Hard to make ends meet in Nassau

Part 1 of a series

Working Floridians with incomes well above current federal poverty guidelines are struggling to cover the basics in Nassau County – that’s housing, food, child care, health care and transportation – according to a recent report from the United Way.

The 2017 ALICE report – the acronym stands for Asset Limited, Income Constrained and Employed – shows that annual incomes in Florida once viewed as sufficient to provide a comfortable lifestyle are being stretched to the breaking point.

United Way of Florida is one of 15 state organizations across the country implementing ALICE as a tool to measure what it takes to make it on a “Household Survival Budget,” calculated according to where people live.

Income thresholds for the report, customized on a county-by-county basis, revealed that an average Nassau County family consisting of two adults, one preschool-aged child and an infant needs an annual household income of $53,088 to cover the basics, with nothing left over to save for emergencies.

The median income for Nassau County is $52,005.

Federal poverty guidelines classify a family of four as impoverished on an income of $24,250 or less, but the ALICE report is based on actual costs as they vary across the country for basic necessities, including health care.

With data now available for more than 40 percent of the nation, the ALICE project finds the current federal guidelines – upon which most allocation of public and private resources is currently made – are no longer relevant to reality.

United Way of Florida began participating in ALICE in 2014. The initial report found that nearly half, 45 percent, of Florida households had trouble affording basic necessities. In the vast majority of cases, the head of the household was working, yet 15 percent lived below the poverty level, and fully 30 percent were scraping by paycheck to paycheck.

The report found the cost of basic household expenses increased steadily in every county in Florida between 2007 and 2015 while wages, when adjusted for inflation, stayed flat.

Housing costs alone went up 20 percent statewide.

“Housing affordability” for the report was measured by affordable housing stock, housing burden (households paying more than 30 percent of their income for housing), and real estate taxes.

“Job opportunities” was another composite index, including the number of jobs available, wages and distribution of income.

Nassau County fared poorly in both of those areas of the report.

Nassau was one of only four counties out of Florida’s 67 where both job opportunities and affordable housing options decreased by 20 percent between 2007 and 2015. Most Florida counties were showing growth in both areas following the 2008 recession.

A total of 29,674 households in Nassau County – 37 percent – were found to be struggling with the basic necessities of housing, food, transportation, child care and health care. This figure included very low-, low- and moderate-income households.

Most ALICE families in Nassau County in 2015 lived in owner-occupied housing, with a fourth of them paying more than 30 percent of their income toward house payments. A smaller portion lived in rental housing. Among the renters, nearly half were paying more in rent than what is considered affordable for their income. 

The county was found to be nearly 5,000 rental units short of meeting the affordable housing needs of its ALICE households.

Demographic trends point to the need for more, and smaller, low-cost housing in coming decades.

“Low-wage jobs continued to dominate the landscape in Florida, with 67 percent of all jobs in the state paying less than $20 per hour – a wage that is almost enough to afford the family Household Survival Budget. However, three-quarters of those jobs pay less than $15 per hour,” according to the report.

Service industries, like retail, education, health services, leisure, and hospitality employ large numbers of ALICE workers.

No mention is made in the ALICE report about current minimum-wage laws. The state minimum wage is $8.10 per hour ($16,848 per year for a fulltime job), $8.05 for those earning tips. The federal minimum wage is $7.25 an hour.

The most common occupation in Florida, retail sales, offers the lowest pay, at $9.99 an hour. With two adults working full time in retail, the household would still fall $14,000 below the ALICE survival budget.

Of the common service occupations, the report found only one category is paid enough to support the Household Survival Budget: A registered nurse, at $26.93 an hour.

Although small businesses account for the majority of new jobs, most employ 20 or fewer workers. Small businesses often lack the resources to pay well or to retain workers through tough times. While households with children more likely to be struggling, a  growing segment within ALICE is single adults age 65 and older. Nearly half of retired people in Florida now work to supplement retirement benefits. Young adults and retirees, both vulnerable populations, are now competing for the same low-wage jobs and affordable housing options.

ALICE households represent young and old and every ethnic group and race, but minorities are overrepresented in the population, indicating a continued racial disparity in income. Households headed by women and by single parents are also more likely to meet the ALICE criteria.

Looking beyond mere survival, the ALICE report finds that for the same Florida household of two adults with a preschool-aged child and an infant to achieve financial stability, it would need an annual household income of $92,034 – 71 percent more income than the survival budget. “Financial stability,” according to the report, includes home ownership, quality child care, comprehensive health coverage and an opportunity to set aside 10 percent of income for the future. The stability budget for a single-adult household with no children was calculated at $31,482.

Jason Roth, the director of public policy for United Way of Northeast Florida, explained that 32 United Ways throughout Florida participate in ALICE, and all are collaborating on how to use this data to improve services to the community.

“We are one of only a few United Ways in the country that pulls everyone together to work on a consensus agenda for the Legislature. All Florida chapters have the opportunity to be active on the public policy team,” said Roth.

An early consensus among the Florida chapters, with input from the Internal Revenue Service, was that many ALICE households were not taking advantage of tax credits to which they are entitled because they lacked a free, safe resource for tax-preparation assistance. It was estimated that Florida ALICE households failed to claim more than $1.1 billion in Earned Income Tax Credit alone. In 2016, the United Way asked the Florida Legislature for $1.2 million to expand free tax assistance to these families. It received $500,000.

Nassau County’s share of those monies made it possible for United Way to help an additional 749 families increase their income last year by applying for their maximum tax benefits. United Way of Florida again approached the Legislature in February requesting $1.2 million to further expand these services statewide in 2017.

“Representative Cord Byrd, R-District 11, has agreed to co-sponsor the appropriations bill in the Florida House,” said Phyllis Martin, head of community impact at United Way Florida. “Senator Aaron Bean, R-District 4, has also been supportive of United Way efforts.”

As for other specific services to come out of the ALICE report, Martin projects that more resources for child care for working families are likely to develop as a result.

“This is a new thing for us ... We are learning as we go,” said Sarah Henderson, the director for marketing and communications of United Way of Northeast Florida. “Right now, we are at the stage of sharing this information with our member chapters and the public.”

Future priorities will depend on the consensus reached by United Way member chapters.

The ALICE report also looks at trends for Florida as well as strategies for support from every level of the community: friends and family, nonprofits, employers and government. Among projected trends is a job forecast with more of the same: “According to the Bureau of Labor Statistics 2015 to 2023 job projections for Florida, 82 percent of new jobs will pay less than $15 per hour, and only 3 percent will require any work experience.”

Florida has the lowest rate of working residents planning for retirement and only about half participating in an employer-sponsored retirement plan. With an aging population and a constant migration of retirees to the state, more and more of these households are likely to become ALICE. Already, more than 40 percent of people 65 and older in Florida are single, increasing the likelihood they will become ALICE households.

While the findings and recommendations of the ALICE report will likely come as little surprise to households struggling to make ends meet nor to many community leaders, they shine a spotlight on real problems, and they are not going away without a broad range of solutions.

Although nonprofits and government agencies continue to offer crisis intervention to ALICE families, more medium and long-range strategies are needed, per the report, to pull households back from the brink of financial calamity.

To read the full 2017 Florida AlICE report, visit www.uwof.org/ALICE.

 

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