Addicted to Fines

Source: Mike Maciag, Governing, September 2019

Small towns in much of the country are dangerously dependent on punitive fines and fees.

….Throughout the country, smaller cities and towns generate major dollars from different types of fines, sometimes accounting for more than half of their revenues. Some places are known for being speed traps. Others prop up their budgets using traffic cameras, parking citations or code enforcement violations.

To get a picture of just how much cities, towns and counties rely on fines and fees, Governing conducted the largest national analysis to date of fine revenues and the extent to which they fund budgets, compiling data from thousands of annual financial audits and reports filed to state agencies.

What we found is that in hundreds of jurisdictions throughout the country, fines are used to fund a significant portion of the budget. They account for more than 10 percent of general fund revenues in nearly 600 U.S. jurisdictions. In at least 284 of those governments, it’s more than 20 percent. Some other governments allocate the revenues outside the general fund. When fine and forfeiture revenues in all funds are considered, more than 720 localities reported annual revenues exceeding $100 for every adult resident. And those numbers would be even higher if they included communities reporting less than $100,000 in fines; those jurisdictions were excluded from our analysis. In some places, traffic fine revenue actually exceeds limits outlined in state laws…..

….The fact is that fines and fees are a volatile revenue source, and the towns that rely the most on them face an increasingly uncertain fiscal future…..

Distributional Impacts of State and Local Tax Policy in a Heterogeneous-agent Model

Source: Jorge A. Barro, Public Finance Review, Online First, Published September 8, 2019
(subscription required)

From the abstract:
This article presents a dynamic heterogeneous-agent life-cycle model with housing demand to evaluate the economic implications of reforming US state and local personal tax structures. Because of the extensive reliance of state and local governments on income, sales, and property tax revenue, those three taxes are explicitly modeled to generate a baseline and varied to evaluate alternative policy proposals. The results of the model show that the sales tax burden falls evenly across the distribution of income earners, while the property tax burden falls more heavily on the highest income earners. By design, the model’s income tax is progressive, so the tax burden shares rise with income. Results also show that the property tax generally improves utilitarian social welfare relative to income and sales taxation, but the magnitude of these gains depends on the availability of a state and local tax deduction on federal income taxes.

U.S. Nursing Assistants Employed in Nursing Homes: Key Facts (2019)

Source: PHI, September 3, 2019

From the abstract:
This research brief provides the latest annual snapshot of U.S. nursing assistants employed in nursing homes, including key demographics and a variety of wage and employment trends. This year’s research found that 581,000 nursing assistants support older people and people with disabilities in nursing homes. Nursing assistants are injured more than three times more frequently than the typical American worker, and earn a median hourly wage of $13.38 and a median annual income of $22,200.

Key Takeaways:
– The number of nursing assistants employed in nursing homes in the U.S. declined from just over 599,000 in 2008 to 581,000 in 2018.
– Nursing assistants earn a median hourly wage of $13.38 and a median annual income of $22,200.
– Nursing homes will need to fill nearly 680,000 nursing assistant job openings between 2016 and 2026.

U.S. Home Care Workers: Key Facts (2019)

Source: PHI, September 3, 2019

From the abstract:
This research brief provides the latest annual snapshot of the U.S. home care workforce, including key demographics and a variety of wage and employment trends. This year’s research found that nearly 2.3 million home care workers earn a median hourly wage of $11.52 and about $16,200 annually. One in six home care workers lives below the federal poverty line and more than half rely on some form of public assistance.

Key Takeaways:
– Nearly 2.3 million home care workers provide personal assistance and health care support to older adults and people with disabilities.

– From 2016 to 2026, the home care sector will need to fill 4.2 million home care worker job openings.

– With a median hourly wage of $11.52 and inconsistent work hours, home care workers typically earn $16,200 annually.

The Effects of Performance Audits on School District Financial Behavior

Source: Paul N. Thompson, Mark St. John, Public Finance Review, Online First, Published September 8, 2019
(subscription required)

From the abstract:
Performance audits are a form of weak financial oversight intended to curb inefficient spending and help alleviate financial problems. This study examines the effect of these performance audits on school district finances in Ohio, where performance audits are used on their own and within the context of the state’s fiscal stress labeling system—a strong financial oversight system. Using a difference-in-differences analysis, we find school districts do reduce expenditures as a result of these performance audits. These changes in financial behavior are found even for performance audits in nonfiscal stress districts, suggesting that weak oversight programs may be an effective means toward changing fiscal behavior. Despite the financial changes in nonfiscal stress districts that receive audits, there appears to be little impact on school district proficiency rates. These results suggest that audits may provide a useful mechanism for changing financial behavior of school districts without much associated efficiency losses.

