2017 Symposium Industry Report: Pay for Success

phenomenal in generating many thousands of units in communities across the United States. However, reliance on federal subsidies has left local communities toothless. Cities have become increasingly powerless to build new affordable housing units and maintain existing units on their own, instead waiting com- placently for federal allocations and HUD representatives to tell them what their community needs. The past decades have seen an almost complete decline in locally issued housing bonds and other local efforts to finance affordable hous- ing construction. It is inexcusable that cities and counties do not prioritize hous- ing issues and commit funds to increasing their stock of affordable housing. Governments must also begin focusing on preventive solutions to social issues, instead of reparatory aid. Government interventions must be innovative and responsive to feedback from projects in progress and incorporate diverse and unique funding mechanisms to more efficiently spend taxpayer money. Governments must also constantly learn from past mistakes and work with pri- vate service providers to incorporate ever-improving social services into their communities. The responsibilities that local governments face are daunting. The con- cerns that these communities raise are valid. Government administrations are influenced by budgetary constraints, the wants of their constituents, and con- cerns over financing, regulation, and NIMBYism (Not In My Backyard opposition by residents to affordable housing units. Pay for Success contracts are the best innovative financing tool today that can help local governments overcome their skepticism and hesitation. PFS acts as a much-needed buffer to allow communi- ties to experiment in innovative ways to promote housing affordability in their communities, risk-free. PFS also promotes the viability of local service providers to best make a positive impact in their communities. As the PFS model evolves over the next decade to better suit the needs of communities, we believe that Pay for Success is the best and most promising solution for local communities to address their issues. NHPF supports innovation and entrepreneurship in the not-for-profit sec- tor. We are constantly searching for new and better ways to promote affordable housing across the United States, including Pay for Success contracts. We wel- come further dialogue to explore the potential of Pay for Success in the afford- able housing industry. We believe that PFS is among the mechanisms we can use to finance affordable housing construction more cheaply, quickly, and efficiently, leading to more low-cost units in areas of high opportunity. Pay for Success can also be used to promote housing preservation, uplift communities, revitalize neighbor- hoods, and finance crucial resident services to turn housing units into homes and affordable housing projects in to communities. Ultimately, PFS projects can provide tangible benefits for everyone involved. This is especially true for hous- ing providers who are given upfront capital to begin development, thus solving a

Pay for Success & Affordable Housing | Stefano Rumi 47

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