On June 6, 2011, I was honored to join the Mayor in declaring that June 2011 is “Bank on Gaithersburg Month” in the City. Bank on Gaithersburg is an innovative package of interconnected programs and services designed to help our residents — especially those who are “unbanked” or “underbanked” — attain financial security through accessible banking products, free tax assistance, and free financial education workshops. It is one of my signature initiatives, proposed after I attended the National League of Cities conference in 2008 and learned about the first “Bank On” program in San Francisco. You can read more about Bank on Gaithersburg, how it works, and why it benefits not only the participating consumers but also the local economy, community financial institutions, and the government, by reading this guest blog that I authored last year for Maryland Politics Watch.
The program is one of only eight nationwide to be awarded a grant from the National League of Cities, and it has been featured at the Maryland Municipal League’s conference in October, where I spoke to a packed house of municipal officials from throughout the state. In a nutshell, Bank on Gaithersburg, established in September 2009, seeks to help residents access mainstream financial services, safeguard their money, and identify opportunities for future asset building. The program focuses on increasing the availability of no-cost starter accounts, raising awareness about the benefits of account ownership, encouraging the opening of accounts, and providing free financial education. In showcasing the program during the month of June, city staff will focus on promotion, outreach, and events. Look for information about Bank on Gaithersburg presented via events (flea markets, farmers’ markets, open houses, classes), signs, publications, the City’s website and TV station, bus stops, letters, brochures, and other displays.
On May 24, 2011 the Montgomery County Community Action Board awarded Gaithersburg the Henry L. Dixon, Jr. Award for the work that Bank on Gaithersburg is doing to help low-income residents. It has the potential to ripple outward to benefit the local housing market, local retail establishments, small businesses, educational institutions, and many other entities that rely on financially secure consumers or on loans from banks and credit unions. When people are saving more, they can rely on a nest egg that makes them less likely to default on their mortgages, or run out of money for college tuition, or require food assistance from the government. And with a little extra cash saved up, they can spend some of it at local restaurants and stores. And the more that people deposit into local banks, the more leverage the banks have to free up credit for small business loans. In recent months, the county, state, and federal governments have all taken steps toward establishing their own “Bank On”-style programs, but Gaithersburg was among the first!
When we added the Volunteer Income Tax Assistance component to the initiative last year, Gaithersburg instantly became the most successful VITA site in all of Montgomery County in its very first year of operation, providing free income tax assistance to more than 700 people, representing 37% of all VITA clients county-wide – due in no small measure to the excellent outreach from Bank on Gaithersburg. Thanks to Bank on Gaithersburg, 88% of taxpayers using the Gaithersburg VITA service had their tax refunds direct-deposited in local financial institutions, where their money is insured and can earn interest. Eighty-nine percent of the VITA clients county-wide received money from the Earned Income Tax Credit, which they might have otherwise forfeited if they hadn’t submitted the paperwork. The total tax returns for all four VITA sites in Montgomery County amounted to just over $7 million. That is real money that can go back into people’s savings and back into the local economy, especially when considering that 37% of the VITA clients are located in or near Gaithersburg.
Bank on Gaithersburg may have been my idea, but it took the dedication and hard work of city staff, our partner financial institutions, and our partner nonprofits to make it happen. So I want to again thank all of them for turning my vision into a reality. I hope you take the time to learn about this innovative and valuable initiative during “Bank on Gaithersburg Month” in June. It is the creative exploration of new initiatives like Bank on Gaithersburg that makes our City so cutting-edge in the way we govern, lead, and serve our residents and businesses. I ask for your vote in November to ensure that we continue this successful philosophy. If reelected, I will keep exploring new ideas everyday; you can bank on it!