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This appendix describes the data and methodology used to estimate federal program and tax expenditures on children in "Kids' Share 2021: Report on Federal Expenditures on Children through 2020 and Future Projections" (ED616306). The following contents are included in this appendix: (1) Introduction; (2) Summary Table of Multipliers and Expenditures in 2018; (3)Income Security Programs; (4) Nutrition Programs; (5) Housing Programs; (6) Tax Programs; (7) Health Programs; (8) Social Services Programs; (9) Early Care and Education Programs; (10) Education Programs; (11) Training Programs; (12) Works Consulted; and (13) Acknowledgments.

Public spending on children represents an effort to invest in the nation's future by supporting children's healthy development and human potential. To inform policymakers, children's advocates, and the general public about how public funds are spent on children, this 15th edition of the annual "Kids' Share" report provides an updated analysis of federal expenditures on children from 1960 to 2020. This year's "Kids' Share" report also provides a view of public expenditures from the nation's initial responses to the COVID-19 pandemic. Our projections of federal expenditures on children through 2031 give a sense of how budget priorities were scheduled to unfold based on economic and legislative responses as of May 2021 but do not include legislation that might be enacted by the end of 2021. A few highlights of the chartbook: (1) Federal expenditures per child were significantly higher in 2020 than in 2019 and prior years, reflecting federal relief efforts in response to the pandemic. In 2020, the federal government spent about $7,800 per child younger than age 19. Federal expenditures are projected to surge even higher in 2021, to $10,700 per child, as the federal pandemic response continues, though under the law in place as of May 2021 they are scheduled to fall back to prepandemic levels; (2) COVID-19 relief bills enacted during the pandemic expanded assistance to children through three rounds of stimulus checks, an increase in the child tax credit (CTC), an education stabilization fund, expanded child care funding, increased nutritional assistance through the Supplemental Nutrition Assistance Program (SNAP), and increased federal funding for Medicaid. (3) Dozens of other children's programs and tax credits received smaller increases; Tax provisions and health programs remain the two largest categories of federal support for children in 2020, accounting for more than three-fifths of all federal expenditures on children. Spending on children through tax provisions is projected to spike dramatically in 2021 as a result of the stimulus checks administered through the tax code and a temporary increase in the CTC; (4) Despite increased dollar amounts spent on children in 2020, as a share of federal outlays, the $482 billion invested in children in 2020 fell to 7.4 percent of all federal outlays, down from roughly 9 percent in recent years as overall federal spending swelled in response to the pandemic. The children's share of the federal budget is projected to further decline slightly to 7.2 percent over the next decade, under laws in place as of May 2021; (5) Interest payments on the national debt are projected, under laws in place as of May 2021, to grow as a share of the budget, from 5 percent in 2020 to 12 percent by 2031, reflecting a higher national debt and projected rising interest rates; (6) As a share of the economy (GDP), federal outlays for children grew during the pandemic but by significantly less than other budget priorities. Federal spending during the pandemic grew from about 20 percent of GDP to a post-World War II high of 30 percent of GDP, with spending on children growing from around 2 percent to 2.3 percent of GDP; and (7) Over the next decade, all categories of spending on children as a share of GDP are projected to decline below prepandemic levels. Most categories also see declines or remain at similar levels in real dollars. [For the appendix, see ED616344. For the 2020 report, see ED607695.]

Public spending on children is an investment in the nation's future, as it aims to support their healthy development and human potential. To inform policymakers, children's advocates, and the general public about how public funds are spent on children, this 14th edition of the annual "Kids' Share" report provides an updated analysis of federal expenditures on children from 1960 to 2019. This year's "Kids' Share" report also provides a baseline view of public expenditures before the COVID-19 pandemic. Our projections of federal expenditures on children through 2030 give a sense of how budget priorities were scheduled to unfold under the law before the pandemic and related economic and legislative responses. View a single-page formatted version of the report with text and charts side-by-side here (https://www.urban.org/sites/default/files/2020/07/27/kids_share_2020_chartbook_spread.pdf). A few highlights of the chartbook: (1) Federal expenditures per child were slightly higher in 2019 than in recent years, after adjusting for inflation. In 2019, the federal government spent about $6,700 per child younger than 19. The increase primarily reflects some delayed effects of the temporary expansion of the child tax credit enacted in the Tax Cut and Jobs Act (TCJA) of 2017; (2) As a share of federal spending, the $408 billion invested in children in 2019 remained at roughly 9 percent of all federal outlays for the second year in a row; (3) As a share of the economy, federal investments in children represented 1.9 percent of GDP, similar to last year but lower than other years in the past decade; (4) The child tax credit was the largest source of federal support for children in 2019, surpassing Medicaid, which had been the largest program for many years. More than three-fifths of federal expenditures on children are from tax provisions or health spending; (5) The share of federal expenditures on children targeted to families with low incomes has grown over time, reaching 57 percent in 2019; (6) Under prepandemic law, children's programs are projected to receive only two cents of every dollar of the projected $1.6 trillion increase in federal spending over the next decade; (7) Under prepandemic law, children's share of the federal budget is projected to drop from 9.2 percent to 7.3 percent over the next decade, as built-in spending on Social Security, Medicare, Medicaid, and interest payments on the debt consume a growing share of the budget; (8) The federal government spends nearly as much on interest payments on the debt as on children; and (9) Over the next decade, all categories of spending on children except health are projected to decline relative to GDP. Most categories also see declines or remain at similar levels in real dollars. [For the 2019 report, see ED607694.]

