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Rural Families Get A Prescription for Financial Health

Downtown Uniontown, Pennsylvania

The story of southwest Pennsylvania’s Fayette County is a familiar one across rural America. The heyday of farming here is long past. Gone, too, are the days when locals could make a good living from the rich coal bed buried beneath their feet, or in the booming local steel industry. As manufacturing jobs dwindled in the second half of the twentieth century, so did Fayette County’s population. The county seat, Uniontown, is now home to some ten thousand people, roughly half the number who lived there in 1950. Many who remain cobble together earnings from low-wage service jobs (Wal-Mart and McDonald’s are among the county’s top employers) and informal gigs, from babysitting to bartending.

The community is hurting, says Jim Stark, longtime CEO of Fayette County Community Action Agency (FCCAA), a local nonprofit serving lower-income community members. “If you look at rankings of social distress—anything from children in poverty to participation in public assistance programs—you’ll find that in Pennsylvania, Philadelphia is usually number one, and not too many percentage points behind is Fayette County,” Stark says. “And it’s been that way for a lot of years.”

In June 2014, at its headquarters in the heart of Uniontown, Stark’s agency began a new program to tackle this problem where the rubber meets the road—by working intensively with individuals to improve their household balance sheets. It’s called a Financial Opportunity Center (FOC) and is one in a nationwide network of sites supported by Local Initiatives Support Corporation (LISC). Based on the premise that a job is not enough to attain financial security, the LISC’s FOC “recipe” binds together three essential ingredients: employment services such as training and job placement, guidance in accessing income-boosting public and private benefits, and one-on-one financial coaching to help participants see just where they are financially and take the small, determined steps required to get where they want to go.

A “game changer”
This integrated approach, pioneered in the early 2000s by the Annie E. Casey Foundation, is gaining traction in the community development world because of its direct, demonstrated impact on poor families’ economic well-being. A major early adopter of the model, LISC in the last ten years has developed a network of 75 FOCs in cities across the country. The Uniontown FOC is the first one LISC has helped to plant in rural America, where the need is also great.

“Eighty-five percent of persistent poverty areas in the nation are rural,” says Suzanne Anarde, Rural LISC program vice president. “We believe that Financial Opportunity Centers could be a game changer in much the same way that we’re moving the needle in urban areas. But our approach has to be tweaked.”

A client receives financial coaching at the Financial Opportunity Center in Uniontown

Photo courtesy Fayette County Community Action Agency

The challenge in sprawling rural areas dotted with small towns is to achieve the convenience and economies of scale that are possible for community agencies in densely populated urban neighborhoods. An FOC’s success depends on clients returning to the center to partake of its services largely at their own initiative, and evidence suggests that in this case, more is more. A LISC evaluation published in April looking at the experience of 40,000 FOC clients over 34 months found that fully three quarters raised their monthly income-to-expenses ratio. Those who used the program’s three components most intensively were most likely to enjoy key employment benefits—to land a job and to keep it for at least six months. But frequent face time with FOC counselors is far more practical for urbanites than for poor rural dwellers who must travel far and rely on their own transportation to get there.

If an FOC can’t attract a critical mass of participants, it may very well fail to attract the financial support it needs, says Anarde. Funders want to see that an FOC can bring in enough people to make it cost effective and able to make a substantial impact in a community.

Local solutions
In Uniontown, FCCAA has been able to leverage local strengths to get its FOC off the ground using just a small grant ($40,000) and training from LISC. For starters, the agency not only offers a variety of services itself, but also shares its Beeson Boulevard campus with fifteen other nonprofits, from a sliding-scale health clinic to a branch of Westmoreland County Community College; “bundling” services to local families is in the organization’s DNA. In addition, even before opening its FOC the agency was doing work in job training and asset building (through homeownership, for example). In fact, says Stark, LISC training helped the organization identify the perfect place to anchor its new center: in a 15-year-old program that prepares mostly young women to work as nurse aides.

The advantages? In a county full of nursing homes and other healthcare facilities, the program gives participants entrée to a steady source of good jobs that can’t be sent offshore. Its trainees are just starting out in life, a great time to lay down a sound financial plan. And though bus service is pretty limited in Fayette County, the students are already on site for instruction Monday through Thursday for eight to ten weeks, so they don’t have to make a special trip for financial coaching.

Most people fall prey to anxiety and irrational thinking when it comes to money. But according to recent work by behavioral economists, the condition of poverty makes it even harder to think clearly about finances, focusing the mind on a never-ending stream of stressful short-term tradeoffs. “It becomes really overwhelming,” says Seung Kim, director of LISC’s Family Income & Wealth Building program. “The financial coach can help you unpack all these stresses that are happening. Suddenly, you have a little bit less to worry about, a little more self-confidence to ask for that promotion.” In Fayette County, FOC director Rita Masi and her colleague David Mutich are available to their clients long after they complete their CNA training. Says Masi, “They know, ‘If something happens, I can call Rita or David and they’re going to help talk me through this.’”

Growing FOCs in the countryside
It’s this long-term, beyond-the-current-crisis thrust that makes the FOC something valuable and new in Fayette County social services, says Stark. That, and the FOC data-gathering system that is part of the package LISC provides to partners. The system allows Stark’s agency to closely track participants’ personal financial progress, which in turn will help the organization win grants to serve other local populations from organizations like PNC Bank and the University of Pittsburgh Medical Center, and use a portion of the new funding to support FOC staffing.

LISC Family Income & Wealth Building Director Seung Kim leads a training for Financial Opportunity Center staff

Photo by Andres Saavedra

Meanwhile, LISC and its rural partners are in brainstorming mode, thinking about ways to adapt the FOC model so it will work as well in rural areas as it has in 33 American cities. In April, Anarde and Denise Scott, LISC’s executive vice president of programs nationwide, traveled to the hard-pressed Appalachian region of Kentucky for a site tour. Over three days, as the two women rode along the meandering roads of the Appalachian foothills and visited with local colleagues, they talked about the promise of FOCs.

Maybe, they thought aloud, they could set up an FOC pilot project here. Maybe LISC could step in to facilitate the information sharing that occurs fairly easily in close-knit networks of urban FOCs. And why not try bringing some services to FOC participants, instead of the other way around? Like mobile health clinics or libraries, these services could “ride a circuit” and be shared over a large area. “By the time they dropped us off at the airport,” recalls Anarde, “we kind of had a plan.”

Posted in Integrated Services Delivery, Family Income & Assets, Rural Community Development

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