Category: Blog

More Than 50,000 Kids in New Jersey Could Miss Out on the Child Tax Credit

Posted on by Peter Chen

The expanded Child Tax Credit for tax year 2021 will help millions of children and their families across New Jersey, providing direct cash payments to the vast majority of families with kids. The poverty-fighting effects of this credit could be enormous, with roughly one in three children in poverty lifted above the federal poverty line. Another roughly 200,000 children would be lifted closer to the poverty line if their families claim the credit.

But that’s a big if. Many families in poverty did not file a 2019 or 2020 tax return because the Internal Revenue Service (IRS) does not require a tax return for single individuals earning $12,400 or less, or for married couples filing jointly earning $24,800. They may also not have applied for the COVID-19 relief payments.

Without basic information about eligibility from tax filings (specifically the Social Security numbers of dependent children and the Social Security number or tax ID number of the filer), the IRS may be unable to authorize and mail the payments to qualifying families. This means some of New Jersey’s most vulnerable children may not receive this critical lifeline.

New IRS analysis shows that up to 55,000 children in New Jersey may miss out on the expanded Child Tax Credit payments for tax year 2021. The IRS determined this by identifying individuals with dependent kids with Social Security numbers through their health insurance documentation who did not file a tax return in 2019 or 2020. Put differently, the IRS used health insurance data to estimate, by ZIP code, where children might live whose parents or guardians did not file a tax return and therefore might miss out on payments. However, some of these non-filers may have applied for federal pandemic tax relief checks, which contain the information the IRS needs to send out Child Tax Credit payments.

If the estimate is accurate, that would mean more than 1 in 5 children living below the poverty line in New Jersey might be unable to access their expanded Child Tax Credit payment.

The child-poverty-fighting power of the Child Tax Credit expansion lies in its simplicity — direct checks to families based on information the IRS already has. But the IRS can’t reach the kids who need it most if the agency doesn’t have the necessary eligibility information, either through the IRS Non-Filer Child Tax Credit Portal or through a filed tax return for 2019 or 2020.

To maximize the number of children who receive the expanded Child Tax Credit, state government, local officials, and community-based organizations should consider the following:

  • Widely publicizing the IRS Non-Filer Child Tax Credit Portal at all government and nonprofit organizations where families with children go, including child care centers, schools, WIC offices, health clinics, etc.;
  • Expanding grants and outreach for free tax preparation for the 2021 tax year;
  • Engaging with direct-service providers to assist families in completing the online non-filer portal form, which can be complicated;
  • Conducting in-person door-to-door campaigns (perhaps paired with other campaigns such as vaccination campaigns or voter registration) to help people enroll through tablets.

 

The ZIP-code level analysis for New Jersey is available below:

Expanded Child Tax Credit Will Benefit More Than 1 Million Kids in New Jersey

Posted on by Vineeta Kapahi

Happy Child Tax Credit Awareness Day! Established by the Biden administration, this commemorative day is meant to boost awareness of the substantial expansion of the Child Tax Credit (CTC) under the American Rescue Plan Act (ARP). These improvements to the CTC will help families cover the costs of raising children, improving families’ economic stability and children’s wellbeing.

As part of the ARP, Congress temporarily increased the maximum CTC amount from $2,000 per child to $3,600 per child for children under 6 years old, and to $3,000 for children between 6 and 17 years old. Prior to the temporary expansion of the Child Tax Credit under ARP, an estimated 27 million children nationwide, including 561,000 in New Jersey, received less than the maximum credit amount or were excluded from the credit entirely because they live in a household with low earnings. Under ARP, the CTC is fully refundable, meaning that households with little or no income can qualify for the full credit amount. An estimated 65.6 million children, including 1.6 million children in New Jersey, will benefit from these improvements to the CTC.

In addition to changes in eligibility and the credit amount, the delivery process for the CTC will now allow families to receive the credit sooner. Instead of waiting for a lump sum at tax time, families will be able to receive advance payments so they can use credit to make ends meet throughout the year. The first payments are scheduled to be distributed in July 2021. Families who have already filed 2019 or 2020 taxes or who signed up to receive stimulus payments will automatically receive their CTC. Families who have not yet filed taxes or who typically are not required to file taxes because their incomes are too low can sign up to receive the CTC through a new online portal.

Expanding relief for families is especially important now as households with children face heightened financial hardship, but many families struggled to make ends meet even before the pandemic. While this historic CTC expansion under ARP will temporarily improve the lives of millions of families, this expansion will expire after one year. To realize the long-term benefits of such improvements, Congress should make the temporary expansions to the CTC permanent. In addition, lawmakers should make the credit more inclusive by expanding eligibility for immigrant children.

To learn more about the Child Tax Credit, visit childtaxcredit.gov.

Four Ways New Jersey Can Improve Health Care Using American Rescue Plan Funds

Posted on by Brittany Holom-Trundy

As state budget discussions come to a close this month, New Jersey lawmakers and advocates alike should turn their attention to the ways that the American Rescue Plan (ARP) can complement the state’s Fiscal Year (FY) 2022 budget. The ARP, signed into law by President Biden in March, includes expansions to food assistance, housing support, unemployment benefits, tax credits for working families, and health coverage to ensure a full and strong recovery after the COVID-19 pandemic.

