Community Bulletin: The Growing CSA Movement, New Steering Committee Members and More!
From the Guest Editor
Dear Community Partners and Friends,
Last month, we spent time with Prosperity Now Community members from Iowa, Idaho, Minnesota, Montana, North Dakota, Oregon, South Dakota and Washington at two regional Summits that we designed in partnership with local leaders around regional needs and interests. (Read more about the Summits here!) The areas of interest shared by partners for these events reflect what we’re seeing and hearing from our Community members more broadly: centering the people we serve in program design and discussing racial wealth equity. To learn more about these topics, check out these resources:
- African American Financial Capability Initiative: An Implementation Blueprint released earlier this year, based on a three-year project we coordinated alongside organizations of color in the northwest
- Financial Coaching Network peer call series, where we have discussed navigating identity differences in coaching sessions with practitioners who have been thinking about this critically in their own programs
- Human Insights Tools we created for a learning cohort last year to apply human-centered design principles to their work
If you have any items you’d like to see featured in future Community Bulletins, share them with us at Community@prosperitynow.org.
Fran Rosebush Baylor
Director of Field Engagement, Prosperity Now
Capital Area Asset Builders Brings Children’s Savings Accounts Pilot to D.C.
Prosperity Now Community Champion, Capital Area Asset Builders (CAAB), advocates and forges pathways of opportunity to financial prosperity for low-to-moderate income residents in the greater Washington, DC area through financial education, financial coaching, matched savings and consumer education programs. As the Children’s Savings Account (CSA) movement continues to gain momentum, this year CAAB launched its CSA pilot program called EduSaveDC. We spoke to CAAB’s Acting Executive Director, Joseph Leitmann-Santa Cruz, to learn more.
EduSaveDC is a pilot program designed to help low-to-moderate income families save for their child’s college education. CAAB partnered with 11th Street Bridge Park to implement this 18-month long initiative, with financial support from Capital One Bank. In this program, EduSaveDC focuses specifically on assisting African American families in DC’s lowest-income area: Ward 8. As Joseph emphasized in our interview, it is also crucial to acknowledge racial inequity. Ninety-two percent of the population in Ward 8 is African American and does not receive direct investment for college savings, making EduSaveDC especially significant for this community and a way to close the District’s growing racial wealth divide.
With this this mind, EduSaveDC partnered with two public and two private schools in Ward 8 to recruit 110 families who qualify for the program over the next 18 months. EduSaveDC offers a 5-to-1 match rate up to $1,500 with the goal of families saving at least $300. This means, families can leave the program with $1,800 to use towards post-secondary education. Lastly, the program offers participating family members financial wellness classes and financial coaching to help cultivate savings behavior. Once the 18 months are over, the funds in the EduSaveDC Escrow Account, which is in the name of the head of household and CAAB, are transferred to a 529 college savings account owned by the parent or caregiver for the benefit of the child.
As Joseph expressed in his interview, every human being aspires for success and stability for themselves and their families, and Joseph hopes to use his 19 years of wealth management experience to help low-income D.C. residents with his role at CAAB. CAAB is optimistic that the outcomes of EduSaveDC could become citywide and expand CSA programs across the region. However, we may not have to wait too long! Several states have begun taking a legislative approach to securing CSAs including Illinois, California and Colorado.
Prosperity Now Community Steering Committee Welcomes Three New Members
In partnership with the Community Champions and nine current Community Steering Committee (CSC) members, Prosperity Now is excited to welcome three new members to the national Committee that advises us on our work with the Prosperity Now Community. The three new members are Laura D’Alessandro of the Local Initiatives Support Corporation (national), Carlos David Garcia of Neighborhood Partnerships (Portland, OR), and Kate Larose with the Champlain Valley of Economic Opportunity (Vermont). Learn more about the expansive work of the CSC here.
Leaders of Color from the Financial Empowerment Cohort Gather for a Design Convening
From April 24-25, 2019, members of Prosperity Now’s Building High Impact Nonprofits of Color Financial Empowerment Cohort (FEC) gathered in Washington, DC for the 2019 FEC Design Convening. A sub-cohort of the larger Building High Impact Nonprofits of Color (BHINC) project sponsored by JP Morgan Chase, the FEC pairs leaders from five organizations of color from around the country with Prosperity Now's technical assistance providers to innovate financial empowerment services for communities of color. FEC strategies place particular emphasis on addressing the impacts of racial economic inequality on service delivery.
Organizations participating in the FEC include:
Bon Secours Community Works (Baltimore, MD)
Greater New Orleans Fair Housing Action Center (New Orleans, LA)
Hispanic Unity (Miami, Florida)
North Lawndale Employment Network (Chicago, IL)
Sant La Haitian Neighborhood Center (Miami, Florida)
Each of the five FEC organizations sent two Racial Wealth Equity Champions to the Design Convening for customized training and skills practice in human-centered design and change management. Topics included developing a refined vision and theory of change, exploring ecosystem mapping, establishing strategic action plans, leading institutional change and more. In addition, the Design Convening included cultural and community-building elements to strengthen cohort identity and promote peer learning long after Champions return to their home cities. Champions hailed the convening as “a WOW experience” that “set the stage for group learning and sharing,” and cultivated “a sense of common purpose and reinforced bonds between the Champions.”
In the coming months, FEC Champions will be moving from the Discover to the Build phase in preparation for piloting their innovations in the fall. We’re excited by all of the energy and insights being generated by these Champions and look forward to sharing additional updates when the BHINC FEC project wraps up!
