South By North Strategies, Ltd.

RALEIGH, NC (October 10, 2018) – Every $1 in spending on community action programs in North Carolina generates more than $2 in additional economic output. If not for the community action funding provided annually under the federal Community Services Block Grant Act, the state would have a smaller economy, fewer jobs, and fewer tax dollars to support public services.

These findings come from a new economic impact study commissioned by the North Carolina Community Action Association, Inc., a nonprofit membership organization that represents the state’s 34 local community action agencies. The study was developed by South by North Strategies, Ltd., a research consultancy specializing in economic and social policy.

“North Carolina’s community action network exists to help individual men and women transcend poverty,” said Sharon Goodson, Executive Director of the North Carolina Community Action Association. “Community action agencies provide significant—though significantly overlooked—positive impacts on the overall economy of North Carolina.”

In 2016, North Carolina’s community action agencies expended some $20 million in federal resources provided under the Community Services Block Grant Act, the nation’s only program focused exclusively on reducing poverty in a comprehensive manner. Moreover, local agencies used their modest federal grants to leverage an additional $245 million in public and private resources to support anti-poverty initiatives in all 100 counties.

“The funds spent on community action programs in North Carolina not only ameliorate poverty, but they also enhance the state’s economy, as measured by economic output, employment, labor income, and tax receipts,” said John Quinterno, Principal of South by North Strategies who coordinated the development of the economic impact study.

The study considered two scenarios: a conservative one that analyzed only the federal funds granted to the state under the Community Services Block Grant Act and a more expansive one that included leveraged funds and certain program outcomes. Key findings include the following:

• Community Services Block Grant funding, when combined with certain direct program outcomes, generates $43 million in additional statewide economic output annually; when leveraged funds are included, statewide economic output rises by $450 million. In short, every $1 in program spending sparks more than $2 in added economic output.
• Community Services Block Grant funding, when combined with certain direct program outcomes, supports a total of 415 jobs across all industry sectors; when leveraged funds are included, a total of 5,123 jobs are supported through funding for community action.
• Community Services Block Grant funding, when combined with certain direct program outcomes, produces an estimated $16 million annually in additional labor income; when leveraged funds are included, community action resources boost labor income in North Carolina by $195 million annually.
• Community Services Block Grant funding, when combined with certain direct program outcomes, yields an estimated $2 million annually in additional state and local tax revenues; when leveraged funds are included, community action resources expand state and local tax collections by $23 million per year.

“This study shows the powerful extent to which community action works for North Carolina,” said Dr. Landon Mason, President of the North Carolina Community Action Association and Executive Director of the Economic Improvement Council, Inc. in Edenton.

“If not for its community action network,” added Dr. Mason, “North Carolina would have a smaller economy that offers fewer job opportunities, reduced earnings, and fewer tax receipts to support vital public services—all while tens of thousands of low-income residents would be left to confront poverty on their own.”

Click here to access the full report.