RD491 - Report on the Virginia Community Action Partnership Earned Income Tax Credit Initiative Virginia CASH Campaign – December 1, 2018

Executive Summary:

The Virginia CASH Campaign continued to offer quality free tax preparation services across the Commonwealth of Virginia to over 33,500 taxpayers from January-April 2018. This year 23 coalitions working with community volunteers received funding from the Earned Income Tax Credit grant. VACAP distributes 100% of the funding to the coalitions. The Virginia CASH Campaign highlights include:

• Over $34.8 million in federal refunds
o Over 33,500 federal returns filed

• Almost $12 million in EITC refunds
o Over 7,800 taxpayers claiming EITC
o $6.7 million saved in tax preparation fees

• Over $4.8 million in state refunds
o Almost 26,000 state returns filed

• Over 1,200 Volunteers
o Over 50,000 hours of tax preparation time

Compared to 2016 tax year, other important data points include:
• 8% increase in clients asking for direct deposit
• 3% increase in the amount of federal refunds

The modest state-funded $185,725 EITC Grant program (average grant $8,075) resulted in over 1,200 volunteers working with 24 coalitions (one coalition did not apply for funding) to provide free tax preparation and financial education services at 121 sites throughout Virginia. Many coalitions continue to partner with Affordable Health Care Navigators to assist consumers with making smart health insurance choices and correct filing of income tax returns. Coalitions are offering Facilitated Self-Assistance which allows clients to file their own taxes where help is available if needed. The Independent Sector estimates the 2017 value of volunteer time in Virginia to be $26.75 per hour. The Virginia CASH Campaign volunteers contributed over 50,000 hours of tax preparation to the program. An additional 10,600 hours were contributed for tax training. This equates to over $1.6 million in value to the program and communities where these volunteers live and work. Grant funds leverage over six times the amount of volunteer time.

The Virginia Community Action Partnership (VACAP) EITC Initiative supports community groups and coalitions throughout Virginia that provide free tax preparation services and promote financial stability, savings and asset building to modest income working individuals and families. The Virginia CASH Campaign (Creating Assets, Savings and Hope) gives the program an identity that is used by the coalitions to engage community partners in their work.

VACAP co-hosted the two-day Common Cents Conference (CCC) in September 2017. The conference theme was “Inclusive by Design" and participants included VITA volunteers and practitioners, financial educators, state and local departments of social services, housing programs, Community Action, and other non-profits involved in working family asset building initiatives. Presentations and plenary sessions included strategies on closing the racial wealth gap and improving accessibility. Workshops included financial education building blocks, income volatility and what to do about it, financial coaching, using data as a tool to educate community stakeholders and others. Over 200 participants from Virginia, Maryland, District of Columbia and West Virginia attended.

The EITC grant was announced at CCC 2017 and proposals were due at the VACAP office by October 13, 2017. Twenty-three grant recipients were notified of successful proposals on November 17, 2017 and funds were disbursed by December 1, 2017. Each coalition submitted a budget and plan as to how the grant funds were to be used throughout the year. The largest funding allocation is for personnel costs (65%).

Coalition costs for printing, supplies and equipment totaled eight percent of the budget. Advertising was about seven percent of the total. Nine percent was spent on volunteer recruitment, management and training, travel to meetings and conferences. Other smaller amounts were used for rent, telephone and administration costs.

VACAP maintains a website dedicated to the CASH Campaign. http://www.vaeitc.org provides timely information to EITC partners, clients and funders throughout the year, but especially during tax filing season. Coalition information, data, flyers, asset building links, news articles, PSAs and funding resource information are readily available for viewing and download. This key component links all coalitions and assists in communication and sharing best practices. Between December 2017 and April 2018, the site averaged 1,325-page views per month with an average of 772 visits per month. During the same time frame the site averaged 648 new visitors per month. VACAP encourages its Virginia CASH coalition members to share tools and resources, enabling them to work more efficiently and serve more clients.

Keeping taxpayers compliant is one of Virginia CASH’s most important functions. If a taxpayer gets into trouble with the IRS or state department of revenue, all other efforts to help improve their financial situation are destined to fail.