Carolina Estrada, a CASH staff member, signs up a Rochester resident to participate in the city’s financial services during the “ROC Your Refund” event in January. Image courtesy of the City of Rochester. Image courtesy of the City of Rochester.

Rochester Helps Residents ‘ROC’ Their Refund

Can the City help the working poor turn an underused tax credit into a better life?

By Alison Gardy

**Even before COVID-19 exposed and exacerbated so many symptoms of the United States’ crisis of economic inequality, local governments were working on better ways forward. Through the What Works Cities (WWC) Economic Mobility initiative, launched in June 2019, nine cities chose to develop critical projects to increase the financial security and economic mobility of their most vulnerable residents — often in low-income communities of color.

The story below is a snapshot: a record of a persistent obstacle to economic mobility, of a city creatively engaged with the problem, of an emerging solution. Written before the pandemic began, it shows the commitment and leadership of city leaders, staff, and local community partners who recognized the need for change. Although COVID-19 is reshaping economic mobility challenges and solutions around the country, the stories of these pre-crisis actions and insights remain instructive and valuable.

As the hard tasks of response and recovery continue, WWC will be publishing stories about how cities have evolved their economic mobility projects to meet the moment.**

ROCHESTER, NY — Tax preparation isn’t usually a cause for celebration, but things got festive in this city early this year. Hundreds of residents braved snowy weather in late January and early February to participate in a first-of-its-kind weeklong event: the ROC Your Refund Taxathon.

Launched by the City, Monroe County, and a coalition of nonprofit partners, the Taxathon offered low-income families and individuals expert volunteer assistance with filling out tax returns and applying for the federal Earned Income Tax Credit (EITC), a refundable credit designed for low- to moderate-income individuals. Experts also offered residents financial counseling on how to avoid predatory lenders and high-interest credit products.

For some, the Taxathon was their first encounter with these kinds of financial services. Seventeen percent of Rochester households are “unbanked,” meaning they do not have a checking nor a savings account. Twenty-three percent are “underbanked,” meaning they may have a bank account but go elsewhere for other financial services such as money orders, check cashing, and payday loans — services and products that often come with excessively high fees and interest rates. Over 50 percent of adults in the city have subprime credit scores, which makes them vulnerable to predatory loans.

Unpredictable incomes or expenses can make such loans hard to resist. Across the nation, financial shocks are a main cause of economic insecurity, including housing instability and financial stress. A stunning 40 percent of Americans are not prepared for an unexpected $400 expense. In Rochester, one in three residents lives in poverty and nearly 60 percent of households are in liquid asset poverty, meaning they could not cover basic expenses for three months if faced with sudden job loss. Almost 31,000 employed residents — more than one-third of all people with full-time jobs who live in Rochester — cannot sustain their households without supplemental financial assistance.

The precariousness facing so many Rochester residents isn’t unique to the city. Around the country, it’s the normal state of affairs for people earning low to moderate incomes: finding any money to save is difficult, if not impossible. Could the EITC — which only 78 percent of eligible people around the country actually receive — be a way for the working poor to jumpstart savings?

Sparking the Match

The City of Rochester is determined to make residents’ money “work for them,” says Mayor Lovely Warren, who established the Office of Community Wealth Building in 2018. She has leveraged a coalition of local nonprofits to help participants in a “matched savings” pilot increase savings and financial stability, and decrease personal debt and financial stress.

The pilot, which eligible residents were encouraged to sign up for during the Taxathon, disburses EITC refunds on a quarterly basis, rather than as a one-time sum. The City is also testing what happens when they match a portion of residents’ reimbursement in order to build savings. One of the pilot’s goals is to demonstrate that residents will be better able to save more when the tax refund is spread over quarterly payments and is matched by the city through grant dollars that were allocated for the program.

Three organizations have partnered with the City for the program. Empire Justice Center’s CASH (Creating Assets, Savings and Hope) program administers the pilot and offers free tax preparation to low-income residents. Genesee Coop Federal Credit Union serves lower-income people and has an extremely low loan default rate; the Consumer Credit Counseling Service of Rochester offers a wraparound financial counseling program in partnership with the City’s Financial Empowerment Center (FEC).

