Which 3 Cities are Fighting Poverty Through a Tech Cohort?

As more cities embrace the civic innovation movement to tackle local problems, Philadelphia, Nashville and Louisville are harnessing new technology to reach out to residents in most need of help.
In collaboration with nonprofit Living Cities and the nonprofit arm of global bank Citi, the Citi Foundation, the three cities will form the first cohort under City Accelerator, a program with the goal of helping nine cities innovate solutions to tackle everyday challenges facing low-income residents.
Louisville, Nashville and Philadelphia have been selected to spend the next 18 months implementing tech-driven solutions with guidance from coaches and other municipal innovators to create solutions faster and promote more proactive governance. But unlike other philanthropic programs aimed at municipal innovation, there’s no monetary incentive.
Instead, each city receives $3 million worth of technical assistance and consulting to implement their respective innovative projects.
Louisville plans to use its established innovation toolkit as part of the pilot program, focusing on services for people suffering from mental illness and substance abuse while Nashville officials plan to collaborate with other city agencies and local nonprofits to combat homelessness through affordable housing and more economic opportunity, according to Governing.

“Both the public and private sectors in Nashville are filled with dedicated individuals who work hard every day to help more citizens share in our city’s economic success,” says Nashville Mayor Karl Dean. “Our Office of Innovation is working to bring all of those entities to the same table, because we know separate efforts can be much more impactful when our strategies are unified and everyone is willing to consider new approaches.”

Meanwhile, Philadelphia’s innovation team will partner with city departments to assist low-income residents in accessing benefits and tax relief.

As a cohort, all three cities will also rely on each other to share ideas and resources as they implement solutions to their local problems.

“Cities are getting better at making incremental improvements to the way they deliver services,” says Nigel Jacob, co-founder of the Mayor’s Office of New Urban Mechanics for the City of Boston, who is leading the first cohort.  “This is important, but it is not enough to solve our greatest challenges. Cities need to be able to find breakthrough ways of solving problems on an ongoing basis.”

The goal is to get more urban communities on board with innovating faster, creating more universal solutions that can be consistently applied elsewhere. The three cities were selected from 35 other cities and six finalists, and two more City Accelerator cohorts are expected to launch in spring and fall of 2015, according to a press release. Living Cities also plans to regularly update an innovation guide.

“There’s a cacophony of activity around ‘cities need to be doing different things,’” says Ted Smith, chief of civic innovation in Louisville. “We’re now at a point where we’re trying to get some focus on the way that cities rationalize, organize and prioritize this kind of effort in a sustainable way.”

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This State May Have Discovered the Secret to Saving Tax Dollars While Doing Good

In Massachusetts, Governor Deval Patrick has launched a $27 million initiative that he hopes will keep at-risk youth out of jail, reduce crime, and promote safer communities. That may sound like a tall order — after all, it’s more difficult than ever to get funding for social services these days — but the government isn’t fronting the cost, and neither are the taxpayers. Instead, the Massachusetts Juvenile Justice Pay for Success Initiative will be funded by organizations like Third Sector Capital Partners, New Profit Inc., Living Cities, the Laura and John Arnold Foundation, and Goldman Sachs, among other private and nonprofit investors, through the largest social impact bond ever created in the U.S.

Social impact bonds are a new type of philanthropy that involves a partnership among the government, nonprofit organizations and private-sector investors. Here’s how  they work: a government identifies a social problem in the community and contracts with private investors who raise money to fund a solution and (hopefully) achieve a pre-determined goal. Participating nonprofits manage the project — in the case of the Massachusetts’s initiative, Third Sector Capital Partners, a nonprofit advisory firm, will serve as the project intermediary, while Roca, a local charity that aids high-risk young men, will provide the services — while a third party conducts a rigorous independent evaluation at the conclusion to determine if it achieved the desired outcome. Only then will the government (and taxpayers) pay the investors back. Therefore, Social impact bonds (otherwise known as Pay for Success initiatives) is a minimal risk to taxpayers, while allowing nonprofits to use their already-established resources to make a significant societal change.

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In Massachusetts, the new Pay for Success initiative will allow Roca to provide job training, counseling and other services to 929 at-risk young men between the ages of 17 and 23, all of whom are currently in the juvenile justice or probation system. Roca has a specific model that it uses to keep its participants out of jail and employed. Its four-year program consists of two years of intensive support from a youth worker, followed by two years of follow-up, and has a proven track record. Out of 115 young men participating in the final two years of the program, 89 percent had no new arrests, 69 percent retained employment for three months and 95 percent had no new legal violations, according to Fast Company. The social impact bond’s success will be determined by Roca’s ability to reduce the number of days participants spend in jail by 40 percent, and improve these young mens’ employment options. If Roca’s services are proven to produce these positive outcomes — in turn saving Massachusetts millions — the government will begin making “success payments” to the investors. “By working with our partners at Roca, the Pay for Success initiative will allow us to marry smart financial solutions with programs proven successful in helping high-risk youth become employed, stay employed, and break the cycle of violence,” Patrick said in a press release.

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Massachusetts recently received an $11.7 million grant — the first of its kind — from the Department of Labor to help fund this Pay for Success initiative.  The additional funding will help with success payments and enable the state to extend the project, should it be successful, to an additional 391 young men, thereby serving a total of up to 1,320 young men over nine years. On a larger scale, these social impact bonds are an innovative way for governments to try to fix some of the largest social issues facing the nation, without risking taxpayer backlash. Colorado, New York, Ohio, South Carolina and other states are pursuing Pay for Success initiatives. The only question is: which state will be next?

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