NDESPA Testimony to Interim Health Services on the Cliff Effect

North Dakota Economic Security and Prosperity Alliance (NDESPA) 

Testimony to the Interim Health Services Committee

Wednesday, November 4, 2015

Good afternoon Chair Lee and members of the Interim Health Services Committee.  Thank you for examining the cliff effect related to employment and public assistance programs through Study 3049.

I am Karen Ehrens and am here today as a private citizen, public health professional and partner in the North Dakota Economic Security and Prosperity Alliance, or NDESPA.  NDESPA is a coalition of organizations around the state working to build and sustain a system of economic security for all through poverty awareness and education, grassroots and community capacity building, research and data development and promotion of policies and practices to eliminate disparities and obstacles for achieving economic security.  I have provided a list of the coalition’s member organizations.

The cliff effect is loss of benefits as the result of a minor increase in gross wages, like a raise in pay or an extra work shift, that can push a family off program eligibility, losing some benefits or all benefits, like falling off a cliff. Often, the increase in hours or pay is not enough to make up the difference in an individual’s or a family’s lost benefits. Falling off the cliff can keep a family in poverty and inhibit their economic self-sufficiency.

Because of the complexity within and between public assistance programs, there will not be one single solution to helping end the cliff effect.  Each program has different income qualifying levels and other specific eligibility requirements. And because program requirements are set at the federal level, changing federal requirements may be out of the states’ hands. 

But, there are solutions being tried in other states to enrich these state run federal programs. NDESPA is beginning to gather information about ways North Dakota could mitigate the cliff effect and truly move people out of poverty.  NDESPA would be willing to provide an overview of the findings at a future meeting for the committee's consideration.  NDESPA also suggests continuing to coordinate poverty relief programs, saving and asset building, education and training, and childcare.