Public spending on children aims to support their healthy development and help them fulfill their human potential. As such, federal spending on children is an investment in the nation's future. To inform policymakers, children's advocates, and the general public about how public funds are spent on children, this 13th edition of the annual "Kids' Share" report provides an updated analysis of federal expenditures on children from 1960 to 2018. It also projects federal expenditures on children through 2029 to give a sense of how budget priorities may unfold absent changes to current law. A few highlights of the chartbook: (1) In 2018, the federal government spent about $6,200 per child younger than 19, less than in 2017 after adjusting for inflation. This decline is driven by a reduction in federal spending on education and nutrition programs and a temporary reduction in child-related tax credits; (2) As a share of the economy, federal investments in children fell to 1.9 percent of GDP in 2018, the lowest level in a decade; (3) Medicaid is the largest source of federal support for children, followed by the child tax credit and the earned income tax credit. More than three-fifths of federal expenditures on children are from health or tax provisions; (4) The share of federal expenditures for children targeted to low-income families has grown over time, reaching 61 percent in 2018; (5) Looking forward, children's programs are projected to receive only 3 cents of every dollar of the projected $1.5 trillion increase in federal spending over the next decade; (6) Assuming no changes to current law, the children's share of the budget is projected to drop from 9.2 percent to 7.5 percent over the next decade, as spending on Social Security, Medicare, Medicaid, and interest payments on the debt consume a growing share of the budget; (7) By 2020, the federal government is projected to spend more on interest payments on the debt than on children; and (8) Over the next decade, all categories of spending on children except health are projected to decline relative to GDP. Most categories also see declines or remain at similar levels in real dollars. [For the 2018 report, see ED607636.]

Public spending on children aims to support their healthy development, helping them fulfill their human potential. As such, federal spending on children is an investment in the nation's future. To inform policymakers, children's advocates, and the general public about how public funds are spent on children, this 12th edition of the annual "Kids' Share" report provides an updated analysis of federal expenditures on children from 1960 to 2017. It also projects federal expenditures on children through 2028 to give a sense of how budget priorities may unfold absent changes to current law. A few highlights of the chartbook: (1) In 2017, 9 percent of the federal budget (or $375 billion of $3.9 trillion) was spent on children younger than 19; (2) An additional $106 billion in tax reductions was targeted to families with children. Combining budget outlays and tax reductions, federal expenditures on children totaled $481 billion; (3) More than three-fifths of expenditures on children are from tax provisions or health programs. Medicaid is the largest source of federal support for children, followed by the earned income tax credit and the child tax credit; (4) The share of federal expenditures for children that is targeted to low-income families has grown over time, reaching 61 percent in 2017; (5) Looking forward, children's programs are projected to receive just one cent of every dollar of the projected $1.6 trillion increase in federal spending over the next decade; (6) Under current law, the children's share of the budget is projected to drop from 9.4 percent to 6.9 percent over the next decade, as spending on Social Security, Medicare, Medicaid, and interest payments on the debt consume a growing share of the budget; (7) By 2020, the federal government is projected to spend more on interest payments on the debt than on children; and (8) Over the next decade, every major category of spending on children (health, education, income security, and so on) is projected to decline relative to GDP. [The Peter G. Peterson Foundation helped sponsor this research. For the 2017 report, see ED607635.]

