Essays on People, Place & Purpose

Investing in What Works for America's Communities

Inflection Point: New Vision, New Strategy, New Organization

by Nancy O. Andrews and Nicolas Retsinas

PILLARS OF A NEW VISION FOR COMMUNITY DEVELOPMENT

Pillar I. Invest in What Works-Evidence Matters

In the past, we believed that access to opportunity and services was enough to improve lives. With access as our primary mental model, it made sense to focus on outputs. Simply providing the outputs would cause the desired change, we believed. Of course, this idea was rooted in an earlier understanding of how poverty emerged. After 50 years of trial and error, we know much more about what works and what does not. Focusing on outcomes, rather than just outputs, requires a system of learning and self-reflection, with a commitment to accountability. We must be willing to test, to err, to adjust course. To learn, there must be clear benchmarks and data linked to the desired outcome. Focusing on outcomes and impact will be a paradigm shift not only for community development, but for much of American social policy.

Accountability is the elixir of success. In our view, the ultimate evidence of success is moving the dial on poverty, and the most powerful predictor of this is closing the achievement gap between poor and affluent children. But there are other measures along the way, including health improvements; improvements in child development, particularly by age 5, so that children enter school ready to learn; a greater sense of personal safety; reduced violent crimes; and social efficacy.

There are also exciting new examples of social models with built-in accountability. For example, pay-for-success approaches, now emerging in several fields, are a good step in this direction. Experiments with Social Impact Bonds in the United Kingdom, pay-for-success programs in New York City and Boston, and Human Capital Performance Bonds in Minnesota are all early-stage trials of a new way of working. By investing in what works, we hold our feet to the fire, we ensure that evidence is the basis for decision making, and we create an atmosphere that rewards learning. These approaches will pave a path for sustained social investments in the future. They are the beginnings of an outcomes-based vision. Outcomes, social metrics, and measurement are part and parcel of learning, adaptive practice. Pay-for-success and evidence-based models will amplify our success by many fold.

Solving the problem of poverty and inequality is not a simple task, but today we understand a great deal about how to get the job done. At this stage, community development can and should be accountable to this standard, as a matter of integrity to our mission and as a means of creating buy-in for our work. The access-based models of the past will be overtaken by ways of working that reward success and are validated by evidence.

Pillar II. Networks of Organizations across Sectors

Recently, after listening patiently to the case for integrative models, Mary Kaiser, CEO of the California Community Reinvestment Corporation and a seasoned community development practitioner, penned an essay humorously entitled “Siloes of the World, Unite!” It is hard enough to learn how to do one thing well, she argued. Entire careers have been devoted to mastering the skills needed for success in a single sector—building or financing affordable housing, for example. We have spent decades creating excellence in our practice. Isn’t an integrative approach that expects community developers to perform too many roles a recipe for mediocrity?

The answer is likely yes. Poverty may be a complex integrated problem, but the solution cannot be layering myriad expectations onto a single organization, or even on a single strategy. This is where networks or teams of organizations come in. Community development’s goal can be holistic, but its execution strategy requires a network of expert and professionalized organizations working toward a common purpose and vision. One of the critical questions we face is who creates and who is accountable for the master vision?

In answer to that, we imagine a symphony of players, working from a common score, guided by a conductor who holds the vision for the whole and harmonizes the unique qualities of individual instruments. In the Purpose Built example, a governing board of civic leaders plays this role. The board monitors the quality of the physical development, the schools, the early learning centers, and holds the authority to remove poor-performing operators. In other examples, such as NCI or the Harlem Children’s Zone, a nonprofit organization plays this role. In all cases, some entity must take ownership and be the advocate for the community and its residents, with responsibility and authority for outcomes.

