The Massachusetts
Juvenile Justice
Pay For Success Initiative
JUVENILE RECIDIVISM HAS CONTRIBUTED TO
AMERICA’S RISE IN INCARCERATION RATE FOR YEARS

The US has a growing
number of inca...
INTERVENTION CAN ALTER THE TRAJECTORIES
OF AMERICA’S MOST HIGH-RISK YOUNG PEOPLE

In 2013, Roca served 469
high-risk young...
PAY FOR SUCCESS LEVERAGES PRIVATE CAPITAL
AND REDUCES RISK FOR GOVERNMENT

The Commonwealth
of Massachusetts is
looking fo...
THE INITIATIVE WILL EXPAND INTERVENTION
TO 929 HIGH RISK YOUNG MEN

This $27 million,
7-year project is
the largest financ...
SAVINGS FOR MASSACHUSETTS BASED
ON REDUCED INCARCERATION RATES

% Decrease in Total Bed Days =
Savings Net of Pay for Succ...
INVESTING IN HUMAN CAPITAL

The Massachusetts
Juvenile Justice Pay
for Success Initiative
will serve as proof
of concept t...
The Massachusetts Juvenile Justice Pay For Success Initiative
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The Massachusetts Juvenile Justice Pay For Success Initiative

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Pay for Success is an innovative financing structure in which philanthropic and private investors provide up-front funding for a project and government only pays for successful outcomes.

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The Massachusetts Juvenile Justice Pay For Success Initiative

  1. 1. The Massachusetts Juvenile Justice Pay For Success Initiative
  2. 2. JUVENILE RECIDIVISM HAS CONTRIBUTED TO AMERICA’S RISE IN INCARCERATION RATE FOR YEARS The US has a growing number of incarcerated young people. Without intervention, high-risk young people face a reality of years in jail and prison. The average prison sentence for young male ex-offenders in Massachusetts is 64% go back to jail within 5 years 35% Only gain employment within a year 2.4 years
  3. 3. INTERVENTION CAN ALTER THE TRAJECTORIES OF AMERICA’S MOST HIGH-RISK YOUNG PEOPLE In 2013, Roca served 469 high-risk young men ages 17-24. In Massachusetts, Roca, an outcomesdriven organization, combines relentless outreach with datadriven evaluation to produce consistent, positive outcomes for young people. Of the 115 young men already in the third phase (last two years) of the model: 69% had no new arrests 89% retained employment 95% had no new technical violations
  4. 4. PAY FOR SUCCESS LEVERAGES PRIVATE CAPITAL AND REDUCES RISK FOR GOVERNMENT The Commonwealth of Massachusetts is looking for new ways to solve problems while saving taxpayer dollars. Pay for Success is an innovative financing structure in which philanthropic and private investors provide up-front funding for a project and government only pays for successful outcomes. The government only pays back investors if certain outcomes are reached. The Commonwealth underwent a process to develop a first Pay for Success deal in Massachusetts that would serve as a pilot for future deals: 1 2 3 Reviewed what social problems would be good ventures for first Pay for Success deal Evaluated and decided on juvenile recidivism Structured deal with Roca and philanthropic and private lenders
  5. 5. THE INITIATIVE WILL EXPAND INTERVENTION TO 929 HIGH RISK YOUNG MEN This $27 million, 7-year project is the largest financial investment of its kind and allows Roca to expand its high impact intervention, which aims to reduce recidivism and increase employment. Roca will serve approximately 929 young men Ages 17–23 At high risk of incarceration In the probation system or exiting the Massachusetts Department of Youth Services
  6. 6. SAVINGS FOR MASSACHUSETTS BASED ON REDUCED INCARCERATION RATES % Decrease in Total Bed Days = Savings Net of Pay for Success Payments The Commonwealth of Massachusetts will only pay a return if the program is successful. If there is no reduction in incarceration, the Commonwealth pays nothing. 55% = $7M 50 40 30 20 PAYMENTS TO LENDERS 10 At higher levels of success, all the philanthropic funding that is replenished will be recycled. Laura and John Arnold Foundation will use recycled funding to support future PFS initiatives. New Profit and The Boston Foundation will use recycled funding to support scaling of Roca. USD MILLIONS Government savings are based on a decrease in incarceration and an increase in employment. 70% = $18M 10% 20% 30% 40% 50% 60% 70% DECREASE IN TOTAL BED DAYS Source: PFS Factsheet
  7. 7. INVESTING IN HUMAN CAPITAL The Massachusetts Juvenile Justice Pay for Success Initiative will serve as proof of concept that philanthropic and private dollars can be used to invest in not only physical infrastructure, but also human capital. Our hope is that future transactions modeled after this deal will draw more private sector capital to address other social problems: Education Income Security and Social Services Employment Workforce Development Public Health

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