Resources from Across the Community
Short-Term Financial Stability: A Foundation for Security and Well Being | The Aspen Institute
This report explores the ways short-term financial stability leads to long-term economic prosperity and upward mobility.
Ending Child Poverty Now | Children’s Defense Fund
This report demonstrates how improvements to nine policies, including minimum wage, EITC and SNAP, could potentially reduce the rates of children living in the poverty in the United States.
Analyzing the Landscape of Saving Solutions for Low-Income Families | Prosperity Now
Part one in this series of briefs details America’s savings crisis and the priorities to make savings solutions more comprehensive in design and impact.
Clipped Wings: Closing the Wealth Gap for Millennial Women | Asset Funders Network
This brief analyzes the gender wealth gap experienced by millennial women.
Illuminating A Hidden Safety Net: Lessons from Research into Employee Hardship Funds | Common Wealth
In partnership with the Aspen Institute, Common Wealth explores the impact of Hardship Funds, which employers could use to support their employees during financial difficulties.
Promising Practices and Lessons Learned for Child Savings Account Programs | Consumer Financial Protection Bureau
The CFPB released four briefs which highlight the designs, lessons learned, and successful practices of existing CSA programs.
Opportunities and Events
FPP 11th Annual 2019 Statewide Training Conference |Florida Prosperity Partnerships
Orlando, FL | May 31, 2019
South Florida Economic Inclusion and Racial Equity Convening | Asset Building Policy Network | June 4. 2019
Building Wealth, Building Justice: A Conversation with Cat Goughnour and Robert Friedman | Prosperity Now | June 5, 2019
Webinar: Financial Coaching Bi-Monthly Peer Call: Fintech and Racial Equity in Financial Coaching, |Prosperity Now| June 27, 2019
Webinar: 2019 Savings Network Webinar Series | Prosperity Now| July 9, 2019
8th Annual Municipal Finance Conference | Brookings | Washington D.C. | July 15, 2019
2019 Colorado Community Actions Conference | Colorado Community Action Association | Colorado Springs, CO | July 16-18, 2019
Save the Date: Midwest Asset Building Conference |Detroit, MI| November 13-14, 2019. The planning team is currently accepting speaker and session proposals here.
The I'M HOME Conference | Prosperity Now| Portland, OR | November 18 -20, 2019
Individual Development Account (IDA) Act
In April, New Mexico Governor Michelle Lujan Grisham signed bill SB 95 into law. This bill will create a state-funded IDA program to continue supporting residents of New Mexico on their path to achieving financial stability and prosperity by building credit and assets. Prosperity Works, which played a crucial role in securing this bill, named the passing of SB 95 as a goal for its 2019 Legislative Agenda to remove barriers and create opportunities for residents of New Mexico to build wealth. They have advocated for this bill by meeting with legislators, securing buy-in from community partners, and speaking with the residents of New Mexico. We celebrate Prosperity Work’s commitment to advocacy, as well as the bright future of New Mexico and their residents.
Children’s Savings Account (CSA)
Several states have recently taken legislative action to introduce Children’s Savings programs.
- Colorado: The General Assembly approved House Bill 19-1280, which launches a 529 account for every child within five years of birth, seeded with $100, on January 1, 2020.
- Illinois: Proposed bill HB 2237 would create an automatic at-birth CSA program with an initial $50 deposit. The bill now waits decision from the Senate and Prosperity Now Community Champion, Illinois Asset Building Group, is leading the efforts.
- California: Proposed Assembly Bill-15 would create a statewide CSA program that deposits an initial $25 into a 529 account for all enrollees.
- Oregon: Proposed bill HB 2389 would create the Oregon Bright Futures Plan Task Force to design a statewide CSA program. Prosperity Now Community Champion, Neighborhood Partnerships, is leading advocacy efforts.
- New Mexico: Proposed bill HB 239 would deposit an initial $500 for infants whose family income is at or below 200% of the federal poverty line. However, the bill was not voted on before the end of the legislative session in March.
- Washington: Proposed bill HB 1592 would create a CSA program with an initial deposit of $100 for low-income kindergarten students enrolled in the state’s public schools. The bill did not make it through the Appropriations Committee.
We will continue to monitor their progress as the legislation moves through government. You can read more here. In the meantime, to receive updates, research and resources on the children’s savings field, sign up for the Campaign for Every Kids Future.
Consumer Fairness Act
To address the burdens of crippling debt on Illinois families, the Illinois General Assembly is considering bill HB 88, which would help families both pay their debts and meet basic needs by decreasing consumer debt interest rates from 9% to 5%. The bill would also protect and prevent consumers from being trapped by old debt by decreasing the statute of limitations from 26 years to 17 years. The bill has passed the House and awaits the final decision from the Senate.
Two Threats to Consumer Protections
The Consumer Financial Protection Bureau recently put forth policy proposals on payday lending and debt collection that could negatively impact vulnerable consumers.
The first is a proposed rule that would weaken payday lending by removing limits on reborrowing rules, even though repeat borrowing causes harm to individuals who use payday lending.
The second proposal is a set of guidelines that are an attempt to modernize the Fair Debt Collection Practices Act of 1977 but does not contain the needed specificity to protect consumers. The new guideline does not set limits on how often collectors can reach out consumers through modern technology such as e-mails or texts, which favors debt collection agencies. It also prohibits consumers from being sued if the statute of limitation passed. However, the pursuit of old debt must be stopped all together if the overarching goal is to help individuals build credit and wealth. Read more