REI Tour Mayor's Leadership Academy Engages Federal Agencies in Promoting the Economic Advancement of Citizens with Disabilities

Last week NDI and the Real Economic Impact Tour held the 5th Annual Mayor's Leadership Academy at the Federal Reserve Bank of Chicago. Over 150 leaders in the asset and disability communities from 45 tour cities gathered to share best practices from the 2010 Tour and to learn about what's new for the Tour and in the world of asset development for low-income Americans and Americans with disabilities.

Highlights of the two-day event:

Federal Q&A panel:

• Bob Williams, Senior Advisor to the Acting Associate Commissioner, Office of Employment Support Programs, Social Security Administration
• James Gatz, Manager, Assets for Independence, Office of Community Services, Administration for Families and Children, U.S. Department of Health and Human Services
• Louisa Quittman, Director, Community Programs, U. S. Department of the Treasury
• Angelisa Harris, Community Affairs Officer, Division of Supervision and Consumer Protection, FDIC 

Participants in this workshop heard from panelists Serena Lowe and Steven Mendelsohn on ways to leverage VITA advocacy efforts with disability for greater impact.

For more information on the Academy, including the program, participant list and downloadable presentations, please visit: http://www.realeconomicimpact.org/REI-Tour-Initiatives-and-Projects/Mayor%27s-Leadership-Academy.aspx.

IRS Announces 2011 VITA Grant Recipients

The Internal Revenue Service announced it has awarded more than $11 million in matching grants to support its Volunteer Income Tax Assistance program.  Under the VITA Grant Program, the IRS awarded matching grants to 177 organizations that will offer free tax preparation services during the 2011 filing season at locations in all 50 states and the District of Columbia.

"These funds will enhance the VITA program and the work of volunteer tax preparers who provide an invaluable service to millions of taxpayers each year," stated Richard Byrd, Jr., IRS Wage and Investment Operating Division Commissioner.  The funds will be used to:

• Enable VITA programs to extend services to underserved populations and hardest to reach areas, both urban and non-urban;
• Increase the capacity to file returns electronically;
• Heighten quality control and improve the accuracy of returns prepared by the VITA sites; and
• Enhance training of volunteers.

There was a strong response to the 2011 VITA grant program with 374 organizations submitting applications requesting more than $33 million in matching funds. VITA partners are organizations that provide free federal tax return preparation and electronic filing to low and moderate income individuals. For tax year 2010, individuals and families with an adjusted gross income of $49,000 or lower are eligible for assistance.

The VITA program has enjoyed tremendous support since it was created in 1969. For example, more than 3 million tax returns were prepared at over 12,000 locations during the 2010 filing season by volunteers working under either the VITA program or the Tax Counseling for the Elderly, another volunteer program sponsored by IRS.

VITA partners are the essential component to the success of the REI Tour's mission for reaching low income workers with disabilities providing free tax preparation assistance, financial education, and a pathway to saving and economic stability. With an unprecedented mobilization of volunteers in 100 cities nationwide, over 180,000 individuals with disabilities were the recipients of the Earned Income Tax Credit (EITC) and other favorable tax credits and deductions in 2010. Backed by business, government, and community groups, the Real Economic Impact Tour brought the five year total of assistance to 693,402 individuals with disabilities and over 663.8 million dollars in tax refunds.

A list of the 2011 VITA matching grant recipients can be accessed at:http://www.irs.gov/pub/newsroom/vita_grant_recipients_2011-110510.pdf.  Questions about the VITA grant selection process should be directed to the IRS Grants Program Office at: Grant.Program.Office@irs.gov.

Mid-Term Elections, Key Congressional Staff Changes lead to Significant Impacts on Disability Policy

After a six-seat gain in the U.S. Senate and a 60+ gain in the U.S. House of Representatives, Republicans will assume control of the House in the 112^th Congress and Democrats will enjoy a much narrower majority in the Senate in 2011.  The aftershock of the Congressional mid-term election results were largely in response to general concerns about the lack of progress in economic conditions, soaring housing foreclosures, and continually high unemployment rates.  With one Senate seat and seven House seats still left undecided, the breakdown of the mid-term election results are as follows:

• U.S. Senate:
• Current Composition:  57-2-41
• 2011:  51 Democrats; 47 Republicans; 2 Independents; and 1 Undecided (Alaska)
• U.S. House of Representatives:
• Current Composition:
• 2011: 189 Democrats; 239 Republicans; 7 Undecided
• Gubernatorial Gains for Republicans:  Iowa, Kansas, Maine, Michigan, New Mexico, Ohio, Oklahoma, Pennsyvania, Tennessee, Wisconsin, Wyoming
• Current Composition:  26-24
• 2011:  19 Democrats; 29 Republicans; 1 Independent; 1 Undecided

While the Congressional sweep consumed most of the national news coverage of the political election results, perhaps the most significant gains for the Republicans occurred at the state executive branch.  Republicans picked up eleven new gubernatorial seats with one additional election pending.  Given the enormous budget crises that many states are facing, such a significant number of state governments going Republican will have a dramatic effect on the strategies states use for improving their fiscal health.

