Banks, Foundations Get Behind an Unsexy Fight Against Poverty

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The Fund brings together philanthropic leaders and financial bigshots.

CCF

The Fund brings together philanthropic leaders and financial bigshots.

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Editor’s Note: Incorrect information provided to City Limits by associates of the Change Capital Fund indicated that Goldman Sachs was still a funder of the effort. That is no longer the case. This story has been updated to reflect that fact.
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Residents of the Cypress Hill section of Brooklyn often walk off the street to a clinic run by Jamaica Hospital not because they’re sick, but because they’re seeking a job.


“We get a lot of people who are interested in health care, but if you’re not a nurse or doctor, it’s difficult to get into the field,” says Jason Maffia, who manages the operations at the site.

While he liked the idea of hiring locally, he says that many of the people who showed up at the door weren’t qualified for any open positions, or simply weren’t sophisticated about matters like preparing resumes and interviewing for jobs.

Now, a new program in the neighborhood seeks to make it easier for Maffia to employ Cypress Hills residents.

Last October, the nonprofit Cypress Hills Development Corporation launched a “business partners” program that aims to connect small enterprises in the neighborhood with job applicants. The 22 business partners—including the Jamaica Hospital clinic, local office supplies store Peck’s Office Plus and a nearby grocery store—agree to interview candidates referred by the nonprofit, and keep it apprised of any job openings.

In return, the establishment proprietors are invited to at least two events a year where they are notified about vending and contracting opportunities coming up at Cypress Hills.

Assisting people who live in the impoverished East New York neighborhood of Cypress Hills find jobs isn’t new for the development corporation, which has long sought to connect local residents with nearby businesses. But they have new resources to pursue that long-held goal, thanks to a $1 million grant, spread out over four years, from the Change Capital Fund, a collaborative of 17 donors formerly known as the Neighborhood Opportunities Fund. Members include Capital One, the M & T Charitable Foundation, Scherman Foundation, United Way and the New York City Center for Economic Opportunity (full list below).

The fund could reflect an evolution in thinking about poverty and philanthropy aimed at reducing it. Ten years ago, private funders emphasized innovation in funding anti-poverty efforts, leading to plenty of new ideas but few initiatives that could demonstrate enough impact to warrant scaling-up.

The Change Capital Fund embodies a different approach: funding unglamorous but useful programs, supporting the institutional infrastructure of organizations that have existed for decades.

Like the previous generation of anti-poverty funding, the Fund has struggled with how to measure program impact.

But the nature of the Fund’s investments make them hard to argue against. “We’re not trying to have them think outside the box, but trying to make the box stronger, sturdier and more effective,” Steven Flax, chairman of the Change Capital Fund and administrative vice president at M&T Bank, says of the fund’s beneficiaries.

A move beyond housing

The fund evolved from the Neighborhood Opportunities Fund, a collaborative that supported local organizations’ efforts to develop housing since 1997. Initially, the Change Capital Fund reached out to hand-selected nonprofits and asked them to submit proposals for to receive funds. Those solicitations said the organization sought to support “multidisciplinary strategies” that would address poverty in a holistic manner.

“Affordable housing, the focus of many community development corporations, has proven to be a necessary foundation for individual and family success in employment, asset building, education and health; however, evidence suggests that housing alone is not sufficient to reduce poverty,” the original request for proposals stated.

The impetus to move beyond home-building stems at least in part from the growing costs of obtaining real estate, according to Wendy Fleischer, consultant to the Change Capital Fund.

In the past, local community development corporations could buy abandoned parcels at huge discounts, and then set about building homes on them. But that situation has changed in recent years.

“There’s no property in the city that a private developer doesn’t want,” Fleischer says. For that reason, nonprofits that once focused on building homes have turned their attention to education, social services and preserving existing housing, she says.

The collaborative kicked off the program in 2013, when it awarded 10 groups $50,000 each for a pilot project. The following year, the Change Capital Fund selected five organizations to receive the full $1 million.

At Cypress Hills LDC, the grant includes money for hiring a program director, who is tasked with enlisting local businesses and managing the business partners initiative. That director has placed has placed a total of 26 people in new jobs since October, according to Lowell Herschberger, Director of Career & Educational Development Programs at Cypress Hills.

Since joining the program, Jamaica Hopsital has hired at least one person referred by Cypress Hills, Maffia says.

He adds that the program saves him time by screening applicants and preparing them for office work. “It’s always nice to get a resume when the words are spelled correctly, and people come dressed in suits for the interview,” he says.

Screenings, coaches and databases

Three other Brooklyn-based organizations are receiving similar grants—Community Solutions’ Brownsville Partnership, The Fifth Avenue Committee, and St. Nick’s Alliance—as is the Bronx-based New Settlement Apartments.

New Settlement Apartments is focusing on trying to better integrate its services, says executive director Jack Doyle. He says that the group recently added a new dimension to one of its after-school programs by holding housing workshops for parents of the students.

That initiative stemmed from the realization that many of the students in the after-school program came from families that struggled with unaffordable rents and eviction threats. “The logical thing to do was have our after-school programs work hand-in-hand with our housing initiative,” Doyle says.

The Brownsville Partnership is using the Capital Change Fund grant for a new employment campaign, which aims to place 5,000 Brownsville residents in jobs. Prior to receiving the grant, the Brownsville Partnership worked primarily with NYCHA residents—many of whom were facing eviction because they were behind in the rent. In the course of that endeavor, the group realized that residents also needed assistance finding employment, says Ben Faust, manager for strategy and performance at Community Solutions. “We kept hearing, ‘Jobs, jobs, jobs,'” he says.

