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Mayor Walsh Explores "Pay for the Success" Model to Improve Post-High School Graduation Outcomes

June 15, 2015

Mayor's Office

Published by:

Mayor's Office

BOSTON- Monday, June 15, 2015 - Mayor Martin J. Walsh is calling for ideas to create more pipelines to and improve post-high school graduation opportunities for Boston youth. This Request for Information (RFI) aims to identify effective programs and services that will increase access to higher education and training and would be funded through a Pay for Success model. The Office of the Chief of Education, along with the Boston Public Schools, have put forth efforts to improve outcomes for youth, including the High School Redesign effort and Success Boston.

"Boston is bustling with young talent," said Mayor Walsh. "Not every single young person’s pathway is the same. When I'm out in the neighborhoods, I hear their dreams, challenges and passions. Pay for Success is an innovative funding model that rigorously measures outcomes and ensures that Boston is funding what works and improving outcomes for our City’s young people. I want our young people to know how much they matter to Boston’s future, and that they’re capable. We’re in the business of providing opportunities however we can."

Pay for Success (PFS) is an innovative funding model that drives government resources toward social programs that prove effective at providing results to the people who need them most. PFS expands available funding for nonprofit service providers and tracks the effectiveness of programs over time to ensure funding is directed toward programs that succeed in measurably improving the lives of people most in need.

PFS enables governments to draw in greater resources to tackle social problems by tapping private investments for the upfront costs of the programs. If, and only if, the program is successful in delivering services that improve the lives of the people it is meant to serve, the government repays those who made the original investment. If the program does not achieve its target results, the government entity does not repay those who made the original investment. This model ensures that taxpayer dollars are being spent only on programs that actually work.

A PFS project includes five key partners: government, service provider(s), independent evaluator, funders and an intermediary.

"Our goal in Boston is to help every young person earn a degree or certification that will support their life-long success,” said Rahn Dorsey, Chief of Education for the City of Boston. “The Pay For Success model represents a public policy innovation that could help us meet this goal. The Mayor's office is excited to partner with BPS and Third Sector Capital Partners to engage organizations across the city to identify powerful ideas that will lead to increased post-secondary completion for our young people."

“We continue to develop support services to help our graduates gain greater access to college and successful careers,” said John McDonough,Interim Superintendent of Boston Public Schools. “Through this innovative approach, the city is showing it is committed to thinking creatively and boldly to find ways to save money and ensure our students achieve in life after they graduate from our schools.”

The RFI is currently open. The City of Boston and Boston Public Schools have partnered with Third Sector Capital Partners, Inc. to explore Pay for Success. As experts in innovative public-private financing strategies, Third Sector is an architect and builder of the nation’s most promising Pay for Success projects including the Commonwealth of Massachusetts and Cuyahoga County, Ohio.

“Third Sector is honored to partner with Mayor Walsh, the City of Boston and Boston Public Schools to improve outcomes and opportunities for our City’s youth,” said John Grossman, Co-President of Third Sector Capital Partners, Inc. “As a leader of Pay for Success across the US, we are excited to contribute our expertise here in our hometown.”

The key components of this Pay for Success Project are as follows:

  • Focusing on a population that can be clearly identified and serve enough of that population to ensure that evaluations of impact are statistically meaningful;
  • Demonstrating the potential to achieve positive outcomes through a strong evidence base to merit consideration for financing in a PFS project;
  • Displaying the ability to implement services at the scale of the funded project with fidelity to the intervention model;
  • Collecting data from both service providers and outside sources that can provide independent evaluators the information they need to conduct a rigorous and verifiable analysis of the outcomes of the PFS project;
  • Researching the current outcomes, past trends and future expectations for a target population, and identify how a statistical approach could be used to evaluate outcomes during the project against what outcomes would have been in the absence of those services;
  • Identifying any ethical concerns or potential unintended consequences associated with a proposed project and proactively address them to ensure that the target population to be served is not left any worse off through a PFS project; and
  • Connecting concepts to clear economic benefits, whether through prevention of future expenditures or through cost-effective diversion from current programs or resources.

An RFI is a tool to surface new ideas and to better understand how external organizations respond to new opportunities.  An RFI is for information and planning purposes only and does not result in a contract. Responding to an RFI does not serve as an advantage or disadvantage for an organization on any future procurement.  It does help the City to better understand, however, the landscape of possibilities.

The RFI can be accessed at www.cityofboston.gov/mayor/. To respond to this RFI, submit a written response (10 pages maximum) to policy@boston.gov, including a summary cover letter with the primary respondent’s contact information.

For more information on this RFI, please submit questions to policy@boston.gov. An informational session will be held on Monday, June 22nd, 2015 at 11:00 a.m. in Room 2-13 on the second floor of the Bruce C. Bolling Municipal Building, 2300 Washington Street, Roxbury, MA 02119.