Previous literature documents a strong relationship between food insecurity and mental health, and also examines the impact of safety net programs on food insecurity. However, little is known about the intersection between mental health, safety net participation, and food insecurity. In this research, we use a multi-program safety net calculator (including cash, food, and health insurance programs) and data from the National Health Interview Survey and the Current Population Survey to examine the effects of safety net generosity on food insecurity and mental health for single mother families. We examine four research questions. First, does state safety net generosity affect self-reported participation in safety net programs? Second, does mental health affect participation in safety net programs, conditional on generosity? Third, does more generous cash and food assistance affect mental health? And finally, how effective is the safety net in reducing food insecurity in the presence of mental health issues? We find that state-level safety net generosity does predict self-reported participation, and that conditional on generosity, those with mental health issues are significantly more likely to participate in safety net programs. More generous cash and food assistance is protective of maternal mental health, but results are somewhat sensitive to the measure of mental health examined. Finally, we find no effect of the safety net on 30-day food insecurity. These results have important implications for the effectiveness of safety net programs for some of the most vulnerable members of society: low-income mothers suffering from mental health challenges and their children.

Public spending on children by federal, state, and local governments is an investment in the nation's future because it supports children's healthy development, helping them fulfill their potential. To help interested stakeholders assess the government's investment in children, this 11th edition of the annual "Kids' Share" report provides an updated analysis of federal expenditures on children from 1960 through 2016. It also projects federal expenditures on children through 2027 to give a sense of how budget priorities may unfold absent changes to current law. Highlights include the following: (1) In 2016, 10 percent of the federal budget (or $377 billion of $3.9 trillion in outlays) was spent on children; (2) An additional $108 billion in tax reductions was targeted to families with children. Combining outlays and tax reductions, federal expenditures on children totaled $486 billion; (3) Half of all federal expenditures on children comes from four spending and tax programs: Medicaid, the earned income tax credit, the child tax credit, and the dependent exemption; (4) The share of federal expenditures for children targeted to low-income families has increased over time, reaching 65 percent in 2016; (5) Children's programs are projected to receive just one cent of every dollar of the projected $1.5 trillion increase in federal spending over the next decade; (6) Under current law, the children's share of the budget is projected to drop from 9.8 to 7.5 percent over the next decade, as spending on Social Security, Medicare, Medicaid, and interest payments on the debt consumes a growing share of the budget; (7) By 2020, the federal government will spend more on interest payments on the debt than on children; and (8) Over the next decade, every major category of spending on children (e.g., health, education, and income security) is projected to decline relative to GDP. Increased understanding of how childhood circumstances affect lifelong outcomes has led to more public support for investment in children. Even so, spending on children is not always prioritized relative to other categories of the federal budget, which is why the "Kids' Share" report tracks government spending on children each year. This annual accounting of spending on children is important as Congress considers legislation introducing or amending individual children's programs or tax provisions, sets funding levels in annual appropriation bills, and debates broad tax and budgetary reform packages that may shift the level and composition of public resources invested in children. [The Peter G. Peterson Foundation helped sponsor this research. For the 2016 report, see ED607634.]

"Kids' Share 2016: Federal Expenditures on Children through 2015," a 10th annual report, looks comprehensively at federal spending and tax expenditures on children. Federal spending on children has remained fairly flat over the past four years, in real dollars. Broader budgetary forces will restrict spending on children over the next 10 years, despite an overall projected growth of over $1.5 trillion in federal spending. Over the next decade, outlays on children are projected to decline from 10 to 8 percent of the federal budget.

"Kids' Share 2015: Report on Federal Expenditures on Children in 2014 and Future Projections," an ninth annual report, looks comprehensively at federal spending and tax expenditures on children. Federal spending on children has remained fairly flat, in real dollars, over the past three years. Broader budgetary forces will continue to restrict spending on children over the next ten years, despite an overall projected growth of over $1.4 trillion in federal spending. Over the next decade, outlays on children are projected to decline from 10 to less than 8 percent of the federal budget. [For the 2014 report, see ED607691.]

"Kids Share 2014: Report on Federal Expenditures on Children through 2013," an eighth annual report, looks comprehensively at federal spending and tax expenditures on children. Total federal expenditures on children were up from 2012, but below spending in 2010. Broader budgetary forces will continue to restrict spending on children over the next ten years, despite an overall projected growth of over $1.4 trillion in federal spending. Over the next decade, outlays on children are projected to decline from 10 to 8 percent of the federal budget. [For the 2013 report, see ED607690.]

The strengths and abilities children develop from infancy through adolescence are crucial for their physical, emotional, and cognitive growth, which in turn help them to achieve success in school and to become responsible, economically self-sufficient, and healthy adults. Capable, responsible, and healthy adults are clearly the foundation of a well-functioning and prosperous society, yet America's future is not as secure as it could be because millions of American children live in families with incomes below the poverty line. A wealth of evidence suggests that a lack of adequate economic resources for families with children compromises these children's ability to grow and achieve adult success, hurting them and the broader society. "A Roadmap to Reducing Child Poverty" reviews the research on linkages between child poverty and child well-being, and analyzes the poverty-reducing effects of major assistance programs directed at children and families. This report also provides policy and program recommendations for reducing the number of children living in poverty in the United States by half within 10 years. [Numerous organizations sponsored this work and the full list can be seen in the document.]

