# Presentation: 606572

## Assets for IndependenceFederal Grants for Individual Development Account Projects

**Office of Community Services****Administration for Children and Families****U.S. Department of Health and Human Services**

## Basics for Applicants -- Overview

- Asset Building and Individual Development Accounts (IDAs)
- Assets for Independence Program
- AFI Projects – Overview
- Apply for AFI Funding in FY 2006

***“******Few people have ever spent their way out of poverty. Those who escape do so through saving and investing for the long-term.”***
- Michael Sherraden
- Center for Social Development

**Asset Building**

## Economic Assets Matter

- Stronger, Healthier Families
- Enhanced Self-Esteem
- Long-term Thinking and Planning
- More Community Involvement
- Hope for the Future

## Support for Asset Building

- Homeownership Support
- Small Business Development
- Education / Careers
- Individual Development Accounts

## Individual Development Accounts (IDAs) 

- Matched restricted bank or credit union savings accounts for individuals and families with low incomes.
- Enable clients / participants to save earned income on a regular basis, receive matching funds to grow the savings, and acquire an economic asset for the long term.

## IDAs: A Hand-Up To Self-Sufficiency

- Transform
- to Assets

- Save

- Self-
- Sufficiency

## Overview:Assets for Independence Program

## Assets for Independence Program   

- 	Federal grant program that supports 5-Year AFI Projects that enable participants to ...
- Learn about financial and consumer issues
- Save in IDAs
- In order to ...
- - acquire a first home
- - access higher education or training and/or
- - start or support a small business

## AFI Projects

- 350+ projects throughout the nation
- Multi-purpose non-profits that provide services for low-income families
- Public / Private partnerships including State, local or Tribal governments
- Multi-site networks
- Financial institution partners

## AFI Projects

- Community Action Agencies
- Community Development Corporations
- Community Development Financial Institutions
- Credit Unions
- Faith-Based Organizations

- Government Agencies
- Housing Finance Agencies
- State-Wide and Multi-State Associations
- United Way Organizations
- Workforce Development Agencies
- Youth Agencies

## AFI Clients / Participants

- 34,000+ IDA accounts and growing
- 80% of participants are women
- Many single parent households
- 46% African American; 28% White; 16% Hispanic
- IDA is first savings account for most participants

## AFI Projects –Participant’s Perspective

## EXAMPLE – KIM

- Kim needs a home
- Housing program requires $6,000 for down payment and closing costs
- Financial Education, debt counseling and information about home ownership
- Match rate of $2 for every $1 saved in her IDA
- Kim saves $2,000 – $55 per month over 3 years

## Kim’s IDA

**$2000 **
**Savings**

**$4000 **
**Matching**

**$6000 for**
**Home**

**$2,000 Federal**

**$2,000 Non-Fed**

**$2,000 Kim Saves**

## EXAMPLE – BILL 

- Bill is looking to start a new business
- He needs $5,000 in capital
- Financial Education, debt counseling, training in operating a business, and a business plan
- Match rate of $4 for every $1 saved in his IDA
- Bill saves $1,000 – $42 per month over 2 years

## Bill’s IDA

**$1000 **
**Savings**

**$4000 **
**Matching**

**$5000 for**
**Small**
**Business**

**$2,000 Federal**

**$2,000 Non-Fed**

**$1,000 Bill Saves**

## AFI Projects – Details for Grantees / Administrating Agencies

## Key Topics 

- Project Funding – Federal and Non-Federal
- Project Reserve Account
- IDA Matching Structure
- Participant Eligibility Rules
- Participant Savings Plan Agreement

## Project Funding

- Five Year project grants
- Non-Federal _cash_ equal to or greater than the Federal grant amount

## Project Reserve Account

**PROJECT RESERVE ACCOUNT**
*insured financial institution*
**$200,000**

**Federal Grant**
**$100,000**

**Non-Federal**
**$100,000**
**(Cash only)**

**Other Resources - $ and In-Kind**

## Project Reserve Account Uses

**At least 85% to match IDA savings**
**Up to 13% for financial education and other activities**
**At least 2% for data collection**

## Non-Federal Funding – Examples

- Financial institutions
- Foundations
- United Way organizations
- Corporations / Employers
- Faith-based organizations
- State, local and Tribal governments

