The Districts Dime

DC Should Take Steps to Reduce Gender and Racial Wage Gaps

November 30th, 2016 | by Ilana Boivie

When an employer asks a job applicant, “What are you earning at your current job?” that seemingly innocuous question actually contributes to the wage gaps between men and women, and between black and white workers. Women and black workers in DC earn less than white men, so using someone’s salary at one job to set their pay at a new job serves to lock those gaps in place.  That’s why it’s a good thing that DC is considering a bill, the Fair Wage Amendment Act of 2016, to stop employers from asking this question.

This would help decrease wage gaps in DC. Women working full-time are paid just 86 percent of a man’s median wages in DC.[i] The city’s racial pay gap is even more staggering. The median hourly wage for white workers in DC was $33.43 in 2015, compared with just $17.37 for African-American workers.[ii] While this is explained in large part by educational differences, that alone does not explain the racial pay gap.

workerhandsThis is where it can be helpful to ban an employer’s knowledge of a prospective employee’s prior earnings. For example, when starting a new job, a 5 percent pay increase would generally be seen as a relatively large boost. But if a woman taking that position had been underpaid by 15 percent in her previous job, she still would be underpaid by 10 percent in her new position.

An individual’s prior pay does not affect his or her ability to do a particular job, and so it should not factor into the prospective employer’s wage offer to that individual. Instead, the offer should be based on the employee’s particular skill set and how that fits into the company’s existing pay scale and bottom line. For this reason, many jurisdictions are looking to ban employers from asking prospective employees about their earnings history. Massachusetts recently became the first state to do so,[iii] and New York City banned the practice at city agencies.[iv] Similar laws are currently being discussed in Colorado, New York state,[v] New Jersey, and Pennsylvania.[vi]

Such a change can make a big difference. Since adopting this and other practices to reduce the gap, Google has virtually eliminated gender pay gaps at the company. A Senior Vice President at Google recently wrote that “by paying for the role, not the person, you start with a clean slate and mitigate any bias…In other words, you correct the pay bias that exists in society.”[vii]

Because this legislation could go a long way in reducing the city’s racial and gender pay gaps, DCFPI urges the City Council to pass the Fair Wage Amendment Act.

 

[i] The American Association of University Women. “The Fight for Pay Equity: A Federal Road Map.” September 2016. http://www.aauw.org/files/2016/09/Washington-DC-Pay-Gap-2016.pdf

[ii] Estimates from the Economic Policy Institute based on data from the Current Population Survey.

[iii] The New York Times. “Illegal in Massachusetts: Asking Your Salary in a Job Interview.” August 2, 2016.

[iv] The New York Times. “To Help Close the Wage Gap, de Blasio Tells Agencies to Stop Asking about Applicants’ Past Pay. November 4, 2016.

[v] Time. “How Banning Employers from Asking About Salary History Could Help Close the Wage Gap.” August 11, 2016.

[vi] The Washington Post. “More State, City Lawmakers Say Salary History Requirements Should Be Banned.” November 14, 2016.

[vii] The Washington Post. “How the ‘What’s Your Current Salary?’ Question Hurts the Gender Pay Gap.” April 29, 2016.

 

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In DC, Many Things to Be Thankful For

November 22nd, 2016 | by Ed Lazere

While we at the DC Fiscal Policy Institute spend most of our time advocating for budget and policy choices to reduce income inequality and expand economic opportunity, we feel that this time of year, we should share how thankful we are for many things the District does to help its residents.

thanksgivingIncome and racial inequality are enormous and growing challenges in this city, but DC’s leaders have adopted a number of policies aimed at reducing disparities. Here are just some of the recent policies for which we are thankful, and that inspire us to push the city to do even better.

