The End of Income Tax Season

For the most part, income tax season has ended. VITA and AARP tax volunteers throughout Michigan are closing down their tax sites, deleting personal tax files from computers, and preparing reports for the various funding agencies which support the EITC (earned income tax credit) tax assistance programs.

In Berrien County, we are getting ready to celebrate and honor volunteers next Monday night at a dinner at the Niles District Library. Nothing fancy, really. A few words will be spoken, perhaps a blessing will be said, some food will be eaten together, certificates of appreciation passed out, and then we will be "officially" done until next tax year.

The problems that our clients experience are not just during tax season, but are 365 days of the year.

Yesterday, I had a follow up call with a young woman. (OK, she's in her early 40's, but that is young to me.) The volunteer preparer who completed her tax return had made an error on the return. When she left our tax site, she was under the impression that she was entitled to a refund of about $500 for the Michigan renter's credit (Michigan Form MI-1040CR, commonly referred to as the homestead property tax credit.)

She had not received her refund from the State, except for about $90 in home heating voucher rebate. So, she had returned back to the site, wondering what happened to her $500 refund. To this day, I am still not sure what the tax preparer (a new volunteer this year) had done. It appears to me that he randomly entered $500 in the wrong line. Maybe it was a sticky keyboard (since our equipment tends to be hand me down). Who knows?

When she returned to our tax preparation site in downtown Benton Harbor, I told her that it appeared to be a mistake and that she was not entitled to the $500 refund. She was in tears. So, I promised to look into it further and call her back to confirm this, one way or the other.

Volunteers who work on taxes know that the last week or two of tax season is busy (like the start of tax season) with last minute procrastinator tax filers. (Imagine that! Not everybody likes to get their taxes prepared!) So, I forgot to call her back. Or perhaps more likely, dreaded calling her back because I was not sure what I was going to say other than: "I'm sorry. It was a mistake."

Yesterday, the caller i.d. on my home phone indicated that someone had called. The caller had not left a message, but once I thought about the name, I realized it was the young lady. I had not yet called her back and it was now a week or two later.

So, that was my cue. I did call her yesterday afternoon and let her know. "I'm sorry. It was a mistake." And she said, "That's OK. I have stopped beating myself up over it. I guess it wasn't meant to be."

Our phone call ended with a few pleasantries. "God bless you" and such.

However, this morning, it has got me to wondering. A woman who was "beating herself up" over not receiving a tax refund of $500. What does a woman who lives off of an annual income of $8,300 do the other 364 days of the year when she is not getting her taxes prepared? Maybe wondering will she get lucky on her taxes next year? Or how to pay the bills? Or hoping that she does not get sick?

This morning driving into work, I heard one of my favorite songs, a Motown oldie from the Five Stairsteps, before the Jackson 5 -- the "First Family of Soul."

Somehow, it seems fitting today. So, as a former disc jockey, please allow me to dedicate this to a young lady in Benton Harbor. I hope her boss gives her a raise this year:

"O-o-h child things are gonna get easier
O-o-h child things 'll get brighter
O-o-h child things are gonna get easier
O-o-h child things 'll get brighter

Someday we'll get it together and we'll get it undone
Someday when the world is much brighter
Someday we'll walk in the rays of a beautiful sun
Someday when the world is much lighter"

www.last.fm/music/The+Five+Stairsteps/_/O-O-H+Child

for the full version, and not just a preview of O-o-h child:

www.youtube.com/watch?v=OVF4r3fLBrU

Business leaders agree: Education critical to economic success

Business leaders in Kalamazoo understand that education is a cornerstone and precedent to successful, productive workers and careers in our region. Several business leaders weighed their opinions in a recent Kalamazoo Gazette Article:

That the state spends more on the Department of Corrections than it does on higher education could hurt high-growth local companies such as MPI Research and Stryker Corp., which rely on educated and talented workers in Southwest Michigan.

“That doesn’t make a lot of sense,” said William Johnston, owner of The Greenleaf Cos.

“I shudder to think that the corrections budget is higher than our education budget,” Johnston said. “We know that the only way out (of the economic slump) is through education.”

“One of the concerns I do have is increasingly the U.S. isn’t putting out as many engineers,” said MacMillan, who noted that Stryker needs talented engineers to develop the medical technology it sells.

