The Homelessness program will serve 315 persistently homeless individuals using The Road Home’s evidence-based Homes Not Jail program. The program will provide individuals with rapid re-housing services including move-in support, time-limited rental assistance, roommate matching for peer support and cost efficiency, and intensive case management for self-sufficiency and employment needs. At the target impact level, the program will generate 1,500 more stable housing months, defined as months without jail or shelter, and 250 graduations to permanent location. At this impact level, the County will make $5.55 million in success payments.
- Year Launched2017
- Service Delivery Term (Years)5
- Motivation for ProjectThere is a lack of viable interventions to help the persistently homeless population in Salt Lake County, with $52 million being spent on the homelessness service system. There are over 1,000 of these individuals annually in the County, spending at least 3 months in emergency shelters or booked into the County jail.
- Project Objective(s)Offer 315 individuals rapid re-housing and a range of housing assistance and support services - including access to behavioral health treatment and employment counseling - to improve housing stability, criminal justice and behavioral health outcomes
- Individuals Served315
- GeographySalt Lake County, UT
- Issue AreaHomelessness
- Initial Investment ($ millions) [Note 2]$11.50 (between two projects) [Note 4]
-  This category captures the initial private investment raised to support the project that has the potential to be repaid if the project achieves its pre-determined outcomes. Many projects, particularly those in the supportive housing and health arenas, leverage existing public resources, such as subsidized housing and health insurance, to achieve program impact; the value of these resources is not included in these dollar values but are discussed in more detail in Sections 7, 8 and 9 of this report.
-  The Salt Lake County Homes Not Jail and REACH programs are part of a single initiative that is pioneering a model to combine Pay for Success projects.
- Service Provider(s) [Note 1]The Road Home
- Payor(s) [Note 2]Salt Lake County, Utah
- Transaction Coordinator(s) [Note 3]Third Sector Capital Partners
- Evaluator [Note 4]The University of Utah Criminal Justice Center
- Validator [Note 5]None
- Project Manager [Note 6]Community Foundation of Utah (Fiscal), Sorenson Impact Center (Programmatic)
- External Legal Counsel [Note 7]Dorsey & Whitney, LLP
- Technical Assistance Provider(s) [Note 8]None
-  Delivers program interventions to target population over the course of the PFS contract
-  Makes payments when pre-determined outcomes have been met
- Roles and responsibilities may include: design and structure of PFS project and financing model; capital raise; stakeholder management; on-going performance management
-  Design and implement plan for determining whether outcomes have been met
-  Verify accuracy of data used in evaluation plan, or evaluation plan itself
-  Intermediary during service delivery phase, and/or fiscal sponsor for project funds
-  Provide assistance in drafting, reviewing and negotiating PFS contracts
-  Provide support and expertise to project stakeholders in the project development and/or project implementation phases
Evidence and Program Design
- Service Intervention(s) Model and/or TypeHomes Not Jail program: rapid rehousing
- Evidence base for interventionResearch studies conducted by Supportive Services for Veteran Families, Cloudburst Group, and the University of Utah Criminal Justice Center
- Has effectiveness of the intervention for PFS project target population been evaluated?Partly [Note 12]
- Has the service provider provided this intervention previously?Yes
- Is PFS project: Scaling an existing intervention by replicating at a larger scale? Demonstrating the effect of a new program model or combination of services? Transplanting an existing intervention(s) to a new target population and/or service delivery setting?Demonstrating
-  Rapid Rehousing has been subject to quasi-experimental evaluations, but not for the persistently homeless population this SLCo project is targeting.
Service Provider Characteristics and Service Delivery
- Single or multiple service providers?Single
- Service provider type(s) (nonprofit, government, private)Nonprofit
- Service provider OR site selection methodRFP
- Service Provider Experience with PFS InterventionThe Road Home has historically operated rapid rehousing programs in addition to case management services; this is the first time the program model will be used for the target population
- Referral Method for PFS Target PopulationVoluntary enrollment; State Community Services Office will generate and send The Road Home a quarterly report of data of eligible individuals from the Homelessness Management Information System
- Did the project have a ramp-up phase? (Y/N; brief description)Yes: twelve month pilot period; grant-funded
PFS Contracting and Governance
- Operational Oversight Structure [Note 1]Operating Committee includes The Road Home, First Step House, Salt Lake County (2 representatives), project manager, special purpose vehicle, and independent evaluator
- Frequency of meetings and/or reportsTwice per month during pilot period, once per month for remainder of contract
- Executive Oversight Structure [Note 2]Executive Committee includes The Road Home, First Step House, Salt Lake County, project manager, and funders
- Frequency of meetingsMonthly during pilot period, every two months for remainder of contract
- Investor role in project governance?Investors have one voting member on the Executive Committee who votes on behalf of all investors; the PFS contract specifies voting matters that require "funder consent" which will require each individual investor to vote
- Frequency of reporting to investorsQuarterly
- Non-standard Contract Termination Events [Note 3]1)Pilot Failure; 2) Non-appropriation of funds; 3) Failure to launch both projects by drop date [Note 9]
- Appropriations Risk Mitigation Strategy [Note 4]Annual deposit in PFS Escrow Fund
-  Committee or working group involved in regular and/or day-to-day monitoring of project progress
-  Oversight and decision-making body for PFS project
-  Events that allow stakeholders to exit their contractual obligations, beyond those typically found in loan agreements and contracts
-  The SLCo PFS contract includes automatic termination events, presumptive termination events, and optional termination events.
