The EITC, or Earned Income Tax Credit, has been known for over thirty years to be one of the more successful anti-poverty programs in the nation. The tax relief program is geared toward only workers earning income below a certain income threshold and is responsible for delivering much needed tax refunds to workers, who in turn use this money for medicine, rent, school supplies and food. Every year many people who are eligible for the tax credit in the U.S. and L.A. County fail to claim it, leaving behind billions in uncollected money. According to a 2008 research brief by the United Way of Greater Los Angeles, one in five taxpayers in L.A. County claimed the EITC in the 2006 tax year- that is, 750,000 taxpayers in L.A. County. These residents received a total of 1.5 billion dollars in refunds. Where does all this refund money go? What are the implications when eligible people don’t claim the refund and in essence, ‘leave it on the table’?

A new report by the New America Foundation examines the consequences. Money that is not claimed is never spent on local businesses, which in turn never create new jobs that could have been.  In addition, potential local tax revenue from this forgone economic activity is never generated. The report does an excellent job of highlighting how we are all in the proverbial “same boat.” Even if you are not low income, and not receiving the tax credit, your community still benefits by the infusion of cash coming into your business, your neighborhood and in your infrastructure via tax revenues generated.

Among some of the findings:

• L.A. County left over 370 million dollars in unclaimed refunds in year 2006. This meant a loss of over 440 million dollars to the economy in foregone sales.
• Over 2,700 jobs were not created due to this loss to the economy. This translates into over 123 million dollars in forgone wages.
• The EITC is particularly important in L.A. County because it has a higher level of poverty than the state and the nation- nearly 40% are considered low income. L.A. County has a lower median income compared to other large metro areas, and has a higher proportion of minorities (a constituency which claims the EITC in no small numbers).

If poverty prevention as well as alleviation is to be a public policy goal for our communities, then EITC expansion and funding for capacity and outreach is vital.  To learn about EITC outreach efforts in Los Angeles, visit http://www.greaterlaeitc.org/.

In the meantime, you may want to check out a post I did recently over at the Funders Together blog on “Exploring the Notion of Public-Private Partnerships to End Homelessness.” It reports on a meeting we organized recently to learn about models of cross-sector collaboration in Los Angeles and across the country.

Hasta pronto.

Finally, we are beginning to have numbers that show similar savings in Los Angeles. Last month, United Way of Greater Los Angeles released a case study report of four individuals that showed a 40% decline in public costs.

Economic Roundtable’s Where We Sleep report shows similar levels of savings, but with a much more comprehensive data set (including 10,000 recipients of General Relief in the County). This chart from the report shows how much public costs decline after someone is placed into supportive housing.

Average Monthly Public Costs for Persons in Supportive Housing and Comparable Homeless Persons

Source: Economic Roundtable, Where We Sleep, 2009

That’s a 79% reduction in average public costs. Even when accounting for the cost to provide permanent housing (average of $750 for capital and $352 for operational costs per month), there is a 41% decline in costs.

For years, studies around the country have shown similar cost savings; but a common response in Los Angeles has been, “well, we don’t know if that’s true for L.A.” (we are special here after all). With this evidence, what’s our excuse for not doing everything we can to provide permanent supportive housing for those who need it? Not only is it the right thing to do: it’s the smart thing to do.

Well, according to the 2009 Greater Los Angeles Homeless Count – released today – it hasn’t. The 2009 figure – 48,053 persons homeless in Los Angeles County every night – represents a 38% decline from the 2007 count. This is actually part of a trend over the past four years, as shown in the following chart:

When the 2007 numbers came out lower than 2005, a common justification was that the count became more precise as the methodology improved, implying that the earlier count wasn’t as accurate. Having been briefed on this year’s methodology, I agree that the 2009 count is the most reliable we’ve had yet. But, it still begs the question of whether we’re really seeing declines. As one news article characterizes it, “whether the drop was real or the by-product of fuzzy math in previous years, is hard to say.”

Leaders in Los Angeles are trying to frame the results in the positive, claiming that the decline is the result of increased public and private efforts to house the homeless. As Michael Arnold, Executive Director of LAHSA, stated in reaction to the numbers, “We know, we can sense, we can feel that there’s a change out there. These numbers provide us with some documentation, that things are really happening in Los Angeles.”

As I’ve written about before, there has been real, quiet progress in addressing homelessness in Los Angeles. That work is to be applauded. At the same time, we shouldn’t forget that we still have tens of thousands of people in Los Angeles who will sleep on the streets today. We still have plenty of work to do.

In a July 21 post, Joel Roberts explains how pleasantly surprised he was at the response to a volunteer training session:

Clearly, leaders of this initiative were nervous, worried about low attendance. A small number of volunteers would’ve meant the community was not interested in addressing homelessness.

