Kansas is poised to expand tax credit for helping disabled workers after debate over low pay

A year after a debate over the extent to which the state should counter the national trend against paying workers with disabilities less than the minimum wage, Kansas announced that businesses employing disabled workers The plan is to expand income tax deductions for goods and services purchased from businesses and nonprofit organizations.

The bill approved by Congress this week with broad bipartisan support would increase the total amount of tax credits available from $5 million to $8 million annually. It also creates a new $1 million program for nonprofit organizations that run job programs known as sheltered workshops to help pay workers at least the federal minimum wage of $7.25 an hour. become.

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The tax credit, which previously only covered purchases from employers who pay at least the minimum wage, was scheduled to expire early this year, so lawmakers reconsidered it last year.

This is Congress’ latest attempt to expand tax credits.

Their first proposal would have created a separate sector in which nonprofits with sheltered workplaces would pay at least the minimum wage, and allow people and businesses who buy from that sector to claim tax credits. Advocates saw this as an opportunity to expand tax credits and, in turn, expand employment opportunities for workers with disabilities.

Kansas is set to approve a new bill that expands tax credits for hiring people with disabilities.

However, this drew strong opposition from disability rights groups, who argued that it encouraged wages below the minimum wage. This is a vestige of the decades-old view that people with disabilities cannot get jobs outside of such systems.

A compromise last year was to start a grant program instead. But the Republican-controlled Legislature created an omnibus tax cut bill that included provisions opposed by Democratic Gov. Laura Kelly, who vetoed it.

The tax credit then expired earlier this year, but this year’s bill is written to allow people to continue claiming the tax credit when filing their 2023 taxes.

“This is a good compromise,” said Neil Romano, a member of the National Council on Persons with Disabilities and former director of the U.S. Department of Labor’s Office of Disability Employment Policy. “It moves us toward where we want to be.”

Mr. Kelly has not said publicly whether he will sign the bill, which he typically does when it has near-universal support.

Employers nationwide are moving away from paying wages below the minimum wage, according to U.S. government data. Certification from the Department of Labor is required to pay wages below the minimum wage, and a report from the U.S. General Accounting Office last year found that 2,750 U.S. employers had certification in 2014; As of January 1st, there were 834 companies in the database, a decrease of 70%. Seventeen groups have them in Kansas.

According to the Employment First Association, which promotes inclusive employment policies, 14 states have banned workers with disabilities from working below minimum wage, including Virginia, which enacted a law last year.

Sarah Hart Weir, executive director of the Kansas Council on Developmental Disabilities, said there remains “substantial work to do” in Kansas to move out of below-minimum wage jobs.

But he added: “This is a step in the right direction.”

Rocky Nichols, executive director of the Kansas Disability Rights Center, said it’s good to see the tax credit reinstated and the state’s willingness to move away from sheltered workplaces through grant programs. Ta.


But he also said he was concerned that the measure was not specific enough about how and when groups would have to move away from paying below the minimum wage.

“We don’t want to see it become just a slush fund for protected workshops,” he said.



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