“It’s important to have a lot of partners at the table to help us address the challenges people are having, which are so multifaceted,” says Brad Willows. He is the former financial empowerment initiatives coordinator in the Office of Community Wealth Building, of which the FEC is a part. “We need many perspectives to help us tackle these problems.”

Effective coordination between the nonprofit partners will be key to the success of the “matched savings” pilot. Though Rochester has a rich array of nonprofit and city agency services, they can be difficult and confusing to navigate for many EITC-eligible residents because of a lack of time, transportation or information. The resulting frustration only increases the distrust felt by the working poor toward public services, confirming their impression that no one has their back.

The City is banking on the idea that through robust supports and quality implementation, the savings pilot program could yield benefits that many EITC-eligible residents have never before experienced.

Partnerships for Change

Mayor Warren has long advocated that the City and its partners “meet people where they are.” It is government, she has said, that needs to change to meet the needs of different people. But the challenge is steep: The City is operating with fewer staff than it has historically for the 209,000 residents it serves and has a pressing need to strengthen its data infrastructure. It struggles with old mainframe data systems, siloed data and information between departments, the need to build staff capacity in data analysis, and limited timely access to necessary data held by other jurisdictions.

“For all these reasons and others,” says Kate May, chief performance officer in the Mayor’s Office of Innovation, “it is crucial that the City form partnerships with organizations that provide direct services.”

[Kate May was recently featured as the “Innovator of the Week” in Bloomberg’s SPARK.]

In the spring of 2019, the City got a boost when it was selected to participate in the What Works Cities (WWC) Economic Mobility initiative. The 18-month program aims to help nine participating cities identify, pilot, and measure the success of local strategies designed to accelerate economic mobility for their residents. Rochester chose to focus on getting the “matched savings” pilot up and running, which it has done with WWC technical assistance and funding.

The City is also drawing upon WWC expertise, in partnership with the Rochester Institute of Technology and the Wilson Sheehan Lab for Economic Opportunities at Notre Dame University, to design a pilot evaluation. It hopes to establish evidence that can ultimately influence state policy, so the state of New York can offer a quarterly disbursement option, along with a more robust matching of savings.

Despite structural barriers to reaching residents in need of help, there is reason to be optimistic that Rochester will find a way to improve their financial health. “We are a very close-knit community,” says Berta Rivera, director of CASH. “There’s not a competitive nature among our agencies. We have a lot of collaborative efforts and partnerships.” Rivera is determined to use her personal experience and understanding from having grown up poor to help solve residents’ problems and ask them the right questions to gather relevant data about financial behaviors.

“These are our problems,” says Berta Rivera, the director of CASH. “They are not these people’s problems.”

With many Rochester residents living on a tightrope of economic instability, time is of the essence as the City learns from the pilot initiative how to help residents save for the future and decrease their financial distress. ”People are in survival mode,” Rivera said. “Financial stress is related to mental and physical health. If I get sick more and don’t go to the doctor or to work, there is a ripple effect.”

Determined to reinvent Rochester as a place of prosperity, the City knows it cannot succeed alone. But with a coalition of partners committed to the cause, progress is on the horizon.

Alison Gardy is a communications consultant for Results for America.

The What Works Cities Economic Mobility initiative is a program that aims to help nine participating cities identify, pilot, and measure the success of local strategies designed to accelerate economic mobility for their residents. Through the expertise of the What Works Cities’ network of partners and the support of Bloomberg Philanthropies, the Bill & Melinda Gates Foundation, and Ballmer Group, this initiative puts data and evidence at the center of local government decision-making.

Launched in 2015, What Work Cities helps local governments use data and evidence to tackle their most pressing challenges and improve residents’ lives. Learn more about What Works Cities at



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Helping leading cities across the U.S. use data and evidence to improve results for their residents. Launched by @BloombergDotOrg in April 2015.