized. This year’s funding will be prioritized for housing that serves DC families most likely to struggle to afford housing. Only projects that produce units for households with incomes below $54,600 for a family of four—half of the median income for the DC area—will be considered for funding. This is a positive step, because it directs limited affordable housing resources to those suffering the most from DC’s high housing costs. The majority of DC renters at that income level spend more than half their income on rent.
  • Permanent supportive housing (PSH) will be connected to those who need it. At least 5 percent of units in a funded project must be PSH (housing for vulnerable residents with supportive services on site), per a best practice adopted in DC last year. The new guidelines clarify that PSH funding will be directed to projects that use the “Coordinated Entry” system. Coordinated Entry streamlines access to housing for people who are homeless or at risk of homelessness, prioritizes the most vulnerable, and connects them to the housing that best meets their needs.
  • PSH projects will follow a Housing First model. The “Housing First” model, in which clients don’t have to meet prerequisites before accessing housing and services, is another recognized best practice in combatting homelessness. The new guidelines prioritize projects that use this model.

This year’s budget included significant funding for affordable housing, including $100 million for the Housing Production Trust Fund. DCFPI applauds the DC Council for making those investments, so that more DC families will have a decent and affordable place to live. The next step is to direct those resources to meet the most urgent needs of DC’s poorest, most vulnerable residents. The new funding guidelines are an important step in that direction.

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Students and Families Likely to Benefit from the District’s Expansion of Community Schools

August 11th, 2015 | by Soumya Bhat

The concept of schools serving as community hubs that connect children and their families to other services is getting a boost in the District. The budget that took effect July 1 will enable the city’s pilot Community Schools program to expand to two more sites and provides for evaluation measures that will help to assess whether the program is reaching its goals.

The idea behind the Community Schools model is that if public schools provide services beyond those that are purely educational, ultimately, students and their families will see benefits.Features of Comm Schools

The model uses schools as central hubs for students and the community to make use of services such as physical and mental health care, afterschool activities, adult education, and early childhood services provided by community-based partners. This combination of opportunities can help families become more engaged, help kids do better in school, and build stronger communities.

The strategic expansion of Community Schools is a good idea, and should become part of the city’s broader strategy to close the student achievement gap. Currently, six DC grantees receive local funding to develop Community Schools. The District’s budget for this year includes $400,000 for two more, including one serving a large homeless student population.

As the pilot project expands, it is important to set clear goals and document how the program affects students and families. The budget includes an additional $66,000 to support this evaluation. Tracking school readiness, student attendance, adult education, and other indicators can help measure the model’s effects on student learning, health, and family engagement over time.

DCFPI will be following the progress and evaluation of Community Schools. Stay tuned to the District’s Dime for updates.

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DC Has Big Opportunities to Cover Housing-Related Services with Medicaid

August 7th, 2015 | by Wes Rivers

Last week, DC government officials gathered to strategize on how to use Medicaid — a health program that comes with federal funding — to help more homeless residents get stable housing. There is evidence that stable housing leads to better health, and both DC and the federal government are exploring how housing-related services could be paid for with Medicaid dollars. The meetings, which included researchers, agency officials, and health and housing providers, uncovered several new opportunities that DC should consider to coordinate Medicaid and housing to help combat homelessness.

The District’s Interagency Council on Homelessness and Medicaid agency, the Department of Health Care Finance, have been researching and identifying overlaps in the Medicaid benefits chronically homeless residents use and the supportive services Medicaid covers. They found that certain Medicaid benefits — especially for people with mental health issues in community-based treatment — cover up to 80 percent of the housing support services delivered in Permanent Supportive Housing (PSH) programs. DC’s PSH program places homeless residents with chronic health conditions and other barriers into housing and then provides services to address those issues.

The federal government also issued guidance which could help states leverage Medicaid dollars for housing-related services similar to those delivered in PSH. There is lots of evidence that PSH participants are better able to get to the doctor and keep up with prescriptions, are more likely to stay healthy and housed, and are less likely to go to the emergency room.

