Will Engelhardt
Urban Institute
Training and Technical Assistance Manager

3 ways to engage local leadership in pay for success initiatives

June 28, 2018 - 3:03pm

Engaging local leaders is critical to any pay for success (PFS) project. Because government agencies are typically end payors in PFS, their involvement throughout the process differs from their role in public services projects funded through more traditional mechanisms. In PFS, it is especially useful to engage the end payor early in the planning and development phase. Doing so ensures that the end payor supports the intervention that is being funded and that the goals of the project align with the end payor’s goals. Additionally, as the end payor is typically expected to set aside funds for repayment if the project’s agreed upon outcomes are achieved, they often want to have input on what those repayment outcomes are. Here are three key strategies to help generate buy-in and support for a project—regardless of whether the end payor is a federal, state, county, or city agency, or a combination of the four.

  • Solicit early commitment from leaders who manage the budget: Governments typically bear the risk of programs intended to serve the public interest. As a result, government leaders who manage the budget may be interested in PFS because it transfers some of the risks associated with program innovation to other parties (i.e. investors), and ensures that the government only pays for programs that improve social outcomes. The earlier these leaders can express their interest in PFS through a convening, a letter of commitment, an op-ed, or another method, the sooner the key components of the project can be developed in accordance to their interests and acted upon by other stakeholders.
  • Establish a planning team, with the end payor serving as the designated chairperson: Many PFS initiatives focus on target populations that are served by multiple agencies and systems, requiring cross-agency planning and collaboration. To develop a cross-system plan for a PFS project, it may be necessary to form a PFS planning team that includes formal agreements, such as MOUs, to explain the group’s function and agreed upon goals, purpose, and decision-making process. Ideally, the planning team consists of key decision-makers from the relevant agencies that are engaged in a PFS project. Having the end payor chair the planning team ensures that the other stakeholders are meeting the needs of the end payor so that they can gather the information necessary to fund the project.
  • Ask the end payor to designate a project coordinator to manage the project’s development: To ensure that the necessary information is gathered across system agencies and the planning process is managed in a timely and effective manner, a coordinator should be assigned to the project. Preferably, the project coordinator is assigned or funded by the end payor so that he or she can represent the end payor’s interests and report the project’s progress and challenges directly to them.

Involving key government leaders early and often in the PFS process facilitates important next steps—such as identifying a target population, selecting an intervention, and selecting outcome targets—and allows the project to align with the needs and interests of the end payor.

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