Project Category: Financial Empowerment Center Replication Initiative

Boosting Sustainable Homeownership in Detroit: Adding Financial Counseling to Property Tax Relief Programs to Help Stabilize Low-Income Homeowners

Posted on by Katie Plat

Since it launched in 2020, the City of Detroit’s Financial Empowerment Center (FEC), as part of the CFE Fund’s national FEC Public initiative, has helped homeowners with low incomes avoid property tax foreclosure and stay in their homes. Working with the Wayne County Treasurer’s Office (WCTO) and the Wayne Metropolitan Community Action Agency (Wayne Metro), the City’s FEC joined a property tax relief ecosystem that is complex and constantly evolving, especially in response to the COVID-19 pandemic. Its ability to adapt to changing systems while remaining focused on client services enabled the FEC to help 485 homeowners reduce their overall debt by over $3 million to date.

To study the benefits of the relationship between Detroit’s property tax relief programs and the financial counseling services provided by the FEC, the CFE Fund partnered with the City of Detroit and MEF Associates, with generous support from the Wells Fargo Foundation. This study combines original qualitative research with a unique analysis of administrative data to explore sustainable homeownership outcomes experienced by clients participating in FEC financial counseling, the factors that influence those outcomes, and other questions to inform future programming and the broader field.

This report outlines the challenge of property tax foreclosure in Detroit, the opportunity to connect residents in danger of foreclosure with FEC financial counseling, and findings on how Detroit’s publicly-led financial counseling program supports low-income homeowners with property tax challenges.

Connecting Financial Capability and Small Business Supports: Findings from the Small Business Boost Pilot

Posted on by Katie Plat

The Small Business Boost pilot, with generous support from Principal Foundation, explored how FEC financial counseling can support the personal financial needs of small business owners and better position them to achieve their business goals. Five municipal FEC partners connected their professional, one-on-one financial counseling programs to their local small business  entrepreneurship ecosystems. As a part of the SBB pilot, national research organization the Urban Institute conducted a process and outcomes study that examined pilot implementation, take-up and retention, and the role of personal financial counseling in small business development.

This brief outlines key findings about the client experience and the integration itself; read the full report from the Urban Institute.

Intergenerational Wealth Transfer through FEC Counseling: A Multi-City Legacy Planning Pilot

Posted on by Katie Plat

The lack of intergenerational wealth transfer is a driving force preventing residents with low incomes from building wealth. Additionally, in many localities, because of both historic and current systemic racism and other barriers, Black residents and other residents of color experience more financial instability than White residents: as just one example, Black households have an average of one-fifth of the assets of White households. In response to this critical need, and with funding and partnership support from Bloomberg Philanthropies’ Greenwood Initiative, the CFE Fund and four local governments partnered on a novel effort to build Black people’s ability to transfer wealth to future generations by integrating estate planning, or “legacy planning,” into existing FEC counseling services.

In this brief, the CFE Fund provides an overview of the findings from the pilot study showing the positive impact of integrating legacy planning into FEC financial counseling. The CFE Fund’s Legacy Planning pilot demonstrated that FECs can play a unique role in helping clients, including Black clients, engage in legacy planning – ensuring that clients can achieve their longer-term financial goals and have an opportunity to transfer wealth across generations. By adding legacy planning services to FEC financial counseling, FECs can play an important role in supporting racial wealth equity.

CFE Fund Comment Letter on Community Reinvestment Act Reform

Posted on by Katie Plat

The CFE Fund recently submitted a comment letter to the Federal Reserve Board, Federal Deposit Insurance Corporation (FDIC), and Office of the Comptroller of the Currency (OCC) on their proposal to amend the regulations implementing the Community Reinvestment Act (CRA).

Citing experiences from the Bank On movement, as well as the FEC Public initiative, the CFE Fund supported the proposal for a new Retail Services and Products Test that would evaluate a bank’s branch availability, delivery systems, and the responsiveness of their products to the needs of low- and moderate-income communities; the CFE Fund also supported the highlighting of the Bank On National Account Standards as an example of  a responsive deposit product. The CFE Fund suggested that the new Retail Services and Products Test 1) evaluates all large banks for the responsiveness of their deposit products; 2) enables “intermediate” sized banks to elect the Retail Services and Product Test; and 3) looks to the Federal Reserve Bank of St. Louis’ Bank On National Data Hub as an example of key metrics that examiners might use to assess financial institution account engagement.

Finally, the CFE Fund supported the agencies’ proposal to create a separate definition for activities that help individuals and families make informed decisions about managing income, savings, credit, and expenses that is distinct from other community development services, and suggested highlighting activities that produce measurable impacts such as banking access, credit score improvement, debt reduction, and savings increases.