The ARP’s health investment presents big opportunities to complement work that state leaders and advocates are pursuing through the state budget. Governor Murphy’s proposed FY 2022 budget and the subsequent legislative discussions should put New Jersey on a path toward a strong recovery, reversing in many ways the state government’s policy approach coming out of the Great Recession. Programs like Cover All Kids, support for reproductive health care, and Medicaid coverage for doula services will begin to address many root causes of the health disparities that existed prior to the pandemic and worsened its devastation in the state.

Through the ARP, New Jersey can build on these state-led efforts with federal funding and support. The ARP funds a long list of health programs, including subsidies for health insurance through the state exchange, public health infrastructure, community health workers, mental health and substance use services, home and community-based services, postpartum care, Medicaid expansion, and more. While New Jersey already expanded Medicaid (and thus cannot receive the increased funds for its introduction) and implemented the increased subsidies through GetCovered NJ, there are still several outstanding opportunities for health-specific investments. If targeted effectively, these funds can solidify New Jersey’s path to a quick, strong, and equitable recovery. Here are four priorities for decision-makers and advocates to consider when planning for the use of these funds.

1. Avoid Band-Aid Fixes by Investing in Long-Lasting Infrastructure

State and local leaders may find it tempting to spend the ARP funds on temporary fixes. Yet crisis-response investments without a broader strategy do not address the need for stronger, permanent public health infrastructure. Critically, infrastructure should not only include traditional physical infrastructure; it must incorporate and prioritize human infrastructure, or support for those who provide key services. Without this, New Jersey cannot adequately combat the effects of COVID-19 and structural racism to better weather the next pandemic.

The ARP’s funds support infrastructure development that addresses the devastation the pandemic has had on mental health and substance use challenges, particularly for communities of color. The $78 million that New Jersey receives through the ARP’s Community Mental Health Services Block Grant (MHBG) and Substance Abuse Prevention and Treatment Block Grant (SABG) can fund such expansions. This includes, for example, increasing the number of facilities and available beds that provide treatment for behavioral health issues that center person-centered care, while also supporting a larger public health workforce dedicated to treatment at those facilities. Adequate support provides improved paths to training, credentials, and benefits to support workers’ physical and mental wellbeing.

2. Expand The Length and Diversity of Services for Those with the Greatest Need

Many New Jerseyans, particularly Black and Latinx/Hispanic residents, do not have access to culturally-competent health services that address rapidly changing lifestyles and approaches to care, let alone services that actively counteract the effects of structural racism. By expanding the supported services through the NJ FamilyCare — the state’s Medicaid program — New Jersey can better cover people who face health vulnerabilities, including those with postpartum care needs or living with disabilities. By addressing gaps in health care, the state will better protect those who are at the highest risk of illness and death during a pandemic.

The ARP’s state option to extend Medicaid coverage of postpartum care to 12 months from 60 days (which was also proposed by Governor Murphy in his February FY2022 budget) will help around 8,700 New Jersey women per year receive the care they need. New Jersey leaders have already submitted plans to the federal government for an extension to six months; these will automatically be updated to reflect the full-year expansion. Additionally, the ARP’s enhanced federal funding for Medicaid Home and Community-Based Services (HCBS), which could bring approximately >$172.7 million into New Jersey, can be invested in services that protect people before, during, and after crises, removing the scramble to transition when future outbreaks occur. These can include maintaining and building on telehealth services, expanding personal care services, and providing personal protective equipment (PPE) supplies to home and community health workers.

3. Ensure Investments in the Health Workforce Last Beyond the Crisis

The COVID-19 pandemic emphasized the importance of a diverse and sufficiently supported health workforce in protecting all residents of the Garden State. Community health workers, who are both public health workers and intermediaries between health services and communities, and Direct Support Professionals (DSPs), who provide care directly to individuals with disabilities through programs like Medicaid Home and Community-Based Services (HCBS), serve vital roles in bridging the gaps between the health care system and the unique needs of individuals and communities.

Despite initiatives to better integrate the work of CHWs and increase pay for DSPs, New Jersey remains behind other states in adequately supporting these essential workers. The state still has one of the lowest numbers of community health workers (CHW) compared to the total number of jobs in the state, a turnover rate for DSPs that remains above 40 percent, and dismal wages for services. Continuing to underfund diverse and essential care severely limits resources for people and communities with the greatest health challenges and exacerbates structural racism on health. New Jersey can improve the system of care throughout the state by: ensuring that CHW, DSP, and other essential health workers’ reimbursement adequately support their vital services; supporting training through programs like the Colette Lamothe-Galette (CLG) Community Health Worker Institute; and redesigning training to be flexible and address not just current, but also growing and anticipated health needs. In addition to the HCBS enhanced federal funding, the ARP provides several grant opportunities that New Jersey leaders should leverage to invest in long-term solutions.

4. Keep the Public Conversation Open: Don’t Make The Plan One and Done

Conversations with communities whom COVID-19 has disproportionately harmed will continue to play an essential role in determining the most helpful ways to address the pandemic’s devastation. With changing social and economic circumstances throughout the state and country, the discussions on how best to target funds cannot be held to one-and-done meetings. Instead, New Jersey can make the most of the ARP’s opportunities by implementing broad plans that allow flexibility to respond to feedback from individuals, families, and communities. Ensuring that communities’ needs are addressed will help overcome structural biases in aid and investment. Additionally, planning for regular evaluations of the funding’s impact — instead of treating the ARP as a standalone, single action — can help to better target funds and improve health outcomes for New Jersey’s future.

