Lack of Transportation: Another hardship facing people living in poverty

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1 Lack of Transportation: Another hardship facing people living in poverty A report from Athens County Job and Family Services March 2012 Athens County Job and Family Services 184 N. Lancaster St. Athens, Ohio, Jack Frech, director jfs@athenscountygovernment.com

2 Lack of transportation is a very significant problem for people living in poverty, particularly for people in a rural area such as Athens County, where there is limited public transportation. People who are unable to drive to work, cannot walk to work or have no bus system to rely on often lose their jobs or are unable to find work in the first place. In addition, lack of transportation makes it very difficult for people to go to school, shop for essentials, get the healthcare they need, meet their work requirements for public assistance, keep their children involved with school/community events, and take part in other events or programs. And while it can be hard enough for low income people to buy vehicles or keep them running, the State of Ohio makes it even more difficult when it suspends driver s licenses for a wide range of legal offenses. Many such offenses do not relate at all to the person s ability to drive safely. Having their license suspended then forces people to either drive illegally and risk further fines, or give up driving and likely lose their job or face the many problems related to not having transportation. The cost of owning and operating a car Many people simply cannot afford a car or all of the expenses that come along with it. High gas prices are a significant problem for people all across America, and they often make it prohibitive for people living in poverty to be able to drive. When it costs more than $40 for a tank of gas, many people simply cannot afford to drive. Owning a car means much more than just paying for the gas to put in the car. Expenses such as maintenance, car insurance, license/registration fees and car payments all factor into whether or not a person or a family can afford a vehicle. According to research from AAA, the average cost of owning and driving a small car in America is $8,776 per year. This cost includes the price of fuel, maintenance, tires, insurance, license/registration/fees, depreciation and finance charges. The average of cost of owning and operating a vehicle for business purposes, according to the IRS, is $0.555 per mile. If this same cost is applied to an individual owner, it means that the annual cost for owning and operating a vehicle that is driven for 10,000 miles would be $5,550. A new study from the Center For Neighborhood Technology examines annual transportation costs all across the country. In Athens County, the lowest annual cost is in the city of Athens, where the cost is less than $12,500 according to the study. The study does not specify costs that are lower than that amount. For people living outside of the city of Athens, most pay between $14,300 and $15,400, and some pay more than $15,400 per year, according to the report. While many low income families are forced to operate vehicles on a much more limited budget, the high cost of ownership often leads to unreliable, unsafe, and/or illegal vehicle operation.

3 Car Insurance Across America, nearly one out of every seven drivers does not have car insurance, according to a report from the Insurance Research Council. This is more than 13% of all drivers. In addition, 28% of all American men between the ages of 18 to 34 and 45 to 54 have driven without car insurance, according to an InsuranceQuotes.com poll conducted by Harris Interactive. These drivers risk getting arrested and fined large amounts and having their licenses suspended, but they drive because they have to get to work or to appointments that are important to their families. They simply cannot afford insurance. According to a report from the Insurance Research Council, the average price of car insurance in America is $1,566 per year. According to the same report, the average price in Ohio is $1,084 per year. Driver s license suspensions Hundreds of thousands of Ohio residents currently have their driver s licenses suspended, often for offenses that have nothing to do with driving. According to the 2011 Facts & Figures report on the Ohio Bureau of Motor Vehicles website, Ohio has 7.8 million licensed drivers. The number of active suspensions changes throughout the year, but a daily report from April 2011 states that more than 960,000 drivers had their licenses suspended on that day. On average, each driver facing a license suspension is actually facing more than one suspension. The daily report from the Ohio Bureau of Motor Vehicles states that the average number of suspensions is 2.82 for each driver that is facing a suspension. In April 2011, when more than 960,000 drivers had their licenses suspended, for example, there were more than 2,720,000 active driver s license suspensions in Ohio. In Athens County, according to the same report, there were a total of 9,484 active license suspensions in the county. If the average in Ohio is 2.82 suspensions for each driver with a license suspension, that would mean that more than 3,300 Athens County residents have their driver s licenses suspended, according to the Ohio Bureau of Motor Vehicles report. Income levels for people living in poverty According to the U.S. Census Bureau, 15.1% of all Americans were living below the federal poverty level in This is equal to 46.2 million people living in poverty. In Ohio, 2,983,500 people or 10.3% live in poverty. The majority of these people have a very hard time paying their bills and trying to keep a car running.

