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‘Broke again’: Child tax credit payments collide with debt and eviction for working families

Brittany Baker holds her daughter Kaitlyn in their home in Dayton, Ohio. (Maddie McGarvey/For The Washington Post)
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This story has been updated.

DAYTON, Ohio — Her day started before sunrise. Even though she had been up with the baby a few hours earlier, Brittany Baker lifted herself from the bed at 5, on a morning in June. She moved with slow, tiny steps across the carpet she was so proud to keep clean despite three youngsters running around the apartment. Two were still sleeping with her fiance, Jordan, in the bed she had just left. The other was quiet in a nearby crib.

In the bathroom’s light she ignored the image bouncing back at her from the mirror — a 36-year-old Black woman wincing from pain jabbing up from her feet to her stomach. She was in the third trimester of a high-risk pregnancy but still clocking into work every day. “Is he done yet?” her oldest child, Aubriana, kept asking about the unborn baby boy. Baker knew he might come any day now, and that was what scared her.

She hunted around her belly. Finding a spot less bruised than the rest, she injected the first of two daily doses of a blood thinner that made it possible for her to get out of bed at all. Then she settled onto the family room couch with the cup of coffee her doctor told her she shouldn’t be drinking. But Baker had learned that she had to weigh medical advice against her life’s pressing realities.

Women of color like Baker have seen a disproportionate number of job losses since the coronavirus pandemic began. They also have continued to struggle during the recovery. In June 2021, 1 in 12 black women in the United States over 20 were unemployed, according to the National Women’s Law Center. That rate — 8.5 percent — was 1.7 times higher than before the pandemic. Dayton, Ohio, where Baker lives, also suffers from long-standing income inequality. The Federal Reserve Bank of Cleveland found that, between 2007 and 2017, earnings for minority workers in Dayton declined 17 percent — the largest decline in an American city — while earnings for White workers largely stayed the same.

More than a year into a public health crisis that snowballed into a social and economic disaster, Baker was still among the 28 percent of households struggling to cover household expenses in July. She was still among the 11.5 million renters behind on her payments. She was still among the 1 in 7 parents struggling to feed their families. All this despite a raft of government interventions, the latest of which is an expanded child tax credit approved by Congress in March. The one-year program provides monthly payments of $250 or $300 per child, reaching $3,000 for those ages 6 to 17 and $3,600 for those younger than 6. The credit is expected to cut child poverty by more than 40 percent, according to the Center on Budget and Policy Priorities.

“This would be the largest ever one-year decrease in child poverty in the history of the United States of America,” President Biden said in July. “The benefits will be felt for years.”

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But these lofty expectations are crashing into the reality of debt and eviction. Baker and her family could receive as much as $10,800 through the program. Her debt during the pandemic — made up of back rent, utilities and payments on high-interest emergency loans — hovered near $10,000. She was one of the nearly half of Black households with children in the United States that are “net-worth poor," meaning their assets minus their debts didn’t leave enough to meet basic needs for three months. Her life turned on the type of private dilemmas of survival that policy decisions and charitable donations rarely touch: the daily choices between a bad option and a worse one.

As she rose from the couch to catch the bus for work, Baker felt the pressure of her latest dilemma: a contraction. This was her second high-risk pregnancy in as many years. The unborn son weighed only 2.4 pounds, but she was already dilated three centimeters. Her doctors said she should be on bed rest.

But Baker needed to work, she had decided, at least until the child tax credit payments began arriving mid-July. Until then, she understood she was risking the child she was carrying to provide for the three children at home.

“It’s three weeks away but I’ve got to get to that date,” she explained later that day. “It’s my job to provide for my family. That’s the biggest thing. I don’t want to fail as a mother.”

‘A nightmare of what my life used to be’

To Baker, the pandemic felt like a wrecking ball that wiped out everything she had built up, piece by piece, over the past few years.