Five Ways to Strengthen Tax Credits for Workers

Posted on by Vineeta Kapahi

The American Rescue Plan (ARP), which was signed into law by President Biden in March 2021, is set to provide critical relief to workers and families hard hit by the COVID-19 pandemic. The law, widely considered the biggest anti-poverty plan in decades, includes expansions to tax credits for workers, unemployment benefits, health coverage, and food and housing assistance.

Notably, this relief package substantially, but temporarily, expands two key tax credits: the Child Tax Credit (CTC) and the Earned Income Tax Credit (EITC). For the CTC, which helps working families offset the costs of raising children, the ARP expands eligibility to include all children with a Social Security number except those in households with the highest incomes and increases the maximum credit amount. In addition, ARP expands the Earned Income Tax Credit (EITC) for workers who do not claim dependent children by broadening age restrictions and increasing the maximum credit amount. Unfortunately, most of these changes are scheduled to expire after one year. Federal lawmakers should extend these investments to build a more equitable recovery and permanently strengthen these programs.

In the absence of permanent changes to address inequities in the federal EITC, access to this vital program remains limited: it has age restrictions for workers without dependent children, excludes immigrants, and can penalize survivors of domestic violence. In addition, the permanent version of federal CTC excludes many of the households who need it most. The good news is that New Jersey does not have to wait for the federal government to address these issues — the state can strengthen its own state-level tax credits. Here are five steps New Jersey lawmakers can take right now to improve the economic security and wellbeing of low-wage workers and families.

1. Stop Excluding Immigrant Workers Who File Taxes 

Both the federal and New Jersey EITC exclude immigrants who do not have a Social Security number (SSN)> altogether. As a result, tens of thousands of immigrant households are excluded from this program, even if they file taxes using an Individual Taxpayer Identification Number (ITIN). This arbitrary exclusion pushes immigrant households who are struggling to make ends meet further behind. New Jersey can make this tax credit more inclusive by removing this discriminatory barrier and extending access to New Jerseyans who would qualify for the credit but for the type of number they use to file their taxes. In addition to expanding access to the state EITC, New Jersey should also provide ITIN filers the value of their denied federal EITC so they receive the same total tax credit as other workers.

2. Permanently Remove Age Restrictions to EITC Eligibility

For workers without qualifying children, eligibility for the EITC is subject to age restrictions – workers who do not claim children as dependents are only eligible for the federal EITC if they are between the ages of 25 and 64. In 2020, New Jersey took an important step toward addressing this shortcoming by lowering the minimum EITC eligibility age for workers without qualifying children from 25 to 21. New Jersey can build on this progress by eliminating the age limits for workers without qualifying children altogether, allowing young people under 21 and seniors over 65 to benefit from this important program. The state should also address the gap created by the federal EITC’s narrow eligibility rules by providing these workers with the full amount of the federal EITC that they are denied.

3. Expand the EITC Income Eligibility and Increase Credit Amount for Workers Without Dependent Children

For workers who are not raising children at home, the EITC is limited in two big ways: the maximum credit amount is lower than for residents with children, and the income eligibility threshold is much lower, meaning fewer workers qualify. The maximum state EITC that a worker without dependent children can claim for the 2020 tax year is just $215 compared to $1,434 for a worker with one child. For the same tax year, the maximum income threshold is only $15,280 for a single adult – less than what a person earning the minimum wage and working full-time would have earned in 2020  – compared to $41,756 for a single worker with one child. New Jersey could provide a more meaningful boost for individuals earning low wages by raising the maximum credit amount for workers without qualifying children and by increasing the income cap to match the earnings of a full-time worker earning the minimum wage.

4. Expand EITC Eligibility for Domestic Violence Survivors

Individuals who file their taxes with the status “married filing separately” are ineligible for any EITC. This limitation penalizes some survivors of domestic violence; individuals who leave a relationship in the latter half of the tax year or have not legally divorced are typically required to file their taxes as married filing separately, and as a result, are not eligible for the EITC. By allowing tax filers who are unable to file a joint return because of domestic violence to claim the EITC, New Jersey can better support the safety and economic security of survivors.

5. Establish a State Child Tax Credit and Make the Child and Dependent Care Credit (CDCC) Fully Refundable

Regardless of whether or not federal lawmakers extend the temporary expansion of the federal CTC, New Jersey can build upon and address gaps in the CTC by creating a state version of this credit. In addition, New Jersey can make its current CDCC more inclusive by making this credit fully refundable.

Expanding Tax Credits for Workers  Benefits Working Families and the Economy Alike

Expanding access to New Jersey’s tax credits for working families would not only relieve financial hardship for low-wage workers ― many of whom are essential workers ― it would also serve as a fiscal stimulus. By putting money in the hands of people who need it and are likely to spend it immediately, these credits increase demand for goods and services, strengthening the broader economy and local communities across the state.

Introducing the State of Opportunity Index

Posted on by Nicole Rodriguez

New Jersey does best when all residents can reach their full potential, regardless of their race, ethnicity, or neighborhood. This requires quality public education, safe and affordable housing, jobs that pay well, healthy places to live, reliable transportation, and assurance of just law enforcement practices, among other essentials. Yet many residents across the state still face persistent barriers, despite decades of progress. These disparities are particularly acute for people of color and women who face the compounding effects of racism and sexism. But by having a clearer idea of the challenges we face and where they manifest, we can better plan our efforts for policy advocacy.

