By Kevin P. O’Connor
Herald News Staff Reporter
FALL RIVER — The answer floored him every time he heard it, but eventually he understood it was true, Joe Amaral said. Many of his employees were correct in turning down raises or more hours.
They couldn’t afford the extra money, Amaral said.
These are part time bus drivers and bus monitors at Amaral Bus of Westport. Most earn little enough to qualify for food stamps, child care subsidies, rental assistance, Amaral said.
Those people would lose more money in assistance than they would earn in extra pay, Amaral said. They worried that making more might threaten their child care arrangement or housing.
On Nov. 1, that changes, according to Jeff McCue, commissioner of the state Department of Transitional Assistance.
McCue was at the Fall River Career Center Thursday morning, outlining the effects of new legislation, shaped in part by Rep. Paul Schmid, which will reduce the “cliff effect,” the dramatic loss of benefits that people on state assistance face when they go to work.
The effect is enough to keep some people, especially young single mothers, from accepting jobs or more work, McCue said.
“If offered, they can take work,” McCue said. “It is our attempt to let people get a running start at getting out of poverty.”
The genesis came about two years ago when Schmid went to McCue and asked him if Amaral was correct, that people would lose money by going to work.
“Rep. Schmid said to me, ‘This can’t be true,’” McCue said. “I had to tell him it was.”
The cliff effect is an unintentional consequence of the welfare reform that was ushered in by President Bill Clinton in 1996.
The reforms shrank welfare roles in Massachusetts from 150,000 people in 1996 to 28,500 on the roles now.
“But we often operate in silos in government,” McCue said. “Some programs didn’t play very well together.” Examples were work programs and assistance.
The program was tested in Springfield for a year and will be rolled out statewide next month, McCue said.
No matter what changes happen in a family’s work life, they will be able to hold onto assistance for six months, even after they start a new job or add hours. In addition, they will be able to save up to $5,000, doubling the asset ceiling families face now.
Some programs, especially child care subsidies, will continue until a family reaches 200 percent of the federal poverty level. For a family of three, that is around $40,000, McCue said.
After six months, the DTA will consider only 50 percent of the new earnings until the family reaches 200 percent of the federal poverty level.
“This gives families a chance to save money and actually think about the future and make plans,” McCue said.
“Our clients make very shrewd financial decisions. They balance their family finances on the head of a pin. This will give them more flexibility.”
It will also give business more flexibility by being able to offer more hours to good workers without having to worry about immediate financial harm, Amaral said.
The next step, Schmid said, is to make sure business owners know of the new rules so they can convey them to employees.
“This is far from mission accomplished,” McCue said. “This is really our first foray into this.
“Some of the changes we are bringing in today are just scratching the surface.”
Email Kevin P. O’Connor at email@example.com.