Posted on December 19

Mayor Michael R. Bloomberg announced a $150 million per year commitment to fund over 30 City solutions that will implement the recommendations of the Commission for Economic Opportunity. The Mayor also announced an office to evaluate and monitor the new programs. The Center for Economic Opportunity (CEO) will lead an evaluation and accountability process that will authorize the continuation of successful programs and the termination of unsuccessful programs.

The first program launched because of the Commission’s work is the Department of Consumer Affair’s (DCA) Citywide Office of Financial Empowerment (COFE). The COFE will educate, empower, and protect workers with low incomes so they can make the best use of their financial resources. The announcement was made at the Lower East Side People’s Federal Credit Union (LESPFCU), which for over 20 years has offered affordable financial services to anyone who works or lives in the Lower East Side or lives in a Housing Development Finance Corporation (HDFC) building.

“The Commission gave us thoughtful, practical, and evidence-based strategies,” said Mayor Bloomberg. “We now present equally thoughtful plans to carry out their findings so we can try to release the potential of citizens who are now trapped by the stifling problem of poverty.”

LESPFCU was founded in 1986 when all commercial banks left the Lower East Side of Manhattan. It is the largest community development credit union in New York City and is a pioneer in microfinance, serving the immigrant community, and serving the underserved population of New York.

“We are honored to host the Mayor at this historic event, and excited by the commitment of the City of New York to bring economic opportunity to those who have never had it before,” said Linda Levy, CEO of the Lower East Side Peoples Federal Credit Union. The credit union offers a wide variety of services ranging from low-fee accounts, online banking, and low-interest personal loans to products such as short term loans to combat Refund Anticipation Loans and Payday Lending,

Center for Economic Opportunity Has Innovative Control of $150 Million Budget

The $150 million commitment announced today will fund the implementation of over 30 Commission recommendations and the new Center for Economic Opportunity for fiscal year 2008. The $150 million budget includes nearly $70 million in tax levy dollars that will be appropriated to the CEO and its programs in a unique way. Following a model that is more familiar to private foundations than government, program funds will be allocated to a special CEO innovations fund instead of specific budget lines within City agencies. Only those programs that the CEO measurement and evaluation mechanism proves successful will receive funding from the innovations fund. Those programs that do not show results will be terminated. The CEO will also take the lead in developing the privately funded Conditional Cash Transfer (CCT) program.

Veronica M. White was hired as CEO Executive Director to coordinate and oversee the CEO solutions on behalf of the Mayor and Deputy Mayor Gibbs. Executive Director White most recently worked as a consultant specializing in strategic business planning and management and has held executive positions that include President and CEO of the New York City Housing Partnership and Chief Operating Officer of the New York City Partnership. She has also practiced law and worked for the City Department of Housing Preservation and Development (HPD).

“The Commission created the blueprint, now Mayor Bloomberg and Deputy Mayor Gibbs have asked me to pick up where the Commission left off and put the solutions in place,” said CEO Executive Director White. “I am lucky to be part of what I hope becomes an historic campaign to reduce poverty in our city.”

All of the programs have been carefully crafted to serve one of five strategic areas. Those areas are based on the distinct populations with high degrees of poverty that the recommendations of the Commission targeted. The five areas and select programs that serve them are:

•Improving the early start of young children age 0-5 – childcare tax credit and the expansion of child care facilities;

•Focusing on education opportunities for at-risk young adults – service learning, Rikers Island education, and the CUNY college preparation program;

•Creating employment opportunities for disengaged young adults – various job training and skill development programs;

•Building assets and savings for the working poor – COFE, language access, and matched savings accounts;

•Enhancing employee skills and career advancement for the working poor – nursing career ladder, literacy training, and sector focused workforce centers.

Financial Empowerment Office Will Level Playing Field for Low Income New Yorkers

The Citywide Office of Financial Empowerment is the only office of its kind to be created by a city in the country. The office will institutionalize key recommendations of the Commission that called on the City to combat exploitive business practices that can have a disproportionate impact on the poor and empower lower income communities with the tools and education they need to make more informed financial decisions. COFE’s work will focus on five interconnected priorities: financial capacity, financial education, watchdog protection, strategic partnerships and best practices.

“We are excited to be a part of the Mayor’s efforts to reduce poverty,” said DCA Commissioner Mintz. “By empowering New Yorkers with low incomes to move up the economic ladder – whether through financial education, asset building, or targeted protections – this new citywide office is poised to make a real difference and help make every dollar count.”

COFE will focus on increasing the financial capacity of the poor by identifying and launching coordinated campaigns to help New Yorkers get and save financial resources, such as the Earned Income Tax Credit (EITC), New York’s “Basic Bank Account” products, and Individual Development Accounts (IDA’s).

LESPFCU currently offers its members free tax service to educate about the EITC, offers free accounts and has offered education and small business IDAs.

For the priority of financial education, COFE will centralize connections between those who seek to learn and those who seek to teach through public outreach and the creation of a citywide clearinghouse. For the priority of watchdog protection, COFE will deter deceptive practices aimed at New Yorkers with low incomes such as tax fraud and predatory lending. The office will also broker strategic partnerships with private industry, non-profit, and government players to maximize capacity-building, education and protection. Finally, the office will identify and nurture the best practices, locally and beyond, that most benefit workers with low incomes, such as program evaluation models, credit-building methods, and faith-based approaches.