Therefore, NJPP created the State of Opportunity Index. This is a multifaceted statewide look and breakdown by all New Jersey counties on how residents are doing in their communities. With the most recent data available, the tool highlights the depth of disparities that exist across the state between communities. The Index will serve as an educational tool for the public and will inform advocates and legislators on the distinct and intersectional areas of health and well-being in the Garden State — and where targeted policy solutions are necessary.

Specifically, this user-friendly, interactive state and county-level index consist of eight categories: Economic Security, Education, Employment & Earnings, Health, Housing, Immigrants, Police Use of Force, and Transportation. Each category includes several data indicators at the county and state level and includes race and ethnicity breakdowns, when available.

As one of the wealthiest states in the nation, New Jersey has the potential to build an inclusive economy that leaves no one behind. NJPP invites all to visit the Index to learn more about how your communities are faring and what policymakers can do to make New Jersey a better place for all residents to live and thrive.

Note on disaggregated race/ethnicity data: Variations within racial and ethnic populations are often overlooked because disaggregated data are not always recorded. Racial and ethnic disparities and inequities can only be eliminated if there is high-quality information by which to track immediate problems and underlying social determinants of well-being. This data is also necessary to guide the design and application of culturally specific policy approaches. As policy decisions are made, disaggregated data must be included in order to truly track progress for all who are impacted.

New York Approves $2.1 Billion Relief Fund for Immigrants — New Jersey Should Do the Same

Posted on by Vineeta Kapahi

The COVID-19 pandemic has brought increased recognition of immigrants’ critical contributions to our communities and economies. Our nation’s immigration policy and safety net programs, however, still do not reflect this reality. Undocumented immigrants are both disproportionately represented among industries experiencing job loss due to the pandemic and essential workers who risk their lives to perform critical work, including caring for our loved ones, keeping our stores stocked and running, and growing, preparing, and delivering our food. While most people facing financial hardship can benefit from government aid, including the federal stimulus payments and unemployment insurance, discriminatory eligibility criteria bar many immigrants from the same access to financial assistance. 

The good news is that states do not have to wait for the federal government to act. This week, New York took a big step toward expanding access to critical relief by passing a state budget that includes a $2.1 billion fund for undocumented workers who were excluded from pandemic aid. New York’s Excluded Workers Fund — which is expected to benefit an estimated 290,000 workers and provide substantial economic boosts across the state — creates two levels of aid. Tier 1 provides $15,600 (the equivalent of $300 per week for one year) for undocumented workers who are able to meet strict standards of proof of eligibility. While this amount falls short of what other jobless workers received in unemployment benefits, it will make a substantial difference for families facing financial hardship. The second tier provides $3,200 per worker, matching the amount of three rounds of economic impact payments that many Americans received. 

Source: Fiscal Policy Institute Analysis of Excluded Worker Fund (2021)

Even though New Jersey has one of the largest shares of immigrants in the country, the state’s investment in its immigrant communities pales in comparison to New York and many other states. While only 14 percent of the total U.S. population is born outside of the United States, nearly one in four (23 percent) New Jersey residents is an immigrant. Following national trends, immigrants in New Jersey have higher rates of labor force participation than non-immigrants. In addition,  immigrants have lower median earnings than U.S.-born workers in New Jersey, and this disparity is particularly stark for non-citizen immigrants. Undocumented immigrants make up 6.5 percent of New Jersey’s workforce — an even larger share than in New York’s workforce (4.9 percent). Moreover, the majority (209,400) of undocumented workers in New Jersey’s workforce (294,000) are essential workers whose labor was critical during the pandemic. 

New Jersey lawmakers have yet to establish a program that comes close to addressing the scale of the current crisis, despite the outsized contributions of immigrants to New Jersey’s communities and economy, and the disproportionate health and financial impacts of the COVID-19 pandemic on these same communities. While New York is the most recent and largest example, it is not the only state to take action to support its immigrant communities. Several other states, including Oregon, Washington, New Mexico, Colorado, Illinois, and California, have also created programs to support workers and families excluded from relief. New Jersey lawmakers should follow their lead and support our immigrant communities.

Cooperation with ICE Deepens Racial and Economic Disparities in New Jersey

Posted on by Vineeta Kapahi

New Jersey is home to one of the largest immigrant populations in the nation, yet unjust immigration enforcement practices hold many people back from fully participating in and contributing to our communities. Each year, Immigration and Customs Enforcement (ICE) holds tens of thousands of immigrants in unsafe and inhumane conditions at detention facilities across the country, four of which are located in New Jersey.[1]  During the past five years, over 15,000 immigrants have been ordered to be deported following court decisions in New Jersey, including 4,036 in Fiscal Year (FY) 2020 alone.[2][3] Even as immigrants risk their lives as essential workers during the COVID-19 pandemic, ICE arrests, detention, and deportation continue to compromise public health, separate families, and destabilize communities.[4]

ICE Detention Practices Violate Human Rights and Harm Public Health

New Jersey’s immigrant detention facilities — the Elizabeth Detention Center, which is operated by the private company CoreCivic, as well as public jails in Bergen, Essex, and Hudson Counties — regularly violate the human rights of those detained and are infamous for unsanitary conditions and medical neglect.[5] Over the last year, the COVID-19 pandemic has further intensified these health and safety concerns. ICE continues to book immigrants while neglecting to follow health and safety guidelines, causing outbreaks at all four immigrant detention facilities in New Jersey.[6] ICE has further compromised public health by continuing to transfer people between facilities, including New Jersey jails with confirmed cases of COVID-19.[7]

