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National Disability Institute's Washington Insider is a monthly newsletter highlighting key federal policy news that impacts the financial futures and economic empowerment of all people with disabilities. The Washington Insider tracks legislative and policy initiatives gaining momentum on Capitol Hill, specifically in the areas of taxation, asset building and economic development.

 

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November 2014 | Vol. 6, Issue 8
CONTENTS
ABLE Act Advances in Congress
2014 Post-Election Wrap Up
NDI Participates in Public Forum on Disability and Public Benefits
Social Security Benefits Increasing in 2015
FDIC Issues Report on Unbanked and Underbanked Households
CFPB Warns Lenders Against Creating Illegal Hurdles for Recipients of Social Security Disability Income
October Employment Profile


 

ABLE Act Advances in Congress

On November 19, Congressman Ander Crenshaw (R-Fla.), chairman of the House Financial Services and General Government Appropriations Subcommittee, issued the following statement announcing an anticipated early December vote on the Achieving a Better Life Experience (ABLE) Act (H.R.647).

“The ABLE Act is headed for a vote in December – testament to the wide-spread support for millions who face the daily struggle of living with disabilities. They deserve the same financial planning tools available to other Americans. My bill gives them just that by empowering families to live healthy and independent lives through tax-free savings accounts.”

“Step-by-step with focus and teamwork, ABLE has earned more bipartisan, bicameral support than any other bill in Congress, and I’m excited for its passage. Easing financial strains through tax-free savings accounts for qualified expenses such as medical, post-secondary education, housing, and transportation, the ABLE Act would provide a brighter future for millions of Americans.”

“No longer would they have to stand by and watch others use Internal Revenue Service-sanctioned tools that are unavailable to them. The playing field would finally be level. It creates incentives to employment for individuals with disabilities by allowing them to contribute to their own ABLE accounts and seek out employment opportunities without the fear of losing benefits.”

National Disability Institute (NDI), as a long-time supporter of the ABLE Act, applauds House Leadership, the bill’s sponsors and House members from both sides of the aisle for their support and help advancing this important piece of legislation. Following the House vote, we are hopeful the Senate will quickly act on the bill so that President Obama can sign it into law prior to the adjournment of the 113th Congress.

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2014 Post-Election Wrap Up

The November 4th elections are over and many new names and faces will be in D.C. and numerous state capitols and city halls across the country. While we are certainly hopeful the new Congress, governors and countless state and local officials will bring with them a commitment to economic mobility and security for people with and without disabilities, we know the challenges are enormous.

However, with your help we can engage our newly elected officials at every level of government to focus on the issues facing most Americans, which are financial instability and a very uncertain economic future. No group is more economically vulnerable than people with disabilities, who are 2.5 times more likely to be living at or below the poverty level, as compared to people without disabilities.

So, what can you do to help? It’s easy; call, email or write your elected representatives and ask for a response to these questions.

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NDI Participates in Public Forum on Disability and Public Benefits

As one of the nation’s leading voices in the disability and asset development communities, NDI was invited by New America Foundation (NAF) to join in a discussion entitled, “Trapped in America’s Safety Net: Choosing to Make People Poor.” The event revolved around the challenges Americans with disabilities face in navigating a complex maze of federal and state benefits that require them to stay poor to remain eligible.

During the event, NDI Executive Director Michael Morris, joined by author Andrea Campbell and New America Foundation Senior Policy Analyst Rachel Black, highlighted the numerous personal and financial problems associated with the federal asset limit mandate to stay eligible for critical public benefits such as Medicaid, Social Security, food and housing assistance. Morris argued that people with disabilities should have the opportunity to save and plan for the future while also receiving the services and assistance they require and need to live their life to its fullest potential. Additionally, he stated asset limits do not take into account the added costs associated with living and managing a disability – exemplified by the fact that the current federally imposed asset limit of $2,000 has not been increased in nearly 25 years and in that time has lost almost half of its value. He finished by calling for the immediate passage of the ABLE Act.

The forum, which piggybacked off the release of Campbell’s most recent book, “Trapped in America’s Safety Net: One Family's Struggle,” featured a question and answer component that gave attendees an insider’s perspective on the daily reality of living with a disability while also navigating the convoluted web of government agencies and red tape to maintain public benefits eligibility. Campbell, Black and Morris offered several recommendations to help alleviate the financial crisis faced by all too many people living on public benefits, including people with disabilities. They identified lifting – ultimately eliminating – asset limits and reducing the administrative burden of proving eligibility as an action that could have an immediate, positive impact on the financial health and future for countless Americans with and without disabilities.