Read the Full Article: http://www.mlive.com/news/kalamazoo/index.ssf/2010/04/education_critical_to_economic.html

Don’t Blame Extension of Jobless Benefits for unemployment levels

According to a paper by the Federal Reserve Bank of San Francisco, the high duration of unemployment has a “quite small” relationship with the maximum amount of time one can draw unemployment benefits. From the Wall Street Journal:

“Extended [unemployment insurance] benefits have had a relatively modest effect” on the jobless rate. “We calculate that, in the absence of extended benefits, the unemployment rate would have been about 0.4 percentage point lower at the end of 2009, or about 9.6% rather than 10.0%.”

The paper notes the economic crisis of the last few years has generated an “unprecedented” level of unemployment duration. Those unemployed for more than six months hit 4.3% in March, “well above” the previous high of 2.6% in 1983. The economists note that the current situation is all the more striking because the unemployment rate peak was quite a bit higher in that downturn, relative to what’s been seen in this episode.

With all the rhetoric out there that unemployment insurance is actually raising unemployment, it is refreshing to see some statistics that show that extended unemployment benefits do not encourage job seekers to quit.

Read the full article: http://blogs.wsj.com/economics/2010/04/19/dont-blame-unemployment-extension-for-high-jobless-rate/

Survey of Kalamazoo County shows tie between joblessness, homelessness

Some interesting statistics from the point-in-time survey in Kalamazoo were released this week:

• For the third straight year, unemployment was the top reason homeless people in Kalamazoo County gave on how they ended up without a permanent residence, according to the findings of a point-in-time count performed in late January.
• About 20 percent of those surveyed at homeless and drop-in day shelters and other areas around the county on Jan. 27 said that inability to find work or the loss of a job had led them to lose their homes, stay in shelters or in transitional housing or to reside with friends or family — all circumstances defined as homelessness.
• Among those surveyed, the employment rate fell from 31 percent to 24 percent between 2009 and 2010. During the same period, the number of adults in the survey with an education beyond high school rose to 36 percent from 30 percent.
• The total number of homeless households dropped from 549, representing 985 people, in January 2009 to 409 households, representing 650 people, in January of this year.
• The number of children in homeless households dropped from 402 in 2009 to 238 in the January 2010 count.

Read the full article: http://www.mlive.com/news/kalamazoo/index.ssf/2010/04/survey_of_kalamazoo_county_sho.html

Count of Homeless Students in Michigan Schools Increases by 96% in One Year

"Michigan Department of Education officials say they're only now starting to get a handle on how many students statewide are homeless. And the numbers they've collected are startling.

The number of homeless students enrolled across Michigan jumped from 7,500 in the 2007-08 school year to 14,682 in the 2008-09 school year -- a 96% increase.

A big reason is the economic situation in Michigan, which has led to massive unemployment and home foreclosures . Another reason is more accurate counting required of school districts under McKinney-Vento ...

... Kathleen Kropf, Macomb Intermediate School District's Homeless Education Liaison, said between 75% and 80% of the county's homeless students in the past year have never been homeless before."We are seeing a whole new group, mainly our middle-class citizens who have lost their jobs, and therefore their homes," Kropf said."

- Detroit Free Press

www.freep.com/article/20100418/NEWS05/4180582/1320/School-districts-face-more-homeless-students

Shutting Off Utilities for the Poor Causes Rash of Illegal and Unsafe Electric Hookups

"On a recent sunny morning, Mark Johnson, head of DTE's revenue protection unit, drove through east-side Detroit neighborhoods pointing out illegal electric hookups.

At a complex of 12 apartments on Whittier in Detroit, all of the meter boxes had been opened and rigged with wires that span the bare connectors and allow power to flow into the units without being measured.

"That's 240 volts going through wires that are barely heavy enough to power a light switch," says Johnson, whose 61-man crew dismantles up to 500 illegal hookups a day. "If someone brushes up against that box, they're gone."

A few blocks away on Kilbourne, a 14-gauge wire runs from a utility pole into a tumble-down home that appears to be barely habitable. The wire snakes across piles of garbage and brush in the backyard before slipping through a hole in the exterior wall.

It's a fire waiting to happen. If a refrigerator or large space heater kicks on, the load could cause the wire to overheat and ignite any combustible material it contacts.

That's what may have happened in two fatal fires last month in Detroit. On March 4, a home on Bangor Street with an illegal hookup burned down, killing Travion Young, 5; Fantasia Young, 4; and Salena Young, 3. Two weeks later, a flophouse in the Cass Corridor burned, killing boarder Travis Marshall, 26. A witness said the illegal wire strung from the electric pole to the back of the hotel was glowing red before the fire started.

For advocates of the poor, the answer is simple: If DTE would stop disconnecting electric and gas services, the need for illegal hook-ups -- and the fire deaths -- would go away."

