Many families working to move out of poverty and toward self-sufficiency face benefit cliffs – when increases in income do not compensate for losses in benefits from state and federal programs.
The Wisconsin Department of Children and Families (DCF) sought help from La Follette School students to see how these programs across state agencies interact and create or temper cliff effects for Wisconsin families.
As part of their culminating Workshop in Public Affairs (PA 869) project, the students examined seven public benefit programs available to Wisconsin families. In analyzing the implications of benefit cliffs, the students found that cliffs are not only difficult to identify within public programs, but they appear to be negatively correlated with a household’s ability to achieve self-sufficiency.
They also found that concurrent participation in multiple programs can lead to compounded cliff effects, exacerbated financial struggles, and increased disincentives to raise incomes.
“These findings illustrated the necessity of sharing and jointly analyzing enrollment and eligibility data across multiple programs to develop a more holistic and accurate picture of each family’s financial trajectory,” the students wrote.
In response, the students offered recommendations for improving interdepartmental data collection and mitigating these multi-program cliffs. They also examined what other states and regions have done to combat benefit cliffs and provided recommendations for leveraging this information to better support low-income families.
Jessica Rutstein, Patrick Duffie, Ronald Steinhoff, Samantha Fredrickson, Hayley Young, and Grace George collaborated on the project for DCF, which has partnered with the La Follette School on several other projects in previous years. Professor Tim Smeeding served as the students’ advisor.