Cities Take Action on Poverty

NLC’s Stimulating Municipal Action to Reduce Poverty Project and Institute for Youth Education and Families have long supported efforts of local officials to address poverty and equity through research, technical assistance, best practice information, guidebooks and other tools. The result is a growing list of cities taking on new initiatives that address poverty and equity. Below are examples of three types of initiatives that many of these cities are implementing in response to growing economic insecurity and poverty.

Poverty Simulations
Many cities have started holding poverty simulations as an effective way to build local support for city-led poverty reduction initiatives and to increase understanding on the part of employers, city leaders and others about the realities of living in poverty.  

A poverty simulation is a tool that enables participants to experience what it is like to live in a low-income family trying to survive month to month and to understand why poverty is an issue that impacts everyone. The Community Action Poverty Simulation Kit is licensed by the Missouri Association for Community Action and sold to other organizations. To date, more than 300 kits have been licensed and provided by the Missouri Action Association to other organizations across the country.  

The poverty simulation was first featured in NLC’s 2006 publication, "Tapping the Power of City Hall to Build Equitable Communities: 17 Promising Practices," as a strategy used by the city of Savannah, Ga., to educate the community about poverty and to build support for the city’s anti-poverty initiatives.

In 2007, NLC’s Institute for Youth, Education, and Families hosted a poverty simulation at its 2007 National Summit on Your City’s Families in San Antonio. More than 75 city leaders participated in the simulation. A number of cities are now conducing poverty simulations on a regular basis — Bryan, Texas; Erie, Pa.; Kalamazoo, Mich.; San Antonio; and more recently, San Jose, Calif., and Rapid City, S.D.  

Bank On Initiatives
Many cities, through public-private partnerships, are addressing the victimization of low-income residents by predatory lenders and costly check cashing services by implementing initiatives to connect the unbanked to the financial mainstream. 

The idea was first conceived in 2006, by the City and County of San Francisco, where local government partnered with financial institutions and community organizations to develop and promote free or low-cost financial products that cater to unbanked residents. Bank On San Francisco aimed to remove barriers to financial services for low-income residents such as checking account fees, inadequate ID documentation and account balance requirements. Participating banks and credit unions agreed to offer low or no-cost products, offer "second chance" accounts and partner with community-based organizations to provide financial education to the un-banked.  Since its launch, Bank On San Francisco has helped local residents open more than 16,000 accounts. 

Inspired by the Bank On San Francisco initiative, NLC’s Bank On Cities Campaign helps cities develop comprehensive asset-building initiatives involving financial education, homeownership counseling, savings accumulation programs and asset protection. In September, Seattle, one of the participating cities, became the second city to launch a fully developed “Bank On” initiative. Other cities taking part in NLC’s Bank On Cities Campaign include Boston, Houston, Los Angeles, Miami, New York, Providence, R.I., San Antonio, and Savannah, Ga.  In September, Bryan, Texas, launched its Bank On It campaign.

As it continues to show promise, the Bank On concept is attracting support from the foundation community. In July, the Pew Charitable Trust announced its Safe Banking Opportunities Project “to support a rapidly growing group of state and city governments that are launching campaigns to bring more Americans into the financial mainstream.”

Economic Opportunity
Ultimately, reducing poverty requires increasing the incomes of the poor. Economic opportunity strategies target increasing incomes through developing career ladders, job training and placement in living wage jobs.

Portland, Ore., has modeled this type of initiative for other cities. Launched in 2004 by the Portland Bureau of Housing and Community Development, Portland’s Economic Opportunity Initiative contracts with 34 community-based organizations in order to undertake work force and microenterprise projects for specific economic sectors and target populations. Each group of participants receives holistic support and customized training for a three year period. The initiative’s goal is to increase the income and assets of low-income participants by at least 25 percent within three years of their enrollment, which the first cohort of participants has more than achieved.

Since its inception, many cities have been interested in the Oregon initiative and have contacted or visited the city to learn more. According to director Lynn Knox, staff has responded to requests for information from many cities across the country, both by telephone and in person, and has provided technical assistance and hosted site visits for other cities such as Minneapolis and Spokane, Wash. Knox has also responded to many requests to speak including a presentation at the Mayors Innovation Project. With assistance from Portland and the Northwest Area Foundation, the City of Duluth, Minn., is launching a replication of Portland’s model.

Key aspects of most of these examples are partnerships and collaborations. To learn more about what other cities are doing to address poverty in a more collaborative, comprehensive way, city leaders working on issues related to poverty and equity are invited to join a quarterly conference call to promote networking and information sharing that is hosted by NLC.

In collaboration with Step Up Savannah, an initiative of more than 80 public and private agencies cooperating to reduce poverty in Savannah, NLC has formed the Poverty Reduction Peer Network as a way to bring collaborative efforts in cities from across the country together to learn from one another and address challenges related to the reduction of poverty.

The next Poverty Reduction Peer Network Call is Tuesday, January 27, at 2:30 p.m. EST.  

Details: For information or questions, contact Sarah Bainton Kahn at bainton@nlc.org, or Caterina Bummara at bummara@nlc.org or (202) 626-3136.

For more information related to local strategies addressing poverty and equity:

NLC’s Stimulating Municipal Action to Reduce Poverty Project:
http://www.nlc.org/resources_for_cities/programs___services/poverty_reduction_strategy_project/9815.aspx

NLC’s Institute for Youth, Education, and Families Asset Building Program:
http://www.nlc.org/IYEF/fes/asset/index.aspx

Research Report on the State of America’s Cities: Poverty and Economic Insecurity: Views from City Hall:
http://www.nlc.org/ASSETS/DE101892B179403B883249907EAB96B1/CityViewsOnPoverty.pdf

Tapping the Power of City Hall to Build Equitable Communities: 17 Promising Practices:
http://www.nlc.org/resources_for_cities/programs___services/poverty_reduction_strategy_project/ppbook2006.aspx

Using Poverty Simulations to Build Support for Poverty Reduction Initiatives Municipal Action Guide:
http://www.nlc.org/ASSETS/266082A01DD340B28798502182636C97/PovertySimulation_08.pdf

Earned Income Tax Credit City Practices Brief:
http://www.nlc.org/ASSETS/679402ED526B45A98C68FED62C9343B4/CPB%20-%20EITC%200908.pdf

Financial Literacy and Counseling Programs City Practices Brief:
http://www.nlc.orgASSETSD608B41300054BD38B9D0075D34BA2E9CPB%20-%20Financial%20Literacy%200708.pdf

Missouri Association for Community Action:
www.communityaction.org

Portland’s Bureau of Housing and Community Development:
http://www.portlandonline.com/BHCD/