Federal Immigrant Enforcement Tactics Worsen Economic Inequities

The immigration enforcement system deepens the inequities upon which it is built.  When immigrants are unable to care for their families or miss work because they face detention or deportation, the harms ripple through their families and communities.[8] Over 1,000 immigrants have been deported from New Jersey in each of the last four years.[9] In addition, many immigrants are separated from their families and communities when they are detained while awaiting their case to be heard in an immigration court. New Jersey has the fifth largest backlog of cases pending before the immigration courts.[10] With 69,788 cases awaiting an immigration hearing, cases can remain pending for months or years. As of February 2021, the average length of time cases have been waiting for an immigration court decision in New Jersey is 1,053 days —nearly three years.[11]

While some detained immigrants have the opportunity to be released before their trial on a cash bond, bonds are often prohibitively expensive. Among the 1,198 cash bonds granted in New Jersey last year, the median bond amount was $12,000.[12] This is out of reach for many immigrants, as more than 1 in 3 (37 percent) non-citizens in New Jersey live at less than 200 percent of the federal poverty level.[13] A $12,000 cash bond equates to roughly one-third of the median earnings for non-citizens (median earnings among non-citizens for full-time, year-round workers is $32,075 for women and $42,905 for men).[14] The use of cash bonds as a pathway to release, thus, disproportionately harms immigrants with the least resources.

State and Local Law Enforcement Collaboration with ICE Intensifies Racial Injustice

The criminal justice and immigration systems in the United States are deeply entangled — and both are rife with racial inequities.[15] The rate of incarceration among Black people in New Jersey is 12 times that of white people, which is among the largest disparities in the country.[16] Because ICE relies heavily on state and local law enforcement to identify and arrest non-citizens, the immigration system further entrenches the racial disparities in the criminal legal system.[17] As a result, Black immigrants are disproportionately represented among detained immigrants facing deportation on criminal grounds.[18]

One way that individuals are channeled from the criminal legal system to the immigration enforcement system is through ICE detainer requests. When federal immigration authorities want to take custody of someone who has been arrested by another law enforcement agency, they can file a written notice (Form I-247) to local, state, or federal law enforcement to request that the agency detain an individual for an additional 48 business hours after their scheduled release.[19] Since 2010, ICE has issued over 32,000 detainer requests to law enforcement agencies in New Jersey.[20]

Immigration detainer requests are non-binding: law enforcement agencies have discretion over whether or not to honor them.[21] Yet, law enforcement agencies in New Jersey generally comply with these requests and have only refused a very small portion, 6 percent or less each year, according to ICE’s records collected by Transactional Records Access Clearinghouse (TRAC) through Freedom of Information Act requests.[22] Consistent with ICE’s well-documented lack of transparency, TRAC notes that law enforcement agencies’ refusal to honor detainer requests is an optional field in ICE’s database and may not be reliably recorded.[23]

Strengthening Fair and Welcoming Policies Can Improve Public Health and Safety

Fair and welcoming policies are an important tool for limiting the harm caused by uneven and inhumane immigration enforcement practices.[24] In 2018, New Jersey Attorney General Gurbir Grewal took an important step toward limiting cooperation with federal immigration authorities by issuing the Immigrant Trust Directive.[25] While this Directive places certain limitations on the voluntary assistance that state and local law enforcement officers in New Jersey can provide to federal immigration authorities, the policy is both temporary and limited in scope. The Directive, for example, allows for state and local law enforcement cooperation with ICE in situations involving certain criminal offenses. The 2019 annual reporting data on the Directive showed that the vast majority of cooperation with federal immigration authorities was conducted by state and county corrections agencies. Between the implementation of the Directive and the end of year (March 15 to December 31, 2019), correctional facilities reported that they continued to detain an individual beyond the time they would otherwise be eligible for release for ICE 403 times, provided ICE with access to a detained person 551 times, and provided notice of a detained individual’s upcoming release 779 times.[26]

Just as the inequities in the immigration enforcement system were created through policy decisions over several decades, they can too be improved through policy changes. By building upon the Immigrant Trust Directive with stronger fair and welcoming policies, lawmakers can reduce cooperation between local law enforcement and federal immigration enforcement. In addition, by protecting residents’ personal information and limiting immigration enforcement in public facilities, New Jersey can improve residents’ access to critical resources and public services, like schools and hospitals. Lawmakers can further limit the state’s participation in human rights abuses by prohibiting public and private entities from entering into, renewing, or extending immigration detention contracts. Taken together, these policies will better honor the dignity and respect of New Jersey’s diverse communities and help create a truly fair and welcoming state for all.

End Notes

[1] Transactional Records Access Clearinghouse. “Immigration and Customs Enforcement Detention.” https://trac.syr.edu/phptools/immigration/detention/

[2] Federal Fiscal Years (October to September) 2016 to 2020.

