 Okay, let's get to our panel. You know, we're having here so much evidence and isolation and this great opportunity that we're facing here today. I'm really excited about it, but we still want to talk about what's next. And I think that's the key of this panel, the future. What should we thinking right now about the next steps to take advantage of this opportunity and make sure that we're gonna have the longer impact that we all want in low income families in all America. And I think we have the best speakers for that. So what we're gonna do, just like in other panels, I'm gonna do a quick introduction of them and ask them to do a short presentation. We have some slides for you. Then we'll have a conversation and then we'll open the floor for questions. This is gonna last chance that you're gonna have to ask questions so make sure that you have them ready when it's time for that. So let's do that. And let me say one last thing. Before you start your interventions and presentations. One of the key things I think it's important to have in mind is that we all want to be part of the next steps. And when I say we, I'm talking about public sector, private sector, community-based organizations, great unions, regulators, financial institutions. Anyone who's present, we wanna be part of this. So I think that's important, what role can we play? Let's start with our first speaker and it's my colleague here to my right from the Federal Reserve, Ray Oshara. He's a senior advisor, the St. Louis Fed, but he's also the director of the Center for Household Financial Stability. And if you don't know the center, Google it right now. Go to your smartphones and Google it, because believe me, the amount of work that Ray and his team's bringing out is amazing. Not only because of the quality, but the quantity is always coming out. So get into those newsletters in the list there, wonderful. Ray, he has an extensive resume, I'm just gonna say, he's been advising presidential candidates, the last three administrations. He has been publishing major media outlets in this country and abroad. So I'm gonna stop right there because I really wanna hear what he wants to say. You're embarrassing me. So we are supported at due, Ray Oshara. Thank you, Adrienne, it's great to share a stage with you. And thanks to my earlier Fed colleagues to remind me to say that these are my own views, not necessarily the views, I've only been at the Fed five years. And I still don't remember to always say that. So it's great to be here and it's great working with you and others at the New York Fed, another pioneer, of course, within the system. So many of you know that our center has been looking at family wealth and why that matters for families and why it matters for growing the economy. And when we founded the center a few years ago, Jonathan Mince was alluding to this point, it was kind of a big deal to pay attention to the debt side of the balance sheet for many years. We worried about savings and assets and there were other groups worrying about the debt side of the issue. And we've learned that you can't do that anymore. And I think the great recession was a clear indication that we have to look at both savings and debts. We have to look at the entire balance sheet if we want families to move forward. So our center has been focusing on the household balance sheet, why it matters for families and why it matters for the economy. One of the things we learned was that we focused on the demographic drivers of family balance sheet. Okay, so age, race, and education have been the three particular drivers that we've looked at. We found that younger families, less educated families and minority families generally have lost wealth and have lost quite a bit of wealth in the recession have had a very hard time recovering it. Meanwhile, and we call those families struggleers. Meanwhile, thrivers, families that are older, better educated and white or Asian generally, they also lost some wealth in the recession, but they were quick to recover it. And one of the defining features of thrivers, families who recovered their wealth, was a diversified balance sheet with liquid savings, all right, with a lot of liquid savings. And so this is key, our own research is pointing out a great need for families to have liquidity. And in that sense, I think that tax time is a great moment for families to build liquidity. So we're very interested in this work. So I'm just gonna mention what I think are four frontiers and these have been alluded to in previous panels. The first is making debt repayment possible on tax returns. Many people have talked about debt whether or not it matters. One of the R2S findings that I found particularly striking and Dave Williams mentioned this, was the fact that unsecured debt was very strongly associated with lower levels of savings and higher levels of financial insecurity. This was not true for a secured debt, but it was very true for unsecured debt. And this is true in every single category of unsecured debt. So the impacts were pretty profound and pretty striking. And so I think a great step for the future would be to make it possible for families to make debt payments directly at tax time. Now I noted in David Martzal's research that the families who received the periodic payments among the uses were debt payments. And this has come up in other discussions as well. So I think there's a lot of potential with that. I know there's plumbing issues, there's legal issues. Third party payments are very difficult, I think Gail's nodding her head. But I think it's a real frontier and something that could contribute a lot to family financial stability. Second is making it possible for families to save in their child's 529 or for some sort of a child savings account. There's a lot of reasons for wanting to do