As Jason Jenkins notes in today’s SIB News, “The key to the successful cities of tomorrow will be how they find innovative ways to fix urban ills.” Happy reading…
How To Get Private Investors To Invest In Baltimore’s Social Ills
Jason Jenkins – Baltimore Post-Examiner
New innovative ways are being introduced to help urban areas
I shared with you that development alone doesn’t help everyone. The key to the successful cities of tomorrow will be how they find innovative ways to fix urban ills.
We are all aware that the current processes in Baltimore are not working. We see that everyday on the news or read it on-line. Local governments have become too preoccupied with winning the media message rather than looking at pragmatic solutions. Plus, many cities and states just don’t have the coffers to fund change.
So we need to look outside the box.
A new innovative financing mechanism has been gaining momentum over the past few years. What it does is monetizes social policy. Yes, you read that correctly.
The Federal Government calls it Pay for Success (PFS) while the private sector refers to it as social impact bonds (SIB) – even though they are not really bonds so don’t get scared. Under either name, PFS/SIBs are public/private partnerships that shift the risk of new social investments from the government to private entities such as commercial banks, philanthropists and venture capitalists.
Once you look at how it’s set-up, it seems it could actually work.