“I was working and making good money,” she said. “I wasn’t doing that good where I had a bank account with money saved up, but my kids were not going without. It’s just hard knowing that I am incapable of doing what I was once capable of doing. It’s a nightmare of what my life used to be. How can I get back to that life?”

After years of fast-food jobs, Baker’s break came in 2019, when she was hired at Miami Valley Hospital in Dayton on the cleaning staff. She made $15 an hour, almost double the minimum wage in the city but half of what researchers estimate is a living wage for a family of five. She had waited to have children until she found a long-term partner. She worked six days a week with every other weekend off. Her income was enough that her fiance could stay home with the two children they had at that point. Day care for an infant and a toddler in Dayton could cost around $800, according to the Economic Policy Institute. The family paid $675 a month for a two-bedroom apartment on the top floor of a house east of downtown. Baker’s paychecks kept the shelves filled with groceries, with enough money left over for regular trips to Applebee’s, the family’s favorite restaurant. At the start of 2020, the couple learned that they were expecting their third child, a girl. (Jordan declined to be interviewed for this story.)

On April 12, as coronavirus cases in the state topped 6,000, Baker halted her hospital job for health reasons. Her doctors agreed that she was facing two risks. A year earlier, she had gone through a difficult premature birth. Doctors were concerned that the latest pregnancy would be similar. High blood pressure and chronic asthma also increased the dangers of the virus, if she were to be infected.

Glitches, confusion leave parents without advance child tax credit payments

Baker applied for Ohio unemployment benefits the day after she stopped working. Less than a month later, the claim was rejected because the state determined that she was technically on a medical leave of absence unrelated to the pandemic. Her OB/GYNs “basically said it was really both covid and the pregnancy,” Baker said. She appealed the decision.

But the appeals process meant waiting. Across the country, state unemployment systems were buckling under surging demand. According to the Century Foundation, between March 2020 and January 2021, there were 104.4 million claims for state and federal unemployment insurance, and in 2020 alone 950 million weekly payments were processed. The logjam created the kind of delays that Baker was experiencing — a daily rhythm of raised, then deflated hopes.

Between Baker and her fiance, the family had about $1,000 in savings, she said. Bills swallowed that fast. They turned to food banks and other charities, but even these philanthropic outlets were straining under the demand. Reluctantly, Baker turned to Facebook.

“I had to swallow my pride,” she said. “They always said closed mouths don’t get fed.”

The experience was mixed. A woman in Australia sent items for a newborn. Another person offered to help and asked Baker to send photos of her driver’s license and Social Security card. She did it, then realized she had probably been scammed when the person disappeared. “It’ll probably backfire on them, with my credit score,” she said, making a joke.

The kindness of strangers helped plug some gaps in the family’s budget, but unpaid rent was piling up. “Please let me know if you can make the payment TODAY,” the family’s landlord emailed in June. The Trump administration would put in place an eviction moratorium through the Centers for Disease Control and Prevention in September 2020. But until then, Baker spent every day certain that she would soon be put out.

“I’ve turned in numerous documents [and] I would like a call from a supervisor,” a desperate Baker wrote to the unemployment office in mid-July. “HELP IM ON THE VERGE OF HOMELESSNESS.”

Although the unemployment money would help, Baker felt that the best way the family could get back to normal was to return to work.

‘I wasn’t ashamed to ask for help’

In late July 2020, more than three months after applying for unemployment, Baker’s appeal was granted. The Ohio Department of Job and Family Services decided that she was entitled to $158 a week in benefits. About $2,000 in back payments hit Baker’s account. At the time she estimated that she was close to $10,000 in debt.

A day after the state reversed its decision, Baker went into labor. Kaitlyn was born July 29, five weeks premature, and spent 19 days in an intensive care unit. Before the baby could come home, Baker developed a blood clot in her leg and had to go back to the hospital.

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The rest of the year passed in an anxious blur as her health scare, along with increased pandemic limitations, delayed her return to work.

