innovative financial models to address social problems and social return/out- come achievement. Service providers are most interested in scaling up interven- tions that work and social return/outcome achievement. Finally, senior investors are attracted to testing innovative financial models to address social problems and combining social and financial returns. Overall, most stakeholders have a variety of motivations and put little focus on financial returns and savings. Project Development Process The development, implementation, and evaluation of PFS projects typically involve three stages: feasibility study; transaction structuring; and agreement implementation.
The first stage, feasibility study, includes the following activities:
• Identification of outcome(s) sought • Assessment of community needs, assets, and capacity
• Identification of a challenge(s) or barrier(s) for serving a particular population or addressing a social issue and determination of the total costs associated with the lack of intervention • Identification of interventions that can achieve the desired outcome(s) • P rojection of the potential public value, including any savings, to be achieved through potential interventions • D etermination of the willingness and capacity of stakeholders to implement a PFS project • D evelopment of Rigorous Evaluation methodology to determine if Outcome Measures have been achieved
The second stage, transaction structuring, includes, but is not limited to, the fol- lowing activities:
• Providing overall PFS coordination and support • Raising capital and developing capital structure • M ediating and facilitating agreements between each of the parties to the project • Aligning project design and evaluation • T racking the impact of achieving the Outcome Measures on government funding streams in terms of cost savings and avoidance • F inalizing the PFS project and preparing for post-closing activities and allowing for transition of critical information to those
implementing the third stage • Supporting ramp-up activities
52 Pay for Success & Affordable Housing | Stefano Rumi
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