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N.C. gives $335 to parents during COVID-19 -- but poorest families miss out, new lawsuit says

N.C. gives $335 to parents during COVID-19 -- but poorest families miss out, new lawsuit says

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The $335 check that families will receive under North Carolina's new COVID-19 relief program is made for parents like Ronshell Parker.

The Charlotte resident is a single mother of four who earns less than $10 an hour at a fast-food place. She lives in an extended-stay hotel — largely because the free internet allows her daughter, J.C., to use a school-issued laptop to connect with her remote classroom.

But as it stands now, Parker and her children won't benefit from the state's Extra Credit grant program, even though it is designed to provide families with the very help Parker needs — a little extra money for child care and schooling during the pandemic.

According to a new lawsuit, Parker is one of an estimated 200,000 low-income households who have been unfairly excluded by the state due to a "discriminatory, irrational and unconstitutional process" for dispersing the money.

Under program guidelines, the checks automatically will be sent to more than 1 million of the state's middle- and upper-income families, with household incomes as high as half a million dollars annually. The state hopes to disperse some $440 million by Dec. 15.

But low-income families — annual incomes of between $10,000 and $20,000 — who did not file a 2019 state tax return had to apply by Oct. 15 to receive a check.

Since Parker did not know that Extra Credit money was out there, according to the lawsuit, she missed the filing deadline. Tens of thousands of other needy families did the same. According to the lawsuit, only 1 in 14 low-income households in North Carolina are now in line to receive a check.

In short, many of the state's families who need the $335 most are not getting it, the lawsuit says.

The complaint, filed in the Wake County courts, wants to improve the numbers. It accuses the state of violating the equal protection and due process clauses of the state Constitution.

It also asks a judge to order the state Department of Revenue to extend the filing deadline while it devises a better way to make sure needy families get paid.

A team of attorneys filed the suit on behalf of the Charlotte Center for Legal Advocacy, Legal Aid of North Carolina along with Parker and two other low-income N.C. families. It names the state Revenue Department and Revenue Secretary Ronald Penny as defendants.

The lawsuit surfaces with some urgency. The federal COVID-19 relief money being used for the family grants must be spent on costs incurred before Dec. 30.

Charlotte attorney Adam Doerr, one of five Robinson Bradshaw lawyers who filed the complaint, said he hopes to have the case before a judge as soon as next week.

"We don't know if the legislature meant to make it more difficult for low-income families, or if there was just not enough attention paid to whether this application process would be effective. But there is a big hole, and we're trying to make sure the money actually gets to those most in need," Doerr said.

Laura Brewer, a spokeswoman for Attorney General Josh Stein, whose office represents state agencies in civil matters, said the office could not comment on a pending lawsuit.

The office of House Speaker Tim Moore, a Kings Mountain Republican, also did not respond to emails seeking reaction to the lawsuit.

The N.C. legislature passed the Extra Benefits relief plan in early September, with Republican leaders saying it would help families defray some of the costs of remote learning.

But Doerr says lawmakers hurriedly designed a program that required low-income families to apply for money that middle- and high-income families will get automatically. They then compounded the problem, he said, by giving state residents who were required to apply little notice or time to do so.

The revenue department first published the application form on Sept. 17, or less than a month before the deadline.

Moreover, the complaint alleges, the application forms were unnecessary to begin with since the state's has access to the information required from other sources, including public-assistance programs, federal tax returns and state tax filings from earlier years.

In the end, a little more than 15,000 low-income families successfully applied, the lawsuit says.

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