Copy of Legislation – Economic Pathways MA Coalition

What is the Cliff Effect Pilot Legislation?

The Economic Pathways Coalition worked for years to secure a Cliff Effect Pilot Program in Massachusetts legislation to support families’ transition off of public benefits. In 2022, the legislature passed the pilot as part of an Economic Development Package!

The pilot is called the Bridge to Prosperity Pilot!

(See: Chapter 268 of the Acts of 2022, Line 4403-2001)

What will the Bridge to Prosperity pilot do?

This bill creates a three-year pilot program for 100 low-income working families or individuals receiving any form of public assistance. It offsets the disproportionate impact that the Cliff Effect has on families transitioning out of public assistance, allowing participants to transition off of benefits without facing an income “Cliff.” The bill also includes a savings component that would be paid out after the third year of the program.

The pilot will test whether a cash payment is an effective tool for the Commonwealth to close the cliff gap, thus ensuring that workers are not worse off financially as they move up the income scale.

Why this pilot program?

It is a hand up, not a handout

“The benefits cliff is a systems problem, not a people problem.” Hannah Reuter

“Location matters. What does a loss of public benefits in Boston look like, versus a city like Springfield?...That's going to be very different when your rents, child care expenses, and other costs are different.” Anne Kandilis

It’s good for economic development - businesses need workers

“...if you’re a dollar over…the income threshold, almost all of it turns off automatically…over time, people have to decline work, decline promotions. If they go from $15 an hour to $17 an hour, and it triggers losing their housing voucher, the logical and necessary decision is to decline that raise.” Former State Senator Eric Lesser

Decreases generational poverty

“We believe our pilot will disrupt intergenerational poverty by providing the resources necessary to attain higher-wage employment and ultimately save the state money as families decrease their reliance on public benefits.” Hannah Reuter

Massachusetts is a leader on this issue – we’d be the first state to leverage a cash payment mechanism to remove the cliff gap

“In western Mass, I think there is a burgeoning understanding that getting folks into that first $15 or $16 an hour job is not enough to put someone on a path to economic mobility.” Hannah Reuter

Participants achieve economic stability between $25—$31 per hour; research shows higher income increases health and education outcomes

“To create economic opportunity, we must remove obstacles for people as they work to earn a livable wage by making sure that we do not strip away public benefits too rapidly.” Anne Kandilis

The pilot rewards work and helps people trying to advance in their careers

"Fear of losing benefits prevents people from advancing in their careers, keeping them trapped in a cycle of poverty. It is a major cause of food insecurity and economic instability." Laura Sylvester

Current Phase of the Legislation

We are so grateful the legislature included the Cliff Pilot in the 2022 Economic Development bill!!

There was a last-minute change made to the text that we are now working on implementing. The payments made to families were originally in the form of an expanded Earned Income Tax Credit (EITC), but the legislature changed those to cash payments disbursed by the Department of Transitional Assistance (DTA).

Right now, the job of the Economic Pathways Coalition has shifted to planning the implementation of this monumental pilot, and raising money to ensure it is financially possible to provide these payments. If you'd like to support the implementation of the Cliff Effect Pilot, you can reach out to your legislators and tell them you want more funding for the Cliff Effect Pilot!

How do I find my legislators?

Tips for contacting a legislator

When talking with your legislators, it's often helpful to:

Prepare beforehand - know why you are calling, and what you would like them to do.
Tell them who you are, and that you are a constituent! You can let them know your name, what neighborhood you live in, and that you are a constituent of theirs.
Be clear about what you want you would like them to support.
- In this case, you could let them know you support the Cliff Effect Pilot and you want them to increase funding for it!

ANOTHER OPTION:

What does the cliff effect pilot program do?

The Massachusetts Legislature passed an economic development package that includes the cliff effect pilot program! (See: Chapter 268 of the Acts of 2022, Line 4403-2001)

This bill creates a three-year pilot program for 100 low-income working families or individuals who are receiving any form of public assistance. It offsets the disproportionate impact that the Cliff Effect has on families transitioning out of public assistance, allowing participants to transition off of benefits without facing an income “Cliff.” The bill also includes a savings component that would be paid out after the third year of the program.

The pilot will test whether a cash payment is an effective tool for the Commonwealth to close the cliff gap, thus ensuring that workers are not worse off financially as they move up the income scale.

Why this pilot program?

It’s good for economic development – businesses need workers
Decreases generational poverty
Rewards work
Helps people who are trying to advance in their careers
Is a hand up, not a handout
Massachusetts is a leader on this issue – we’d be the first state to leverage a cash payment mechanism to remove the cliff gap
Is key to our economic recovery in the COVID era – we want everyone who can participate in the workforce to participate
Includes a savings component up to $10,000 per participant upon successful completion of three-year program
Model can be replicated throughout the Commonwealth
Participants achieve economic stability between $25—$31 per hour; research shows higher income increases health and education outcomes