this. First is that we have a lot of evidence from the field that early savings not only builds financial capability, but it often generates a future orientation and better behaviors in the short term. And saving and wealth building is a good idea, the earlier in life you do it the better. Yet right now we don't really facilitate that, the plumbing isn't in place. We don't have the product. Connecting to state base 529s is very awkward. It does happen if a provider makes it possible. But I think another frontier would be to make it very easy for families to save for their kids in a new product like a Roth at birth, something I worked on when I worked at New America or potentially, or I'd say in many ways a 529. So I think there's a real frontier there as well, but we have significant product and plumbing issues with that. Third frontier is the ability to open up savings accounts right on the tax return. Again, this has been alluded to before. I was struck by the R2S finding that 30% of the participants didn't even have a place to save, they didn't even have a savings account. Just imagine what the results might have been had they had savings accounts. Other, and I, granted I've been kind of blown away by some of the earlier presentations here about the really creative ways that people are saving, like buying meat in advance for six months. I mean, what do we do with that? That's fascinating, and Dave alluded to that too. But I think there is probably no intervention that will foster financial inclusion more in one fell swoop than the ability to open up a savings account right at tax time. And then the final future consideration is to take the brilliant idea of R2S of injecting these savings prompts into the software and making that available in all 13 of the organizations that are involved in the free file alliance. Okay, I know that CFPB, of course, is working on that with H&R Block, but there are, what, 11 others, I think? Is that correct? Well, imagine if each of them were to inject R2S-like interventions into the free file. So that would be a really low cost and a very easy way to achieve scale with a much bigger population. So I think maybe there's something that can come out of the CFPB and other research that would point to that direction, create a little bit of a template for other groups in the free file alliance to take up this idea. I'll leave it at that. Thanks. Thank you, Ray. Our next speaker is Justin King, who I learned. He's a graduate from St. Lawrence University in New York City. I know well because he's participating in the College Fed Challenge, one of the programs that we have here, the Fed for Students Interest and Monetary Policy. Justin has a lot of experience in legislative affairs, working with former US Senator Jeffers from Vermont. And some of the major battles in the last few years have been present, including the Individuals for Disabilities Education Improvement Act and No Child Left Behind, and issues affecting children and low income Americans. Currently, Justin is the policy director of the Acid Building Program at New America. Thank you. Be careful not to get me too closely identified with Congress. I'll have Rotten Fruit thrown at me. The representative Serrano did a pretty good job earlier today, I thought. I'm Justin King from New America. We're a think tank based in DC, primarily focused on these issues from a federal policy perspective. Thank you for the kind introduction. Three keys I really want to focus on here. We need to level the savings playing field, is the first one. The second one is, I think we've demonstrated pretty well, though Tim's question about debt is complicated and probably deserves a lot more nuanced discussion than we might have time for today, but emergency savings are necessary and we have to start acting like it. And then the third one is that there is some competition between the states and the feds here. The problem is that there's competition between the states and the feds at times to see who can do the best job for people and then at times to see who can do the worst job for people. So we want to be fostering more of that competition to see who can lead the way here. So I'm absolutely grateful to the gentlemen who asked the last question to the previous panel about people choosing not to save for entirely rational reasons. The first piece of advice that a financial planner would give to someone is you should be putting money aside into an emergency fund. I mean, that's just sort of like, read any one of 10,000 articles that appears on any sort of financial advice website and that's the first thing. But we don't have one set of rules when it comes to savings in America. We have one set of rules for middle and upper income Americans. And then we have an extraordinary mess for low and moderate income Americans. If you're participating in public assistance of any type, there is likely to be a limit on the amount of money that you are allowed to save in order to become eligible for that program or before they'll kick you off of that program. So all of these programs that are meant to help people are tied up in red tape that prevents people from saving. And the problem is not that there's a prohibition on savings, though that's obviously a problem, but the problem is that the rules are so convoluted that no one can figure out what they are. We're in New York City, we're in New York State. What are the rules here? And I feel a little embarrassed about doing this. There's probably 20 financial coaches in here that could do this much better than I could and I trust one of them will correct me. If I'm wrong, but if you want nutrition assistance through the SNAP program, there's no asset limit. That's great, and it's true in 33 other states. If you want financial assistance through the TANF program, what we used