The Evolution of Social Impact Bonds

The idea of social impact bonds is developing. From the WashingtonPost:

The competition for technical assistance attracted 28 applications — a number that surprised officials at Rockefeller and Harvard.

The six winners are developing programs that range from early childhood education to efforts aimed at helping senior citizens remain in their homes longer.

“I love this pay-for-success model,” said South Carolina Gov. Nikki Haley (R), whose state is planning a nurse-family partnership program aimed at reducing the state’s infant mortality rate, which at 7.4 per 1,000 births is among the highest in the nation. “We have tried to make different moves to try to fix that number. This will allow us to go farther.”

Colorado plans to target homelessness in a way that Gov. John Hickenlooper (D) said would be fiscally impossible through the normal government funding channels.

“The hardest money for us to raise is when we have a new idea and it has been in a couple of places but is not widespread,” he said. “There is an inclination in mayors’ and governors’ offices to avoid risk. But investment funds that have a strong social component will inherently take more risk.”