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Commonwealth Institute Outlines Adverse Racial Equity Impact of Proposed House and Senate Budgets

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Great analysis from the Commonwealth Institute on the many, many failings (e.g., in the areas of racial equity, health care, education, housing, democracy and the Census) of the state budget pushed by Republicans and – somewhat inexplicably – approved almost unanimously in the House and Senate. I really don’t get why Democrats didn’t fight against this harder than they did. Was this *really* the best deal Democrats could negotiate? Is this because Gov. Northam is weakened and/or “triangulating” with Republicans? Any other theories?

Racial Equity Impact of Proposed House and Senate Budgets

Despite the uncertainty and hurt caused by the unearthing of racist photos and sexual assault claims, the work to determine how the state uses our shared resources from now through July 2020 must go on. These are not separate conversations, however, particularly as state leaders are echoing what many impacted communities and advocates have long called for: a productive conversation on racial equity.

Right now, legislators are moving forward with proposals on how to raise resources and how those resources will be invested in our communities — decisions that have real impacts on the lives of Virginians. Legislators have the opportunity to contribute to the conversation about racial equity by taking action and using available resources to work toward dismantling barriers facing Virginia’s communities of color or to instead maintain the status quo.

On Friday, TCI released a blog post on the ways lawmakers’ seek to provide tax breaks that leave out many Black families. In order to make room for those tax breaks, the House and Senate propose a number of cuts to public services that would otherwise mitigate or help dismantle barriers facing communities of color. On Saturday, TCI released a blog post on how budgets proposed by the House and Senate slash proposed K-12 funding that is focused on high-need communities, thereby harming Virginia’s schools that are home to the most students of color. And there’s more to the story.

On Monday, lawmakers agreed to look for ways to fund priorities for low-income communities and communities of color. As we move towards a compromise budget, there is still much work to be done to turn these agreements into action. Below is an assessment of major investments in the three proposed budgets and the significant impacts each could have on communities of color. The choices lawmakers choose will determine whether we are making progress towards racial equity or not.

Housing

Racial discrimination in housing was official public policy for much of the 20th century – white families were provided subsidized mortgages and publicly-built highways to move to white flight suburbs and build wealth, while many Black families were displaced from historic neighborhoods and moved to public housing or other rental housing, with no opportunity to build wealth.  Families of color in Virginia continue to be less likely than white families to own their homes. Sixty-nine percent of white Virginia households own their homes, compared to only 44 percent of Black households. This is due to both historical causes – Black families are less likely to inherit a home – and continuing barriers facing communities of color, such as mortgage discrimination. And lower homeownership rates combine with barriers to well-paying employment to result in Black families being more likely to be paying more than they can really afford for housing. Research shows that 3 in 10 Black households pay more than 30 percent of their income toward housing costs, compared to less than 2 in 10 white households. The numbers are almost identical for Latinx communities, who also face discrimination and are less likely to have inherited homes. Meanwhile, Virginia’s lack of protections for tenants has led to the state being in the national news for having one of the highest rates of eviction, an epidemic that has particularly targeted communities of color even after controlling for household income.

The introduced budget proposal included some modest investments to address the lack of affordable housing and high rates of evictions for Virginia’s communities of color. Unfortunately, the House and the Senate gutted that new investment.  The House cut $19 million of support that was intended for the Housing Trust Fund, which is primarily used to increase access to affordable homeownership and rental housing. The Senate’s cut was nearly as deep – $16 million. On addressing the eviction epidemic, the House and Senate both stripped $2.6 million of funding that was provided for eviction defense.  The Senate did approve an eviction diversion pilot and provide $1.3 million in additional general funding for legal aid services.

Health Care
Funding solutions to remedy racial disparities in health care access and quality should be a priority for Virginia’s legislators. Unfortunately, there are several budget items that have been defunded that could have led to health improvements for communities of color.

Over 55 percent of uninsured children in Virginia are children of color. And families that can’t easily access health care, such as families without health coverage, may have more trouble vaccinating their children. Despite efforts to address this barrier, the House and Senate budgets struck the proposal of nearly $1.5 million of funding for vaccines for children administered at local health departments. Immigrant families who have limited options for health insurance, and even less opportunities to access affordable health coverage, may be particularly impacted.

Mental health disparities exist throughout our health and criminal justice systems. We know that Latinx and Black individuals are less likely to receive adequate mental health care leaving them at particular risk of entering one of the state-run mental health facilities or the criminal justice system.

