Editorial: Innovative funding approach to meet a social challenge (The Day)

On Tuesday, Connecticut announced its participation in an innovative program focused on the challenge of addressing social ills — in this particular case the rampant substance abuse that tears apart families — in a cost-effective manner.

At the announcement in Hartford, Gov. Dannel P. Malloy revealed that the state will host the 10th project funded under the “Pay for Success” initiative. The initiative received little attention when the Obama White House unveiled it as part of the fiscal year 2012 budget.

The initiative leverages philanthropic investment to attack specific social challenges. If the funding — known as Social Impact Bonds — proves successful in meeting defined goals, the government repays the investors with interest, allowing reinvestment in expanding the program or addressing other needs. If the program does not achieve its goals, the government does not pay.

New York City and Massachusetts have used the model to reduce youth recidivism, Santa Clara County, Calif., to address chronic homelessness and Salt Lake County, Utah, to expand early childhood education.

In Connecticut, the nonprofit group “Connecticut Family Stability Pay for Success” will raise $12.5 million from angel investors to offer 500 families focused substance abuse treatment support over the next four years. The program is targeting the communities of Norwich, Danbury, Middletown, New Haven, Torrington and Waterbury.

Family-based recovery (FBR) teams will visit homes several times a week where a parent is undertaking a substance abuse recovery program. The teams of two clinicians and one support worker will offer support to parents on their path to recovery while encouraging positive parent-child interactions under difficult circumstances.

It expands on an existing state FBR program in place since 2007 that has intervened with 240 families with children ages 3 and under. The “Pay for Success” effort will include families with children ages 6 and under.

The payoff for the state is keeping more families intact and saving money. The state Department of Children and Families reports spending $600 million annually to address child abuse and neglect, and roughly half the cases involve indications of parental substance abuse. It is not only caring to keep these families intact by addressing root causes, but cost effective.

Research conducted by the University of Connecticut and Yale University showed the FBR program improved chances of recovery, while keeping more families together and children out of foster care. The goals of the latest initiative, which must be met to obtain the federal aid, will be to successfully connect homes to family-based recovery teams; reduce out-of-home child placements; prevent re-referrals to DCF; and reduce substance use.

DCF Commissioner Joette Katz deserves particular credit for putting the proposal together. In an age of severe political partisanship, this is an initiative deserving broad support.