In the coming months, there are potential cliffs ahead in our already-frayed social safety net that could affect supports available for our most vulnerable communities’ basic needs such as food, water, housing and cash assistance. Since the pandemic began billions of federal and state relief dollars have been distributed through existing social safety net programs to support Michiganders. However federal funding through COVID-19 relief packages is limited and temporary policy waivers and moratoriums that provide extensive flexibility, increased benefit amounts and safety measures to prevent families from utility shutoffs and evictions are set to expire.

The Governor’s Office of Foundation Liaison (OFL) has been examining the latest research around these issues and connecting our community of philanthropy with resources on gaps in the social safety net. Last fall the OFL hosted a convening for all members that included examples of effective programs to support economic mobility and has since continued to elevate these concerns. The next convening is a two-part conversation open to all CMF members, slated for September 30 and October 6, that features leading experts on the challenges frontline organizations face as the pandemic rages on and philanthropy’s collective strategies for building toward more equitable and sustainable systems.

We are sharing the OFL’s latest data on the four impending cliffs of our safety net:

Food

• OFL has monitored food assistance and distribution since the outbreak of COVID-19. The policy guidelines for emergency food during the pandemic allowed for maximum flexibility and maximum payout of benefits as food providers doubled and tripled their normal distribution while adapting to social distancing guidelines. 

• The food insecurity rate rose to a historic 18.8% at the height of the pandemic, representing nearly 1.4 million food-insecure people in the state. 

• There are concerns around the drying up of federal emergency food dollars as well as the expiration of temporary policies that vastly improved access to food. As a result of the demand for food through the emergency system, food prices have gone up and thus the state’s return to pre-pandemic funding and policies puts the state in a very difficult position. 

• The return to school also triggered an end to temporary policies on food distribution that will put additional pressure on families trying to manage the many challenges of education at this time. 

• The Hamilton Project has shared data that illustrates how food security has disproportionately affected communities of color during the pandemic. Nationally, nearly 1 in 3 African American households with children reported being food insecure in June. 

Water

• Michigan is currently operating under a moratorium on water-shut offs that is set to expire in December 2020. 

• As the OFL continues to look for more data and work with state and philanthropic colleagues on solutions to water affordability, there is concern the moratorium only pushes the problem down the road for families. They will likely face large, aggregated costs to catch up on bills in the new year. 

• According to the ACLU, for the last 10 years, areas of Detroit with 75% or more of their population comprised of African American residents averaged 60% more water shutoffs. During the pandemic, 93% of water shutoffs occurred in areas with 75% or more Black population and these areas also correlated with higher COVID-19 infection rates. 

Housing

• Governor Gretchen Whitmer issued a moratorium on housing evictions that ended on July 31. Most recently the Center for Disease Control (CDC) issued a national moratorium until December 31, recognizing the connection between evictions and the possibility of increasing the spread of COVID-19. 

• Michigan reserved $50 million for its eviction diversion program to help support families staying in their homes and nearly all of it has been spent. Again, there is concern that the moratorium only pushes the problem down the road, anticipating families who rent their homes will be faced with significant balances starting in January 2021 with the addition of late fees.  

• Based on the most recent census data available, one analysis estimates that 457,000 rental households in Michigan are experiencing rent shortfall and potentially facing eviction. This represents approximately $463 million in back rent. 

• At the same time, 39.2% of African Americans and 45.4% of Latinx reported having no or only slight confidence in their ability to pay next month’s rent compared with 24.7% of whites.  

Unemployment

• The enhanced federal unemployment payments ($600/week) during the height of the pandemic ended on July 31 and the Federal Emergency Management Agency (FEMA) recently approved a continuing unemployment supplement at $300/week. The amount is retroactive to August 1 and while this was a promising development, the funding will only cover about 4-5 weeks of additional payments, according to the State Budget Office.

• In the second quarter of 2020, Michigan had the highest unemployment rate in the country for African Americans at 35.5% compared with 17.5% among whites. Compounding the inequity, 33.2% of white workers and 23.8% of African American workers received unemployment insurance benefits.

In addition to these challenges, OFL shares that the state budget and economic forecasts indicate that recovery will extend into the coming years, and there is a high degree of uncertainty about how the elections in November will impact federal responses to mitigate crises for low-income communities and for communities of color. Winter will also mean additional costs such as home heating, and the pandemic may affect seasonal tourism in popular winter destinations such as northern Michigan.

CMF members interested in a timely and responsive conversation about these pending cliffs are encouraged to attend the two-part series happening on September 30 and October 6 as we explore how our community of philanthropy can work together to meet basic needs in the near term while working to build more equitable systems adapted to the challenges of our new reality. 

Want more?

Join us for Equity, COVID-19 and the Social Safety Net, part one on September 30 and part two on October 6.