[3] Transactional Records Access Clearinghouse. “Outcomes of Deportation Proceedings in Immigration Court by Nationality, State, Court, Hearing Location, and Type of Charge.” https://trac.syr.edu/phptools/immigration/court_backlog/deport_outcome_charge.php

[4] Kerwin, Donald; Mike Nicholson, Daniela Alulema, and Robert Warren. (2020) “US Foreign-Born Essential Workers by Status and State, and the Global Pandemic.” https://cmsny.org/publications/us-essential-workers/

[5] Alvarado, Monsy. (2020) “NJ immigrant detention center may close as landlord moves to end deal with ICE contractor.” NJ Spotlight.  https://www.northjersey.com/story/news/2020/07/15/nj-detention-center-may-close-owner-moves-end-ice-contract/5439615002/; Human Rights First. (2018) “Ailing Justice: New Jersey.”  Human Rights First. https://www.humanrightsfirst.org/sites/default/files/Ailing-Justice-NJ.pdf

[6]Vera Institute. 2020. “Tracking COVID-19 in Immigration Detention.” https://www.vera.org/tracking-covid-19-in-immigration-detention

[7] Evans, Noelle. March 22, 2020. “Advocates call for ICE detainees’ release at Batavia amid threat of possible COVID-19 outbreak.” WXXI News. https://www.wxxinews.org/post/advocates-call-ice-detainees-release-batavia-amid-threat-possible-covid-19-outbreak; Mikati, Massarah. December 2020. “Transfers from Batavia ICE to Rensselaer County Jail raise concerns about COVID-19.” Times Union. https://www.timesunion.com/news/article/Transfers-from-Batavia-ICE-to-Rensselaer-County-15803619.php

[8] Alissa R. Ackerman & Rich Furman (2013) The criminalization of immigration and the privatization of the immigration detention: implications for justice, Contemporary Justice Review, 16:2, 251-263, DOI: 10.1080/10282580.2013.798506

[9] Transactional Records Access Clearinghouse. “Latest Data: Immigration and Customs Removals.” https://trac.syr.edu/phptools/immigration/remove/

[10] Transactional Records Access Clearinghouse. “Immigration Court Backlog Tool.” https://trac.syr.edu/phptools/immigration/court_backlog/

[11]  Transactional Records Access Clearinghouse. “Immigration Court Backlog Tool.” https://trac.syr.edu/phptools/immigration/court_backlog/

[12] Transactional Records Access Clearinghouse. Immigration Court Bond Hearings and Related Case Decisions. https://trac.syr.edu/phptools/immigration/bond/

[13] United States Census Bureau. American Community Survey 5-Year Estimates. “Selected Characteristics of the Native and Foreign-Born Populations.” https://data.census.gov/cedsci/table?q=foreign&g=0400000US34,34.050000&tid=ACSST5Y2019.S0501&hidePreview=true

[14] United States Census Bureau. American Community Survey 5-Year Estimates: Table S0501. “Selected Characteristics of the Native and Foreign-Born Populations.”

[15] Migration Policy Institute. Revving Up the Deportation Machinery: Enforcement under Trump and the Pushback. https://www.migrationpolicy.org/research/revving-deportation-machinery-under-trump-and-pushback

[16] Nellis, Ashley. (2016) “The Color of Justice: Racial and Ethnic Disparity in State Prisons.” https://www.sentencingproject.org/publications/color-of-justice-racial-and-ethnic-disparity-in-state-prisons/

[17] Das, Alina. “Inclusive Immigrant Justice: Racial Animus and the Origins of Crime-Based Deportation. https://lawreview.law.ucdavis.edu/issues/52/1/Symposium/52-1_Das.pdf

[18] Black Alliance for Justice Immigration and New York University. “The State of Black Immigrants” http://www.stateofblackimmigrants.com/assets/sobi-fullreport-jan22.pdf

[19] United States Immigration and Customs Enforcement. “ICE Detainers: Frequently Asked Questions” https://www.ice.gov/identify-and-arrest/detainers/ice-detainers-frequently-asked-questions

[20]  Transactional Records Access Clearinghouse. “Immigration and Customs Enforcement Detainers.” https://trac.syr.edu/phptools/immigration/detain/ ICE data obtained through FOIA requests submitted by TRAC. TRAC notes that law enforcement agency refusal is an optional field in ICE’s database and may not be reliably recorded. ICE does not publish systematic data on refusal rates.

[21] American Civil Liberties Union. “Ice Detainers are Non-mandatory, Optional Requests.” https://www.aclu-ia.org/en/ice-detainers-are-non-mandatory-optional-requests

[22] Transactional Records Access Clearinghouse. “Detainers Refused.” https://trac.syr.edu/phptools/immigration/detain/. ICE data obtained through FOIA requests submitted by TRAC.

[23] Transactional Records Access Clearinghouse. “About the Data – ICE Detainers.” https://trac.syr.edu/phptools/immigration/detain/about_data.html

[24] Migration Policy Institute. (2020). “Revving Up the Deportation Machinery: Enforcement under Trump and the Pushback.” https://www.migrationpolicy.org/research/revving-deportation-machinery-under-trump-and-pushback

[25] New Jersey Department of Law and Public Safety. “New Jersey Attorney General’s Immigrant Trust Directive.” https://www.nj.gov/oag/trust/

[26] Immigrant Trust Directive Annual Reporting Form. https://www.njoag.gov/attorney-general-grewal-releases-immigrant-trust-directive-annual-reporting-data-for-2019/

Gov. Murphy’s FY 2022 Budget Address: 5 Key Takeaways

Posted on by Louis DiPaolo

With the nation still reeling from the COVID-19 pandemic, Governor Phil Murphy unveiled a state budget proposal that once again rejects austerity and makes major investments in New Jersey’s economic recovery. The proposal, buoyed by borrowed funds and stronger than expected revenue collections, includes significant funding for public health, schools, transit, and economic support for workers and businesses alike — all key drivers of strong communities and a strong economy. With a full pension payment, which would be the first since 1996, the budget also protects the retirement security of nearly 800,000 public workers and looks to shore up one of the state’s biggest financial obligations.