  • $15 Minimum Wage and Paid Sick Leave: The District is one of a small number of jurisdictions to adopt a $15 minimum wage. We’ll reach that by 2020, when the federal minimum wage may still be $7.25. On top of that, everyone who works in the District gets paid sick leave (including time off to deal with domestic violence), which starts accruing the first day on the job. That doesn’t happen in many places around the country.
  • Close to Universal Health Care Coverage: 15 years ago, when DC General Hospital was closed, the District created its own health care program, the Healthcare Alliance. It provides insurance to anyone under 200 percent of the poverty line (about $40,000 for a family of three), who doesn’t get insurance from a job and doesn’t qualify for Medicaid or Medicare. For years, DC has had one of the highest health insurance coverage rates in the nation.
  • Tax Policies to Help the Working Poor: DC has the largest state-level Earned Income Tax Credit in the nation. The DC EITC targets residents who work but have low earnings, putting up to $2,000 into the pockets of a family with two children each year. It lifts many families out of poverty, improving their stability and giving parents the resources they need to help their children succeed. Thanks to this and other tax policies, the taxes paid by low-income DC residents are second lowest in the nation.
  • A Plan to End Homelessness: The District adopted a plan in 2015 to eliminate chronic homelessness and otherwise make homelessness rare, brief, and non-recurring. We have not fulfilled the plan yet, but substantial progress is being made. This year, for example, the District has new funding to help 380 chronically homeless residents move into a permanent home of their own.

Anyone who follows the DC Fiscal Policy Institute knows that we have a lot to say about policies that are imperfect or incomplete, including some mentioned above. Next week we will return to advocacy, but today we are thankful.

Happy Thanksgiving!

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DC’s Affordable Housing Investments Are Paying Off

November 21st, 2016 | by Claire Zippel

DC residents can take pride to know that the city is working swiftly to build low-cost homes across the city. Just this year, DC selected 25 projects to support that will build or preserve 2,000 affordable homes and use $184 million in Housing Production Trust Fund dollars. This level of funding commitments reflects recently announced project selections, on top of decisions made earlier this year. The new rental housing includes homes for homeless residents and efforts to help low-income renters buy their building and become homeowners.

This highlights the priority the Department of Housing and Community Development (DHCD) has placed on moving quickly to turn the city’s investments in the Housing Production Trust Fund into urgently needed low-cost homes. It’s also an important sign that affordable housing developers in DC have the capacity to put large amounts of housing dollars to work.

rfp-blog-imageImportantly, the selected projects will largely serve the DC residents most likely to struggle with high housing costs. DHCD has prioritized funds for housing affordable to families at or below 50 percent of the area median income, or $54,000 for a family of four.

The latest awards also make clear how important it is to provide ongoing rental assistance to make newly built or renovated projects affordable to extremely low-income residents—those with incomes below 30 percent of the area median, or $33,000 for a family of four. Nearly all of the new units for extremely low-income households (559 of 589) will use both Housing Production Trust fund dollars and ongoing subsidy from DC’s Local Rent Supplement Program (LRSP). Without LRSP, the District would likely not be able to meet the requirement that 40 percent of Housing Production Trust Fund dollars support housing for extremely low-income households.

Here’s a quick breakdown of the projects selected in 2016:

New Construction (12 projects):

  • 1,047 rental units, including 171 units of permanent supportive housing (PSH) for formerly homeless residents.
  • 223 new rental units (including the PSH) affordable to residents with incomes below 30 percent of the area median.
  • 14 new condominiums will be affordable to residents below 80 percent of area median income.

Preservation (13 projects):

  • 880 rental units will be preserved, including 47 permanent supportive housing units.
  • 362 of the preserved rental units (including the PSH) will be affordable to residents with incomes below 30 percent of the area median.
  • 46 cooperative units in two buildings will be preserved by their tenants exercising their first right to purchase. Most will be affordable to residents below 50 percent of area median income.