to call welfare, there's an asset limit of $2,000 unless somebody in the household is 60 years or older, then it goes to $3,000. But there's also a $1,400 exclusion for money dedicated to post-secondary savings, but that doesn't cover a 529. There's no asset limit on home heating assistance. It gets cold in New York State, people need help heating their house. Unless you're in the crisis assistance program, then you have to spend down to $2,000. If there's someone in the house with a disability, there's an entirely different set of rules. There's now an account called an ABLE account that loosens up some of those rules, but not if your disability occurred after age 26. The rules are different in New Jersey. They're different in Connecticut. They're different in Pennsylvania. They're different by product. The good news about 2016 is that we have incredible data visualization techniques that we can apply to problems like this. So I had some of my colleagues whip up a decision making flowchart for low-income people to decide whether under this rule scheme, it makes sense for them to save. That's the wrong slide. That's a Jackson Pollock that made its way into my thing. Low-income folks put up with a level of surveillance and complexity that other Americans would reject out of hand. Somebody mentioned this earlier. I think Tim mentioned this earlier. We boosted the size of the earned income tax credit when the Recovery Act hit. We recently made that boost to the EITC permanent. That's a good thing, but when we boosted it the first time, folks realized, my gosh, we're gonna have folks that are gonna get their tax refund and they're not gonna be eligible to put food on the table with SNAP anymore. Here's what we'll do. We'll tell everybody just don't pay any attention to that $2,000 or $3,000 that showed up in the bank account. And that's the permanent law now. That's the way it is. You disregard an EITC-based refund in terms of asset limit determinations. This is madness and it's no wonder that people choose not to save. We need to have one set of rules for people. And it would be best if that rule was you should be saving. It's better for you, it's better for your family, it's better for your community, it's better for your country. But that's not the message that people hear right now. So the first thing we need to do is level the savings playing field, reform these outdated rules that prevent people from saving. That's gonna be something that's gonna let all the other amazing things that people are working on really have an impact in low income communities. My second point is that emergency savings are necessary. This is a chart that Clint Key probably recognizes. Charting the average number of days of emergency savings in households by income group. Folks at the bottom end of the income spectrum have six days of savings on hand. This is just a demonstration of the incredible amount of financial insecurity in America and it extends up the income scale. This is not a poor person's problem. This is a mainstream American problem. I'm gonna steal another chart. This is from my dear friend Ezra Levin, just sitting off to my side here. This shows the amount of benefit so the government does support savings. It only supports retirement savings. It does that to the tune of $150 billion a year. If you're a top income earner, you might get a $4,000 benefit or a $10,000 benefit from those retirement savings policies. If you're at the bottom of the income spectrum, you're gonna get $40 from this. You're going to get $100 from this. Give me 10% of that $150 billion and let's see what we can do with some low income families and see where they go with it. Representative Serrano talked about this idea of a financial security credit. For us, that's a first step towards a vision of a government that says clearly to people, we want your household to be financially stable. We want you to be saving and we are going to make the investments that are necessary to do that. It does it two ways, one by delivering extra resources to striving families. And two, by breaking this kind of insane stranglehold that retirement savings has on federal policy. People's needs are not just locked up 30 years from now. They are happening day to day. We need to recognize that. I'm gonna save my third point for later if we have time to get to it and turn it over to Ezra now. And thanks everybody, that was very kind of you. Thanks. Thank you, Yostin. Our speaker is Ezra Levy who is the Associate Director of Government Affairs at CFED Enterprise. He also has experience in Capitol Hill. He was Deputy Policy Director for Congressman Doggett from Texas. And he was also in his campaign in the field, working on some of the major regulations, some of them that we have talking today, like EITC and American Opportunity Tax Credit. He got a bachelor from Cartoon College and a master's from the Woodrow Wilson of the Woodrow Wilson School of Public International Affairs at Princeton. He's gonna be talking about the rainy day EITC. Great. Thanks for having me. This seems like it works. Okay, great. So I'm talking about rainy day EITC, Ezra Levy from Corporation for Enterprise Development, just so you know, the views that I express here are mine and the organizations, but because we're an advocacy organization, my goal is to make them your views as well. So let me know if that's not happening. Please ask questions. You're 16. Right. Okay, so on the agenda very quickly, I'm gonna go through what CFED is, what we do. I wanna spend most of the time, though, on the development of this proposal, this tax time savings proposal. And we'll go over some key policy components that make up this proposal. We'll talk about going from idea to legislation. We're not there yet, but hopefully we'll get to legislation soon. And then we'll end