Here are key takeaways from the governor’s address:

1. All Kids Health Coverage

Universal health coverage for all kids. If that sounds like a big deal, it’s because it is. As it stands, there are approximately 80,000 uninsured children in New Jersey, but that would change under Governor Murphy’s proposed budget. With Black and Latinx/Hispanic children representing three-quarters of those uninsured — during a health crisis that has catastrophically and disproportionately harmed Black and Latinx/Hispanic families — policies that promote health equity are necessary for a strong recovery.

Providing affordable coverage to all children works hand-in-hand with the reopening of schools, keeping workers and their families safe, and the promotion of the positive health and economic outcomes tied to childhood health conditions. By funding All Kids Health Coverage, the governor’s budget provides protections for children and families so that they may not only survive the current crisis, but also have the resources to thrive in the long-term.

Other big health care investments include $19 million for a new Reproductive Health Care Fund, an extension of Medicaid coverage for postpartum care to a full year, and an additional $25 million to state subsidies on the state-based exchange (GetCoveredNJ), which boosts enrollment and keeps costs low.

2. Tax Credits for Low-Paid Senior Workers

The governor’s budget proposal expands who can qualify for the Earned Income Tax Credit (EITC), a powerful tool for providing income support to low- and moderate-income families. Currently, workers who do not have dependent children at home are only eligible for the federal EITC if they are between the ages of 25 and 64. This year’s budget proposal removes the upper age limit for workers without dependent children, increasing the after-tax income of thousands of New Jersey’s low-wage seniors who earn less than $15,980 per year.

While removing the maximum age threshold is a welcome change, there is much more the state could do to improve access to the EITC. Lawmakers could remove the minimum age threshold, allowing more young workers to benefit from this important program. Similarly, lawmakers could provide a more meaningful boost for more families by raising the benefit level for childless workers. Further, lawmakers should extend the credit to include all tax filers, regardless of where they were born. Right now, the EITC explicitly excludes workers who do not have a social security number, even if they file taxes using an Individual Taxpayer Identification Number (ITIN). By removing these barriers, lawmakers can help more New Jersey residents cover the cost of basic needs and provide a much-needed boost for state and local economies.

3. Child Care Tax Credit Expansion

The Governor’s proposed budget expands eligibility of a vital tax credit for working parents — the Child and Dependent Care Tax Credit (CDCC) — and boosts benefits for the state’s lowest-income families. This credit is available for working parents with kids under age 13 and for workers supporting parents or other dependents. It helps offset child care expenses, providing critical relief, but it is available only to a narrow set of families. This leaves working families with the lowest earnings with no benefit at all. By making the credit fully refundable and expanding the eligibility income cap from $60,000 to $150,000, the proposed budget substantially expands the reach of the program.

4. Full Pension Payment (One Year Early!)

Stronger than expected revenue collections, paired with $4.5 billion in borrowing from last year, has allowed Governor Murphy to make a bold proposal: a full payment into the state’s pension system, one year ahead of schedule. This would be the first full payment made by the state since 1996 — a stark reminder of New Jersey’s long history of raids on the pension fund by past administrations of both parties. The proposed payment, at $6.4 billion, is approximately $600 million more than what the Murphy administration intended to make as part of a scheduled phase-in. Now, one of the country’s most underfunded pension systems is on the road to solvency without shortchanging approximately 800,000 public workers. Here’s hoping credit rating agencies will take notice and reward New Jersey’s financial improvements with credit upgrades.

 5. No Pandemic Relief for Immigrant Workers

While the proposed budget includes several critical investments that will support workers and families across New Jersey, many immigrants are once again pushed further behind. New Jersey’s immigrant communities have faced disproportionate harm from the current health and economic crises. Unlike most other New Jersey residents who have access to support, however, certain immigrants are excluded from programs like federal stimulus payments and unemployment insurance when they fall on hard times. Nearly one year since the onset of the COVID-19 pandemic in New Jersey, state lawmakers have yet to take action to address this gap. To ensure strong recovery from the current crisis, is it critical that all New Jersey residents have access to financial support needed to cover the cost of basics.

Higher Education Funding Still Lags Behind Pre-Recession Levels

Posted on by Louis DiPaolo

A well-funded public higher education system opens up countless opportunities for upward mobility and stability, especially for low-income students and students of color. Yet, in 2019, New Jersey spent 19.6 percent, or $2,006, less on each student than it did before the Great Recession, according to a new report from the Center on Budget and Policy Priorities. What’s worse, during the COVID-19 pandemic, New Jersey lawmakers cut higher education funding by $168.2 million to help balance the state budget.

Years of cuts to higher education, tuition increases, and the diminishing value of financial aid make college less affordable and less accessible. The average tuition at New Jersey’s public four-year institutions grew by 12.8 percent, or $1,646, between 2008 and 2019. At New Jersey’s community colleges, which typically serve a greater share of Pell Grant recipients — grants for students with exceptional financial need —tuition grew by 24 percent, or $974, between 2008 and 2019.

