Helping Americans Build Savings and Wealth
Adopted at the in 2015
WHEREAS, federal tax benefits designed to encourage savings and investment primarily benefit wealthier households; and
WHEREAS, of the $340 billion of wealth-building tax expenditures, only 12% accrue to the bottom 60% of households, and the top 1% of households receive more benefits than the bottom 80% combined, according to the Corporation for Enterprise Development (CFED); and
WHEREAS, more than 50 million households have insufficient savings to sustain themselves for three months in the event of loss of job, unexpected major expenses, or a major medical event; and
WHEREAS, though economic mobility is thought to be a part of the American dream, research indicates that children born and raised in lower income households are likely to remain in that economic status as adults (CFED); and
WHEREAS, research also shows that critical provisions of the Earned Income Tax Credit (EITC) and Child Tax Credit (CTC) build financial security of low income households, lead to better school performance and enrollment, and boost earning power later in life; and
WHEREAS, certain provisions of the EITC and CTC expire in 2017; and
WHEREAS, 1.3 million U.S. children are born each year into families with negligible savings to invest in their children's future; and
WHEREAS, research indicates that low-and moderate-income children are three times more likely to enroll and four times more likely to graduate if they have just $500 in college savings. NOW THEREFORE BE IT RESOLVED, that The United States Conference of Mayors calls on Congress to make permanent the current EITC and CTC, and to extend eligibility of such benefits to childless workers; and
BE IT FURTHER RESOLVED, that Congress enact a Financial Security Credit for low income families that encourages them to contribute a portion of their tax refund to eligible savings accounts with federal matching funds deposited into their accounts; and
BE IT FURTHER RESOLVED, that Congress enact a Children's Savings Account (CSA) at birth, or at kindergarten, for low and moderate income children that would be seeded by an initial investment by the Federal government and include matching requirements for parents for purposes of future education, training, homeownership, and other mobility enhancing activities. --
Projected Cost: Unknown