ROCKY HILL, Conn. — Even before the onset of the COVID-19 Pandemic, 38% of households were struggling to make ends meet. Connecticut United Ways call these households ALICE, an acronym that stands for Asset Limited, Income Constrained, Employed.
Despite working hard and holding important jobs across our state, ALICE households –33% of whom are families with children – are unable to keep pace with the high cost of living in Connecticut. The COVID-19 Pandemic and its impacts exposed the financial fragility of ALICE households, and made their struggle harder still.
Yesterday, key Connecticut legislators including, Senator Martin Looney, Representative Sean Scanlon and Representative Brandon McGee, highlighted concrete steps Connecticut can take to better support ALICE families now and going forward, and discussed how proposed legislation can help stabilize our state’s ALICE population.
These concrete steps include increasing Connecticut's Earned Income Tax Credit (EITC) from 23% to 40% and creating a state Child Tax Credit which will lead to the largest tax cut for working families with children in Connecticut history. Combined, these policies will help more than 1 million people in Connecticut.
"If we can have a combination of the enhanced federal Child Tax Credit, which unfortunately might be temporary, an enhanced (Connecticut) Earned Income Tax Credit and also the creation of a long term state Child Tax Credit, we would do more than anything we've done in a long time to improve the plight of low income working people in our state," said Senator Looney
"I believe in trickle up economics," said Representative Scanlon. "If we put money in the pockets of the people who need it most, they spend it, they go to work and they move up. If we can make Connecticut a more affordable state for the middle and working class, I believe that we can grow Connecticut in the way that we want to see it grow."
"Putting money back in the pockets of low and moderate income workers through EITC and reducing the tax burden on families with children through the creation of the CTC will give families the flexible income they need to meet gaps in essential family budget areas including child care, rent, food, transportation and medical expenses," said Representative McGee. "If we truly seek to foster more inclusive and equitable communities in our state, then we must make a choice to invest in communities that we have historically under invested in."
Households of color are disproportionality represented in the ALICE population with 57% of Black households and 63% of Hispanic Households living below the ALICE threshold.
This virtual event featured a keynote by Bryce Covert, contributing op-ed writer at the New York Times and an important perspective from Melissia Stanley, Program Director at the Boys & Girls Club of Stamford, who knows what it means to live paycheck to paycheck.
"A lack of steady, decent income means that many people work hard but are constantly on the brink," said Bryce Covert. "If COVID proved anything, it’s that too many Americans are one emergency away from financial devastation. Just a small amount of extra money can make all the difference. It is often the difference between stability and disaster."
"Our state has seen first hand what happens when families that are living on the edge suddenly have the rug pulled out from under them," said Melissa Stanley. "ALICE households are experts at managing their households budgets and finding creative ways, like I did, to support their families. But when you live paycheck to paycheck and are unable to save, any loss in income or additional expense can send your finances spiraling."
Connecticut United Ways and the Commission on Women, Children, Seniors, Equity & Opportunity were thrilled to host this important discussion.
“When we talk about ALICE it is important to recognize that we all know ALICE,” said Lisa Tepper Bates, CEO and President of United Way of Connecticut. “ALICE is the essential health care worker caring for our aging parents. ALICE is the teaching assistant who helped our children adapt to virtual learning, or the bus driver who gets our kids to school. ALICE is our friend, neighbor, co-worker, and family member. Yet, right now, ALICE households are struggling to feed their families, access affordable child care, ensure their medical care, and maintain their housing.”
Tepper-Bates continued, "The federal benefits are even across the country but the cost of living is not. It is so very important that we focus on the action we can take in our state and the most important thing we can do for our struggling families (38% of households in Connecticut) is give families the flexible funds that they need to meet the needs that they prioritize."
“ALICE workers are essential to the vitality of our communities. The COVID-19 pandemic further exposed just how many families are walking a financial tightrope,” said Steven Hernández, Executive Director, Commission on Women, Children, Seniors, Equity and Opportunity. "Connecticut has an incredible opportunity to better support our ALICE households."
If you missed this event, click HERE to access the recording.