The Supervitamin Quarterly Newsletter, Issue 25

Posted on by Katie Plat

This issue, Issue 25, provides updates on the CFE Fund’s and partner cities’ financial empowerment efforts, including an announcement that the Bank On movement has certified more than 200 bank and credit union accounts, with partner financial institutions comprising 56% of the U.S. deposit marketshare. Additionally, the issue describes the launch of a new pilot, Small Business Boost, to bring FEC financial counseling to small business owners and entrepreneurs; shares updates from the Financial Navigators initiative; and details a new expansion of the CityStart initiative to incorporate a racial equity lens. Additionally, this issue features a guest column from ChexSystems President Ron Whyte, highlighting how the ChexSystems Bank On bundle works to reduce the traditional barriers of negative banking history for under- and un-banked people. 

CFE Fund Announces the Launch of Small Business Boost Initiative

Posted on by Katie Plat

In this March 2022 press release, the CFE Fund announced the selection of five local governments to offer small business owners and entrepreneurs one-on-one Financial Empowerment Center (FEC) financial counseling. Akron, OH; Lansing, MI; Pittsburgh, PA; Polk County, IA; and Rochester, NY will connect their Financial Empowerment Center initiatives, which offer professional financial counseling as a free public service, to local business support services. This new initiative called Small Business Boost, supported generously by Principal® Foundation, will help local entrepreneurs and small business owners improve their personal finances, better positioning them to access capital and achieve their business goals.

CFE Fund Announces New $19M Commitment from Bloomberg Philanthropies

Posted on by Katie Plat

In this November 2021 press release, the CFE Fund announced its latest partnership with Bloomberg Philanthropies that will greatly expand local government-led financial stability efforts across the country over the next three years. With nearly $19 million in new support, the CFE Fund will replicate its proven Financial Empowerment Center (FEC) model – which helps low- and middle-income residents decrease debt and increase savings – under its nationwide FEC Public platform, resulting in as many as 100 cities and counties total looking to offer FEC financial counseling services. Additionally, the CFE Fund will establish a new network of 10 “Financial Empowerment Cities” that will institutionalize government efforts by supporting new financial empowerment offices and cohorts of leaders. The CFE Fund also will help to catalyze new commitments from as many as 30 local governments, partnering with Black-majority localities and Bloomberg Philanthropies’ Greenwood Initiative to create community-informed financial empowerment strategic blueprints through its CityStart initiative, and continuing the Financial Navigators emergency response initiative. Finally, support from Bloomberg Philanthropies will also enable the CFE Fund to pilot a new financial counseling integration in five cities to test FEC eviction prevention strategies in response to COVID-19 housing instability, and field a multi-city evaluation of FEC impact in three to five partner cities.

The Supervitamin Quarterly Newsletter, Issue 24

Posted on by Katie Plat

This issue, Issue 24, provides updates on the CFE Fund’s and partner cities’ financial empowerment efforts, including an announcement of a new partnership with Bloomberg Philanthropies to help grow the municipal financial empowerment field. 

The CFE Fund announced a $19 million investment from Bloomberg Philanthropies to: expand FEC financial counseling through the launch of FEC Academy; support the creation of a new pilot to embed FEC financial counseling into eviction prevention services; build out the Financial Navigators initiative; and invest in a racial-equity focused CityStart initiative. Additionally, this issue includes updates on the 2021 Bank On National Conference which took place in mid-November, with nearly 500 partners in attendance from across the country. This issue also features a guest column from Detroit Mayor Mike Duggan, highlighting the City’s Summer Jobs Connect initiative work providing summer jobs and financial education for Detroit youth.

 

 

The Supervitamin Quarterly Newsletter, Issue 23

Posted on by Katie Plat

This issue, Issue 23, provides updates on the CFE Fund’s and partner cities’ financial empowerment efforts, including those related to COVID-19 recovery. 

In advance of the newly expanded federal Child Tax Credit monthly payments, the CFE Fund and Bank On coalitions are highlighting the availability of safe and affordable Bank On certified accounts; the CFE Fund recently announced that there are over 100 accounts certified as meeting the Bank On National Account Standards. Additionally, the Summer Jobs Connect initiative has launched its eighth summer, and the CFE Fund recently selected a new cohort of Financial Empowerment Center partners.  This issue also features a guest column from Robin McKinney and Sara Johnson, from CASH Campaign of Maryland, highlighting their work with the Maryland Department of Labor to offer Bank On certified accounts for residents receiving unemployment payments.

Five New Cities Chosen to Develop Free Financial Counseling

Posted on by Katie Plat

In this March 2021 press release, the CFE Fund, with support from seed funder Bloomberg Philanthropies, as well as Capital One, the Citi Foundation, The JPB Foundation, JPMorgan Chase & Co., and the Wells Fargo Foundation, welcomes five new local governments (Columbus, OH; Dallas, TX; Jackson, TN; Louisville, KY; and Pueblo, CO) to the newest FEC Planning cohort after a competitive application process. They join 30 other local governments that have already launched, or are working to launch, FEC services that have already served 116,000 clients, helping them to reduce $160 million in debt and build $26 million in savings.