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DC Residents and Businesses Can Still Get Health Insurance Through DC Health Link This Season

November 18th, 2016 | by Jodi Kwarciany

It’s important to remember that DC residents and businesses can still get insurance for all of 2017 through DC Health Link, our local insurance marketplace, despite uncertainty about the future of federal health insurance programs following the national elections. We don’t know what will happen to these programs, but it will not affect health care options for next year. Consumers should take advantage of their health coverage choices now.

Nationally, consumers are taking note. Over a million people have selected a plan this enrollment season through the federal marketplace, Healthcare.gov, ahead of last year at the same point. Several states with their own marketplaces like DC have also seen a spike in enrollment this year. Typically, this doesn’t happen until mid-December as people rush to get coverage that begins on January 1.

Having health coverage is important for a lot of reasons. Consumers can regularly receive preventive care like routine checkups or vaccinations, and are also protected if they face an unexpected illness and need to go to the emergency room. What’s more, consumers can enroll no matter what their health status is—a key provision of health reform referred to as guaranteed issue.

DC Health Link is offering 20 different private health insurance options for residents and their families, and 151 options for small businesses. It provides an easy and transparent way to compare plan benefits and prices, one of the key advantages of creating a health insurance marketplace. And many can use DC Health Link to get financial assistance to help pay for premiums. Residents with incomes below 400 percent of the poverty line ($47,520 for an individual or $100,000 for a family of four) may be eligible for tax credits to reduce their monthly premium payments. Others can use DC Health Link to determine whether they are eligible for, and can apply to, Medicaid.

With health insurance options available to virtually all ages, incomes, and citizenship statuses, it’s little surprise that DC has its lowest rates of uninsured residents ever, and one of the lowest rates of uninsured compared with states.

Open enrollment runs until January 31 for individuals applying for private insurance, or year-round for small businesses or those applying for Medicaid. For more information, check out the Health Plan Comparison Tool for 2017, or log on to dchealthlink.com directly.

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We Can Strengthen Democracy in DC Through Fair Public Campaign Financing

November 17th, 2016 | by Ed Lazere

Legislation to provide public funding to candidates for major DC offices would increase the racial, gender, and economic diversity of people who give – and the people who run – for Mayor, the DC Council, and Attorney General. Public financing would encourage more people to donate to campaigns and to run for office. It would be especially helpful to candidates who do not have large networks of major donors, including first-time candidates. Bringing in more diverse voices to major DC elections would strengthen DC democracy.

fair-electionsDCFPI is proud to be part of the coalition supporting this bill and encourages the DC Council to adopt it.

The Citizens Fair Election Program Amendment Act would provide public funding to candidates for Mayor, DC Council, and Attorney General who collect a specified number of small donations from DC residents, a sign that they have a base level of support. Public funding would include both a base amount and 5-to-1 match for all donations under $100.  Candidates would have to agree to not accept donations above $100.

This would be good for the District for several reasons:

  • The Citizens Fair Elections Act would give low-and moderate income residents, communities of color, and women a much larger voice in DC elections. Most current donors to DC elections are white, and most have incomes above $100,000.  A majority of the largest donors are men. By contrast, half of donors who gave $25 or less in the 2014 mayoral race were people of color, while half of donors who gave $50 or less were women. Limiting donations to $100 would increase the role of low-and moderate income residents, communities of color, and women in DC elections.
  • The Citizens Fair Elections Act would encourage more people to give to campaigns, particularly low-income residents and residents of color. The public match of 5-to-1 would give residents the sense that their donation is meaningful. The $100 donation cap would help small donors understand that their donation is not overshadowed by large donations from higher-income residents.
  • The Citizens Fair Elections Act would encourage more people to run for office and increase the economic and racial diversity of candidates. First-time candidates and candidates from lower-income communities are less likely to have access to large donors than incumbents or candidates from higher-income communities. This creates a serious barrier to considering running for office, and thus restrains democracy. The public financing available under the Citizens Fair Election Act would enable many people to run for office who otherwise would not.

The DC Fiscal Policy Institute encourages the Council to adopt this important legislation.

 

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