Settling into his metal-frame bunk bed each night, in a room crowded with 23 other homeless men, Ervin Rogers imagines his future, one filled, he says, with brightness, hope and a little brick duplex on a quiet street in the suburbs.
"I'm going to have my own place, and it's going to be away from all the madness of downtown Baltimore," says Rogers, 39, a quiet man with penetrating eyes framed by wire-rimmed glasses. "Glen Burnie would be nice."
FOR THE RECORD - An article in Saturday's Maryland section on individual development accounts (IDAs) for the working poor misstated the number of IDA programs that have started in the country since 1993. The estimated number is 500, with about 5,000 participants. The Sun regrets the error.
Rogers, a recovering crack addict, has lived at the bustling Helping Up Mission on East Baltimore Street for two years. Though his job as a nursing assistant pays just $7.50 an hour, such dreams are now within his reach. He is one of five East Baltimore residents investing in individual development accounts (IDAs). The accounts are aimed at encouraging the working poor to save money, build assets and develop better financial habits.
IDAs are part of a growing effort to help people across the country move out of poverty without use of entitlements.
Rogers must deposit at least $25 a month into the account. The program will match every dollar he puts in by as much as $3 for two years. When that term is up, he must spend his savings on post-secondary schooling, a small business, or buying a home. He must also attend twice monthly meetings that hammer away at the principles of financial management.
The accounts began gaining favor in the early 1990s as social service experts sought new approaches. The idea is to boost the working poor by encouraging them to invest in financial plans similar to the individual retirement accounts or 401(k) plans.
More than half of the 47 states with IDA programshave passed legislation clearing the way for public money to be used. Before that, IDAs were usually administered by nonprofit organizations and backed by matching private funds.
Maryland has three modest IDA programs, one in Garrett County, one on the Eastern Shore and one in Baltimore, which started in February. None of the programs receives state or federal help.
Bill clears hurdle
A bill sponsored by two Baltimore Democrats, Del. Howard P. Rawlings and Del. Samuel I. Rosenberg, aims to change that. The bill, which would provide nearly $1 million for a program that would start off with 600 participants, cleared the House Appropriations Committee yesterday. The measure now goes to the full House for consideration.
"We're on our way," said Rosenberg, adding that he is optimistic that the bill will make its way through the General Assembly because it has garnered significant bipartisan support. "IDAs are consistent with our basic thrust, giving people an opportunity to help themselves climb out of poverty and climb up the work force. We need to expand the concept."
Such words excite Talib Horne, assistant director at the East Harbor Village Center, which serves as a jobs, housing and development clearinghouse for residents in East Baltimore's empowerment zone, a roughly 2-square-mile patch in the neighborhoods just southwest of Johns Hopkins Hospital.
A year ago, Horne was increasingly frustrated as he saw many of the people he was helping toil at minimum-wage jobs that failed to move them up economically. Most of them, he said, had none of the assets -- a home, car or college education -- that traditionally lead people out of poverty.
"When I looked at the assets of the people, I was shocked," Horne said. "Seventy percent of the people in the empowerment zone -- I'm talking about 8,000 people -- have zero to negative assets. Man, that's scary."
Horne linked up with United Way, which agreed to put up $40,000 for two years to start the program, then with Provident Bank, which is providing free checking accounts and financial management advice for participants.
The energetic 29-year-old began pitching the notion of IDAs to empowerment zone residents. From close to 300 applications, he chose five people. He settled on Rogers and a group that includes Robert Hazel, 35, who is moving out of the Flag House projects and hopes to move his family into its first home, and Tameaka Dorsey, 21, who plans to use the savings as seed money for a small computer repair shop.
Perhaps the most important element, said Horne, is that the IDA allows participants to overcome a fear of banks born of the fact that they have had little or no contact with financial institutions.
"Everything is working out fantastic so far," said Horne. "But we are just five people. That's too small to make change happen for our whole community. Maryland needs to look at the rest of the country and get with the times."
In the past two years, IDAs have spread rapidly nationwide, according to Karen Edwards, an IDA project coordinator at the Washington University Center for Social Development in St Louis. She estimated that close to 5,000 IDA programs have operated across the country in the past seven years.