## IDA Matching Structure

- IDA Savings Match Rates can range from
- 	$1 match for $1 earned income saved to
- 	$8 match for $1 earned income saved
- Maximum Federal Contribution
- $2000 per individual
- $4000 per household

## Participant Eligibility

- TANF eligible OR
- EITC eligible or annual household income less than twice poverty (about $40,000 for family of four) _and_
- 	Household net worth less than $10,000 excluding value of a residence and one car
- Administrating agencies may apply additional eligibility rules

## Participant Savings Plan Agreement

- Amount to be saved / Schedule of deposits
- Asset to be purchased
- Match rate per $1 of earned income saved
- Financial education / Financial literacy courses
- Debt management counseling
- Asset-specific training
- Contingency plans

## Summary – Grantee Activities

- Create project reserve account
- Recruitment / outreach / marketing to inform community about the program
- Enroll participants and develop savings agreement
- Provide financial education and other services

## Typical Grantee Activities – cont’d

- Work with the client to open the IDA
- Assist the client throughout the savings period
- Allocate matching funds as the client saves
- Provide asset-specific training and preparation
- Assist with the asset purchase
- Collect data and report to OCS

## AFI Application Requirements / Processes

**AFI Application Overview**

- Annual Review Cycles – November 1, March 15, June 15
- Up to $1,000,000 (average $325,000)
- $18,000,000 available in FY 2006
- 50-60 funded projects

## Application Review Criteria

- Approach (50 pts.)
- Organizational Profiles (17 pts.)
- Results or Benefits Expected (10 pts.)
- Objectives and Need for Assistance (10 pts.)
- Budget (5 pts.)
- Evaluation (5 pts.)
- Summary (3 pts.)

## Review Criteria – Details

_**Approach**_** (50 pts.)**
**	**-**	**Work Plan and Timeline (25 pts.)
- 	-	Tax Services (3 pts.)
- 	-	IDA Match Rate (5 pts.)
- 	-	Innovation (5 pts.)
- 	-	Partners / Collaborations (12 pts.)

## Review Criteria

_**Organizational Profiles**_** (17 pts.)**
**	**-**	**Capacity
- 	-	Experience
- 	-	Identify key staff

## Review Criteria

_**Results Expected**_** (10 pts.)**
- 	-	Clear outcome and output statements
- 	- 	For measuring progress

## Review Criteria

_**Objectives / **_
_**Need for Assistance**_** (10 pts.)**
- 	-	Goal and Objectives Statements
- 	-	Needs for Assistance and Strengths

## Review Criteria

_**Budget and Justification**_** (5 pts.)**
- Clear
- Reasonable
- Realistic
- Commitment of Non-federal cash contribution

## Review Criteria

_**Evaluation**_	**(5 pts.)**
- 	-	Electronic information collection
- 	-	Commitment to participate in the 	national AFI evaluation
- 	-	Providing timely data to OCS

## Review Criteria

_**Project Summary**_** (3 pts.)**
- 	-	One-page summary
- 	-	Key features

**Submission Requirements**

- Format
- 		Up to 40 pages plus attachments
- Forms
- 		Standard Application form (SF-424)
- 		Standard Budget form (SF-424A)
- 		Standard Assurances form (SF-424B)

**Submission Requirements**

- Forms (cont’d)
- 		Certification regarding Lobbying
- 		Disclosure of Lobbying Activities (SF-LLL)
- 		Certification regarding Environmental 		Tobacco Smoke
- Proof of Nonprofit Status
- Proof of Designation as CDFI or Low-Income Designated Credit Union *(if applicable)*

**Submission Requirements**

- Upcoming Due Date:
- 		June 15, 2006 – 4: 30 p.m. EST

**Submission Requirements**

- Paper format:
- 		OCS Operations Center
- 		Assets for Independence Program
- 		1515 Wilson Blvd., Suite 100
- 		Arlington, VA  22209
- Electronic format:
- 		http://www.Grants.gov

## Information Sources

- AFI Resource Center (202) 401-4626
- AFI Webpage _[www.acf.hhs.gov/assetbuilding](http://www.acf.hhs.gov/assetbuilding)_

## Let’s Talk Soon

- James Gatz
- Manager, Assets for Independence Program
- Office of Community Services
- AFIProgram@acf.hhs.gov
- (202) 401-4626
- _[http://www.acf.hhs.gov/assetbuilding](http://www.acf.hhs.gov/assetbuilding)_