4 According to a report from the U.S. Department of Agriculture, 40 million Americans currently receive Supplemental Nutrition Assistance Program (SNAP) benefits, formerly known as food stamps benefits. Of these recipients, 20% of these households, or approximately 8 million people, receive no other income besides the SNAP benefits. Nearly one-third of all Athens County residents live in poverty. For a single person, the poverty level is $11,170, meaning that a single person living right at the poverty level would have to spend nearly half (and likely more) of his or her income just to pay the average expenses of owning and operating a small car. Many people live far below the poverty level and do not even bring in enough income in a year to pay for the cost of a small car. If a person is working full-time and making the state minimum wage of $7.70 per hour, he or she will make $16,016 per year before taxes. Using the $5,550 estimate as the cost to operate a car for a year, more than a third of the person s salary will be spent on transportation to that job. That would leave about $10,000 to pay for taxes, rent, utilities, food and other expenses for the year. The average monthly Social Security benefit for a retired worker was about $1,230 at the beginning of 2012, according to information from the U.S. Social Security Administration. This means that the annual Social Security benefit would be $14,760, which is just below the income for someone earning minimum wage. This also means that a person receiving the average Social Security benefit would spend more than one third of their income on a vehicle. For an individual receiving Supplemental Security Income (SSI), the maximum monthly payment is $698, while the maximum amount for a couple is $1,048, according to information from the U.S. Social Security Administration. This means that the maximum yearly payment amount for an individual would be $8,376, and the maximum yearly amount for a couple would be $13,008. In both instances, a significant portion of the available income would be needed to pay for a vehicle, making it nearly impossible to pay other expenses. For a family of three receiving Ohio Works First cash assistance, the monthly payment is $450. Over a year, this is equal to $5,400. This means that most, if not all, of the payments would be needed just to maintain and operate a vehicle. Cash assistance recipients have work requirements, and in most cases the recipients need vehicles to get back and forth to the work assignments. Some counties have public transportation and recipients can get bus passes. But where bus service is not available, recipients require some type of gas allowance to help pay for the cost of transportation to and from the work assignments. Most county job and family service agencies offer small amounts, such as $25.00-$50.00 per month. Some county agencies do not offer any assistance at all, making it virtually impossible for many recipients to make it to their work assignments.

5 A lack of transportation not only hurts poor families directly by severely limiting their access to jobs and essential services, but it adds to their invisibility. While trapped at home, neither they nor their children can participate in our community activities and their plight becomes even more invisible to us. This problem must be addressed. Read stories from Athens County As an elderly widow, car repairs are nearly out of the question for me. I am driving (when I can buy gas) a 1994 car that needs brakes, front end alignment and tires. I know there are agencies that provide transportation for doctor s appointments, but if this car isn t repaired I will have to go without food, and less important, companionship. There are a lot of issues I can bring up, but I don t even carry the insurance that makes my drive legal. I could go on and on, but I ve covered the most important issues. I can t pay all of my bills on what cash assistance I get. It makes it very difficult for me and my family. Also, one family member has medical issues. It is very stressful on me and my family to worry about when we are going to get money to pay for our bills and how we are going to get there. My car needs repairs. I don t know how we can fix it. I can t afford insurance. Just don t know what to do, but thanks so much for what I do get, but it s just not enough. My child and I have been evicted from our home for late rent payments even though I was working. Then my car s transmission went out. I found a place that has lower rent as long as I fix it up. And while carrying firewood, I threw out my back and lost my job due to injury. While I appreciate the help we get, it s not enough. The government requires you to carry car insurance, but yet when you get help it s not enough to pay for it..... We try to drive to work and get pulled over, and that s more money to the courts and the car gets towed. It s an endless cycle. Not to mention rent, toilet paper, shampoo, school supplies, utilities, etc. You add it up. I get enough money from OWF to pay my rent, which leaves all my other important bills out, or I have to choose what to pay to keep from being evicted or disconnected. My car insurance got cancelled and my license got pulled because of getting pulled over on my way to work off my hours for OWF. Being a single mom of a one-year-old and an eight-year-old, losing my job has been the biggest nightmare of my life. Not being able to get a job is the other, and trying to find a way to keep my bills paid and food on the table for my kids is the most important thing to me. I go hungry at times so they don t have to. Been trying to get a job for a long time. And right now, I can t get a job. I can t pay on what was insurance. I can t get the money to pay it anymore. And having trouble getting money for food and an inhaler for me anymore. And I don t have a car to go back and forth for a job.

6 Single parent unable to get disability approved. I suffer from depression, herniated disc, and migraines. Even though we have a medical card, many places will not accept it, so getting the help I need is difficult. Just to pay my rent and BASIC utilities, I have to struggle and borrow money from my aged mother. My education is outdated even though I graduated high school. I am unable to see that the future for my children or myself is going to be good. And heaven forbid if the inevitable things (such as a car breaking down or tires wearing out) comes up because there is no money for that at all! And if my child wants to play sports at school or attend school functions, I m really stuck and at a loss on how to afford that luxury, let alone, car insurance, clothes and shoes. Ugh! Life is sooo hard. Not enough jobs and not enough pay. I work as a home health aide, but they don t pay gas mileage. And along with car insurance, that is a government requirement. And phone bills that are a necessity in finding employment. And gas prices as high as they are. And clothing for children to go to school. After rent, electric, phone, gas for heat and cooking, gas for your car, insurance for your car and the daily needs like soap, shampoo and toilet paper, the measly $350 you give a family a month doesn t pay for even half of that. With all the allotted funds that the men and women in Congress get for haircuts, vacations, cars, shoe shines, dry cleaning and so on and so forth, I think that they could live without some of those amenities at least until the budget gets back on track! Sources: vehicle- in-u-s-increased-3-4- percent-according-to-aaas-2011-your-driving-costs-study/ R_S1702&prodType=table monthly-social-security-benefitfor-a-retired-worker