Houston Selected to Develop Financial Counseling as Free Public Service for Low-Income Residents
Style Magazine Newswire | 11/14/2017, 1:45 p.m.
HOUSTON - Houston and the national Cities for Financial Empowerment Fund (CFE Fund) announced today their selection to replicate the proven Financial Empowerment Center (FEC) model under the new FEC Public national platform. Houston will receive technical assistance and a seed grant to bring free, high-quality, one-on-one financial counseling to Houston residents. The CFE Fund’s FEC Public program is supported by a $7,750,000 investment from Bloomberg Philanthropies as part of their American Cities initiative.
“I am thrilled to have the support of the Cities for Financial Empowerment Fund and Bloomberg Philanthropies. Through this initiative we will be able to directly assist Houstonians with financial planning,” said Mayor Sylvester Turner. “By investing in our families and helping them to reduce their debt we will continue to make Houston a place of opportunity.”
“Financial Empowerment Centers are exactly the kind of bold idea that should spread between cities. It is a proven model that helps low-income citizens and we are delighted to be doubling- down on our investment in this initiative,” said James Anderson, head of Government Innovation at Bloomberg Philanthropies.
“Local leaders know first-hand the connection between family financial stability and community financial stability,” said Jonathan Mintz, President and CEO of the Cities for Financial Empowerment Fund. “Mayor Turner and the City of Houston are joining a national movement to bring free, high-quality financial counseling as a public service to their residents; we are proud to partner with Mayor Turner and Bloomberg Philanthropies on this critical work.”
The national FEC Public platform promotes scale and sustainability for the growing movement of professional, one-on-one financial counseling as a free public service. The CFE Fund is seeding additional FEC replication multiple avenues of grant support, intensive technical assistance, and a vibrant national learning community, which will help as many as 50 local government partners plan, launch, and sustain free financial counseling for their residents. First piloted in New York City under Mayor Michael R. Bloomberg in 2008, the FECs have worked with almost 80,000 clients, helping them reduce individual debt by almost $94 million, and increasing their families’ savings by close to $9 million. In addition, a recent CFE Fund evaluation showed that this program works even for residents with very low incomes and other complex financial challenges. Houston is one of twelve localities selected to receive a grant and intensive technical assistance to prepare to launch a local FEC program.
Financial Empowerment Centers (FECs) offer professional, one-on-one financial counseling as a free public service. At the Financial Empowerment Centers, professionally trained FEC counselors help individuals and families with low and moderate incomes manage their finances, pay down debt, increase savings, establish and build credit, and access safe and affordable mainstream banking products. At the core of the FEC model is the integration of counseling into other social services, including housing and foreclosure prevention, workforce development, prisoner reentry, benefits access, domestic violence services, and more.
FEC Evaluation Findings
Earlier this year, the CFE Fund released An Evaluation of Financial Empowerment Centers: Building People’s Financial Stability As a Public Service, a three-year evaluation of the initiative’s initial replication in 5 cities (Denver, CO; Lansing, MI; Nashville, TN; Philadelphia, PA and San Antonio, TX). The evaluation shows that the model worked in a variety of city contexts, and that clients succeeded in reducing debt, increasing their savings, establishing and improving credit, and opening safe banking accounts, despite deep financial challenges.