This month, Alternatives Federal Credit Union will roll out its new ReEntry Loan Fund, the first of its kind in the county, designed to provide small loans to those who have been previously incarcerated to help them reintegrate into society.
The program began with Alternatives Business Lending Department Assistant Donna Acquavella, who attended a presentation about incarceration and repression at the Out in the Open summit last November at The Root Social Justice Center in Battleboro, Vermont. This presentation and the discussion that followed inspired her to try to combat the difficulties previously incarcerated individuals face.
“People are given a bus ticket when they are released from the carceral system and $50, and they’re expected to go out and start their new lives, and that is not a recipe for success,” Acquavella said.
Acquavella came back to Alternatives and talked to lending team members on how a financial organization might be able to help. Chris Cain, chief experience officer for Alternatives, described the process.
“The discussion that stemmed out of this presentation revolved around how microloans, as low as even $200 or $300, could truly make a difference in the life of a person re-entering from the carceral system,” she said.
These funds can be utilized to pay for clothing for job interviews, costs associated with vehicle ownership, DMV and court fines, utility and phone bills, rental security deposit assistance and many other necessities that most take for granted, Cain said.
“This can truly mean the difference, in many situations, between a person keeping their freedom or recidivism,” Cain said.
The proposed program received immediate support from members of the Underserved Task Force and Diversity Team at Alternatives, including Lending Outreach Coordinator Bea Nellenback. Nellenback attended meetings with partner organizations and enjoyed learning more about the mechanics of the program, she said.
“It is of the utmost importance to examine the inequalities that are present in our society and to respond with thoughts, words and action and with the tools we can,” Nellenback said. “One of those tools from where we sit at Alternatives is to increase access to building block loans like this one. … The loan fund will be an additional resource that can help with unexpected or expected expenses, that can help build credit and that can potentially be a stepping stone to greater stability and success in that person’s life.”
Alternatives teamed up with the Multicultural Resource Center, Alliance of Families for Justice Ithaca, OAR and the Civic Ensemble, all programs who are supporting formerly incarcerated community members regularly, on what the details and parameters of a potential program should look like.
“We wanted to get a sense of what the needs are and also how we can plug in with what is limited resources at this point on a pilot program to work with people coming out of the prison system,” said Chief Lending Officer Carol Chernikoff.
The resulting ReEntry Loan Fund, set to launch by the end of this month, will provide shared secure loans of up to $500 to previously incarcerated individuals who have been referred to AFCU by one of the partner organizations.
These types of loans make it so AFCU won’t lose money if the loan isn’t repaid, allowing the borrower to qualify without having to meet the typical underwriting guidelines. An individual qualifies for a loan based on the recommendation from partner organizations. Acquavella said AFCU has invested in the initial $10,000 for the loan program, and the Park Foundation contributed another $25,000.
Chernikoff said the best-case scenario would be for AFCU to cut a check directly to the uniform shop, DMV or wherever else the money is intended to be spent, but as this is a growing program, Alternatives knows there might have to be some flexibility in every loan.
“It’ll be on a case-by-case basis, and we certainly will listen and try to accommodate the needs that each individual has for the funds,” she said.
Alternatives staff members know financial institutions are generally distrusted by those who have been previously incarcerated, so the referral system is designed to help address those concerns, Chernikoff said.
“People don’t want to be judged. They’re embarrassed of their situation, they don’t want a traditional bank account, and they don’t believe anybody’s in their corner,” she said. “Our hope is that, because we’re connecting with organizations whose resources are specifically to assist them in their challenges, that connection is going to encourage people to trust us and see that we’re a different kind of financial institution.”
Sarah K. Chalmers, co-founder of Civic Ensemble, works with previously incarcerated individuals primarily through the group’s ReEntry Theatre Program. She said she’s seen firsthand the struggles formerly incarcerated people face, and she’s glad Alternatives is starting this program to address that unmet need.
“There really are so many little things that hang people up that that kind of infusion of funds can help people with,” Chalmers said. “In addition to the material items that the money can purchase, that ability to have your phone on or to have that outfit that you need or that food on the table that you need … gives you a sense of confidence that you can meet the day and the challenges of the day.”
OAR has been working with those who have been involved with the court system for over four decades, and Anita Peebles, senior client service worker at OAR and previous Alternatives employee, said she was glad AFCU consulted with OAR on the framework of the program.
“Things that aren’t necessarily a burden to folks who are regularly employed are things like NYSEG bills, getting a phone or getting minutes on a phone, getting a car repair, … and these aren’t things that OAR has in the budget to pay for,” Peebles said. “If you can get a small loan paid directly to, say, the DMV, in order to get your license back, that just opens up a whole new world for people.”
In addition, Peebles said these small loans may be the start of greater financial success for borrowers in the future through involvement in other AFCU programs.
“It’s an opportunity for folks to … get their foot in the door with a community development credit union, and I hope that once they get a loan that they’ll take advantage of the other wonderful services that Alternatives offers,” she said.Cain agreed, saying Alternatives welcomes the chance to work with formerly incarcerated individuals throughout their reintegration journey.
“These loans will provide people with the opportunity to build or repair credit as they seek to regain their footing and could even lead to future microloans through the Business Lending Department for entrepreneurs who wish to start their own businesses, as it is still extremely difficult to secure employment with a felony on one’s record,” Cain said.
This loan fund aligns with AFCU’s mission to serve underserved communities in the region and to address unmet needs in the county, Cain said.
“The ReEntry Loan Fund will help Alternatives actively live our mission to build wealth and create economic opportunity for underserved people and communities through a collective action model,” Cain said.
Those interviewed who work with previously incarcerated individuals are eager for this program’s launch and look forward to what it can provide for the county.
“I hope it can help a whole lot of people, and I hope that people … [can] use that opportunity to move forward with whatever their personal goals are in their lives,” Chalmers said.
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