Finally, in December, she was approved to go back. She went in for coronavirus vaccination and a medical checkup. The doctor had news: She was pregnant again.

Any joy was undone by the realities for Baker. All she had ever wanted was to be a mother, a provider, someone who could take care of her family. Her own father had been a drug addict. Her mother had been married multiple times and struggled with money. Baker had worked to put distance between the way of life she grew up with and what she could offer her own children. But now that seemed in doubt. Her family had barely made it through the past year. The CDC moratorium would eventually expire, reviving the prospect of eviction. Her second high-risk pregnancy would mean more doctor’s appointments, more bed rest and more time away from work.

Baker’s fiance offered to marry her at the courthouse, in part to solidify the relationship and possibly making it easier to access more family benefits. She recalled scoffing. She wanted the fancy dress. The big party. The chance to be a “Bridezilla,” she said. A courthouse marriage wasn’t what she needed.

“I needed help,” she explained later. “I knew then I wasn’t going to be a fully functioning parent. I wasn’t ashamed to ask for help. If I wasn’t a good mother then I probably wouldn’t ask for help. I probably would let my life go straight into the ground, let us get evicted, then be out on the street somewhere.”

So at the end of a bruising year, Baker called Montgomery County Children Services and reported herself for not being able to provide a good home. The children didn’t know what their mother was going through. They were just excited for a new sibling.

“Is he done yet?” Aubriana began to ask her mother.

The hardest call to make

When the agency worker came to the apartment early this year to inspect it, Baker burst into tears, she said. She did not want to lose her kids. She was just looking for help. The call had been a distress signal.

The agency worker was reassuring, Baker said. He told her not to worry about losing her parental rights. There were no issues in the home, she recalled him saying. He left promising that the agency would be in touch with recommendations about programs and charities that might offer additional help. She said Jordan was skeptical. He felt the agency would not come through for the family.

Baker remained hopeful. When she learned in March that her landlord was not going to renew her lease, meaning the family had to be out after August, she began leaving the caseworker regular voice mails. “These kids aren’t in danger now, but they will be if we have no place to go,” she said at the time. No one called back, she said.

While Baker waited, the federal government was adjusting the social safety net because of the pandemic.

The American Rescue Plan included an expansion of the child tax credit. Established in 1997, the credit provides government funds to struggling parents. However, 27 million children whose parents earned too little to qualify were unable to take advantage of the full $2,000-per-child benefit because of the income restrictions, according to the Center on Budget and Policy Priorities.

The Biden administration changed the income requirements and raised the amount per child. Part of that amount will come in the monthly payments that began in mid-July. The rest will come in a lump sum next tax season. The Center on Budget and Policy Priorities estimates that the program — which for now remains a one-year experiment — will raise 4.1 million children above the poverty line. In Ohio, the think tanks predict that 278,000 children will be pushed over the poverty line by the program, with 2,372,000 children total seeing some positive change in their circumstances because of the payments.

But the bold ambitions of the program may crash into the legacy of past poverty policy and the realities of how the poor live now. In the 1960s, when President Lyndon B. Johnson’s administration formalized a process of measuring American poverty, debt was not included in the calculation. “In the 1960s, poor families had no debt, there was no payday lending, they couldn’t get credit cards,” said Steven Pressman, an emeritus professor of economics and finance at Monmouth University.

Pressman noted that the poor and families hovering near the poverty line today are saddled with all sorts of debt — medical bills, college loans, payday loans, back rent and utilities — but our definition of poverty has remained tied to income alone.

“Today, even people with low incomes who are not actually poor according to the standard definition can’t use all of their income to pay for necessities because they have to pay their debt,” he said. “This child tax credit will really be a big aid to these families. Whether it will enable these families to pay down their debt is another question entirely.”

The need to pay down debt has been a constant thread running through the pandemic response. When surveyed by the Federal Reserve Bank of New York about how they planned to use stimulus money in January 2021, respondents said they planned to use an average 38 percent of the money for debt.