In the nearly fifty years since the adoption of the Higher Education Act of 1965, financial aid programs have grown in scale, expanded in scope, and multiplied in form. As a result, financial aid has become the norm among college enrollees. Aid now flows not only to traditional college students but also to part-time students, older students, and students who never graduated from high school. Today aid is available not only to low-income students but also to middle- and even high-income families, in the form of grants, subsidized loans, and tax credits. The increasing size and complexity of the nation's student aid system has generated questions about effectiveness, heightened confusion among students and parents, and raised concerns about how program rules may interact. In this article, Susan Dynarski and Judith Scott-Clayton review what is known, and just as important, what is not known, about how well various student aid programs work. The evidence, the authors write, clearly shows that lowering costs can improve college access and completion. But this general rule is not without exception. First, they note, the complexity of program eligibility and delivery appears to moderate the impact of aid on college enrollment and persistence after enrollment. Second, for students who have already decided to enroll, grants that tie financial aid to academic achievement appear to boost college outcomes such as persistence more than do grants with no strings attached. Third, compared with grant aid, relatively little rigorous research has been conducted on the effectiveness of student loans. The paucity of evidence on student loans is particularly problematic both because they represent a large share of student aid overall and because their low cost (relative to grant aid) makes them an attractive option for policy makers. Future research is likely to focus on several issues: the importance of program design and delivery, whether there are unanticipated interactions between programs, and to what extent program effects vary across different types of students. The results of this evidence will be critical, the authors say, as politicians look for ways to control spending. (Contains 2 figures, 1 table, and 77 endnotes.)

"Kids' Share 2013: Federal Expenditures on Children in 2012 and Future Projections," a seventh annual report, looks comprehensively at federal spending and taxes on children. Federal outlays on children fell by 7 percent between 2011 and 2012, which is the greatest single-year drop since the early 1980s. While most of this decline is explained by the exhaustion of recession-related funds provided by ARRA [American Recovery and Reinvestment Act], broader budgetary forces will continue to restrict spending on children over the next ten years. Over the next decade, outlays on children are projected to decline from 10 percent to 8 percent of the federal budget. [For the 2012 report, see ED607688.]

"Kids' Share 2012: Report on Federal Expenditures on Children through 2011," a sixth annual report, looks comprehensively at trends over the past 50 years in federal spending and tax expenditures on children. Key findings suggest that the size and composition of expenditures on children have changed considerably, but children have not been a budget priority. In 2011, federal outlays on children fell for the first time since the early 1980s, dropping from $378 billion in 2010 to $376 billion. Over the next decade, outlays on children are projected to decline from 10 to 8 percent of the federal budget. [For the 2011 report, see ED607686.]

"Kids' Share 2011: Report on Federal Expenditures on Children through 2010," a fifth annual report, looks comprehensively at trends over the past 50 years in federal spending and tax expenditures on children. Key findings suggest that the size and composition of expenditures on children have changed considerably, but children have not been a budget priority. Federal expenditures on children in 2010, were 11 percent of the federal budget, slightly higher than in 2009. This increase is temporary, however, with the children's share of the budget expected to shrink to less than 8 percent by the end of the next decade. [For the 2010 report, see ED510966.]

This report's 13 chapters address disability statistics and research, major trends, statistics, civil rights, Education, health, and long-term services and supports, children and youth, employment and the workforce development system, welfare reform, housing, transportation, assistive technology and telecommunications, international affairs, and homeland security. Each chapter starts with an Introduction with background information. Chapter recounts developments of importance from the previous year. They describe the key issues likely to emerge or open for discussion in 2004 to 2005, and address long-term trends and interconnections between subject areas that NCD believes must inform this analysis. Each chapter also contains detailed recommendations, addressed to specific agencies or decision makers. The final section of the report is a compilation of the recommendations into three sub-sections directed to Congress, the Administration, and specific federal agencies and courts. (Contains 204 endnotes.)

