Social impact bonds offer great opportunity for South Carolina
Tony Keck and Joe Waters are ready to move forward with the state's recently awarded social impact bond grant.
They visited Washington, D.C., last week and met with other like-minded folks about this innovative program.
South Carolina is the only Southern state among the six grantees chosen in a national competition by the Rockefeller Foundation and the Social Impact Bond Technical Assistance Lab (SIB Lab) at the Harvard Kennedy School. That significance was not lost on Keck and Waters.
“It's a huge opportunity for the state,” said Waters, vice president of the Institute for Child Success, a nonpartisan research and policy organization.
The state will use the grant for its Nurse Family Partnership, a program that already has proven to reduce infant mortality and improve children's health.
Social impact bonds offer the possibility of a true win-win scenario. The investor gets money if the government's costs are reduced. If the government's costs are reduced, the taxpayer wins because that money can be spent elsewhere.
“For those who are interested in social services, they get that expansion because there's financing available,” Waters said, “and for those like Gov. Haley who are interested in performance, those folks feel that they won as well.”
In their relatively short lifespan, social impact bond programs have focused on things like reducing recidivism. That makes sense: you're dealing with a specific outcome of whether someone returned to prison or not. And there's one agency involved —the prison system —which might not be the case for other results-based programs.
The key to attracting investors, according to the folks they heard from at the White House, is a high probability for proven results. The Nurse Family Partnership certainly fills that bill by having nurses partner with low-income, first-time mothers for regular one-on-one visits.
“They want to know that you can successfully implement the thing,” said Keck, director of the state's department of Health and Human Services.
And they don't want to waste any time.
“We'd really like to approach investors in the fall,” Keck said.
Now the institute will focus more on continuing to educate the public about the project, along with the folks from Harvard and Brown, and looking ahead to other projects that could be funded this way.
“The thing we have to remember is that intervention has to have strong effectiveness and cost savings,” Waters said. “Where those interventions exist, we're certainly interested.”
Likewise, Keck said the state is strictly focused on a successful rollout of the grant as it relates to the Nurse Family Partnership, though other programs such as supportive housing services and early childhood education could certainly be good fits in the future.
“The people who are lending the money spend a lot of time making sure they're going to get the money back,” Keck said, which leads to rigorous analysis of the social programs that they might not get from the Legislature.
“It was nice being up there and being with people who are on the cutting edge of things,” Keck said.
It's even better for South Carolina to be on the cutting edge.
Reach Melanie Balog at email@example.com or 937-5565.