Fears about the impact of the changing political tides have been much the talk among disability policy advocates over the past week.  However, NDI Executive Director Michael Morris warns against a fatalist reaction to the mid-term elections: "Disability is not a partisan issue.  Republicans and Democrats alike share a common goal of improving the economic security of all Americans, including citizens with disabilities.  It is incumbent upon disability advocates to make sure that the current national policy discussion around employment, asset development, tax reform, and economic advancement engages the disability community and includes a frank discussion about how to break down the disincentives to working and saving and promote innovative strategies that have demonstrated success in terms of helping citizens with disabilities obtain and sustain employment, build assets and attain optimal self-sufficiency through increased economic security."

In addition to the mid-term election results, recent Congressional staff changes on Capitol Hill will also have a major impact on the disability policy arena.  On November 15^th, Aaron Bishop will become the new Executive Director of the National Council on Disability.  Aaron will step down from his post as the long-term disability policy aide to Senator Michael Enzi (R-WY), Ranking Member of the Senate Health, Education, Labor & Pensions (HELP) Committee.  A successor for Bishop has not yet been named.

The chairmen of President Obama's bipartisan commission on reducing the national debt outlined a politically provocative and ambitious package of spending cuts and tax increases Wednesday.  Alan Simpson, the former Republican Senate leader who is one of the co-chairmen, along with Erskine Bowles, who was White House chief of staff for President Clinton.  Their outline will be the basis for negotiation within the commission, which has a Dec. 1 deadline for submitting a final plan. It represents a challenge to both parties: to Obama and the Democrats, to show in the wake of the midterm election that they are serious about their pledges to address long-term deficits, and to Republicans, who for the most part have ruled out consideration of tax increases even as they have promised new adherence to fiscal responsibility.

The plan calls for deep cuts in domestic and military spending, a gradual 15-cent-a-gallon increase in the federal gasoline tax, limiting or eliminating popular tax breaks in return for lower rates, and benefit cuts and an increased retirement age for Social Security.  Those changes and others, none of which would take effect before 2012 to avoid undermining the tepid economic recovery, would erase nearly $4 trillion from projected deficits through 2020, the proposal says, and stabilize the accumulated debt.

The plan lays out options for overhauling the tax code that include limiting or eliminating the mortgage-interest deduction, the child tax credit and the earned-income tax credit. The plan would reduce cost-of-living increases for all federal programs, including Social Security. It would reduce projected Social Security benefits to most retirees in later decades, although low-income people would get higher benefits. The retirement age for full benefits would be slowly raised to 69 from 67 by 2075, with a "hardship exemption" for people who physically cannot work past 62. And higher levels of income would be subject to payroll taxes.

None of the panel's members - 10 Democrats, eight Republicans - embraced the package and several made clear they would not support it without big changes. Under Obama's executive order creating the panel of 12 members of Congress and six private citizens, 14 of the 18 commissioners must agree in order to send any package to Congress for a vote in December.

.....Leading to Significant Implications for Tax Reform Efforts in Lame Duck Session and 112^th Congress

The Congressional Lame Duck session officially begins on November 15^th, and the hot topic on the minds of both political parties is the impending votes on whether or not to extend various tax credits and tax cuts scheduled to expire on December 31 of this year. 

The biggest issue facing the lame-duck Congress is whether to extend the Bush-era income-tax cuts, which expire Dec. 31, for all taxpayers, as Republicans want, or for income below $250,000, as Obama and Democrats want. The Bowles-Simpson plan includes one option that assumes only the lower-income rates are extended and another that ends all Bush tax rates and replaces the tax code with simpler, lower rates and many fewer tax breaks. Extending all the Bush tax cuts through 2020 would add more than $4 trillion to the debt, coincidentally, about the same amount that the chairmen's painful options are designed to cut in the same time frame.

House leaders from both parties have indicated the likelihood that a one-year extension of all tax credits will be passed in the Lame Duck session.  However, Chairman Max Baucus (D-MT) of the Senate Finance Committee is adamant about holding ground against extending tax cuts for taxpayers with annual income over $250,000. 

NDI has worked steadfastly with several national organizations to push for extension of several tax credits vitally important to taxpayers with disabilities, including the Earned Income Tax Credit (EITC), Child Tax Credit, and HOPE Tax Credits. 

The Bowles-Simpson plan proposes simplification of the tax code that would repeal or modify a number of popular tax breaks - including the deductibility of mortgage-interest payments - so that income-tax rates could be reduced across the board. Under one option, individual income-tax rates would decline to as low as 8 percent for the lowest income bracket (it is now 10 percent) and to 23 percent for the highest bracket (now 35 percent). The corporate tax rate, now 35 percent, would be reduced to as low as 26 percent.

As reported by the U.S. Department of Labor's Bureau of Labor Statistics, Table A-6