Pillar III. Scale with Impact

Community development has created a national platform that is networked, local in its roots, yet scaled and professional. We are a national asset in the country’s response to social need. Over the past few decades, we have leveraged hundreds of billions of dollars in capital into low-income communities. We are poised to reach a far greater scale and to play a much broader role in changing the lives of the poor. We have become outstanding practitioners, with success in building affordable housing, creating strong and vibrant communities, running high-performing schools that see their graduates into and through college. We have created innovative capital tools, such as the Low Income Housing Tax Credit and the New Markets Tax Credit, and annually deliver goods and services to millions of Americans. We are now creating partnerships with new sectors within the economy, such as the health care industry, insurance companies, and social venture capital. For the past several decades, we have built organizations that possess the know-how and the assets to be first responders in hard times for low-income communities and individuals.

Many community development organizations have billions of dollars in delivery track records, with decades of successful operations. We possess sizable balance sheets and are well respected by private investors. We have the skills, the knowledge, and the capital to make a difference. We are ready to be a partner to the private and the public sectors at a far larger scale. We are ready to embrace models that reward success for impact as well as quality outputs. We are entrepreneurial and confident enough to learn from trial and error. We are ready to deliver scale with impact.

CONCLUSION

By all measures, the community development field has reached scale and is poised at an inflection point. We see a future where we will channel hundreds of billions of dollars annually into mission-related work, where we will help millions of people with a firm hand up, and where we are a steady partner to private capital markets. Banks, insurance companies, Accountable Care Organizations, and others will turn to us as a reliable platform to deliver social improvements in addition to financial return. As we develop an integrated vision of what works, and hold that ideal accountable to data and measurement, community development should become the “go to” partner for improving the life chances of individuals and fostering healthier communities. We will deliver scale with clear and measurable impact, with evidence of “return on taxpayers’ and social investment.”

The future will champion a vision of social progress based on integration and collaboration across sectors, on accountability to evidence-based outcomes, and on models that reward success. Community development is poised to be at the center of this, offering scale and quality. We are entrepreneurial, willing to innovate, to test, to learn by trial and error, and to be accountable to results. We are ready, willing, and able to be a partner to the private sector, to private capital markets, and to the public sector. We have the know-how, the scale, and the skills to invest hundreds of billions of dollars toward an agenda of progress in America’s communities. We are ready to build a twenty-first century platform for investment in what works in America’s communities, a platform that allows all Americans to achieve at their highest potential and to give their very best to our nation’s future prosperity.


Endnotes

  1. Federal Reserve Chairman Ben Bernanke, in a December 10, 2010 interview on 60 Minutes, available at www.cbsnews.com/stories/2010/12/03/60minutes/main7114229_page4.shtml?tag=contentMain;contentBody.
  2. “The Economic Impact of the Achievement Gap in America’s Schools,” McKinsey & Company, April 2009. Achievement gap is defined as educational achievement levels between the U.S. and other top-performing industrialized countries. The gap for black, Latino, and low-income children is estimated to be approximately $700 billion to $1.3 trillion annually, or 5–9 percent of GDP, available at http://mckinseyonsociety.com/downloads/reports/Education/achievement_gap_report.pdf.
  3. “Annual Message to Congress: Concluding Remarks, Washington, D.C. December 1, 1862,” Collected Works of Abraham Lincoln, edited by Roy P. Basler.

One Comment

  1. Mohammad Ali Barzegar Reply

    Dear MS. Nancy O. Andrews,

    I am a true believer and practitioner of Integrated socio-economic, People Centered concept called Basic Needs Approach since 1987. I love all you have written about the integrated community development, and I accept all the achievements mentioned in the Purpose Building Communities in Atlanta, because I have seen similar results in three countries( one in Africa& Two in Asia) during last 26 years. Also I am a true believer that mono-line approach does not work. Because it is originated from the specialists perception, in which does not match with the daily life pattern of the people. Therefor as a new permanent resident of USA( Green Card Holder), I love to work for your organization and learn, share my 26 years experiences in the subject. With Special Respect. Mohammad Ali Barzegar, MD, MPH.Cell Phone: 571-201-6022.

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