Rising tuition costs also place greater burdens onto groups that have historically and currently face barriers to higher education, like New Jerseyans of color and those with low incomes. In 2018, New Jersey’s public tuitions cost the average Black and Latinx/Hispanic households 14 percent and 13 percent of their incomes, respectively. Meanwhile, the cost of public tuition only costs the average white family 8 percent of their household income.

New Jersey is not alone. Nation-wide, undergraduate enrollment decreased by more than four percent between the fall 2019 and 2020 semesters. Students who are low-income, Black or Latinx/Hispanic, unemployed, or single parents have been more likely to cancel their college plans. Students with low incomes are also more likely to take on and struggle to repay student loans, a situation that the ongoing recession could worsen absent stronger state investments.

An equitable economic recovery will depend on a well-educated workforce. Therefore, policymakers must prioritize raising new and sustainable revenue to support higher education. This could be accomplished, in part, by closing corporate tax loopholes and ensuring wealthy heirs pay their fair share in taxes. If not, cuts to public higher education will continue to reduce opportunities for students of color and students from low-income families.

Tax Break on PPP Loan Expenses Will Cost New Jersey More Than $1 Billion

Posted on by Sheila Reynertson

In an unexpected windfall, New Jersey businesses that received federal grants through the Paycheck Protection Program (PPP) can now exempt the forgiven loan from state taxation and claim a deduction on expenses paid by the loan.

This unprecedented move would allow companies to receive a tax cut on both sides of the ledger – one for receiving the money, and another for spending it – costing New Jersey up to $688 million in lost personal income tax (PIT) revenue[1] and at least another $560 million in lost corporate business tax (CBT) revenue.[2] Of note and concern is the fact that this tax break is likely to disproportionately benefit white-owned businesses given the inequitable distribution of the original loans and difficulty that Black-owned businesses had in accessing the program.[3] Based on a sampling of PPP loans, more than 80 percent have been granted to white-owned businesses.[4] Black-owned businesses received less than 2 percent of the loans while 6.6 percent went to Hispanic-owned businesses, according to the Center on Public Integrity.

In light of the moral obligation to fund an equitable pandemic recovery, despite foreseeable revenue shortfalls in the not-so-distant future, lawmakers giving the green light to a $1.2 billion double tax cut on loan forgiveness raises serious concerns about the state’s ability to support other, potentially more urgent, needs.

Background

Last year, Congress created the Paycheck Protection Program, a large loan assistance program designed to help businesses and stabilize local communities during the COVID-19 crisis. So long as the loans were used for allowable business expenses like payroll and rent, the loan would be forgiven and converted to a grant.

Since expenses paid with PPP loans are exempt from taxation, the Internal Revenue Code (IRC) directed that they could not be deducted in calculating taxable income. In other words, PPP loan forgiveness was to be treated as tax neutral, which is standard practice.

Then, just days before the calendar year came to a close, federal legislation reversed that directive, granting businesses both tax exemption and deductibility of expenses covered by their PPP loans. This change turned PPP loan forgiveness into a net tax benefit. So, in addition to having wages reimbursed through forgiveness of the loan that paid for them, PPP recipients are now set to get a federal tax cut.

New Jersey plans to offer the same tax cut, even though it is under no obligation to do so. And the cost is staggering — more costly to New Jersey coffers than other tax breaks in the CARES Act and a larger amount than the projected revenue from the newly passed “millionaires tax” — because of how many PPP loans have been granted.

Conformity Matters

New Jersey businesses pay state taxes either through the corporate business tax code or the personal income tax code, depending on how they are incorporated. Each code regards the IRC differently.

The state’s personal income tax code does not use IRC as a starting point, and its treatment of loan forgiveness is already tax neutral. In other words, the forgiven loan is taxable, but the expenses associated with the loan can be deducted. A recent announcement by Governor Murphy changes this. Pass-through businesses with a forgiven PPP loan on the books can now avoid gross income taxation of the forgiven loan and be allowed to deduct associated payroll and other expenses as normal business expenses.

The state’s corporate business tax code already uses the IRC as a starting point, meaning the new federal treatment of PPP loan forgiveness will be automatically replicated at the state level. By choosing not to decouple from the IRC, New Jersey is on track to lose at least $560 million in revenue, based on the $6.9 billion in PPP loans granted to corporations in 2020.

The last-minute, bipartisan change at the federal level turned a tax-neutral program designed to protect jobs into a tax cut for businesses that received federal aid. But let’s be clear: that policy change does not mean that these businesses are entitled to receive an additional tax break here in New Jersey. The state has to affirmatively choose to do so, which it has, thus weakening its ability to fund other needs central to pandemic recovery. Worse yet, thanks to the racial inequities of PPP disbursement, it will inherently exacerbate disparities among businesses ravaged by the economic downturn.

End Notes

[1] Legislative Fiscal Estimate on S3234, December 28, 2020. https://www.njleg.state.nj.us/2020/Bills/S3500/3234_E2.PDF

[2] Based on $6.9 billion in PPP loans granted to NJ corporations in 2020.

[3] Boston Business Journal, PPP data shows Black-owned businesses received fewer loans, despite efforts, December 29, 2020. https://www.bizjournals.com/boston/news/2020/12/29/updated-ppp-data-shows-black-owned-businesses.html

[4] The Center on Public Integrity, Small Businesses Loan Data Includes Little About Race, July 2020. https://publicintegrity.org/health/coronavirus-and-inequality/small-business-loan-data-includes-little-on-owners-race-paycheck-protection-program/

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