[CircleUp] CFED Scorecard: South Dakota Receives "B" for Financial Stability

[Heidi Davis]

South Dakota Receives “B” for Financial Stability

State Does Well in Assets and Income, Must Improve in

All Areas Related to Race and Policy Arena

 

WASHINGTON, DC — South Dakota leads the nation in key assets and income measures, but must

address gender and race disparities that are holding residents back in housing and homeownership, small

business development and higher education according to a report released today by the Corporation for

Enterprise Development (CFED), a national economic nonprofit. The state earned a “B” on the 2009‐2010

Assets & Opportunity Scorecard, with South Dakota also performing well in education generally, but falling

behind in important health care measures.

 

CFED’s Assets & Opportunity Scorecard—online at scorecard.cfed.org—measures the financial security of

families in the United States by looking beyond just income to the whole picture of building ownership

and protecting against financial setbacks. The Scorecard ranks the 50 states and the District of Columbia on

58 performance measures in the areas of Financial Assets & Income, Businesses & Jobs, Housing &

Homeownership, Health Care and Education.

 

South Dakota ranks 1st in unemployment, 6th in bankruptcy and 10th in both asset poverty and extreme

asset poverty, earning an “A” in Financial Assets & Income. The state’s education performance is also

strong, ranking 2nd in Head Start coverage, 6th in four‐year college degree attainment by income and also

ranking in the top 10 in 8th‐grade math and reading proficiency. However, with the state’s considerable

Native population, South Dakota has significant room for improvement in key measures in order to help

all its residents achieve surer financial footing. At a time when the nation’s housing market is unstable,

South Dakota ranks 51st in homeownership by gender and 50th in homeownership by race. Similar

disparities are evident in the Businesses & Jobs area: the state ranks 51st in minority business ownership

and 48th in women‐owned business value. And while health insurance is a key safeguard against asset

depletion, the state ranks 48th in health insurance coverage by race and 49th in employers offering health

insurance.

 

“The Scorecard provides a broad picture of how families stand, and what it tells us is that many American

households were already very vulnerable economically going into this recession,” said CFED President

Andrea Levere. “It also shows state by state what is being done to address these vulnerabilities, and while

many states are taking some action, in most cases they haven’t been putting a very strong commitment

into their efforts.”

 

The Scorecard also assesses states on the strength of its policies to help families build financial security. The

Scorecard includes a detailed look of state‐by‐state information on 12 policy priorities, as well as

information on 23 additional policies. Together, these policies provide a comprehensive picture of what

states can do to help residents build and protect assets.

 

The Scorecard notes that South Dakota’s policymakers have significant opportunities to support the

financial well‐being of their constituents. To address South Dakota’s last‐place rank for minority business

National Office �� 1200 G St. NW, Suite 400 �� Washington DC 20005 �� Ph 202.408.9788 �� Fx 202.408.9793 �� www.cfed.org

ownership, the state should fund organizations like community development financial institutions, or

CDFIs, that provide technical assistance and loans to microenterprises. In order to reduce disparities in

health care coverage by race, the state should expand coverage for parents and childless adults, simplify

Children’s Health Insurance Program procedures and defray health insurance costs for small businesses or

their employees. Finally, South Dakota should match the deposits of those who save in a 529 college

savings account to increase college attainment for minorities and to reduce college education debt. Of the

12 policy priorities, South Dakota currently has taken action on three of them, with only one state policy

rated strong or very strong by the Scorecard.

 

”South Dakota’s overall score is quite encouraging at a “B”. However, a visit to any one of the state’s eight

reservations tells an entirely different story”, stated Stewart Sarkozy‐Banoczy, Vice‐President and COO of

Oweesta, a national Native CDFI intermediary located in Rapid City, and a Scorecard State Partner.

“Digging deeper into the data, we find that in every area, across all measures, the state’s B rating does not

reflect how the minority population of South Dakota, which is predominately Native American, was

ranked. In fact South Dakota was ranked at the bottom in virtually every measure when applied to race.

We encourage South Dakota to adopt policies and support programs such as financial education that will

strengthen and protect the ability of all its residents, Native and non‐Native, to build assets and create

wealth.”

 

Nationally, the Scorecard notes that even before the current recession, economic vulnerability was growing,

especially among low‐ and middle‐income families. Among the findings:

·         While U.S. households overall registered a 27% increase in net worth between 2004 and 2006,

median net worth fell over that period for the 40% of U.S. households earning less than $37,000 a

year.

·         The number of individuals with employer‐provided health‐insurance fell sharply, to 60.9% from

63.2%, leaving more families vulnerable and financially unprepared for health emergencies.

·         The median amount of revolving debt, including credit card debt, rose from $1,805 to $2,960

between 2006 and 2008, an increase of 64%.

·         Slightly more than 12% of households live below the federal income poverty line, but nearly

double that amount (22.5%) are asset poor, meaning they have insufficient assets to keep them out

of poverty for three months in the event of job loss. Over 14% of American households are in

extreme asset poverty, meaning they have zero or negative net worth.

 

Top performers on the 2009‐2010 Scorecard—those states that earned an overall “A” in performance

measures—include Hawaii, Iowa, Kansas, Maine, Massachusetts, Minnesota, New Hampshire, Vermont,

Washington and Wyoming.

 

For more information and to access the Assets & Opportunity Scorecard, visit scorecard.cfed.org.

 

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CFED expands economic opportunity by helping Americans and their children build assets, save for the

future, start and grow businesses, pursue education and become homeowners. We identify, refine and

help realize good ideas and develop partnerships to promote lasting change. We bring together

community practice, public policy and private markets in new and effective ways to achieve greater

economic impact. Established in 1979 as the Corporation for Enterprise Development, CFED works

nationally and internationally through its offices in Washington, DC; Durham, North Carolina; and San

Francisco, California.

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