The County of Ventura, through a Board of State and Community Corrections grant, has made effective offender reentry and reducing recidivism priorities for community safety. The Ventura County Project to Support Reentry establishes an innovative strategy for expanding evidence-based services to previously underserved men and women on formal probation. Individuals gain access to a custom suite of services that focus on each client’s individual needs to support them in leading healthy and productive lives when returning to their families and community. The impact on the community will be measured by an independent evaluator using administrative data and a randomized controlled trial (RCT). The RCT will be conducted by the University of California, Los Angeles.
Ventura’s project is a collaborative project with the County Executive Office, County Probation Agency, Interface Children & Family Services, and Social Finance.
- Year Launched2017
- Service Delivery Term (Years)4
- Motivation for ProjectNearly 300,000 offenders are on probation in CA and recidivism rates remain high with more than two-thirds of those released from prison returning within 3 years
- Project Objective(s)Reduce recidivism, improve public safely, and promote family stability for residents throughout Ventura County
- Individuals Served400
- GeographyVentura County, CA
- Issue AreaCriminal Justice
- Initial Investment ($ millions) [Note 2]2.59
-  This category captures the initial private investment raised to support the project that has the potential to be repaid if the project achieves its pre-determined outcomes. Many projects, particularly those in the supportive housing and health arenas, leverage existing public resources, such as subsidized housing and health insurance, to achieve program impact; the value of these resources is not included in these dollar values but are discussed in more detail in Sections 7, 8 and 9 of this report.
- Service Provider(s) [Note 1]Interface Children & Family Services
- Payor(s) [Note 2]Ventura County & California Board of State and Community Corrections [Note 19]
- Transaction Coordinator(s) [Note 3]Social Finance US
- Evaluator [Note 4]UCLA
- Validator [Note 5]None
- Project Manager [Note 6]Social Finance US
- External Legal Counsel [Note 7]Jones Day
- Technical Assistance Provider(s) [Note 8]None
-  Delivers program interventions to target population over the course of the PFS contract
-  Makes payments when pre-determined outcomes have been met
-  Ventura County was the recipient of grant funds from the California Board of State and Community Corrections, awarded through a competitive process through the agency's Social Innovation Financing Program. Grant funds received through this process are being used in whole or part to fund outcome payments.
- Roles and responsibilities may include: design and structure of PFS project and financing model; capital raise; stakeholder management; on-going performance management
-  Design and implement plan for determining whether outcomes have been met
-  Verify accuracy of data used in evaluation plan, or evaluation plan itself
-  Intermediary during service delivery phase, and/or fiscal sponsor for project funds
-  Provide assistance in drafting, reviewing and negotiating PFS contracts
-  Provide support and expertise to project stakeholders in the project development and/or project implementation phases
Evidence and Program Design
- Service Intervention(s) Model and/or TypeInterface Reentry Services: case management with Moral Reconation Therapy (MRT), trauma therapy, relationship skills, employment support and placement
- Evidence base for interventionMRT, which the Project anticipates the majority of participants will receive, has been extensively evaluated through multiple studies
- Has effectiveness of the intervention for PFS project target population been evaluated?No
- Has the service provider provided this intervention previously?Yes [See Note 20]
- Is PFS project: Scaling an existing intervention by replicating at a larger scale? Demonstrating the effect of a new program model or combination of services? Transplanting an existing intervention(s) to a new target population and/or service delivery setting?Demonstrating
- Evaluation Design MethodologyRCT, Validation
- Data Source(s) for EvaluationVentura County Probation Agency administrative data; Service provider data
- Outcomes Tied to Success Payments1) Number of avoided arrests (mean number or rate of rearrest); 2) Clean Quarters (90-day period without rearrest)
- Outcomes Tracked, Not Tied to Success PaymentsVarious
- Length of Evaluation Period4.5 years total
Service Provider Characteristics and Service Delivery
- Single or multiple service providers?Single
- Service provider type(s) (nonprofit, government, private)Nonprofit
- Service provider OR site selection methodPartner in grant proposal submitted by Ventura County
- Service Provider Experience with PFS InterventionExperienced with providing case management, MRT, trauma therapy, relationship skills, employment support
- Referral Method for PFS Target PopulationEligible participants identified by Ventura County Probation Agency
- Did the project have a ramp-up phase? (Y/N; brief description)No
PFS Contracting and Governance
- Operational Oversight Structure [Note 1]Management Committee includes representatives from Ventura County Executive Office, Ventura County Probation Agency, Interface Children & Family Services, and Social Finance
- Frequency of meetings and/or reportsMonthly
- Executive Oversight Structure [Note 2]Executive Steering Committee includes senior executives from Ventura County Executive Office, Ventura County Probation Agency, Public Defender's Office, Interface Children & Family Services, and Social Finance
- Frequency of meetingsBi-annually
- Investor role in project governance?Can attend Executive Steering Committee meeting as non-voting member [Note 7]
- Frequency of reporting to investorsQuarterly
- Non-standard Contract Termination Events [Note 3]None
- Appropriations Risk Mitigation Strategy [Note 4]Annual deposits in Ventura County budget unit; required matching fund per terms of Board of State and Community Corrections grant
-  Committee or working group involved in regular and/or day-to-day monitoring of project progress
-  Oversight and decision-making body for PFS project
-  Investors may require consent rights or rights to direct SPV voting through the loan agreement for material changes to the PFS contract and ancillary agreements.
