Hundreds of people with a history of experiencing chronic homelessness achieved stability and improved health in their lives through an innovative five-year study that linked housing with supportive services. The groundbreaking study based in Denver, Colorado, and named the Denver Social Impact Bond (SIB) Initiative targeted people entrenched in the cycle of homelessness and stays in jail.
The Urban Institute served as the initiative’s independent evaluator with research partners from the Evaluation Center at the University of Colorado Denver and with funding from the City and County of Denver, Arnold Ventures, and the Robert Wood Johnson Foundation. CSH and Enterprise Community Partners (ECP) served as co-intermediaries for the project, working together to ensure the quality of the housing and services and promote positive outcomes for tenants. CSH focused on project management and overall project support while ECP oversaw fiscal management.
The five-year project ended in December of 2020. The randomized control trial study led by the Urban Institute released the final results today.
The SIB researchers identified more than 700 individuals in Denver who were chronically homeless, had numerous arrests and were battling substance use and mental health challenges. Roughly half (365) were selected randomly to receive supportive housing, with the remaining receiving services as they normally would through their interactions with multiple systems. The latter served as the control group.
The Colorado Coalition for the Homeless and the Mental Health Center of Denver, two high-capacity service providers, implemented the supportive housing intervention as part of the initiative. The five-year randomized control trial evaluation in the project proves that supportive housing is the reason for the reductions in interactions with the justice system.
Among those who received supportive housing, 86 percent remained in their homes in the first year, and after three years, more than three-fourths (77%) remained stably housed. Also, participants had a 34% reduction in police interactions, 40% reduction in arrests, and spent 38 fewer days in jail (a 30% reduction in jail stays and 27% reduction in jail days) compared to the control group.
The project prioritized participants based on their justice system interactions, helping to drive resources towards historically marginalized communities who have suffered from criminalization policies rooted in racism. The results are compelling for communities seeking to address systemic racism and patterns of over-criminalization of Black, Indigenous and People of Color (BIPOC) and people with disabilities experiencing homelessness.
The SIB Initiative was designed using a "pay for success" model, an innovating financing approach that links public and private investment in social services to improved outcomes. Private investors, including nonprofit foundations and for-profit companies, made an upfront capital investment of $8.6 million. In addition, the Harvard Kennedy School Government Performance Lab provided support to develop a "pay for success" contract under which the City of Denver agreed to pay investors back if participants got housed, stayed housed, and spent less time in jail.
The program was so successful that investors received their total investment from the city, plus $1 million in return. Northern Trust, one of the for-profit investors, agreed to share $250K of their return with providers.
Supportive Housing Drives Long-Term Results
Highlights from the Denver SIB Initiative findings include:
- Most who were offered housing stayed for the long term. Many studies on supportive housing evaluate housing stability outcomes for only one or two years. But, the Denver SIB Initiative looked at housing stability over three years and found that 8 in 10 people remained in stable housing at two years, and at three years, 77 percent remained. The long-term nature of the study showed that supportive housing helps people and communities create long-term, lasting results.
- The Denver SIB Initiative significantly increased participants' access to housing assistance. Over three years, people referred to supportive housing received an average of 560 more days of permanent housing assistance per person than those who received usual services in the community.
- SIB participants spent significantly less time in shelters. People referred to supportive housing had an average of 40 percent reduction in shelter visits and a 35 percent reduction in days with any shelter stays because of supportive housing.
Reduction in Justice System Outcomes
- The SIB helped people reduce their interactions with the criminal justice system. In the three years after being randomized into the evaluation, people referred to supportive housing had a 34 percent reduction in police contacts and 40 percent reduction in arrests.
- SIB participants spent less time in jail. Participants who were referred to supportive housing spent an average of 38 fewer days in jail than those who received usual services. This represents a 30 percent reduction in unique jail stays and a 27 percent reduction in total jail days.
Health services outcomes
- Supportive housing helped people use less emergency health care and more office-based health care. Two years after SIB participants were referred to supportive housing, they had a 40 percent decrease in emergency department visits, a 155 percent increase in office-based visits, and a 29 percent increase in unique prescription medications.
- The SIB helped people reduce their use of short-term, city-funded detoxification facilities. Participants enjoyed a 65 percent reduction in the use of detoxification facilities that were not equipped to provide follow-up treatment.
Social Investments Reward Social and Economic Dividends
- The Denver SIB Initiative demonstrated that the "pay for success" model can work as a strategy to scale supportive housing as a solution to chronic homelessness. The upfront investment was one of the most significant influxes of service funding for supportive housing ever made in Colorado.
- The project was so successful as it progressed the City of Denver expanded it by 75 slots in 2018 through a direct performance-based contract with Colorado Coalition for the Homeless without upfront capital from investors and has agreed to fund ongoing services for all participants in the Denver SIB Initiative.
- This commitment of services funding was critical to leveraging the housing resources needed in the project and ensuring stability for tenants. The SIB provides an impressive local template to understand the financial investment and service model required to reach the expected results.
The Denver SIB Initiative is also a powerful illustration of the positive outcomes that result when a group of committed stakeholders comes together around a shared definition of success. For five years, the project stakeholders: investors, services providers, evaluator, City of Denver, CSH, and ECP, met to review performance and solve problems in real time.
Over the project duration, each governance committee meeting began with a story of how a participant's life improved after the supportive housing intervention. This project's opportunity to offer supportive housing to people was always at the center of this work. As with most supportive housing projects, there were bumps in the road. The difference here is that this project's unique structure provided the information and quality improvement structure needed to address the hurdles. As the project manager, CSH had the privilege to witness all the stakeholders' collaboration, passion, and dedication.
Our vantage point on this project has left us more convinced than ever that communities and our nation can commit to ending the cycles of justice involvement and homelessness for thousands of Americans. We know that providing affordable housing with flexible person-centered supportive services makes the difference. Supportive housing is the solution.
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