Utah High Quality Preschool Program

Last updated Sunday, January 22, 2017

Quick Facts

Current Phase
Issue Area
Term of Project

High-quality early childhood education programs have been proven to create positive learning outcomes among children – especially those living in low income communities – and help prevent the need for special education and remedial services between kindergarten and 12th grade.  In Salt Lake County, Utah, many children from low-income families have limited access to quality early education.  To address this problem, the county launched a Social Impact Bond in 2013 that would provide high impact and targeted curriculum to preschool-aged children from low-income communities.  These services are intended to increase school readiness and academic performance, and thereby reduce the need for special education at a later age.  Additionally, the school district, the state, and other government entities would realize large cost savings due to the reduction in remedial services.  The county hopes to serve 3,500 preschool children by 2018.


  • Market Overview

    • Year Launched
    • Service Delivery Term (Years)
    • Motivation for Project
      Children from low-income families have limited access to high-quality early childhood education.
    • Project Objective(s)
      Increase school readiness and academic performance; Reduce the need for special education services
    • Individuals Served
    • Geography
      Salt Lake County, UT
    • Issue Area
      Early Childhood Education
    • Initial Private Investment ($ millions) [Note 2]
  • Project Partners

    • Service Provider(s) [Note 1]
      Granite School District; Park City School District; Guadalupe School; YMCA of Northern Utah; Children's Express; Lit'l Scholars
    • Payor(s) [Note 2]
      United Way of Salt Lake; Salt Lake County (cohort 1)/ State of Utah (cohorts 2-5)
    • Transaction Coordinator(s) [Note 3]
      United Way of Salt Lake
    • Evaluator [Note 4]
      Utah State University
    • Validator [Note 5]
    • Project Manager [Note 6]
      United Way of Salt Lake
    • External Legal Counsel [Note 7]
      Holland & Hart LLP; Mannatt
    • Technical Assistance Provider(s) [Note 8]
      Voices for Utah Children; Granite School District
  • Evidence and Program Design

    • Service Intervention(s) Model and/or Type
      Half-day preschool: Utah High Quality Prekindergarten Program model
    • Evidence base for intervention
      2 comparative studies [Note 2]
    • Has effectiveness of the intervention for PFS project target population been evaluated?
    • Has the service provider provided this intervention previously?
      Partly [Note 3]
    • 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?
  • Evaluation

    • Evaluation Design Methodology
      Longitudinal study
    • Data Source(s) for Evaluation
      Granite School District
    • Outcomes Tied to Success Payments
      1) Use of special education and remedial services
    • Outcomes Tracked, Not Tied to Success Payments
      Math and reading proficiency; Secondary and post-secondary school completion; College readiness; Connection to health insurance and health care provider
    • Length of Evaluation Period
      12 years
  • Service Provider Characteristics and Service Delivery

    • Single or multiple service providers?
    • Service provider type(s) (nonprofit, government, private)
      Public , Nonprofit, Private and Charter School
    • Service provider OR site selection method
      Existing sites, plus expansion sites selected by intermediary
    • Service Provider Experience with PFS Intervention
      Public and nonprofit providers had already been implementing program with grant support
    • Referral Method for PFS Target Population
      De facto enrollment for all students at PFS program sites
    • Did the project have a ramp-up phase? (Y/N; brief description)
  • PFS Contracting and Governance

    • Operational Oversight Structure [Note 1]
      United Way of Utah as project intermediary manages day-to-day operations of program and reports to School Readiness Board
    • Frequency of meetings and/or reports
    • Executive Oversight Structure [Note 2]
      School Readiness Board housed within Governor’s Office of Management and Budget includes Dept. of Workforce Services and Board of Education representatives, appointees of State Charter School Board, and state House of Representatives and Senate leaders
    • Frequency of meetings
    • Investor role in project governance?
    • Frequency of reporting to investors
    • Non-standard Contract Termination Events [Note 3]
    • Appropriations Risk Mitigation Strategy [Note 4]
      Annual appropriation earmarked through legislation and reserved in restricted fund
  • Investors

    • Senior Investor/ Lender and Total Senior Investment ($MM)
      Goldman Sachs ($4.6)
    • Subordinate Investor/ Lender and Total Subordinate Investment ($MM)
      J.B.& M.K. Pritzker Family Foundation ($2.4)
    • Deferred Fee Source and Total Deferred Fees ($MM)[Note 1]
    • Recoverable Grant Source and Total Recoverable Grants($MM)[Note 2]
    • Non-recoverable Grant Source and Total Non-recoverable Grants ($MM)[Note 3]
    • Guarantor and Guarantee ($MM) [Note 4]
  • Basic Repayment Structure

    • Initial Investment ($Millions)
    • Maximum Repayment Funds Committed by Payor ($Millions)
      Not available
    • Full service delivery term (years)
    • Full repayment period (years)
    • Interim outcomes reported? Tied to payments?
    • Sustainability/ Recycling of Funds
      None specified
  • Detailed Repayment Terms

    • Interest
    • Trigger for initial repayment of principal [Note 1]
      Any difference between predicted and actual use of special education services for treatment group
    • Threshold for full repayment of principal
      ~90% avoidance of special education for students deemed at-risk
    • Threshold for full repayment of principal plus maximum success payments
      Not available
    • Repayment timing
      Senior: annually, years 3-10; Subordinate: after senior investment repaid
    • Return to Investor [Note 2]
      5% + municipal money market rate, with a maximum rate of 7.26% [Note 4]
    • Success Payment to Other Stakeholders? [Note 3]
  • Project Costs

    • Project Development Costs Not Covered by PFS Capital Raise
      Transaction coordinator fees; Technical assistance provider
    • Funding source(s) for project development costs, if any
      United Way of Salt Lake
    • Project Implementation Costs not covered by PFS Capital
      Evaluation; Project Intermediary
    • Funding sources for implementation costs not covered by PFS capital
      State of Utah