Bloomberg Philanthropies and Living Cities, a collaborative of twenty-two of the world's largest foundations and financial institutions, have announced grants totaling $16.2 million to five cities in support of efforts to replicate New York City's Financial Empowerment Center model.
The evidence-based model offers low-income residents free one-on-one financial counseling at local Financial Empowerment Centers and by integrating counseling into the delivery of municipal services. Denver, Nashville, Philadelphia, San Antonio, and Lansing, Michigan, will each receive grants from the Cities for Financial Empowerment Fund to replicate the New York model in a local context. New centers created through the process are expected to open for service in March and serve more than thirty thousand people over three years.
Since the first Financial Empowerment Center opened in New York in 2008, the initiative has helped more than nineteen thousand New Yorkers reduce their debt by more than $9 million while saving nearly $1 million. Financial counselors help their clients by taking a number of measures, including checking credit reports for inaccuracies and taking steps to erase or correct any erroneous details; advocating with creditors to lower late fees and penalties; identifying new sources of income; and creating budgets and payment plans that facilitate a realistic savings plan.
"The innovative financial empowerment initiatives we pioneered here in New York City have been an important part of our work to help New Yorkers weather the national economic downturn," said New York City mayor Michael R. Bloomberg. "The Mayors Project at Bloomberg Philanthropies spreads effective solutions to challenges that many cities face, and we know that mayors are increasingly seeking strategies that will help their residents achieve long-term financial stability. We are excited to bring this model to five cities and hope this innovative, data-tested program spreads to even more cities nationwide."