House Votes to Help Low-Income Families Earn Their Way Out of Poverty
6/23/2015
HARRISBURG – The House of Representatives today voted unanimously to approve landmark legislation, introduced by Reps. Tom Murt (R-Montgomery/Philadelphia) and Stephen Bloom (R-Cumberland) that would help low-income working Pennsylvanians fulfill their own “American Dream.”

House Bill 1164 would reform the Commonwealth’s child care benefits structure in order to help families retain temporary assistance, while allowing them to earn their way out of poverty.

“For too long we’ve forced parents to make difficult choices,” Murt said. “They could accept a raise and become completely responsible for their child care payments, which they cannot afford, or reject the raise to continue receiving benefits. This has forced many parents to limit their own earning potential and become trapped in a cycle of dependency.”

Under current law, families who earn more money eventually reach a so-called “benefits cliff,” at which even a slight increase in their income makes them completely ineligible for services worth substantially more than the potential income increase, thereby discouraging them from accepting raises or working additional hours.

“In the past, government has too often found ways to discourage many Pennsylvania families from becoming self-reliant,” Bloom said. “The era of policies that keep people trapped in poverty must end. With House Bill 1164, we are leading the way in the fight to end the dependency-driven, all-or-nothing system of human service benefits that literally discourages work.”

Specifically, House Bill 1164 would increase copayments as parents earn additional income. In addition, when parents reach the current benefits cliff, they would not be cut off from services. As they earn more money, their responsibility for the cost of services would increase until their income can support it entirely.
Community and nonprofit organizations supported the lawmakers’ efforts and hailed House passage as a step toward eliminating obstacles faced by families who want to rise out of poverty.

“Our social service programs should reward and encourage success, not penalize it. By offering incentives for work and smoothing the benefit structure, we can help move families from poverty to prosperity,” said Nathan A. Benefield, vice president of policy analysis, Commonwealth Foundation. “House Bill 1164 would help address the benefit cliff in child care subsidies, and can serve as a first step to eliminating this barrier to success.”

“Smoothing the child care subsidy cliff bolsters United Way’s efforts to lift families out of poverty and help low-income working families improve their financial stability. Gradual increases in co-payments for child care costs are good news for parents who are striving to earn a family-sustaining wage,” said Kristen Rotz, president, United Way of Pennsylvania.

“The Community Action Association of Pennsylvania has worked closely over the past year with House Majority Leader Dave Reed to overcome this major hurdle our low-income families face when moving towards self-sufficiency,” said Susan A. Moore, CEO, Community Action Association of Pennsylvania. “I am happy to see our political leaders put forth legislation aimed at smoothing out the ‘benefits cliff’ by reducing child care benefits over time as a parent earns additional income.”

In 2013, the House Majority Policy Committee began its Empowering Opportunities: Gateways Out of Poverty policy initiative, led by then Majority Policy Chair, now Majority Leader Rep. Dave Reed (R-Indiana). House Bill 1164 was co-introduced by Bloom and Murt in response to the committee’s findings.

“It’s wrong to force people to choose between climbing the ladder to economic self-reliance or keeping their child care services because of an artificial roadblock,” Reed said. “We want all Pennsylvanians to fulfill their own American Dream through hard work, earning additional income and gradually moving completely off of government dependence.”

House Bill 1164 now heads to the Senate for consideration.

Representative Dave Reed
62nd District
Representative Stephen Bloom
199th District
Representative Tom Murt
152nd District
Pennsylvania House of Representatives
Media Contact: Abbey Haslam
717.260.6222
ahaslam@pahousegop.com
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