NDI has been a long-time supporter of raising/eliminating asset limits as a condition for public benefits eligibility. NDI has also been a proponent and advocate for the passage of the ABLE Act. The bill, if enacted, would allow Americans with disabilities and their families or caretakers the opportunity to create a tax-exempt savings account. Set aside monies in an ABLE account would not count as an asset when calculating Supplemental Security Income (SSI), Social Security Disability Insurance (SSDI) or Medicaid eligibility. Funds can be used toward specific expenses including healthcare, education, housing, transportation, employment support and general welfare.

To date, the ABLE Act enjoys broad bipartisan support in both the House and Senate. Currently, the bill has 380 House cosponsors and another 74 cosponsors in the Senate.

Going forward, NDI will continue to work at all levels of government with stakeholders, policymakers and other leaders to ensure all Americans have the opportunity to live financially independent.

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Social Security Benefits Increasing in 2015

The Social Security Administration (SSA) announced a 1.7 percent benefit increase for the 64 million Americans who receive Social Security and SSI benefits.

Tied to the Consumer Price Index, determined by the U.S. Department of Labor’s Bureau of Labor Statistics, the 1.7 percent cost-of-living adjustment (COLA) will affect Social Security beneficiaries in January 2015. SSI recipients will see increased payments beginning on December 31, 2014.

Additionally, SSA announced the maximum amount of earnings subject to the Social Security tax would increase from $117,000 to $118,500. That means that of the nearly 168 million workers who pay Social Security taxes in 2015, only 1 in 17 will pay higher Social Security taxes as a result of the increase in the taxable income.

For more information, view the SSA’s COLA press release.

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FDIC Issues Report on Unbanked and Underbanked Households

On October 28, 2014, the Federal Deposit Insurance Corporation (FDIC) released the report, “2013 FDIC National Survey of Unbanked and Underbanked Households.” The most comprehensive study of its kind in the United States, the survey collected and analyzed data on the financial health and access/utilization of traditional financial products, services and institutions among U.S. households.

The survey found that the total number of “disabled households” in the U.S. was 10.8 million in 2013, as compared to 78.3 million “non-disabled households.” For reporting purposes, the FDIC classified a household as “disabled” only if the owner or renter of the home was living with a disability – not simply a household with an individual living with a disability.

The report concluded that individuals with disabilities are more likely to be financially unstable and use alternative financial services (AFS) – including pre-paid debit cards – as compared to individuals without disabilities and half of all households reporting a person with a disability are “fully banked,” as compared to the more than 65 percent of “fully banked” households with no person living with a disability. Additionally, the report found that of the 116 million households with up to date banking information only 8.7 percent, or 10.1 million, are households where the owner or renter was an individual with a disability. Further, the study determined people with disabilities are less likely to be banked for extended periods of time, less likely to have been recently banked and more likely to be unbanked or underbanked, as compared to individuals without disabilities.

For more information, view the FDIC report’s webpage.

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CFPB Warns Lenders Against Creating Illegal Hurdles for Recipients of Social Security Disability Income

The Consumer Financial Protection Bureau (CFPB) issued new guidance to lenders to not ask potential borrowers with disabilities who are recipients of SSI and/or SSDI for statements from their physicians about the likely duration of their disabilities or request for additional documentation from the SSA about the nature of their disability or their medical condition.

The Equal Credit Opportunity Act (ECOA) prohibits creditors from discriminating against an applicant whose income is supplemented by public assistance programs. That is why CFPB Director Richard Cordray recently stated, “Consumers should not be put at a disadvantage just because they receive Social Security disability income.” As a result of the new federal directive, lenders must not put unnecessary requirements on consumers who receive these benefits. For more information, read the CFPB bulletin.

NDI applauds the CFPB for taking this important step to protect consumers and will continue to work with Bureau and other federal agencies to ensure all people with disabilities have fair and equal access to credit.

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October Employment Profile

Disability employment statistics for October show that the unemployment rate among people with disabilities was 11.3 percent. This is as a result of only 20 percent of people with disabilities actively in the labor force, as compared to the 68.8 percent of people with no disability who are part of the labor force. Data on people with disabilities covers those from the ages of 16 to 64 who do not live in institutions.

U.S. Disability Employment Profile
Statistic
With Disability
Without Disability
 
Oct
2013
Oct
2014
Oct
2013
Oct
2014
Percent of Population in the Labor Force
20.0
20.0
68.5
68.8
Employment-Population Ratio
17.5
17.7
63.9
65.2
Unemployment Rate
12.8
11.3
6.7
5.3
As reported by the U.S. Department of Labor's Bureau of Labor Statistics, Table A-6

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