on next steps. So briefly CFED, we're a national nonprofit based in DC. We do three things or a thousand things, depending on how you look at it. But the three buckets here are identifying good ideas. So we have a program team and there's program work on the ground. We have a applied research team that does applied research, obviously. They're identifying the good ideas. And then we also try to develop partnerships that's within DC, but also through our field team. So we run a couple of big nationwide grassroots, grass-top networks of folks who are working on financial security. Maybe they're running bite sites or they're running financial education programs, what have you. And then if we're really doing everything right, I'm on the federal policy team, we're trying to bring these ideas to scale. So working with the folks on the ground and working with our researchers to identify these ideas and come up with these new ideas, but so I see come up with these ideas. I'm reminded of Representative Serrano's comments earlier, both because I think I'm one of the people in the crowd who's younger than his tie, but also because he said he gave credit to new American others for coming up with the idea that he was presenting on the financial security credit. This is not my idea what I'm presenting here. There's a great book, it's not like I'm poor with Sarah Halper Meakin, Catherine Eden, and others. There's also research related to this by Sarah Sturmburg Green, looking at the financial lives of low-wage workers in America. And this book is phenomenal because it takes in anecdotes and it has great data and it gives some political history and social history. I'm just a huge fan. I don't get any money if you buy it, but I still highly recommend it. At the very end of this book, or near the end of the book, there's a chapter of proposals for next steps. And a paragraph or two proposes this new idea, what if we could have a deferred EITC? Some portion of low-wage workers who are receiving the EITC, it's a huge benefit to them, but they find themselves three months later, six months later, nine months later without any emergency savings. And wouldn't it be great if they could check a box and just defer some portion of their EITC? We had CFED, thought it was a great idea. So we worked with the authors and Sarah Halpern-Meek and to start putting this together. We also worked with our taxpayer opportunity network. So this is one of those grassroots, grass-tops networks I mentioned a little bit ago. It's 600 to 700 organizations connected to the free tax prep field. A lot of bite sites, volunteer income tax assistance sites, who really know what works on the ground. Our goal for this rainy day EITC policy was to not have it just be something that we thought up in a windowless room in DC or New York. We wanted to really work for folks who are receiving benefits from bite sites. People who are preparing the tax returns of low-wage workers. So they were crucial in actually honing this policy. And we released this proposal and the proposal came out in July of last year. And this is kind of a very basic overview and I'll go through specific components. But the idea is that if you are an EITC eligible family, let's say you're getting $2,500, roughly the average EITC, you can check a box. You check the box and you opt in to this program to defer 20% of your EITC. So that means instead of receiving $2,500 at tax time, you're receiving $2,000 at tax time and deferring $500 of it for six months. As a side note, it was called in the book deferred EITC but people really didn't like that name. That's why we landed on kind of the cutesy rainy day EITC, which I will say is played really well. We'll see if that plays well in Congress too. So six months later, you've deferred $500 but you don't just get that $500. There's the savings match component to the idea. So you get $750 and it's just deposited in your same account. That's the 30,000 foot level. Specifically, I want to go over the individual components here. The overriding goal when we were putting this together was simplicity. What we heard from the researchers, what we heard from the folks on the ground was that, yeah, great idea. We need emergency savings. There's a desperate need. Some folks are really going to want this and we've actually gotten some research from Intuit and CSD that shows that 82% of folks who are asked whether or not they would like something like this would in fact like something like this. Whether they actually use it and opt into it, that's another question. But a huge amount of interest. But it's got to be easy to administer and it's got to be easy to explain to the folks who are actually receiving the benefit. We heard from Gail one earlier, I think, that a good, what it was. You're still sitting next to each other. No, yeah, it's not helping things. That a good idea for a program is all well and good. But if it's impossible to administer, you don't have much of an idea there. So the goal here was to make it possible to administer and explain. Opt in, we would have loved to make it opt out and just automatically enroll everybody. The feedback we got is that would make a lot of people really mad and confuse a lot of folks. So it's opt in, you're going to have a lower participation rate, but the people who are participating are actually going to want it. 80% of tax time, 20% deferred. Again, we would have liked to provide a lot of options for folks. They can defer more, they can defer less. But we're talking the IRS here. We don't want them to have to create another 30 page form to opt into the program, same deal for the 50% savings match. I really like the research we heard about earlier about the impact of a 10% match versus a 20% match. That lines up with the feedback we got. Originally, this was proposed as a one