The group is using the Change Capital Fund money to hire several new employees, including a full-time director of the jobs campaign, to forge relationships with other organizations, like Brooklyn Workforce Innovations—itself a subsidiary of the Change Capital Fund grantee Fifth Avenue Committee. Brooklyn Workforce Innovations helps residents find positions as commercial drivers, film production assistants and cable installers, among others.

In the first year, more than 550 people in the Brownsville Partnership’s database participated in a program connected to the jobs initiative. Faust says that even more people might have attended a program after hearing about it through the Brownsville Partnership, but the organization can’t track that figure.

St. Nick’s Alliance, which serves people living in Williamsburg’s housing projects, used a portion of the funds to launch a new “transformational coaching” initiative that works with families of children enrolled in the organization’s afterschool programs. The effort is part of what the group is calling “Nabe 3.0″—its new initiative that seeks to better integrate efforts at improving employment, education and housing for residents.

Last year, the transformational coach hired by St. Nick’s worked with families of 18 students enrolled in P.S. 18 who had been flagged for intervention by the school principal or after-school program director. In most cases, the students had high absence rates, according to executive director Michael Rochford.

The coach “helped analyze what was happening with the child and family,” Rochford says. For instance, children in two separate families weren’t coming to school because a parent was terminally ill. In other cases, the children were living with their families in homeless shelters, and going to school required them to travel long distances. Ultimately, 70 percent of the children improved their attendance, and all of them improved their academic performance, Rochford says.

St. Nick’s Alliance recently has hired an additional coach in order to extend the program to three schools, where the coaches will work with a total of 50 students.

The Fifth Avenue Committee-Stronger Together Partnership seeks to better combine the services of the Red Hook Initiative and the Southwest Brooklyn Industrial Corporation. Executive director Michelle de la Uz says the Red Hook Initiative primarily serves young people under age 25. In the past, if people older than 25 visited the group’s office, they typically were given flyers for other programs. Now, however, the Red Hook Initiative is screening those people to determine whether they are candidates for services run by the other organizations that participate in Stronger Together.

Hard to find nuts-and-bolts funding

Integrating services is only one part of the Change Capital Fund’s mission, according to Flax. He says that donor collaborative aims to fund organizations that employ a “multi-pronged approach” to combatting poverty, while also “building on their strengths, embellishing their back offices and bandwidth, figuring out how to use data to … prove to the government that this deserves additional resources.”

At Cypress Hills, for instance, in addition to launching the new business partners program, the organization hired a new director of evaluation and research, and tasked him with upgrading the organization’s technology.

One of his first orders of business was to migrate data about clients to a cloud-based software system, so that staff in the 15 different branches could more easily access information about the organization’s clients. In the past, the different locations’ computers weren’t networked.

Finding donors willing to fund that type of behind-the-scenes work is often a challenge, says Nancy Rankin, vice president for policy research and advocacy at the Community Service Society of New York.

“It’s not as sexy as saying, ‘We’re hiring teachers,'” Rankin says. “The content part is sexy. Turning on the lights in the room is not sexy, but you need to do that.”

Joel Berg, executive director of the New York City Coalition Against Hunger—an organization that also receives support from some of the same donors in the Change Capital Fund—adds that improvements to infrastructure often translates to better services for clients. Upgrading computer systems can shave off time needed to complete intake assessments, which in turns means that programs can see more people during the course of a day.

“When we make internal improvements it almost always helps the people we represent,” Berg says.

The Capital Change Fund also expects grantees to develop the kinds of metrics that would prove their programs are working. The request for proposals that was distributed to organizations in 2013 noted the importance of measuring whether programs’ efforts would “justify continued public support.” So far, however, figuring out how to measure success remains a work-in-progress, according to Fleischer.

“It’s been harder than we thought it was going to be,” she says. The groups were supposed to have developed a common set of metrics by earlier this year, but the initial effort “wasn’t ready for primetime,” Fleischer says.

Flax says that groups had an easier time of proving that money was well-spent when they were simply developing real estate—projects that by definition were tangible. “In housing, the bricks and mortar made it very easy,” he says. Now, the funders are looking to answer the more complex question of whether the lives of people in poor neighborhoods have improved. The groups are expected to submit another report regarding metrics by Oct. 30.

But even assuming that everyone agrees on what types of factors should be examined, proving that specific programs made a difference in people’s lives likely will be extremely difficult. Rankin of the Community Service Society points out that without running experiments that have control groups, it’s hard to know whether any change in people’s lives is attributable to programs run by the nonprofit. In addition, she says, there are numerous outside factors—including, importantly, the strength of the larger economy—that the programs’ metrics probably can’t account for, and that results can take years to materialize.

“These are big messy problems,” she says, referring to the conditions that have kept residents of some neighborhoods impoverished for generations. “They’re not going to change overnight.”

Current members of the Change Capital Fund:
Altman Foundation
Capital One
Citi Foundation
Deutsche Bank Americas Foundation
Enterprise Community Partners
F.B. Heron Foundation
JP Morgan Chase
Local Initiatives Support Corporation
M & T Charitable Foundation
Mitsubishi UFJ Financial Group
Mizuho USA Foundation
New York City Center For Economic Opportunity (Ex Officio)
New York Community Trust
New York Foundation
Scherman Foundation
United Way Of New York City