-  Means by which to mitigate risk that funding is not available for investor repayment
- Senior Investor/ Lender and Total Senior Investment ($MM)Northern Trust; Ally Bank; QBE Insurance; The Reinvestment Fund ($3.6 total)
- Subordinate Investor/ Lender and Total Subordinate Investment ($MM)Sorenson Impact Foundation; Sorenson Family Foundation ($0.8 total)
- Deferred Fee Source and Total Deferred Fees ($MM)[Note 1]None
- Recoverable Grant Source and Total Recoverable Grants($MM)[Note 2]None
- Non-recoverable Grant Source and Total Non-recoverable Grants ($MM)[Note 3]Noorda Foundation; Miller Family Foundation; Nonprofit Finance Fund; Ally Bank; County Escrow ($1.26 total)
- Guarantor and Guarantee ($MM) [Note 4]None
- Illinois Dually-Involved Youth Project
-  Deferred fees are delayed payments for the services provided by service providers, transaction coordinators and/or project managers. Deferred fees are one way of structuring projects so that more stakeholders have a financial interest in ensuring project success.
- Philanthropies can use either their regular grant making protocols, or protocols for program-related investments (PRIs), to contribute to PFS capital stacks. If a foundation does not use a PRI, their investment may be structured as either a loan or a recoverable grant. The distinction between the two is in the expectation of repayment. A loan, even if from a philanthropic source, is expected to be repaid, and structured accordingly. A recoverable grant does not bear the same expectation of repayment.
-  Non-recoverable grants are traditional grants contributed to capital stacks; if the project is successful and generates full repayment, the non-recoverable grants can remain with the service provider or project manager, or be recycled by the original funder.
Basic Repayment Structure
- Initial Investment ($Millions)5.3
- Maximum Repayment Funds Committed by Payor ($Millions)10.85
- Full service delivery term (years)5
- Full repayment period (years)6
- Interim outcomes reported? Tied to payments?Yes (graduation to permanent housing location)/ Yes
- Sustainability/ Recycling of FundsNone specified
Detailed Repayment Terms
- Interest5% (senior); 2% (subordinate); paid quarterly
- Trigger for initial repayment of principal [Note 1]Any difference between treatment and control group on payment metrics
- Threshold for full repayment of principalBetween 15% and 20% impact on months without jail or shelter
- Threshold for full repayment of principal plus maximum success payments1) 30% impact on months without jail/shelter; 2) 80% graduation to a permanent location; 3) 100% enrollment in substance abuse services; 4) 100% enrollment in mental health services
- Repayment timingInterest paid throughout, principal paid at Q19 and Q24
- Return to Investor [Note 2]8.70% (senior); 13.47% (subordinate)
- Success Payment to Other Stakeholders? [Note 3]Yes: Service provider and project manager
-  Initial repayment does not equate to full principal return. Investors may recover only part of their principal if projects do not meet a certain level of success.
-  There is no standard methodology for calculating investor return. These numbers are what is publically reported, and comparing from one project to another may not be an apples-to-apples comparison for the reason of potentially different calculation methodologies. Calculation methodologies may be provided in investor agreements, which are not available publically and were not available for this report’s analysis.
-  Success payments for other stakeholders such as project managers and service providers create a financial incentive for project success.
- Project Development Costs Not Covered by PFS Capital RaiseTransaction coordinator fees
- Funding source(s) for project development costs, if anySalt Lake County; Sorenson Impact Foundation; Living Cities
- Project Implementation Costs not covered by PFS CapitalNone
- Funding sources for implementation costs not covered by PFS capitalNone