This report describes 39 successful initiatives that illustrate what 27 cities have been able to accomplish for working families across four goal areas: improving job access and quality employment for residents of underemployed neighborhoods (e.g., connecting quality labor-seeking employers in metropolitan markets with placement and training organizations serving high-needs neighborhoods); rewarding and reinforcing the work efforts of welfare-to-work and other low-income working families (e.g., city outreach and tax assistance campaigns that help ensure that all eligible low-income families apply for and receive their federal and state Earned Income Tax Credit refunds); increasing the savings, assets, financial sophistication, and wealth of low-income families (e.g., promoting Individual Development Accounts); and strengthening the community services and institutions most crucial to working families (e.g., improving schools, public safety, child care, and/or human services). Each description includes the name of a contact person from whom additional information is available. (SM)

This paper examines correlations between children's educational outcomes and family structure. Although popular discussions focus on distinctions between two-parent and single-parent families, earlier research shows that outcomes for stepchildren are similar to outcomes for children in single-parent families, and earlier researchers suggested that the crucial distinction is between children who were reared by both biological parents and children who were not. This paper suggests that such a finding is misleading, asserting that educational outcomes for both types of children in blended families--stepchildren and their half-siblings who are the joint biological children of both parents--are similar to each other and substantially worse than outcomes for children reared in traditional nuclear families. It concludes that the crucial distinction is between children reared in traditional nuclear families and children reared in other family structures. The paper also examines the effect of family structure on children's outcomes, recommending a reformulation of the family structure question by specifying some explicit counterfactual and expressing a preference for a policy-relevant counterfactual. The paper suggests considering the effect of reducing the marriage penalty in the earned income tax credit that makes the credit essentially unavailable to two-earner couples. (Contains 44 references.) (SM)

This document is intended to provide business leaders, policymakers, and others with information about the operation and value of six work support programs designed to help low-income parents obtain the assistance needed to enter a job, retain employment, and better provide for their families' needs. The six programs profiled are as follows: the Earned Income Tax Credit; child care; Food Stamps; health care; Temporary Assistance for Needy Families, and child support. The document begins with a discussion of the lack of a single national structure or location where low-earning parents can access work support programs. Next, principal differences between the six programs with respect to the following dimensions are summarized: who funds the benefit; who administers the benefit; who is eligible for the benefit; length of eligibility; and whether the benefit is an entitlement or its availability is limited by funding. The remainder of the document presents profiles of each program. Each profile contains information on the following topics: the program's history, current size/scope, and differences in the program's administration and structure in individual states; the program's impacts on financial security and job retention; and program participation. The names and addresses of 16 organizations offering publications on the 6 work support programs profiled are appended. (Contains 86 references.) (MN)

Much of the discussion surrounding marriage promotion policies have little basis in the reality of life in low-income communities. Research suggests that much of the income differential between low-income and middle class women is the result of differences in educational attainment, labor market experience, and access to labor supply rather than to marital status. Many low-income mothers indicate that marriage can actually reduce their well-being if their potential spouse cannot add to the economic viability of the household. The following policies would significantly improve the economic well-being of single-parent families: (1) eliminate the cap on the number of families that could receive education and training activities counted as work; (2) remove the 12-month time limit on vocational training; (3) give states the flexibility to provide assistance to those participating in education and training programs; (4) increase the earned income tax credit and earned income disregards; and (5) provide full funding for child care subsidies. Several studies have questioned the role of marriage in the different outcomes and life chances of children. The literature emphasizes the importance of providing adequate job opportunities for single mothers so that their economic stability and, ultimately, the well-being of their children can be improved. (Contains 24 references.) (MN)

The Jobs-Plus Community Revitalization Initiative for Public Housing Families, which is a national demonstration project in six cities, is testing ways to increase employment among public housing residents by combining changes in rent rules and other financial work incentives with employment and training services and social supports for work. The incentives being tested at each Jobs-Plus site were examined to identify how they can increase residents' net incomes and influence their decisions about work. The study documented that Jobs-Plus builds upon recent changes in welfare rules and the Earned Income Tax Credit by introducing flat or fixed rent steps, rents based on a lower percentage of income, lowering ceiling rents, rent credits, and escrow accounts. The importance of communicating all available financial supports for work to Jobs-Plus clients was emphasized. Across all housing developments and for a range of family circumstances, the Jobs-Plus rent rules gave residents more incentive to not only accept employment but also to choose full-time over part-time jobs and advance into higher-wage jobs than they had under the traditional rules. Jobs-Plus may have encouraged some residents, particularly second earners in two-parent families, to reduce their work hours. (Contains 36 notes, 25 references, 11 tables, and 10 figures.) (MN)

The federal government administers an Earned Income Tax Credit (EITC), as do many states. States that enact EITCs can reduce child poverty, support welfare-to-work, and cut taxes for working poor families. The popularity of state EITCs results from continued child poverty, welfare reform, and tax changes. Research confirms the effectiveness of federal EITCs in supporting work and alleviating child poverty, lifting nearly five million people out of poverty each year, contributing to significant increases in labor force participation among single mothers, and allowing EITC recipients to make investments that enhance economic security and promote economic opportunity. Sixteen state EITCs piggyback on the federal EITC. Eleven states follow the federal practice of making the credit refundable, so the family receives the full amount of the credit. In the remaining five states, the credit is available only to the extent that it offsets a family's income tax, which provides no relief to working families with income too low to owe any taxes. The annual cost of refundable state EITCs ranges from $11 million to $361 million. Most state credits are financed from funds available in the state's general fund. Two appendices present federal EITC parameters and estimated cost of refundable state EITCs. (SM)