-  Events that allow stakeholders to exit their contractual obligations, beyond those typically found in loan agreements and contracts
-  Means by which to mitigate risk that funding is not available for investor repayment
- Senior Investor/ Lender and Total Senior Investment ($MM)Reinvestment Fund, Nonprofit Finance Fund, Whitney Museum of American Art ($2.072 total)
- Subordinate Investor/ Lender and Total Subordinate Investment ($MM)None
- Deferred Fee Source and Total Deferred Fees ($MM)[Note 1]Interface Children & Family Services, Social Finance ($0.218 total)
- Recoverable Grant Source and Total Recoverable Grants($MM)[Note 2]Blue Shield of CA Foundation ($0.3)
- Non-recoverable Grant Source and Total Non-recoverable Grants ($MM)[Note 3]None
- Guarantor and Guarantee ($MM) [Note 4]None
- Illinois Dually-Involved Youth Project
-  Deferred fees are delayed payments for the services provided by service providers, transaction coordinators and/or project managers. Deferred fees are one way of structuring projects so that more stakeholders have a financial interest in ensuring project success.
- Philanthropies can use either their regular grant making protocols, or protocols for program-related investments (PRIs), to contribute to PFS capital stacks. If a foundation does not use a PRI, their investment may be structured as either a loan or a recoverable grant. The distinction between the two is in the expectation of repayment. A loan, even if from a philanthropic source, is expected to be repaid, and structured accordingly. A recoverable grant does not bear the same expectation of repayment.
-  Non-recoverable grants are traditional grants contributed to capital stacks; if the project is successful and generates full repayment, the non-recoverable grants can remain with the service provider or project manager, or be recycled by the original funder.
Basic Repayment Structure
- Initial Investment ($Millions)2.59
- Maximum Repayment Funds Committed by Payor ($Millions)2.85
- Full service delivery term (years)4
- Full repayment period (years)4.5
- Interim outcomes reported? Tied to payments?No/No
- Sustainability/ Recycling of FundsGovernment Partners hope to continue successful programs
Detailed Repayment Terms
- Interest7% (seniors); 4% (deferred fee providers) [Note 9]
- Trigger for initial repayment of principal [Note 1]Any 1) relative reduction in rearrests; 2) number of clean quarters achieved
- Threshold for full repayment of principalNot publicly available [Note 10]
- Threshold for full repayment of principal plus maximum success paymentsNot publicly available [Note 10]
- Repayment timingRCT: at month 36 and month 52; Clean Quarters: quarterly
- Return to Investor [Note 2]Expected IRR at base case: Seniors 7-7.5%; Deferred Fee Providers 4-4.5%
- Success Payment to Other Stakeholders? [Note 3]No
-  Payment of accured interest contingent on achievement of outcomes
-  Initial repayment does not equate to full principal return. Investors may recover only part of their principal if projects do not meet a certain level of success.
-  There are multiple paths to repayment and repayment starts with initial outcomes.
-  There are multiple paths to repayment and repayment starts with initial outcomes.
-  There is no standard methodology for calculating investor return. These numbers are what is publically reported, and comparing from one project to another may not be an apples-to-apples comparison for the reason of potentially different calculation methodologies. Calculation methodologies may be provided in investor agreements, which are not available publically and were not available for this report’s analysis.
-  Success payments for other stakeholders such as project managers and service providers create a financial incentive for project success.
- Project Development Costs Not Covered by PFS Capital RaiseCounty and service provider costs for project development; Legal services
- Funding source(s) for project development costs, if anyCA Pay for Success Initiative; Pro bono legal support
- Project Implementation Costs not covered by PFS CapitalNone
- Funding sources for implementation costs not covered by PFS capitalNone