According to the National Conference of State Legislatures, the benefits cliff is the “sudden and often unexpected decrease in public benefits that can occur with a small increase in earnings.” For families with babies, the benefits cliff often impacts parents’ ability to accept promotions or seek more gainful employment in their efforts to give their babies the best possible start in life.
To help rectify this problem for Kentucky families, a new legislative task force in the state will begin to evaluate the cliff and its impact on families. The group will develop recommendations to smooth Kentucky families’ transitions from benefits. To do this, the group will study:
• Eligibility rules and income thresholds for current public assistance programs administered by the Cabinet for Health and Family Services; • The fiscal impact of the benefits cliff on state finances and budgetary impacts of addressing the benefits cliff; • Interconnections of the benefits cliff across multiple layers of government and other support networks; and • Awareness of the benefits cliff among public assistance beneficiaries, government agencies and programs, the nonprofit sector, the business community, and the general public.
Finally, the group will make recommendations that will help to eliminate the benefits cliff as a barrier to work, career advancement, and self-sufficiency and to reduce benefit duration and dependency in the Commonwealth.