The District’s health and housing leaders who met last week identified a number of promising opportunities.

  • Medicaid now covers or will soon cover many of the services that chronically homeless residents and residents in PSH need. There may be opportunities to link residents in PSH with a Medicaid case manager. Still, there are gaps and implementation barriers that need to be explored further.
  • Medicaid Managed Care Organizations can play a part in linking Medicaid and PSH. The District’s Medicaid managed care program paid for millions in unnecessary health costs last year, related to uncoordinated care, avoidable hospital visits, and emergency room use for non-emergencies. These companies will soon be paid based on how they improve these measures and will have an incentive to partner with PSH providers to provide case management.
  • Medicaid services for people with severe mental illness look a lot like PSH services. Medicaid’s intensive treatment and case management for mental health (known as Assertive Community Treatment) closely mirrors what the services delivered in PSH. Pairing residents who receive these Medicaid services with rental assistance could expand supportive housing.

These developments are exciting and could lead to more stable and affordable housing for our homeless residents. All of the options explored will need further refinement, cross-walking, and study to see if they can realistically be implemented. And the District will have to do more to create partnerships and information sharing among providers. But last week’s meeting was a great start.

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New DCFPI Report Examines DC’s Public Charter School Revenue and Spending Trends

August 5th, 2015 | by Soumya Bhat and Thu Pham

The DC Public Charter School Board (PCSB) annual report on charter school finances offers an important snapshot of the finances of each DC charter school. But it could do even more to help parents and policymakers understand how their schools spend money and how financially strong they are. For example, the Financial Audit Review (FAR) report should have a clearer listing of each school’s financial performance “grade” for the year, and it should provide more detailed breakouts of each school’s capital costs and sources of philanthropic funds.

Even with these concerns, the report offers a great deal of useful information on the financial health of charter schools that sheds light on how individual schools are spending their resources.

charter philanthropic revenueThe FAR report for the 2013-2014 school year, the latest year for which data is available, finds wide variation in the financial health of DC’s 60 charter schools (known as Local Education Agencies, or LEAs):

  • Seven LEAs were identified as financially low-performing. However, the FAR does not identify which schools fall into this category.
  • 21 LEAs were categorized as financially high performing.
  • 18 charter LEAs had operating deficits, an 80 percent increase from the previous two fiscal years.

The Public Charter School Board works with financially low-performing schools and can close schools that are financially unsound.

DCFPI’s analysis of the FAR also reveals wide variation in spending per-pupil and in the philanthropic revenue raised by each charter school LEA.

  • Per-pupil spending varies from school to school: Charter LEAs spent an average of $14,639 per pupil for FY 2014. This spending ranged from $6,079 per pupil to $51,594 per pupil. In most cases, the variation reflects the characteristics of the students – charter schools serving adults receive less per-pupil funding than others, while schools with a substantial number of special education students or English language learners receive more per pupil.
  • Philanthropic revenue is a relatively small share of charter school finances: DC’s charter school sector brought in an approximate $44 million in philanthropic revenue, including parent fundraising and foundation grants. However, DC charter schools still rely primarily on local resources – philanthropic revenue only accounted for 6 percent of the sector’s collective revenue.
  • Philanthropic revenue varies from school to school: While most schools raised less than $500 per pupil from philanthropic sources, 12 charter school LEAs raised $1,000 or more per pupil. One school raised over $15,000 in additional resources per pupil.

While the FAR is an important and helpful document for the public, it could make it easier for the public to see which schools are doing well and which schools are considered financially at-risk. Most important, the FAR should provide a summative grade of each school’s financial performance and identify which schools are financially high- or low-performing. It also should clarify the sources of philanthropic revenue, separating funds raised by parent activities from foundation and other fundraising. And it should do a better job of separating each school’s operating expenses from its capital expenses.

To read the full DCFPI report, click here.

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