UNC researchers with the School of Social Work and School of Government have been awarded a $250,000 grant from the Robert Wood Johnson Foundation (RWJF) to lead a project designed to help address poverty in rural North Carolina.
The project, “Creating Community-Designed Approaches for EITC Uptake in Rural North Carolina,” will focus on getting more eligible families to take advantage of the Earned Income Tax Credit (EITC), a federal benefit that historically has shown success in lifting families out of poverty.
According to the IRS, the federal EITC was created in 1975 to assist low- to moderate-income working families, particularly those with children, by eliminating their income tax liability. Households that qualify for the tax benefit may also receive refunds, which can amount to thousands of dollars.
Because the tax credit has helped many families already living paycheck to paycheck, federal lawmakers have praised the EITC as a significant anti-poverty tool. For instance, in 2016, an estimated 6.5 million people, including 3.3 million children were lifted out of poverty because of the tax credit.
However, in North Carolina, more than 20% of the state’s qualifying households never claim the credit. As a result, families and poor communities are collectively losing $450 million annually – money that would not only boost household incomes but improve residents’ overall health and well-being, said Sarah Verbiest, director of the School of Social Work’s Jordan Institute for Families and project principal investigator.
“In North Carolina, many of our state’s poor are concentrated in rural communities already struggling with an increasing loss of jobs and a lack of economic opportunity,” Verbiest said. “In these communities, particularly those where people of color reside, workers are trying to make ends meet on poverty-level wages, which amounts to about $26,000 for a family of four.”
The financial struggles these families and their children experience can result in poor and disparate outcomes across their life course – from infant mortality, to third grade reading, to chronic disease, and beyond, Verbiest said. Families of color who reside in these communities are especially impacted because they face additional barriers to financial advancement.
“Ultimately, the goal of this project is to spark action that leads to change and increased access to financial resources for rural communities, particularly those where people of color reside,” Verbiest said.
With the UNC study, researchers will examine the role of the federal EITC in improving the lives of some of the nearly 4 million people in the state’s small towns and rural communities. The study will focus specifically on McDowell, Rockingham, Robeson, Beaufort, Nash, Halifax and Edgecombe counties.
The project’s interdisciplinary team includes co-principal investigator Anita Brown-Graham with UNC School of Government and ncIMPACT; co-investigators Calvin Allen with Rural Forward NC; Alexandra Sirota with the North Carolina Justice Budget & Tax Center; and Danny Ellis with Together Transforming Lives, Inc. School of Social Work associate professor Paul Lanier is also a co-investigator on the project.
“This partnership is unique and very exciting for the Jordan Institute for Families and the School,” Verbiest said. “This team has expertise in research, data analytics, budget and taxes, maternal and child health, community engagement, health equity, and economic development working across social work, business, health, faith, government, and policy sectors. Our coming together for this project signals our shared desire to support the health and well-being of rural families.”
Perhaps most important, Verbiest emphasized, is that residents living within the study focus areas, particularly people of color, will play a vital role in leading the research and in creating community solutions. Such efforts, she said, will help to ensure that the interests, needs and voices of the community are supported and promoted in any new policies, programs and strategies for increasing the use of the federal tax credit and for advancing conversations around the reduction of poverty in low-wealth, rural communities.
“Working in partnership with communities, this project has the opportunity to shift the needle in helping families benefit from what they have earned and therein have the resources they need to improve the health and well-being of their families.”
The UNC project is funded by the RWJF Equity-Focused Policy Research Building Evidence on Income Supports for Low-Income Families with Young Children program.