Citi Earns 2014 Community Reinvestment Award for Innovative College Savings Program
Citi Community Development honored for its role in Texas pilot program that enables custodial parents to convert child support payments into college savings accounts
New York, April 2, 2014 /3BL Media/ – Citi has received a 2014 Community Reinvestment Award from regulators at the National Interagency Community Reinvestment Conference in Chicago for excellence in cross-sector community development collaboration. The award recognizes the leadership role played by Citi Community Development in the “Child Support for College” program, a first-in-the-nation pilot program in Texas that allows custodial parents to convert child support payments into college savings accounts that pay for their child’s future education.
“Tuition and fees at Texas four-year public institutions have risen by 18% over the past five years, making college increasingly difficult to afford, especially for Texas’ low- and moderate-income families, yet research has shown that a child with school savings of $500 or more is about five times more likely to graduate from college than a child with no savings account,” said Woody Widrow, Executive Director of RAISE Texas. “Support from Citi Community Development enabled RAISE Texas to forge a new partnership with the Office of the Texas Attorney General’s Child Support Division to develop a comprehensive solution. As a result, child support agencies around the country have a model for working with nonprofit organizations to making college a reality for underserved children who are dependent on child support payments”.
The Community Reinvestment Awards honor the work of financial institutions that are advancing innovative solutions to the challenges facing lower-income communities. Citi was nominated by RAISE Texas, a statewide network of non-profit organizations, for-profit corporations, and public institutions which provides financial support, resources, and technical expertise throughout Texas, focusing on low-and moderate-income areas.
“We are honored to receive this recognition, and we accept this award on behalf of all of our partners involved in the Child Support for College program,” said Bob Annibale, Global Director of Citi Community Development. “A college degree can increase individual earning potential by more than $1 million over the course of a lifetime – yet for many families and children, personal or financial circumstances can lead them to believe that a college education is out of reach. However, we know that with programs such as Texas' Child Support for College initiative, even in the most complex of family circumstances, innovative child savings initiatives and cross-sector collaboration can empower more families to aspire and to save for their child's college education."
Approximately $76 million is delivered in overdue payments to thousands of custodial parents every month in Texas, and more than 75 percent of cases are families from lower to middle income households. Lump sum payments occur when a noncustodial parent makes a large “catch-up” payment to the child support system on arrears owed to the custodial parent. With funding from Citi Community Development, RAISE Texas partnered with the Office of the Texas Attorney General to create opportunities for custodial parents to voluntarily convert overdue lump-sum child support payments into Texas’ 529 college savings plan. In addition, participating families received regular financial coaching from non-profit members of the RAISE Texas network.
The Community Reinvestment Award marks the latest recognition of Citi’s commitment to promoting child savings. In 2013, Citi Community Development and the City and County of San Francisco received the Excellence in Public Private Partnership Award from the U.S. Conference of Mayors for the Kindergarten to College program, the nation’s first universal college savings account program. Last month, nearly 700 families in Los Angeles were honored for completing the “Families Save: College-Bound Savings Program,” created by the Youth Policy Institute (YPI) and Citi Community Development. The College-Bound Savings Program is a three-year partnership between YPI and Citi designed to help 1,300 low-income families with children in middle and high school to save for college, reduce debt, build credit and learn budgeting through financial education and one-on-one college preparation counseling.
Citi Community Development is leading Citi’s commitment to achieve economic empowerment and growth for underserved individuals, families and communities by expanding access to financial products and services, and building sustainable business solutions and innovative partnerships. Focus areas include: commercial and philanthropic funding; innovative financial products and services; and collaborations with institutions that expand access to financial products and services for low-income and underserved communities. For more information, please visit www.citicommunitydevelopment.com.
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