Urban Institute Launches Effort To Back “Pay For Success” Projects


The Washington, D.C.-based Urban Institute has launched an initiative to ensure “Pay for Success” (PFS) transactions are well-designed, informed by rigorous research, and deliver outcomes as intended. It will focus on which evidence-based programs and strategies are best poised for a Pay for Success approach in not only criminal justice but also housing, economic development and poverty reduction. The Laura and John Arnold Foundation is committing $8.4 million over three years for the project.

Pay for Success aims to drive government resources toward proved social programs to deliver better results to those in need. The model provides a way for state and local governments to tap private investors to cover the up-front costs of the programs. If the programs are successful, governments pay the investors back. If they are not, the investors absorb the cost and the governments pay nothing. There is only a handful of Pay for Success deals currently operating nationwide. The Urban Institute’s John Roman said, “We want to make PFS deals as strong and research-based as possible.” s

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