Vehicles for Change

According to a National Economic Development and Law Center report, the relationship between owning a car and employment is clear:  Studies show that owning a car increases hours worked and earnings, that people who own cars are more likely to work, and that the impact of car ownership on wages and hours worked is greater for low-skilled workers than for higher-skilled workers.

Since 1999, The Abell Foundation has supported Vehicles for Change (VFC) with grants totaling $398,800. VFC helps Baltimore City residents become car owners, build credit, and move toward self-sufficiency.  Each year, VFC has provided approximately 50 cars to Baltimore City families, most of which are headed by single mothers.

To be eligible to purchase a car through the VFC program, each applicant must reside in the City, qualify as low-income, have a job or a job offer, and need a car for employment purposes. The new owner pays approximately $1,000 for his or her used car, which has an average retail value of $3,200. VFC helps each new owner secure a bank loan to purchase the car, and the program maintains the car for a six-month period after its sale, completing major mechanical repairs as needed. VFC identifies potential owners through partnerships with workforce development service providers such as Washington Village, Pigtown Neighborhood Planning Council, the Housing Authority's PACE program, STRIVE, Christopher's Place and the Rose Street Community Center.

Results from a 2003 survey of 155 VFC car owners (including recipients of cars from other Maryland counties) indicates that the program works:

• 68 percent have obtained better jobs, with an average annual salary increase of $4,853;
• 83 percent report that their lives have improved;
• All report that they now take their children to after-school activities and athletic programs;
• 89 percent feel that the car is reliable, with the average cost-per-repair after six months being $199; and
• 79 percent have had the oil changed, indicating that they are making efforts to keep their cars in good condition.

With a loan guarantee provided by The Abell Foundation, Vehicles for Change launched Freedom Wheels, a used-car business that allows Vehicles for Change to sell cars it buys and repairs to the general public. Profits from the used-car businesses will be used to fund the provision of cars to low-income individuals.