Black individuals are treated at state mental health facilities at a higher rate than any other racial group. The Senate budget proposal decreases funding for additional staff in state-run mental health facilities by $1.5 million. As one of our vital supports of treating mental health crises, this could leave more people of color at risk of inadequate care during their time of need.

Untreated mental health issues can sometimes lead to difficult interactions with the public and law enforcement. Black individuals are less likely than white peers to receive psychiatric evaluations when accused of a crime and less likely to receive mental health services when incarcerated. The House budget strips the $2.5 million to continue and expand a pilot program for inmates with mental health concerns, which will leave many Black and Latinx inmates behind.

One noteworthy investment in the Senate and House budgets was the addition of $3 million for implementation of electronic health records in women’s correctional facilities beyond the administration’s budget (Legal Aid Justice Center recently won a lawsuit against the state to force improvements in health care at Fluvanna women’s correctional center.) Accurate health records provide important information for health providers which can lead to better health outcomes. We know that Black adults represent 37 percent of the population in female prisons in Virginia, yet Black individuals in the state only represent 19 percent of the state’s population. Improved health services in the justice system will help all inmates, but particularly Black individuals who are overrepresented in our prisons.

The Senate budget also includes an additional $6.8 million to increase Medicaid reimbursement rates for certain physicians and mental health professionals — in turn leveraging an additional $15.6 million federal match.Increasing the Medicaid reimbursement rates will likely increase the number of providers willing to accept Medicaid patients. We know that a large share of people on Medicaid in Virginia are people of color, and improving access to these vital services provides more equitable access to health care.

Higher Education
The House slashed more than $15 million from December’s proposed budget amendments for need-based financial aid. Virginia’s inadequate investment in public colleges and universities over the last decade has contributed to rising tuition prices, often leaving students with little choice but to take on more debt or give up on their dreams of going to college. The problem is especially serious for Black,  Latinx, and low-income students.

State cuts to higher education have helped drive up the cost of attending public colleges and universities. And slow income growth has worsened the situation. The average tuition bill grew by nearly 55 percent between 2008 and 2018 after adjusting for inflation, while real median incomes for Virginia families only grew about 2.4 percent between 2008 and 2017 (2018 data is not available at this time).This leads to tuition being a much larger burden for students and families.

In 2017, the average tuition and fees at a public four-year university accounted for 17 percent of the median household income for all Virginia families. For white families, tuition and fees  accounted for about 16 percent of income, and 12 percent for Asian families, both below the state average. Meanwhile, it accounted for 25 percent of median household income for Black families and 19 percent for Latinx families.

The House budget proposal does include $45.7 million distributed to colleges and universities if they keep tuition and fees at 2018-2019 levels for the next school year. This is an important step to address the growing challenges of college affordability for Black, Latinx, and low-income students. However, investing in need-based financial aid and reducing or freezing tuition cost simultaneously, is a better approach to make higher education more affordable and accessible for Black, Latinx, and low-income students in the commonwealth.

Census
Both the Senate and House eliminated the modest $1.5 million that was included in the introduced budget for Census outreach. The federal government isn’t doing their part in terms of Census outreach this time around, and an undercount would have major implications for equal representation and federal funding that helps boost low-income communities, particularly communities of color. The problem is so acute that the National Association for the Advancement of Colored People (NAACP) is suing the federal government over the lack of Census funding. Many states are stepping up to fill this gap by providing their own funding for Census outreach, and it is vital for Virginia to do so to in order to get a fair count of our community members, particularly in communities of color and rural areas that are hard to reach.

Democracy
Access to the ballot box has been central to so many civil rights struggles in the United States because it is fundamental to accessing and protecting all other rights. During the 2018 elections, Virginia had long lines and other problems at a number of polling places, while our neighbors in North Carolina and Georgia had far more egregious problems. The introduced budget included a modest $607,500 boost to training for local election registrars. The Senate cuts about one-third of that funding.

Making Choices
State budgets are always a reflection of priorities. Every addition, cut, and language change between the introduced, House, and Senate budgets represent the values of each entity. Choices made in the final compromise version of the budget will have profound impacts on all of our communities, and targeted cuts or investments for low-wealth communities of color may be felt the most. Lawmakers have an opportunity in their final negotiations to select the key investments from all of their budgets that break down barriers and provide real opportunities for Virginia families of color.

— TCI Staff

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