Cost of not addressing poverty could surpass current cost

Cost of not addressing poverty could surpass current cost


Millions of dollars in federal and township poor relief flood Lake, Porter and LaPorte counties every month, outpacing statewide rates, a Times computer-assisted analysis of state, federal and local data shows.

The high percentages of impoverished and economically strapped Northwest Indiana residents trigger heavy government spending, from federal food stamps to local township aid that pays for rent and other needs.

Critics of poor-relief policies see the wave of welfare spending nationwide as a means of making the indigent perpetually dependent on government services.

But the leaders of at least two region social service agencies agree the social — and financial — cost of doing nothing could be greater than the dollars spent on poor relief.

More individuals and families are finding themselves in need of assistance because of the changing local economy, said Gary Olund, president and chief executive officer of Northwest Indiana Community Action. Fewer jobs available and lower-paying existing jobs add up to increased need at many levels.

"Although we're recovering economically, there are still a lot of people behind the eight ball due to job loss, due to the economic crisis ... you've got folks who never anticipated being in need of assistance," Olund said.

They want to live independently and support their family and themselves, but they lean on social service agencies.

"I believe people understand more and more people are falling into this 'need' category," Lake Area United Way Director Lou Martinez said. "I don't think they know how large the problem is and how many people are affected."

The local cost

Those from various sides of the welfare-cost debate largely agree the local cost of poverty appears staggering.

A Times' computer-assisted analysis of Indiana Family and Social Services Administration data for February 2014 alone revealed the following:

* 122,661 people from Lake, Porter and LaPorte counties received $15.5 million in aid from the federal Supplemental Nutrition Assistance Program, also known as food stamps.

* Food stamp recipients in the three local counties accounted for about 14 percent of the state's total recipients, while the three counties comprised about 12 percent of Indiana's population.

* Lake County, in which 90,034 people received about $11.6 million in food stamps, accounted for nearly 11 percent of all Indiana food stamp recipients; by contrast, the county comprises 7.5 percent of the state's population.

* 1,621 of the three-county area's neediest families received $310,819 in federal Temporary Assistance for Needy Families funds, accounting for more than 15 percent of state's share.

The cost of local government poor relief provided by the 42 township trustees' offices in the three counties also shows heavier concentrations of spending than the state as a whole.

A Times' analysis of 2013 financial records for township trustees' offices in Lake, Porter and LaPorte counties revealed the following:

* 24 percent of all township poor-relief recipients in the state lived in the three-county area.

* Those 73,069 region residents received $5.3 million in various types of help, including assistance paying for rent, utility bills and food.

* In addition to providing local government dollars, region township trustees also linked residents with another $7.8 million in aid provided by other government and private social service agencies.

Spending reforms

On a local level, Republicans in Griffith, who have fought for spending reforms in Calumet Township, which includes Gary, contend more reforms are needed statewide to bring the region in line with the rest of Indiana and ensure uniform policies will govern local government poor relief.

And on a federal level, U.S. House Rep. Paul Ryan, R-Wis., has proposed a federal budget that would convert food stamps, which include federal dollars administered by state agencies, into a block grant program and institute spending caps beginning in 2019. The plan would cut food stamps by $125 billion through 2024.

Ryan's budget also relies on imposing new work requirements on some of the aid recipients.

Munster native and U.S. Rep. Todd Rokita, R-Ind., co-authored the Ryan budget plan. He said the high percentages of spending on food stamps in Northwest Indiana alone shows the current "one-size-fits-all" approach isn't working.

"When we put people in these government programs, we are essentially making them a number — a commodity," Rokita said in a prepared statement.

Rokita said he favors giving community organizations and churches the resources they need to better aid the poor.

"Community organizations, churches, our neighbors and so on, can do what government can't — what a bureaucrat can't — and that is build relationships," Rokita said. "We can spend our limited resources on those who are truly poor, on things the poor really need and in a way it will actually help ..."

Weighing the cost

As high as Northwest Indiana's poor relief costs are compared to the rest of the state, United Way's Martinez said the social costs of cutting back on that aid could be higher than the existing price tag.

"There are societal costs of not spending that money and providing those services," Martinez said. "Our society would be holding on for dear life without these safety nets.

"If people lack the basic survival needs of food, clothing and shelter — and they have no personal means to get those things — many will turn to crime. That is one of the many social costs of doing nothing."

"Our court system is having a hard enough time managing the cases it already has. Reductions in assistance would increase that burden."

Martinez agrees with some welfare critics that a better, more effective response to poor relief should be created and implemented, but suspending or reducing existing services isn't the answer, he said. In fact, decreased funding and steadily growing local need are straining local safety nets as it is.

Even if donors drive up contributions, it would be tough to make up the loss from rapidly diminishing government dollars, Martinez said.

"It's hard to make up that gap. The government primarily funds social services. Fewer and fewer dollars are being allocated," Martinez said.

"The gap has widened between the haves and have-nots. That's very difficult for all the agencies right now."

Sandra Noe, executive director of Meals on Wheels Northwest Indiana, said her organization sees both social and economic returns on the dollars it spends feeding homebound region seniors one or two balanced meals per day. One is keeping seniors properly fed and less likely to get sick and draw on government health insurance programs.

"Every dollar spent on nutrition for seniors leads to Medicaid savings of $50," said Noe, citing statistics compiled by the Meals on Wheels Association of America.

And nutrition aid, such as that provided by Meals on Wheels or federal food stamps, curbs more than hunger among the needy, Noe said.

"It's a psychological impact," Noe said. "It empowers someone to have control over at least that one aspect of their life — nutrition."

More awareness may drive solutions

The answers lie in the community coming together and identifying and addressing local problems, whether it be poverty or transportation issues, Martinez suggested.

Public awareness of poverty is there, but people may not have a full understanding of its depth.

It's been a "battle" to keep the funding level at or below the current amount, Northwest Indiana Community Action's Olund said. The 3 to 5 percent increases in the past helped agencies keep pace.

"Now, it's a victory if your funding levels aren't decreased," Olund said. Decreased funding means you can't serve as many people, and the service you can provide as an agency is lower.

"You make choices based on the most pressing priority need," he said. 

The organization in 2008 could offer $350 to $400 or more in energy assistance to people needing their heat kept on in the winter. "Now, that benefit level is under $300," he said.

The agency has 200 people on its waiting list for a housing-choice voucher program, which is subsidized housing assistance for people who rent in the seven Northwest Indiana counties, Olund said.

"The expected wait time, since the funding is flat and/or decreasing, is up to 24 months," he said.

In the meantime, people make hard choices to find a place to stay and food to eat, and fill their medication prescriptions.

The division of Northwest Indiana Community Action that serves seniors has a waiting list of 2,228 people, he said. They're waiting for case management, nursing and in-home health care, among other services.

Despite political debates and funding cuts, the good news is that funding has not been completely gutted.

"When folks can step aside from whatever position that they need to take because of partisanship, there's a tremendous amount of support for the work we do," Olund said.

People don't realize how close they are to needing social services, he said.

"It doesn't matter whether I'm in Morocco or Gary or East Chicago. People are the same. They have the same hopes, desires and needs."

Click here to view a larger version of the map.

(Source: Northwestern Indiana Regional Planning Commission)
Click here to view a larger version of the map.


Get local news delivered to your inbox!

* I understand and agree that registration on or use of this site constitutes agreement to its user agreement and privacy policy.

Related to this story

Get up-to-the-minute news sent straight to your device.


News Alerts

Breaking News


Entertainment & Dining

Latest News

Local Sports

NWI Prep Sport News

Weather Alerts