This analysis examines poverty in families headed by working single mothers, addressing whether and to what degree their economic situations have improved. It investigates the effect of the 1996 Personal Responsibility and Work Opportunity Reconciliation Act, which moved single mothers from welfare to work. Poverty data from the annual Census Bureau Current Population Survey for 1993-99 were used. No progress was evident in reducing poverty between 1995-99 in families headed by working single mothers. Poverty rates for families with children not headed by single mothers dropped from 1993-99. The poverty gap in families headed by working single mothers grew larger since 1995. A major factor in the lack of progress in reducing poverty in this group after 1995 was the contraction of certain government safety net programs. Declines in the anti-poverty impact of government benefit programs occurred despite the increasing effectiveness of the Earned Income Tax Credit in reducing poverty among people in working single mother families. After 1995, declines in the effectiveness of the safety net in reducing poverty among these families offset the effect of the improving economy, halting the reduction of poverty rates for those families and pushing those who remained poor deeper into poverty. (SM)

Studies of 29 welfare reform initiatives conducted by the Manpower Demonstration Research Corporation were synthesized in an exploration of how welfare and work policies affect employment and income. Each of the studies reviewed focused on one or more of the following key program features: mandatory employment services, earnings supplements, and time limits on welfare receipt. The synthesis yielded the following key lessons: (1) although a number of programs that provided only mandatory employment services were effective, the most successful of these programs used a mix of services (including some education and training) and strongly emphasized the need to find work; (2) the only programs that both increased work and made families financially better off were those that provided earnings supplements to low-wage workers; and (3) although relatively little is known about the effects of welfare time limits, the available data suggest that time limits need not cause widespread hardship, at least not in the short term. (Twenty-three tables/figures/boxes are included. The bibliography lists 30 references. The following items are appended: a list of 23 key reports from the studies reviewed; program descriptions; program impacts; and a discussion of why including the federal Earned Income Credit does not substantially change program impacts on income.) (MN)

This paper examines trends in federal spending on children, assessing changes in spending between 1960-97 and classifying federal programs within eight budget categories: tax credits and exemptions (including the Earned Income Tax Credit and dependent exemption); income security (including Aid to Families with Dependent Children); nutrition (including Food Stamps); health (including Medicaid); education; housing; social services; and training. Federal spending on children grew 246 percent, from $48.6 billion to $168.5 billion, while the number of children grew just 9.7 percent. In terms of gross domestic product, this growth in spending is just 11 percent. Federal spending on poor children increased 23-fold. Until recently, programs that put money into parents' pockets lost ground to targeted, in-kind spending. The dependent exemption declined from 65 percent of all federal spending on children to 16 percent. Three new programs account for half of the increase in total spending on children (Earned Income Credit, Medicaid, and Food Stamps). Nutrition and health programs rank third and fourth among categories of spending on children. Federal education funds shifted from targeting children of military or government personnel toward targeting disadvantaged children. Spending on children increasingly shifted from broad-based middle class relief to programs designed for the poor. (SM)

This report identifies overall tax burdens faced by low income families, explaining how those burdens would change if certain types of federal income tax cuts were enacted. Using detailed household-level data on incomes and taxes, the report shows how federal income and payroll taxes differ for low income families and how these families benefit from certain features of the income tax, such as the Earned Income Tax Credit (EITC). The report examines five tax cut options that are representative of recent proposals, comparing the benefits for low income families with those for higher income taxpayers. They are: an across-the-board reduction in marginal tax rates; an increase in standard deductions and in the income range for the lowest tax bracket; an increase in the child tax credit; an expansion of the earned income tax credit; and a new refundable payroll tax credit. The analysis highlights the effect of such tax cuts on average tax rates rather than marginal ones. Overall, options to increase the EITC or to create a new refundable payroll tax credit are the most beneficial to low income working families. The other three options provide very little benefit to low income families. (SM)