But these numbers diverge along lines of household income. According to the bank, households earning less than $40,000 were likely to spend 44 percent of the stimulus on debt, while households making more than $75,000 were likely to spend only 32 percent.

The lifeline thrown by the federal government would be Baker’s only help, she learned. In May, a letter arrived from Children Services. “We are writing to inform you due to recent investigation of child safety and/or neglect we do not find any reason to keep this case open,” the letter read. “Not any assistance will be provided.”

Baker decided that she had to return to work. “I think the system is backward like that,” she said. “Wouldn’t you want to help someone who wants to help themselves?”

‘I’m just trying to get by’

On a June morning, she left at 6 a.m. to catch two buses that would eventually drop her off near Miami Valley Hospital. She had to clock in by 7:07 a.m. Any delay in her commute meant jogging for the door. The doctors said she should not be running.

Nearly everything about her job ran against doctor’s orders. She was responsible for cleaning 18 patient rooms on the seventh floor of the hospital’s southwest tower. The doctors said don’t lift anything over eight pounds. The cart with her cleaning supplies probably weighed about 25 pounds. The doctors said don’t bend down. She was responsible for emptying the trash cans. The doctors said don’t be on your feet for more than two hours. She was standing or walking from 7 a.m. to 4 p.m.

In early summer, when her feet began to give out under her, the hospital reduced her hours from 7 a.m. to noon. But then her paycheck was half the usual — $346.

One day in late June, Baker clocked out for an obstetrician appointment. The doctor explained the contractions were the result of daily stress on her body, and that a baby born at that premature stage probably would not survive. “If something happened to the baby, that would crush me,” she thought.

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That night she couldn’t sleep, so she stayed on the couch, surfing the tug of war between her body and the contractions. Then she got up, tiptoeing to the kid’s room. “I wish I could sleep peacefully like them,” she thought.

“I do thank God that it’s my job to provide for them,” she would say later. “But I don’t want to fail as a mother. That’s the biggest thing. That’s what gets me. I actually feel like I’m failing because no matter where I turn, nothing is working out for me.”

The next morning, Baker submitted her paperwork to the hospital for medical leave and again applied for unemployment. She had been able to reduce her debt to about $6,000, but now that figure would grow again. Ohio had received $614 million in federal rent relief funding from the American Rescue Plan, money for families like her own. But Baker’s landlord had already decided not to renew the lease, so what was the point, she thought. With Baker now at home to care for the children, Jordan started looking for a job to tide the family over. The family had three weeks until the child tax credit payments started.

That morning she went to the kitchen to clean up the plates and glasses. They were out of dish soap. Baker wasn’t sure when they would have the cash for more.

“Is he done yet?” Aubriana asked a few moments later.

“Soon,” Baker answered.

“He’s going to be big and strong,” the child said. She sounded confident. She was ready. “I’m going to be the babysitter. I’ll take care of all of them."

‘I can’t do that’

By mid-July, the family was running low on food. No breakfast cereal. No milk. Just a few meat packets left. When the child tax credit payment hit Baker’s account — $900 — she went to the grocery store right away. She gave a couple hundred dollars to the landlord. The rest of the money was spent on clothing for the children.

“Now I’m broke again,” she said in late July. The next payment was due in mid-August.

The money was a boost, but it didn’t help much with the family’s most immediate problem: finding a new home. The waiting list for public housing was crowded. The three-bedroom apartments she saw were renting for about $900. Landlords wanted security deposits and the first month’s rent upfront, plus other fees.

“I would need to come up with something like $1,800, and to do that I would need to save two of the child tax checks whole,” she said. “I can’t do that.”

Once again, Baker was facing a hard choice. If the family didn’t have a place to stay after August, was it worth remaining together as a family and going to the public shelter? Or splitting up, sending Jordan with relatives and Baker and the children to the safer women’s shelter?

She is still considering her options.