to one match, 100% match. And the feedback we got was it's going to be more expensive and you're not going to get higher take up. So if you want to cut the cost of the program, there's an easy way to do it and you'll still have similar levels of take up. We opted here for a single lump rainy day payment six months later. Again, in the interest of simplicity, if somebody checks a box on the tax form, they know that six months later they will receive the rest of their deferred EITC. It would be nice if you could say, what if we make these payments quarterly or monthly or give people an option about when to get it. Again, it's complex. Final word, okay, delivery direct deposit. We have data that shows that 90% ish of EITC recipients actually do direct deposit, so although we're losing a few, we're not losing a ton. The escape hatch, now this is key. What we heard a lot about today was the volatility in both income and consumption and expenses, those are the same thing, income and consumption. The escape hatch allows folks to get the money out that they deferred if they need to, if their car breaks down, if they have some kind of medical emergency. So it's not actually in a lock box. So I'm on final word, so I'll just say we're working on legislation. We actually have a bipartisan bill that we're working on. That start is a democratic bill, but yeah, we have had folks come to the table. So we're excited to roll something out relatively soon, although I will say I gave almost this exact presentation a couple months ago. Sorry for everybody, this is my Marco Rubio moment. But so next steps, we're going to be finalizing TA from the administration, both from HHS and Treasury. Line up third party validators, everybody in the room. If you wanna weigh in on this, great, let me know. We're still taking in feedback. We don't have a final proposal yet. Nothing is baked. And then all we have to do is pass federal law. So coming to a theater near you. Thank you. Thank you, very interesting proposal. And I'm sure we're gonna have a lot of questions about it. Our next speaker is David Marcel. He's the CEO and president of the Center for Economic Progress in Chicago. He's a provider of tax and financial services to low-income Americans, reaching almost 25,000 per year, an impressive average. He's one of the leading voices in economic security in the United States. He's very involved in the non-profits and foundations in Illinois. Just to give you an example, he's in the advisory board of the Second Federal Committee Credit Union. He's also a director of the Illinois Coalition for Refugee and Immigrant Rights. They say correct? Okay. And Illinois Asset Building Coalition Group. He is a graduate from Northwestern as well as from Kello. David. Thanks. In the interest of time, I'll jump into immediately kind of an overview of what I want to cover. I want to kind of put out some thoughts around the role of government going forward, the role of industry, the role of, we use the term non-profit sector, I think it's time to drop that. We're the social purpose sector since when did we allow ourselves to be defined by tax exempt status and something that we are not. So I think it's important to think that through. I want to share kind of our parallel proposal to Ezra that we've done in Chicago around the EITC, a pilot around rethinking the payment model, and then list a few challenges for everyone here today just to end the day. So most instructive probably, and let's take a visual kind of view of this, we're talking about role of government here today a lot. We had Melissa from Treasury, anyone here from IRS? Okay, we have a problem, and I think I want to underscore it. They are the delivery mechanism, they enforce the tax laws, they collect the revenue, but they're actually not at the table. And I think that's a challenge that we have because the IRS is a woefully under resourced agency right now going through a lot of challenges. We've heard through both the presentations here today and having Intuit be both a sponsor and David Williams speak, tax software undergirds the world of tax preparation. We no longer completing paper forms as we would have 10, 15, 20 years ago. And so the right tax software constructed the right way can either hinder or bolster linkages to financial wellness. And I think that's really important. The IRS approves tax software every year and establishes requirement. The IRS also oversees the VITA program, which many of us here are part of, and manages the VITA grant program, but I will say the IRS manages this program so close to the vest that they allow almost zero creativity and zero latitude for the kind of flexibility that on the ground providers could really benefit from in terms of connecting the dots between taxes and long-term financial health. So we have some opportunities here. There's a great example. We've heard form 88, 88 unless you're a tax practitioner, you don't really know what it is, but it's a refund splitting. That actually required the IRS to make this possible, but they would never have acted on their own. And one important note to mention, several people practitioners mentioned the tax software that we use tax wise, it's changing next year to tax slayer because the IRS just changed their vendor and the contract. So there actually are some opportunities here. So the way I look at in the future, one thing is we need to get the IRS to change the terms and conditions of the tax software licensing process, and I think Ray alluded to this, to integrate savings platforms. Why aren't all of them connecting the dots and making it more logical? Because into it may be the industry leader, but almost no one else is following right now, which is really unfortunate. And I think expanding the VITA authorization to allow financial services at tax time would