How Local Economic Conditions Affect School Finances, Teacher Quality, and Student Achievement: Evidence from the Texas Shale Boom

Source: Joseph Marchand, Jeremy G. Weber, Journal of Policy Analysis and Management, Early View, August 29, 2019
(subscription required)

From the abstract:
Whether improved local economic conditions lead to better student outcomes is theoretically ambiguous and will depend on how schools use additional revenues and how students and teachers respond to rising private sector wages. The Texas boom in shale oil and gas drilling, with its large and localized effects on wages and the tax base, provides a unique opportunity to address this question that spans the areas of education, labor markets, and public finance. An empirical approach using variation in shale geology across school districts shows that the boom reduced test scores and student attendance, despite tripling the local tax base and creating a revenue windfall. Schools spent additional revenue on capital projects and debt service, but not on teachers. As the gap between teacher wages and private sector wages grew, so did teacher turnover and the percentage of inexperienced teachers, which helps explain the decline in student achievement. Changes in student composition did not account for the achievement decline but instead helped to moderate it. The findings illustrate the potential value of using revenue growth to retain teachers in times of rising private sector wages.

Why Are Some Places So Much More Unequal Than Others?

Source: Jaison R. Abel and Richard Deitz, Federal Reserve Bank of New York, Economic Policy Review, Forthcoming [2019]

From the abstract:
This study examines the magnitude and sources of regional wage inequality in the United States. The authors find that, as in the nation as a whole, wage inequality has increased in nearly every metropolitan area since the early 1980s, though there is significant variation among places in both the degree of wage inequality and the pace at which it has risen. The most unequal places tend to be large urban areas that have benefited from strong demand for skill and agglomeration economies, with these factors leading to particularly rapid wage growth for high-skilled workers. The least unequal places tend to have seen weak demand for labor, largely as a consequence of technological change and globalization, and this weakness has led to lackluster wage growth across the entire wage distribution— particularly for middle- and lower-skilled workers. These findings suggest that a relatively low level of regional wage inequality is often the result of a weakening local economy, while relatively high regional wage inequality is often a consequence of strong but uneven economic growth.

How to Optimize Onboarding

Source: Dave Zielinski, HR Magazine, Vol. 64 no. 2, Summer 2019
(subscription required)

The right tools can make new hires more productive more quickly and save time for HR…

Good onboarding practices can reduce turnover and greatly improve new hires’ time to proficiency. But next-generation onboarding technologies can also eliminate much of the manual work, reduce the chance of problems or delays, and leave more time for HR and line managers to train and socialize new employees.

Using customized portals, today’s platforms allow new workers to complete essential digital forms, learn about teammates and begin developing short-term goals even before their first day on the job. Many also feature artificial intelligence (AI)-driven virtual agents to answer commonly asked questions. These portals can customize workflows to match an organization’s orientation needs and send automated reminders to ensure that all onboarding tasks are completed on time.

The stakes are high for choosing the right onboarding system, since nearly one-third of new hires grow dissatisfied and look for a new job within their first six months of employment, and those who stay take an average of eight months to reach acceptable levels of productivity, according to new research from Gartner. A recent Gallup study found that only 12 percent of employees strongly agree that their organization does a great job of onboarding new hires…..

Making Onboarding More Effective
• Define your objectives. Determine the structure and content of your onboarding program. Give careful thought to what new hires need to know about the organization and their roles.
• Identify key players. Onboarding is more than an HR initiative. People throughout the organization need to take ownership of their part in the process by contributing content, serving as mentors and building connections with new hires.
• Stay engaged. Onboarding can last from a few weeks to more than a year. Develop timetables to ensure that new hires stay on track, and suggest resources to help them develop throughout their employment journey.
• Keep tweaking. Gather feedback from new hires about how the onboarding process worked for them and how it can be improved…..

Closing the Gender Pay Gap

Source: Tamara Lytle, HR Magazine, Vol. 64 no. 2, Summer 2019
(subscription required)

The gender pay gap has been stubbornly hard to close, but the tide may be turning.

…. These pay gaps are due to many factors, including women’s stepping out of the workforce for family obligations, the concentration of women in certain relatively low-paying “pink collar” occupations (such as teaching and hospitality), stereotypes that women aren’t tough negotiators on pay and plain old bias, whether conscious or not. ….

…. Big-Picture Questions on Pay Disparities

• Do women generally wait longer than men for promotions?
• Are female workers shunted into lower-paying jobs?
• Are performance reviews based on subjective factors that can be clouded by unconscious bias?
• Is the company culture welcoming to women?
• Are there gender differences in nonsalary compensation such as bonuses, overtime opportunities and stock options?