As of February 2008, approximately 75,000 people are living in poverty with no relief in sight. Over 11,000 individuals who are able to work are unemployed. Roughly 28,000 households pay more than 30 percent of their income on rent alone, and bank foreclosures increased 121 percent in the past year.
These aren’t national numbers. These are figures from right here in Central Kentucky. Thousands of our neighbors are in financial trouble and don’t know what to do or where to turn. In the Bluegrass, United Way is working with others to find a solution to this community problem.
A recent statewide conference held in Lexington, “Strengthening Economic Self-Sufficiency for Kentucky Families: Using Tax Credits to Support Families,” was aimed at showcasing much of what is happening in the Central Kentucky region to address poverty issues. The event was sponsored by the Department of Health and Human Services Welfare Peer Technical Assistance Network and the Central Kentucky Economic Empowerment Initiative.
Turnout for the conference was outstanding. Members from across our local human service spectrum were represented: United Way of the Bluegrass, LexLinc, University of Kentucky College of Social Work, Community Action Council, Bluegrass Community and Technical College, Lexington Housing Authority, West End Community Empowerment Project, UK Targeted Assessment Program, Family Care Center and LFUCG Division of Economic Development. There were also representatives from the Internal Revenue Service, as well as various asset-building coalitions from six states.
Topics of the conference ranged from increasing assets through tax incentives to how our community can help individuals and families achieve financial stability. Among others, Community Action Council discussed a recent groundbreaking initiative in the community that helps individuals seeking self-sufficiency establish Individual Development Accounts.
One of the main goals of the conference was to strategize the use of the Earned Income Tax Credit (EITC) by families that are seeking self-sufficiency. The EITC is a credit intended to increase financial stability in low- to moderate-income workers. The forum explored best practices and models from within Kentucky, as well as from other areas that have found success.
It’s unfortunate that the majority of those who qualify for the tax credit are not aware of the EITC. It is estimated that over 20,000 individuals in Central Kentucky are eligible but not receiving the credit, according to the IRS.
For those who have taken advantage of the credit, the EITC has proven to be a gateway to additional financial stability vehicles such as Individual Development Savings Accounts, home ownership services, financial literacy programs, and more.
To help promote a free tax preparation service, including helping those who qualify take advantage of the EITC, United Way has partnered with the Central Kentucky Economic Empowerment Project. In fact, any individual or family with an income of $40,000 or less in 2007 can simply dial 2-1-1 and schedule an appointment at a Volunteer Income Tax Assistance site to have their taxes prepared at no cost. The one-stop call to 2-1-1 can guide individuals through the documents and materials they would need and set up their appointment. Last year, more than 800 individuals scheduled appointments by calling 2-1-1. The partnership returned over $1 million in credits that otherwise might not have found their way to hardworking families in 2007. In addition, 2-1-1 can also direct callers to other financial stability opportunities.
At United Way, our focus is to identify the causes of serious social issues in order to tackle these problems at the source. Because financial stresses on thousands of hardworking people are currently perpetuating other social issues, United Way is working to strengthen the financial stability of individuals and families in hopes of facilitating economic independence, leading to a better quality of life.
Through partnerships with business, labor, government, academic, nonprofit and faith-based organizations, United Way is working to create additional avenues for individuals and families to maximize their income, build savings and gain assets.
Please join United Way in promoting financial stability in Central Kentucky. Contact Jon Parker, United Way’s vice president of community building, at (859)233-4461, ext. 205. Get involved. Our community, our businesses and our families need your help.