make a lot of sense. We have an opportunity working with the tax industry to make some real changes, we'd be able to better understand the tax industry. Again, into it's here today, but Block isn't here, Jackson Hewitt, Liberty. I would venture to say that some of them don't have quite the reputation of others. I'll leave it to your imagination to figure out why. But I think we need to look at the settlement process and tax refunds. It was no accident that we got rid of tax refund loans, refund anticipation loans, it was by virtue of having a long concerted advocacy effort and the right people at the IRS and Treasury to get rid of it and the administration. And again, I would put out there that I don't think a lot of the tax industry is thinking as forward as others here about what we should be doing about the financial lives of low income people. So I think I would apply, I raised it with David, I think we need into it to take some of their lessons learned, move it across their entire platform, not just through TurboTax, but to actually all the tax software they provide to bricks and mortar providers and to be transparent about it because I think into it can actually drive industry change and may well already be doing so. And I think we need to look at the companies that are providing all the settlement products, the Green Dot, which acquired Santa Barbara Bank and Trust, some of the others out there, and to provide better product offerings. I think we need to push them as best as possible. And the fact that the end of the day that we have no regulation of the tax preparation industry, there are no minimum standards right now to ensure someone's competence to prepare tax return. In fact, a vita volunteer has a higher level of professional certification than the paid tax prepare around the corner. And that is because US District Court throughout the IRS rules and regulations, not surprisingly in the last two weeks alone, in Chicago we've had two major lawsuits filed, one by the State Attorney General, one by Department of Justice, shutting down tax preparers for defrauding hundreds if not thousands of taxpayers of their refunds. Absent any minimum standards, I think we're gonna continue to see some of these problems. So what is the role of us at the social purpose sector? I think one thing that's important for Vita to rethink what we're doing, we're serving 2%, maybe 3% of overall market. We can grow potentially. The end of the day, we need to both serve the market share we can, but to be serious about research, to be serious about policy, to be thinking ahead about where there are opportunities. I really wanna commend CFED and the Taxpayer Opportunity Network for increasing the Vita authorization this last year. There's actually more dollars for, boy, we went quick to final words. You're right, she's fast. So I do wanna say a few words about our EITC pilot in Chicago, because I think this is really important. One of the things that really has, I think is we've just allowed to happen over the years is the proportion of a person's refund commensurate to their actual income has gone up fourfold in the last four years for people getting the EITC. You heard that right. It has grown four times the rate of actual wage increases. So is at the end of the day a $1,500 or $2,000 or even a $3,000 refund a good thing? It generally is except for what we're talking about all the income volatility and expense volatility that people are experiencing. So we looked at very specifically putting in place an evidence-based pilot in Chicago that would restructure the earned income tax credit. Ezra has put forth the idea for a rainy day EITC, a deferred model. I think it has great potential. We decided to bring it forward, play it forward so to say, and make it a periodic payment where people could get up to 2,000 in increments of $500, four times 500 in the year that you technically earn the EITC. And the rationale again is income volatility, high levels of debt, high levels of financial stress that low income workers are experiencing. And we looked at specifically from an evidence-based perspective, is it administratively feasible? Would periodic payment at the end of the day actually be desirable for people who participated and would it improve household financial stability? Payments were made in the year that people technically earn their refund. And everyone who participated had to take part in surveys and focus groups so that we could actually collect data over the course of the year. As well as at the back end, when they actually filed their return, when they got a lesser refund to determine would they still like it. So we found, and again, it's interesting with some of the evidence from the work that you mentioned, Ezra, that the folks at WASH. You have looked at, in this case of the participants, and there were 340, 72% of participants indicated a desire to participate again. 90% actually preferred periodic payment. We didn't say specifically how, but we asked them, would you like it spread out over the course of the year? 90% preferred it to lump sum. And not surprisingly, but a little difficult for us. It was a one-year research pilot and we're on the ground organization. We continue to get calls today from people who want to participate and say, can't I get my EITC refund in periodic payments? We'll say, well, when the policy passes Congress, you'll be able to have a chance to do that. So what we found were from the participants in terms of evidence at the end of the day was reduced borrowing from family and friends, which we know happens a lot. Half as likely to actually have paid late fees and used to pay a loan in the last quarter of the year proceeding. So they're one of the things that is consistent across EITC studies that look at participants as proxies for low income