Two years ago today, Mayor Gavin Newsom unveiled a "financial justice" program for the city of San Francisco:  the Working Families Tax Credit.  Modeled after the federal Earned Income Tax Credit (EITC), San Francisco’s WFTC was designed to give working poor people several hundred dollars in additional income per year.   (The federal EITC is a program which effectively gives cash grants to working poor people.  Although it was designed to help offset taxes for the working poor, it has morphed into a federal welfare program, giving more money back than some people actually paid in taxes.)

At the time the program was announced, Newsom said he believed the WFTC would stimulate the local economy and "reduce tax inequity by providing additional income to low-wage families, who pay a disproportionate amount of their income in sales tax."

The pilot program was expected to cost $6 million.  Newsome said the City would budget $3 million over two years for WFTC in the City’s FY 2005-2006 budget. He also said that it wouldn’t be that much of a budget hit because he challenged the philanthropic community to leverage City funding dollar-for-dollar (raising $3 million for in private funds).

How is the program doing two years later?  City records show that Newsom has only been able to raise $625,000 in cash in 2004-05 (mainly from H&R Block, which is administering the program, and Bank of America), with some additional funding raised in free advertising and consultant fees.

This entry was posted on Thursday, February 2nd, 2006 at 12:00 am and is filed under Blog Posts.