- The Detroit News

www.detnews.com/article/20100416/OPINION03/4160390/Electricity-theft-rising-in-Detroit

Unemployment climbs among black men even as nationwide jobless rates level off

Yesterday I wrote that the face of poverty was changing in West Michigan and the United States as more suburban families lose their jobs. I stand by this claim.

However, as jobless rates are beginning to level off nation-wide, unemployment for black men is still rising. The Problem is that even before the recession began, black men were already struggling. The recession has brought necessary attention to their plight, but has only exacerbated the situation. From the Kalamazoo Gazette:

As the grip of the recession eases, U.S. unemployment has leveled off at 9.7 percent for the past three months. But unemployment among black males hit a record 19 percent in March. And in Michigan, the 2009 jobless rate was worse than one in four for the black male population: 26 percent.

"One of the hard realities is, whether you are being released from work like myself, or you've been just getting out of prison, the situation is pretty much the same," Beattie said. "As far as looking for a job, you're a black male."

Beattie, 53, got cut by his longtime employer in January 2009, a year when office furniture sales plunged more than 30 percent industrywide.

"I was one of the folks they didn't want to let go," he said. "Prejudice didn't have anything to do with it."

But once he joined the swelling crowd of jobless, the search quickly turned sour.

"The pool is large, and the opportunities are starting to shrink, especially for someone who was not a majority class. When you're in an employers' market, folks are going to go for the known."

Nationwide, men of all races have borne the brunt of the recession. Since 2007, four of every five jobs lost were from male-dominated categories.

"It has affected men more than women, dramatically more so," labor analyst Jason Palmer said. "And it's affected black men more than white men. A lot of jobs that were lost were tough, lower-skilled jobs."

Read the full Article: http://www.mlive.com/business/west-michigan/index.ssf/2010/04/unemployment_climbs_among_blac.html

The face of poverty is changing

The face of poverty is clearly changing. It seems no longer are the days where poverty was an either an urban or rural challenge; it is now hitting suburban neighborhoods hard as well. In West Michigan, suburban unemployment is much higher than any economic recession of recent times.

According to the Brookings study, West Michigan suburban unemployment grew by 46 percent from 2007 to 2008, compared to 44 percent in Grand Rapids. The suburban figures include Kent County outside the city, and Barry, Newaygo and Ionia counties, all part of the same Standard Metropolitan Statistical Area.

What does this mean? That it is even more important we reserve judgments about those who struggle with financial instability and poverty. In fact, the rise in suburban areas for food stamp use has seen a higher increase in suburban areas than urban areas, though urban counties remain home to a larger number of recipients.


One families story is detailed here:

"I think some people would be surprised to know some of the situations that people are in," said Moore, 29.

The Belmont resident lost his tool-and-die job in 2009 and later, his suburban home to foreclosure.

He and his wife, Hope, 32, now reside with their two children in a single-wide mobile home as they apply for food stamps for the first time in their lives.

Enrolled in a state retraining program for computer technology, Moore is determined to remain optimistic.

"I think with some training and a little bit of time, we'll build back up again," he said.

Read the full article: http://www.mlive.com/news/grand-rapids/index.ssf/2010/04/report_shows_recession_hitting.html

New Orleans to Detroit March Seeks to "Fulfill the Dream"

"In 1967, Martin Luther King Jr. urged the nation's dispossessed to 'organize a revolution' against the injustice of poverty. Forty-three years later, the Poor People's Economic Human Rights Campaign has organized a march hoping to revive that call.

The "March to fulfill the dream" began last week in New Orleans and will end in Detroit, culminating in the U.S. Social Forum June 22-26. Organizers say thousands will participate in the march, which will cover 2,300 miles and 24 cities in 12 weeks."

- MLIVE.com

For more information, see:

www.mlive.com/news/detroit/index.ssf/2010/04/new_orleans_to_detroit_march_s.html

United States Has Lowest Tax Burden of G7 Nations

According to the Christian Science Monitor, "With the April 15 filing deadline in view, American taxpayers may be surprised to find that their tax burden is less than those in most industrialized countries." Indeed, the United States "... matches Japan for the lowest ratio of tax revenue to gross domestic product (GDP) among the G-7 nations. France and Italy score highest."

The G7 nations include: Canada, France, Germany, Italy, Japan, the United Kingdom, and the U.S.A.

For more information, see:

www.csmonitor.com/USA/2010/0411/US-tax-bite-smaller-than-other-nations