workers, which they are, is that in the final quarter of the year, households are enormously financially stressed. Federal Reserve Bank in Chicago actually did a study around a household food security and the level of nutrition in EITC households goes down in the final quarter of the year. Again, I think part of the condition of financial stress. We did find something very surprising and I don't think we need to say periodic payment is a counter to saving actually is that the people who participated in periodic payment reported increased saving over the course of the year. They actually had a greater ability to save. And at the end of the day, again, I think I would say the conclusions were that we see periodic payments in whatever form they're delivered, whether deferred or in advance, are administratively feasible, that participating taxpayers in our study preferred it, and that all the positive financial outcomes I think we're here for today, which is reduced debt, increased tax time savings, and less financial stress would be possible by putting something like this into play. So the three challenges I leave you with very quickly, and I know I'm over time, is I think we need stronger collaboration and coordination between all of the intermediary organizations here and those delivering the services. I think we need to connect us better and not have too many studies out there. We need to ground them in people's everyday lives, select the funding from the donors who are willing to support it, but really work together because there's only so much attention we can focus on all these issues. I think we have good example of pilots that have been done here today that are connected to serious policy change. When Jonathan, I think, dreamed up save, or New York saves, turned into USA save, save USA, the idea was we had to have the financial security credit because it's not going to happen without some kind of policy. P2D, great work around savings bonds. Now we actually have split refunds and that possibility. And then last but not least, I think the thing that most troubles me today, I'll put out there, is I wasn't even honestly thinking as an organization on the ground promoting my RA to tax filers that maybe we need to think through, is it retirement, or is this really a better vehicle for savings? And do we need to think through the messaging a little differently? I think we got going so late in the game because of just timing. We didn't figure out the marketing to go with it. So I think we have a lot of homework to leave with here today to figure out what comes next. Thanks. Thank you, David. Thank you to all of our panelists. And before we ask our audience for questions, I have a couple of questions for you. I mean, I think this is very exciting because we were talking about the future and we have some very good ideas, programs, pilots already in place that are telling us what directions should we taking. But one question I have is, how do we connect the household with the community? How do we start thinking at this point, at the early stages of these next directions, how the gains that we have in financial security, financial capability at the household level will translate to benefits at the community level to see economic development at the local level? I would like to hear your thoughts on that if you have already some ideas about it. You know, they are deeply connected already. And I think sort of the first step is looking at those connections. Not Clint, but other colleagues of his at Pew put out a report just last week on levels of financial insecurity in neighborhoods by neighborhood, by measures of sort of neighborhood wealth. And you can start to look at this, look at financial insecurity in the same way that you look at a pathology, right? It is a disease that impacts neighborhoods. And so, you know, I think the connections are already there. They're working in the wrong way in a lot of places and a lot of times now. So, you know, in a lot of ways I think it's our responsibility to try and address exactly that formulation you put forward. I mean, I think, you know, other data from Chetty, of course, and many others shows a very clear link between certain neighborhood characteristics and the prospect of a child moving up, the income ladder later in life, those being the fraction of African-Americans, single parent households, quality of schools, level of inequality. So I think making the case with data that these things are connected is an important part of the answer. I mean, and one thing on the policy angle, yeah, we have to talk about VIDA if we're talking about communities, volunteer income tax assistance programs. We've heard from a couple of folks in the room who work with these organizations, but they are fundamentally, one, that they are community efforts. They represent a small federal investment, but it's leveraged in a big way by local communities to provide a huge amount of service to low-income folks throughout the country. But these are community-driven efforts. But the second piece of VIDA is they're bringing money in to communities. So when we manage to get more folks their tax refund, that's investment that's going into the community from the federal government. So more EITC, more CTC for these low-wage workers means community investment. I found a way to get back to one of the slides that I missed. So I'm federally focused, generally speaking, and I talked about the feds quite a bit. But one of my points that I wanted to make earlier is that there are 26 states that have their own EITC on top of the EITC that the feds deliver. That means there's 24 states that are blowing an opportunity to invest in their low-income communities and to reward their workers. If there are folks that represent the gray states on that left-hand chart, this should be