A Good-News Economic Story for the Disabilities Community

Lost in the endless political campaign and Iraq news is an emerging success story. The Real Economic Impact Tour conceived and sponsored by the National Disability Institute has seen a 10-fold increase in the past three years in assisting people with disabilities to receive Earned Income Tax Credits (EITC). EITC is the single most significant federal tool in helping more than 5 million Americans escape poverty. This is especially significant given that there are 54 million Americans with disabilities, and a large number of these individuals are low-income.

REI provides free services to people with disabilities to both receive EITC refunds and asset-building services and products. In 2007, 54 cities participated in REI, with 36,275 tax returns totaling $32.6 million. The final results are not yet in for the 63 cities that participated in 2008, but more than 80,000 returns were prepared with more than $70 million in income to one of America’s poorest populations.

This is an exciting model that can reach hundreds of thousands of people with disabilities and help them move forward on the road toward economic independence. Targeting individuals with disabilities has become embedded in the growing community tax coalition approach that now serves more than 3 million individuals.

Federal policy and programs for people with disabilities is also starting to shift from a complete focus on income maintenance to initiatives that encourage asset-building and skill-development. One of the exciting new developments in federal disability policy is the creation of self-directed accounts. These accounts enable people with disabilities to acquire training and skills, access jobs and maintain employment, and build assets toward homeownership and entrepreneurship. The self-directed accounts vary from individual development accounts (IDAs) to the family self sufficiency (FSS) initiative linked to public housing authorities to disability specific initiatives from the Social Security Administration (SSA).

The newest SSA initiatives are the Ticket to Work (TTW) and the Plans to Achieve Self Sufficiency (PASS) programs. Both provide waivers and allow disabled Americans to earn income and use some of the income for training and savings initiative.

Federal policy toward disabled Americans has a perverse disincentive for people to work, since they are penalized if they accumulate too high a level of income, trisking the lose of SSI or SSDI. The piloting and eventual mainstreaming of self-directed accounts are exciting developments for social policy in the foreseeable future.

It is ironic to think that the IRS and the SSA are paving the way for providing flexible opportunities to people with disabilities. This begs the question: Where is HUD, HHS, Labor, and the Small Business Administration in encouraging disabled Americans to become economically independent?

Financial education is another growth area for people with disabilities. NDI formed a partnership with the FDIC Consumer Affairs Division to adopt the Money Smart Program with supplementary materials to enhance its overall design for use by individuals with disabilities. Financial education is a cornerstone of asset-building and economic self-sufficiency. The 2004 Harris Poll found that 54 percent of persons with disabilities had no savings accounts and 75 percent do not have loans with financial institutions. One-third of the 22 percent of unbanked Americans are people with disabilities.

These are a few of the early snapshots of economic progress occurring within the disabilities community, but new thoughtful federal leadership is likely to expand self-directed accounts and other initiatives to provide the tools and resources for a growing number of disabled Americans to achieve economic independence. This is not a question of new federal resources, but rather enlightened public policy deploying existing resources to create better economic futures.

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