Santa Cruz Community Credit Union, Californis

November, 2005

When Maria Hastings was asked to run a tax program, she was not enthusiastic. Taxes? Since when have taxes been interesting? But after two seasons of running an EITC free tax assistance program, she regards it as an intensely human interaction which she enjoys immensely.

Maria is the EITC Program Coordinator for the EITC free tax assistance program at the Santa Cruz Community Credit Union (SCCCU). Two years ago, she began managing the program as an AmeriCorps*VISTA volunteer.

The SCCCU became involved with EITC free tax assistance through a partnership with Project SCOUT, a nonprofit that has operated VITA and TCE sites in Santa Cruz County for many years. The IRS estimates that 3,700 eligible families within the county fail to claim $6-8 million in Earned Income Tax Credits. When the SCCCU realized the impact that the Earned Income Tax Credit (EITC) has on low-income families, it became involved, managing sites previously operated by Project SCOUT and expanding outreach and service to EITC-eligible clients. The SCCCU now manages sites at two public libraries in Santa Cruz County from mid-February to April 15 and specifically targets EITC-eligible clients.

The Santa Cruz Community Credit Union is a nonprofit financial cooperative that promotes economic justice. As a community development credit union, the SCCCU is federally mandated to serve low-income members. With $60 million in assets and a staff of 50, it finances micro-enterprises, small businesses, child care, affordable housing, women- and minority-owned business, and nonprofit organizations. The SCCCU views the EITC free tax assistance program as part of its commitment to increasing access to financial education.

The SCCCU recruits and trains volunteers in conjunction with Project SCOUT; they managed a joint pool of 50-55 volunteers this year. They recruit through the Volunteer Centers of Santa Cruz County, from a local college and university, and through newsletters and mass mailings to community partners. The January training is provided by IRS instructors using the IRS curriculum for 16 hours, and adding on six hours of additional training for TaxWise and California state taxes. Despite this daunting time commitment, they have a strong core of returning volunteers. Maria says that the real challenge is getting them through the training, certified, and settled into sites. Once they start working, they love the program because they work one on one with real people, and there is an exchange of humanity between the volunteer and the client.

In 2004, its second year, the program completed 344 returns for total refunds of $300,000 at sites open for 12 hours/week. Better outreach this year meant less rush at the end of the filing season.

Outreach to clients is conducted through print media, community TV, and radio ads. The SCCCU works with community-based organizations, local government, and employers to get the message out. For example, a local food bank put the sites’ schedules in the 12,000 food boxes it sends out. The local Workforce Investment Board approached the SCCCU, wanting to get word about the EITC out to employers. As a result of an article it ran, Maria took 15 calls from local businesses interested in the program.

One challenge faced by the program is serving clients who need ITINs (Individual Taxpayer Identification Numbers issued by the IRS to taxpayers without Social Security Numbers). The VITA program is not certified to fill out the IRS W-7 forms. In addition to the complexities of communicating across the language barrier, the volunteers had to explain to clients that even after filling out the W-7 and completing their tax return, they still had to travel 45 minutes to the local IRS office to lodge it. Maria would like to develop a partnership with another organization to provide complete ITIN services at tax assistance sites.

Funding for the program this year came from First 5 (a state-funded organization that distributes money from CA state cigarette taxes). Currently, Maria is seeking more grants, as the VITA program needs 100 percent outside funding.

Targeting low-income people, the program records that 43 percent of its clients are Latinos, and most of the rest are Caucasian. The Credit Union is particularly interested in serving the unbanked, which constitute about 20 percent of the VITA program’s clients.

Being a newcomer to the tax business, Maria has been appreciative of the support and involvement of the local SPEC office of the IRS. She has relied heavily on the “outstanding resources” of the National Community Tax Coalition: its Resource Library, phone conferences, listservs, and information sharing.

Maria plans to start outreach for the upcoming tax season in November, conducting workshops for clients and staff of local organizations and community partners, and showing them how to identify people who might qualify. She wants to increase their use of media, maybe holding a press conference involving the mayor and local leaders.

Maria says that the effect of the program is tremendous. “You can measure the impact of your work when you see clients who receive large refunds. I was working with one Spanish-speaking woman with the aid of a translator. I asked her several times if she had any dependents other than the disabled husband she named. She answered, ‘No.’ I was just about to complete her return when she mentioned that she provides 100% of support for her 3 grandchildren. I redid the return, and she qualified for the maximum EITC and got a refund of $5,000. She had been supporting these kids for three years, so I lodged amended returns for the prior two years, giving her a total refund of $15,000! It was very emotional for both the client and myself.”

Written by Don Wedd.