a high-priority item for changing policy in your state. Sorry, Ray. No. Yeah, I'm good. I'm great. I was just going to mention a paper from Mita Brown here at the New York Fed showing a correlation between quality of financial services in the neighborhood and the prospect of upward mobility. That paper will be published in a few months by the St. Louis Fed. It wasn't very minor point, but I see this all the time when I'm in neighborhoods in Chicago and I've worked some with LISC on projects there. This is truly remarkable when you look at the square footage dedicated in low-income communities to predatory and subprime financial services where storefronts are taken out of commission to provide quality retail services just to provide products that really, at the end of the day, are stripping wealth out of the community. And in some neighborhoods in Chicago, 25% of retail square footage is dedicated to financial services and it's not financial institutions. It's all the other lenders out there. Thanks. Okay. We have some time for questions, which I know a lot. So what I will suggest is let's hear some questions from the audience and then the whole panel can answer them in tandem. I see. And given the time, I'm going to ask you to tell us your name, what organization you represent, and be very, very brief because I know some folks need to leave very soon. So we only have five minutes. Let's start here. Let's hear the question. Yeah. Fiona Gregg from the JPMorgan Chase Institute. Very simply, I think the proposals for the EITC periodic payments or rainy day are awesome. I'd love to hear the counterargument. Why wouldn't we do this? I mean, if it requires so much effort and so much hard work to get people to save the EITC money, why wouldn't we just structure it as such? I agree. I mean, I think cost. Cost is a problem. If you're providing extra funds through matches, also there, I think, David, maybe you should talk a little bit about making the case on early EITC. Well, and I think I see David Williams shaking his head having worked many years in the IRS. I think the biggest challenge is the inability of the IRS to really construct the interface, the forms, to manage all of it. I mean, I think in an ideal world, I would like to see this in the next two or three years, but I think we may need to see the private sector innovate somewhat and then take the lessons learned or build some more evidence-based pilots and then with a new Congress and a new president with more resources for the IRS. I have a deep worry, and I'm just being honest here among friends, that the fact that the advance EITC was never structured right, it was taken out of commission three or four years ago, and if we move too quickly on this and the IRS can't administer it, we'll end up with egg on our face. So I think we need to have the ducks fall in a row. I think one idea might be we pursue it on the federal level, but we find a state which has a large state EITC, and there are several, and we pilot it at the state level, even though it's not as large a dollar amount, but in a Minnesota or a Wisconsin, I don't know how big is the state EITC in New York compared to federal, 20%, 25%, is try to do it in one state to prove it and then bring it to the federal level. But I don't know, David, if you don't have a microphone, but you go at the end. Oh, you still have a chance. Take the mic away from him. But I will say your question, why not do it? I think the response that we've gotten to pitching the rainy day EITC on Capitol Hill, I mean, it is a bipartisan response. You can go into conservative and progressive offices and folks get that it's a good idea for low-wage workers to put away money if they're able to put away money. So I think that your question is the question we've gotten in several offices, which is great. That's what we want to get. I hate to do this, but I think that we don't have more time because people are telling me, oh, we have one. Okay, one more question. Peter Burgess, true value metrics, very quick question, interest. What should the interest be on a savings of a small amount? You know, borrowing as a small amount, the interest rate is very high. If I'm very, very rich and billionaire, I want a very high return. What is the return that you get on a small savings account? If you sign up for a MyRA, you get a much higher rate of interest than you'll get at any other financial institution for a pure savings account in the country. And I can't believe I have to say that because Melissa Coyde didn't say it earlier today. It's, you know, it's small. Two and a quarter? Well, yeah, for MyRA, a quarter for anything else. It's small, but I think one of the things we've learned over the last 15 years is that interest rates don't matter that much when it comes to behavior. It's like that same thing about matches. It can make some change on the margins, but it doesn't really matter. There are benefits to family saving beyond interest and growing their interest rate. And I think it's our view that the government's position should clearly be in favor of promoting stability for families, security for families, and opportunities for families to move up. And savings, regardless of the interest rate, begins to give you a down payment on those things. And so if it's up to me, I focus on those things more than the, more than the interest rate. And if I can dominate the conversation a little bit longer, a rich person puts a dollar into a 401K and the government gives them 40 cents. A low-income person puts a dollar into a 401K, which maybe they should or should do, the government gives them a dime. That's a problem. We're nothing at all. We're threatens to kick them off of public benefits. That's right. So. Well, I think we're going to conclude our panel. Thank you very much for David, Ezra, Joshi, Ray.