Aims to Widen the Pathway to Prosperity for More than 10 Million Low-Wage Workers and their Families; Launches New U.S. Initiative to Leverage Over $1 Billion in Private Capital by 2025
WASHINGTON, D.C., February 25, 2020 – The Rockefeller Foundation today announced a comprehensive $65 million investment to help more than 10 million low-wage workers and their families across the United States meet their basic needs and have a path to a better future. As part of this investment, the Foundation is also launching the U.S. Equity and Economic Opportunity Initiative ($36.5 million from 2019-2021) to transform economic stability and mobility for nearly 5 million low-wage workers in America and leverage over $1 billion in private capital by 2025.
“Far too many people work hard and play by the rules, but the American Dream feels more out of reach than ever before – and for many marginalized communities, it was hardly accessible to begin with,” said Dr. Rajiv J. Shah, president of The Rockefeller Foundation. “Over our 106-year history, The Rockefeller Foundation has stepped up during our country’s most critical moments. To meet the moment today and going forward, we have to fight on every front to expand opportunity for America’s working families.”
There are more than 44 million working households – representing more than 90 million people across the United States – that have trouble paying their bills each month. To start, the Foundation’s new Equity and Economic Opportunity Initiative is targeting proven economic policies like the Earned Income Tax Credit (EITC) and Child Tax Credit (CTC) and promoting public-private partnerships to mobilize more responsible investment in Opportunity Zones.
In addition to the new Equity and Economic Opportunity Initiative, the Foundation is investing nearly $30 million in cross-Foundation efforts to improve the lives and livelihoods of more than 5 million working families, children, and individuals in America – from enabling public schools and health payers to direct their dollars toward healthy and sustainable food, to using data science and technology to make America’s social safety net more efficient and effective, to expanding access to reliable, renewable power for critical facilities in Puerto Rico, among other programs. Today’s new, comprehensive investment in America’s working families is part of the wider $160 million the Foundation has committed since 2017 to lifting up underserved and vulnerable communities in the United States.
Earned Income Tax Credit and Child Tax Credit
On the policy front, the Foundation will reach at least 4.6 million people at the state level by promoting awareness about the impact of expanding and modernizing the Earned Income Tax Credit (EITC) and Child Tax Credit (CTC). These policies have proven to be two of the most effective tools for lifting families above the federal poverty line. Research indicates that the EITC and CTC successfully boost earnings for low-wage workers, while generating substantial benefits in the areas of health, education, and quality of life. For example during the 2018 tax year, the Center on Budget and Policy Priorities calculates that a family with children received an average EITC of $3,191, and when combined with the CTC, 10.6 million people were lifted out of poverty.
Previously, the Foundation provided financial support to the Economic Security Project to pilot EITC/CTC education and outreach programs in California and Maine. Early results indicate that three million households are expected to be recipients of the California EITC for the 2019 tax year, a 50 percent increase from the two million that claimed the credit during the previous year, and an estimated 102,000 households will benefit from the Maine EITC, which is up by nearly 20 percent from 2018. Over the next year, the Foundation will replicate this effort in at least eight states, with work already under way in four: Economic Security for Illinois; Missouri Budget Project, which includes 203 state-wide organizations through its Campaign for Tax Fairness; New Jersey Policy Perspective with its partner, Make the Road NJ; and Solid Ground Washington through its initiative, Statewide Poverty Action Program.
In order to extend the outreach into all 50 states, the District of Columbia, and Puerto Rico and also raise awareness about the impact of the federal EITC/CTC, the Foundation is also announcing new grants to national organizations: Bipartisan Policy Center, which is also working with the Foundation across broader economic goals; U.S. Chamber of Commerce Foundation, Center on Budget and Policy Priorities, Economic Security Project, EITC Funders Network, and UnidosUS. Doubling the federal EITC/CTC would provide more than $130 billion in tax relief to America’s workers.
Place-Based Investments/Opportunity Zones
The second area focuses on promoting partnerships to spur greater investment in low-income communities across the country. The Foundation is initially working in twelve cities and the District of Columbia to mobilize new and responsible private investment in Opportunity Zones, part of a new tax policy intended to bring capital investment into distressed communities nationwide. Efforts are underway to support municipal capacity and provide technical assistance to Atlanta, Ga., Boston, Ma., Dallas, Texas, Louisville, Ky., Miami, Fla., Newark, N.J., New Orleans, La., Norfolk, Va., Pittsburgh, Pa., Oakland, Calif., Seattle, Wa., and St. Louis, Mo., along with D.C.
In order to expand this impact throughout the country, the Foundation has also provided funding to Local Initiatives Support Corporation, known as LISC, and Smart Growth America. Strengthening the capacity of cities to take better advantage of Opportunity Zones will incentivize responsible investment that supports robust community engagement and mitigates the risk of displacement. Over the next few years, the Foundation aims to collaborate with additional organizations to achieve the goal of leveraging over $1 billion in private capital and creating more than 8,000 living-wage jobs by 2025.
“There is no investment in America that gets a better ROI than investment in an equitable future for America’s workers,” said Otis Rolley, managing director and acting senior vice president of the U.S. Equity and Economic Opportunity Initiative, The Rockefeller Foundation. “Our team hit the ground running and are already supporting proven economic policies and promoting grassroots partnerships to spur greater investment in low-wage workers and low-income communities all across the country.”
In addition to the work outlined above, The Rockefeller Foundation uses the tools of data, technology, science, innovative finance, and the power of convening to identify and to scale up solutions to the changing needs of the U.S. workforce. In order to improve the lives and livelihoods of America’s working families, children, and individuals, the Foundation is also:
- Influencing major institutions like public schools, public health payers, and hospitals to direct their dollars toward healthy and sustainable foods, thereby shifting the market to better practices while also offering healthier food to millions of low-income individuals;
- Collaborating with partners to accelerate the development of renewable energy microgrids over the next three years in Puerto Rico, where poverty and where inequality are embedded in the island’s energy infrastructure;
- Providing support to organizations such as Benefits Data Trust, which uses data analytics, technology, targeted outreach, and policy change to help millions of Americans access essential benefits that can improve their health and economic mobility.
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About The Rockefeller Foundation
The Rockefeller Foundation advances new frontiers of science, data, and innovation to solve global challenges related to health, food, power, and economic mobility. As a science-driven philanthropy focused on building collaborative relationships with partners and grantees, The Rockefeller Foundation seeks to inspire and foster large-scale human impact that promotes the well-being of humanity throughout the world by identifying and accelerating breakthrough solutions, ideas, and conversations. For more information, sign up for our newsletter at rockefellerfoundation.org and follow us on Twitter @RockefellerFdn.
The Rockefeller Foundation
Ashley E. Chang
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