Celebrating the California Pay for Success Initiative (Nonprofit Finance Fund)

Oakland – On September 15, 2017, The James Irvine Foundation and Nonprofit Finance Fund (NFF) convened over 70 social sector leaders from across California to celebrate the achievements and discuss building on the remarkable lessons of the California Pay for Success Initiative. Launched in 2014, the initiative was designed to help nonprofit and government leaders launch Pay for Success (PFS) projects in the state. With the right investments and cross-sector support, Pay for Success (PFS) and outcomes-based approaches more broadly have the potential to transform our social sector by aligning resources with better outcomes for our communities.

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Want to be the next PFSI TTA recipient? (Urban Institute)

Back in 2015, we launched our first application process for Urban’s pro bono pay for success (PFS) training and technical assistance (TTA) services. The seven grantees we selected from a strong applicant pool included government and quasi-governmental agencies and intermediaries from Yakima Valley in Washington State to Suffolk County, New York. Some were close to project launch and looking for specific evaluation support from Urban; others were in the early stages of project planning and sought guidance on how to select an appropriate problem to address using this approach.  

Through our work with this first cohort of TTA grantees, our team has better honed what factors appear tied to success in PFS; absorbed lessons from our staff working on evaluation; and learned more about the steps that governments take when planning and implementing this model.

Now, we are ready to apply these lessons learned to a brand-new cohort of cities, counties, states, and service providers.

That is why Urban is excited to release its second RFP for TTA services. Our experts are eager to help other places interested in PFS strengthen their projects.

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Alameda County district attorney announces justice restoration project (Fox KTVU)

O'Malley said, "Under the leadership of the District Attorney's Office, we are changing the paradigm from simply supervision-based probation to building outcomes of success. We understand that recidivism is a problem that plagues communities throughout the county, the state, and the nation."

She said, "Repeatedly jailing low-level offenders without providing supportive services and opportunities for employment and education is not the answer. The criminal justice system and our citizens are best served when we embrace new ideas and approaches to addressing crime, punishment and rehabilitation."

O'Malley said the new program is a Pay For Success Project, with seed funding awarded by the Bureau of State and Community Corrections through a competitive grant program.

She said Pay For Success is a fiscal partnership between a government agency, in this case Alameda County, under the leadership of the District Attorney's Office, and private or foundation funders. The non-government funds are invested in a project with specific contractual milestones and outcomes.

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New report: Unlocking Private Capital to Finance Sustainable Infrastructure (Environmental Defense Fund)

When two large storms knocked out an estimated $200 billion in economic value within a week, critical gaps in our infrastructure preparedness were laid bare. The 2016 “Hell or High Water” series from ProPublica and The Texas Tribune predicted a scenario that “visualizes the full spectrum of what awaits Houston” if it were hit by a large-scale hurricane. Experts consulted for the series cite Houston’s unimpeded development as a principal factor contributing to the region’s high exposure to flood risks.

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Lessons for Providers Interested in Pay for Success (America Forward)

With the launch of the Social Innovation Fund’s Pay for Success (SIF PFS) program, new funding was available to resource both feasibility assessment and project construction support activities (for more information on PFS feasibility, construction, and launch engagements, click here.)  When the first eight organizations were chosen as SIF PFS grantees, and subsequently launched their competitions to identify subrecipients in 2014, the overwhelming majority of respondents were government jurisdictions; however, among the subrecipients chosen by Third Sector Capital Partners, Inc. (Third Sector) in its first cohort was a private, nonprofit service provider.

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Senators Introduce Home Visiting Bill Without State Match Requirement (Chronicle of Social Change)

The Senate bill introduced today does not increase the authorization for MIECHV, and includes similar provisions to the House bill on measuring impact and including pay-for-success strategies. But unlike the House bill, it does not require states to match MIECHV funds at all.

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Early Wins and Challenges in Implementing WIOA Pay-for-Performance to Improve Outcomes for Opportunity Youth (Third Sector Capital Partners)

The current public workforce system has left out some of our country’s most vulnerable people. With federal funding spread across 11 agencies and 47 programs, much of the system relies on cost-reimbursement contracts that stifle innovation by 1) prescribing services that prohibit providers from adapting programs to needs and 2) not rewarding providers for improving outcomes. Providers are often paid regardless of results, yielding little incentive to use evidence-based interventions or deploy new technologies. While some programs use something called “performance-based contracting,” much of the time, payments are linked to activities and outputs, like enrollment instead of long-term outcomes like wage growth.

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As Wildfires Scorch U.S. Forests, Forest Resilience Bond Blazes a New Trail (World Resources Institute)

The Forest Resilience Bond (FRB) is an investment in forest health. It is a public-private partnership that enables private capital to finance much-needed forest restoration. Beneficiaries of the restoration work make cost-share and pay-for-success payments over time (up to 10 years) to provide investors competitive returns based on the project's success.

Once investor capital is used to implement the restoration treatments, investors earn back their money from payments by the following beneficiaries:

  • USFS, paying for decreased risk of severe fire;
  • Electric utilities, paying for increased hydroelectricity generation, avoided sedimentation, and protected infrastructure;
  • Water utilities, paying for protected water quality and improved water volumes; and
  • State and local governments, paying for avoided fire suppression costs, avoided carbon emissions, protected communities, and job creation.
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BNP Paribas Recognized for Leadership in Sustainability (BNP Paribas)

BNP Paribas continues to be recognized for its leadership worldwide in Sustainability. For the second year in a row, the Bank was named the ‘Most Innovative Investment Bank for Climate Change and Sustainability” by The Banker magazine, and for the third straight year was listed in the Dow Jones World and Europe Sustainability Indexes.

In its 2017 Investment Banking Awards issue in September, The Banker praised BNP Paribas’ sustainable efforts, ranging from the supply chain finance program created for Puma to the World Bank’s first bond tied to the United Nations Sustainable Development Goals (SDGs). BNP Paribas also received specific mention on two U.S. transactions: Joint book-runner on $139mm green ABS by Solar Mosaic (led in Jan 2017 by our Global Markets teams) and Structuring of the 2016 Social Impact Bond for the State of Connecticut (led by CSR.)

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NRCS-PA Awards More Than $1.5 Million In Chesapeake Bay Watershed Conservation Innovation Grants (PA Environment Digest)

These projects complement the recent national CIG award of $415,000 to the Chesapeake Bay Foundation for a pay-for-success pilot project, which will explore new ways to attract private capital for agriculture-based conservation practices that will satisfy stormwater pollution reduction requirements of urban and suburban municipalities.

The "PA Offset Partnerships" project will be the first of its kind pay-for-success investment in agricultural practices.

“The Conservation Innovation Grant program is an example of government at its best, providing seed money to help spur cutting-edge projects,” said NRCS Acting Chief Leonard Jordan.

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