An Earned Income Tax Credit (EITC) is a tax reduction and a wage supplement for low- and moderate-income working families. The federal government, and some states, administer an EITC through the income tax. States that enact EITCs can reduce child poverty, support welfare-to-work efforts, and cut taxes for families struggling to make ends meet. This report focuses on: (1) "The Problem: Poverty Despite Work"; (2) "Helping Make Work Pay: The Federal Earned Income Tax Credit"; (3) "Why Enact a State Earned Income Tax Credit?" (federal EITC does not lift all working families out of poverty, and state EITCs lift additional families out of poverty, complement welfare reform, and provide needed tax relief); (4) "Designing a State Earned Income Tax Credit" (refundable versus nonrefundable EITCs, setting the size of a state EITC, adjustments for family size, and workers without qualifying children); (5) "Financing a State Earned Income Tax Credit" (estimating the cost of a refundable state EITC and financing state EITCs through the Temporary Assistance for Needy Families Block Grant); and (6) "Enacting a State Earned Income Tax Credit: Case Studies." Two appendixes include the federal EITC parameters and the estimated cost of refundable state EITCs. (SM)

The Minnesota Family Investment Program, the Canadian Self-Sufficiency Project, and Milwaukee's New Hope Project are three antipoverty programs that were undertaken in the 1990s to end dependency on welfare by "making work pay." The impacts of all three programs were reviewed and compared to those of the Seattle/Denver Income Maintenance Experiment, which was a "negative income tax experiment" conducted in the 1970s in response to the mushrooming growth of welfare programs and policies that discouraged welfare recipients from taking jobs. The review focused on the following issues: (1) program impacts in the areas of promoting work and reducing poverty; (2) effects of targeting and program design on program impacts; (3) ways universal support programs might reduce work; and (4) unintended consequences of targeted work incentive programs. The comparative analysis confirmed that all three work incentive programs have effectively achieved their goals of increasing work and income among single parents without incurring many of the unintended negative consequences on employment among the working poor that plagued past welfare reduction policies. When work incentive programs were linked to participation mandates or conditioned on full-time work, they substantially increased the employment, earnings, and total income of long-term welfare recipients. (Contains 54 references.) (MN)

This report examines recent trends in the impact of government safety net programs, such as cash assistance, food assistance, and the Earned Income Tax Credit, on poverty among children. The effect on poverty is determined by comparing the number of children who would be poor if government benefits were not counted as part of their family income with the number who are poor when benefits are counted. The report uses Census Bureau data collected annually on the incomes of the U.S. population. Because of the improving economy and increases in employment and earnings among low-income families, the number of children living in poverty has declined significantly since 1993. Between 1993 and 1995, the reduction in child poverty was substantial, but after 1995, progress continued at a much slower pace. In addition since 1995, the basic measure of the overall depth and severity of child poverty has improved very little, and the children who remain poor have, on average, become somewhat poorer. The primary reason is that the safety net became less effective in reducing the depth of child poverty between 1995 and 1998. There was a lessening of the impact of cash assistance and food stamp benefits on child poverty and a great decline in the number of children receiving assistance. However, the safety net lifted the same proportion of children from poverty in 1998 as in 1995 because the decline in the impact of cash and food assistance programs was offset by an increase in the antipoverty impact of the Earned Income Tax Credit. (Contains 11 tables.) (SLD)

An Earned Income Tax Credit (EITC) is a tax reduction and a wage supplement for low- and moderate-income working families. The federal government administers an EITC through the income tax, as do some states. States that enact EITCs can reduce child poverty, support welfare-to-work efforts, and cut taxes for families struggling to make ends meet. Altogether, 11 states now offer EITCs based on the federal credit. The federal EITC is considered the most effective antipoverty program in the United States for working families. It is estimated that the federal EITC lifts nearly 5 million people, roughly half of whom are children, out of poverty each year. Interviews with EITC recipients show that many use their refunds to make the kinds of investment, including paying for education, that enhance economic security and promote economic opportunity. Two appendixes show parameters of the federal EITC and the estimated cost of refundable state EITCs. (SLD)

This conference presentation explores current patterns of public transfer receipt (such as earned income tax credit, public health insurance coverage, food stamps, and public assistance) among single-father families and provides an update on existing census-based research on characteristics of single-father families. Data were obtained from the March Current Population Surveys (CPS) for selected years from 1983 through 1995. Demographic characteristics, socioeconomic characteristics, and public transfer receipts were compared for three types of fathers: (1) married fathers; (2) single fathers living with a partner; and (3) single fathers living without a partner. Findings indicated that the number of single-father families increased substantially between 1984 and 1994, and by 1995, accounted for 5.9 percent of all fathers living with their own children. "Cohabiting" fathers were considerably younger than married or "non-cohabiting" single fathers. Single fathers were more likely to be black, had less education and significantly lower incomes than married fathers. Only six percent of non-cohabiting single fathers received child support payments. Rates of health insurance coverage for single fathers was substantially lower than that experienced by single-mother families. Single fathers were less likely to work full time than married fathers. Single-father families depended much more than married-father families on public transfers. Fathers' income increased in the late 1980s and decreased in the 1990s. The rates of receipt for most forms of public transfers declined or stayed constant between 1984 and 1989 and increased between 1989 and 1994. (KB)