But by five minutes after the starting hour, the room was packed. Over 100 local volunteers were there—from faith groups, the local university, service agencies, businesses, and the community as a whole. There was clearly an excited buzz during the meeting.

Volunteer Richard Hackett blogged in a July 24 post how participating in the effort had changed his perspective:

The variety of circumstances surrounding the reason for each individual’s homelessness varied. I encountered those that were mentally ill, the extremely intelligent who had earned a college degree, drug and alcohol abusers, displaced family units, and those running from the law.

I found myself reflecting after a days worth of surveys, that all of these transgressions (whether their own or those against them) as bad as they might seem, are no different than some of the sins I have committed in my life. There is goodness in each of the people I met this week. I saw that during the interviews I conducted.

And in a July 26 post, Patricia Loughrey blogged how the people she met are ready for a place to live.

But Juan is ready. He is in perfect position. Slip a house around Juan and he’ll fit right in. Put an address on his front porch and he’ll be ready to wake up and walk into a new day. Juan is ready.

And Carla is ready. And Byron, and Pops, Gerald, and Peanut, Patrice and Clyde. They’re all ready. And so are the other 350 people sleeping outside this week in central Long Beach: they are ready.

The most familiar of these stories is the extensive reporting by Steve Lopez on Skid Row and his friendship with Nathaniel Ayers, which resulted in “The Soloist” book and movie. Other recent stories may not be as well-known but are just as compelling.

Esmeralda Bermudez wrote about Khadijah Williams, an 18 year old who has long been homeless but is going to Harvard this year. Sandy Banks has written about Eddie Dotson, a man who created his own home in tight spaces near LA freeways and who was reconnected with his children through the columns. Banks’ most recent column highlights how Dotson “captured a community,” and she makes the important point that overcoming the odds wasn’t just a matter of personal will. Each of these special people received help from someone.

We should be inspired by these personal stories of triumph, while remembering that it is up to us to make sure that all the Nathaniels, Khadijahs, and Eddies out there have the opportunity experience similar victories.

A new report from the LA-based Economic Roundtable attempts to meet those needs by providing a wealth of the most recent data on how the current recession is affecting everything from employment, income, housing, poverty and health in Los Angeles and the state. Using historical data on recessions and employment projections from respected forecasters, the report produces estimates for how residents will fare over the coming years. If you are interested in where we’ve been and could be going, check out Ebbing Tides in the Golden State: Impacts of the 2008 Recession on California and Los Angeles County.

In general, the report sees conditions continuing to worsen over the next year but then starting to improve steadily by 2011 or 2012. It even provides estimates of how much poverty and homelessness will increase or decrease. Are these accurate? Of course there is no way to know. As the Nobel Prize laureate physicist Niels Bohr said, “Prediction is very difficult, especially about the future.” At the very least, Ebbing Tides in the Golden State provides an important overall understanding of how deep the recession is affecting us.

We hear nearly everyday about the growing number of foreclosures in our country, particularly in boom-and-bust markets like Los Angeles. This chart provides a historical picture that shows what a unique moment we are in.

In the last LA housing bust during the early 1990s, foreclosures doubled from under 15,000 in 1992 to over 33,000 in 1996 and 1997.   As the economy boomed, the number of foreclosures declined steadily to under 1,000 by 2005.  That eight-year decline was reversed in three quick years, with 2008 skyrocketing to nearly 40,000 foreclosures.

The early part of this decade looks like a nice, slow coast downhill.  Too bad we didn’t put on the brakes; maybe we could’ve avoided this current steep uphill climb.

There were several people who like me had read the book and were disappointed but several also felt like the movie at least hit the high points and messages of the book.  To be honest, however, I am most interested in what people who knew little about the true story or even homelessness and mental illness thought of the movie.  The words I heard were simple descriptions like “touching,” “profound,” and “eye-opening.” So, while the movie could not live up to the high standard of the book for me, I am hopeful it can be an important vehicle for educating people about the scourges of homelessness and mental illness and what it takes to overcome them.  Also, there are things that a movie can do better than the written word, such as in this case providing a visual glimpse into a schizophrenic mind.  The movie is well done and the performances are solid.

Mental illness, extreme poverty and homelessness are not issues we like to talk about, but hopefully this movie can get people talking.  Therefore, here is some advice for people not sure if they should see “The Soloist:”

• If you don’t have time to read the book and know little about homelessness and mental illness but want to learn about the challenges facing people who suffer from them, you should see the movie and think about how many lives of promise exist on our streets.
• If you are thinking about reading the book, do it (it’s a quick read) and then take someone who probably wouldn’t read the book to see the movie and talk with them about it.
• If you have read the book and are worried that seeing the movie will be a disappointment, go ahead and see the movie with realistic expectations.  Take someone who may be unfamiliar with the story and talk afterward about what the story tells us about how to help people suffering from mental illness and homelessness.

Have you seen the movie? What did you think?