Ohio, like other states, will soon begin implementing parts of a sweeping new federal welfare reform law. These seven 1- and 2-page reports, issued under the general heading of "Ohio Children: Together We Can Help Them Grow," describe various Ohio welfare programs, providing statistics on their costs and usage rates, as well as changes in the programs over time, their successes, and continued problems. Many of the reports also discuss the probable impact of the welfare reform act on the programs. Programs described are the Earned Income Tax Credit, Aid to Dependent Children (ADC), Job Opportunities and Basic Skills (JOBS), Head Start, public child care aid, and Medicaid. Included with the reports is a summary sheet on eight components of the new federal law, major statistics on Ohio welfare, and five proposals advocated for adoption when Ohio rewrites its public assistance laws. Also included is a list of questions for consideration in decisions on implementing the welfare reform act. (EV)

Based on the assumption that fair tax systems should consider differences in ability to pay resulting from income sharing within families, this publication analyzes the effects of three strategies for federal tax reform on families raising children: the Armey/Shelby flat tax, the Nunn/Domenici USA Tax System, and the Gephardt 10-Percent Tax. Part 1, "Introduction," summarizes the proposals, defines major terms, and compares tax incidence under the proposals and the impact of reduced tax burdens on investment income. Part 2, "Analysis of Specific Tax Reform Provisions Affecting Children and their Families," examines direct and indirect effects on families. Direct effects considered include size of the dependency exemption, tax credit for dependent children, earned income credit, head-of-household rate schedule, "kiddie tax," personal exemption, standard deduction, marital income splitting, alimony payment, child support payment, and child care tax credit. The indirect effects analyzed include elimination of charitable giving, deduction for home mortgage interest, and deduction for state and local taxes. Part 2 also suggests modifications to provide greater benefits to families with dependent children. Part 3, "Simulated Impact of Armey/Shelby Flat Tax on Families with Children," reports results of simulations of the effects on family tax burdens of shifting to a flat tax by comparing equal-revenue versions of the Armey-Shelby flat tax plan and current law. Part 4, "Conclusion," summarizes the report. An Executive Summary is included with the publication. Includes 15 tables and 7 figures. Appendices list supplementary tables and describe the tax model used for the simulation. Contains 49 references. (KDFB)

Children are among the poorest of Maine's residents. Nearly 1 in 5 children under the age of 18, 19.3%, lived in families below the federal poverty line in the early 1990s. Most of these poor children lived in working families. The working poor are often missing from policy debates, but their numbers are likely to increase with welfare reform efforts. In Maine, working poor families represent a broad cross-section of the state's population. Job growth in Maine has been concentrated in industries with low average pay, and federal and state policies have contributed to working poverty. Because most poor children are in families with a worker, the high child poverty rate in Maine is unlikely to decline significantly without efforts to assist low-wage working families. Steps the state could take to help the working poor include: (1) enacting a state earned income credit; (2) raising the minimum wage; (3) modifying the rules for aid to families with dependent children to allow families to earn more without a loss of benefits; (4) strengthening the unemployment insurance system; and (5) responding to the child care and health care needs of the working poor. As these policies helped alleviate child poverty, they would promote the broad goals of welfare reform by helping parents support their families. (Contains nine figures and seven tables.) (SLD)

This report examines state earned income tax credits (EICs) as a means to assist working poor families to escape poverty. Specifically, the report notes that six states have their own EICs, expressed as a percentage of the federal EIC, with the advantages being that the credit is a reward for work, is a pro-family policy, is efficiently targeted, prevents states from taxing families deeper into poverty, and offsets the effects of regressive state and local taxes. Following a summary and introduction in Chapter I, chapter II, entitled "Poverty and Work", reviews the extent to which work alone no longer alleviates poverty and covers the education-related subject of "child poverty". Chapter III examines the structure of the federal EIC and the role it plays in helping to "make work pay." Chapter IV examines the purposes that a state credit serves and the key decisions in designing a credit. Chapter V takes a closer look at the need to improve state tax progressiveness and the role of a state EIC. Chapter VI discusses the need for outreach to eligible families once a credit is enacted. Chapter VII describes the legislative and political processes by which EICs became law in Wisconsin and Maryland. Included are five graphs and eight tables. An appendix provides information on calculating the state revenue impact of an EIC. Forty-four footnotes are included. (JB)