The Social Impact Partnerships to Pay for Results Act (“SIPPRA,” or the Results Act) was enacted as part of the Bipartisan Budget Bill of 2018. The Results Act appropriates $100 million to support the launch of state and local Pay for Success initiatives over a 10-year period. The Results Act presents an opportunity for state and local governments to leverage federal funding to tangibly advance their policy objectives, deliver measurable results for individuals and communities in need, and catalyze the incorporation of outcomes-driven practices into funding and contracting decisions.
The majority of SIPPRA funds, $75M, has been allocated to support Pay for Success outcome payments. (Of this $75M, up to $20M can be allocated to administrative costs). $10M has been allocated to fund evaluation costs, and $15M to fund feasibility studies. The Results Act outlines twenty priority outcomes across the spectrum of focus areas and target populations, including workforce development, health, education, criminal justice, veterans’ employment and well-being, and children and families – in fact, 50% of outcomes funding granted under the Results Act must be used for initiatives that directly benefit children.
Social Finance will support governments to take advantage of this historic opportunity by providing application assistance and conducting government and market education. Please contact us to learn more.
What is Pay for Success?
Pay for Success aims to measurably improve the lives of people most in need by driving resources toward better, more effective programs.
At its core, Pay for Success is a public-private partnership which funds effective social services through a performance-based contract. Pay for Success projects enable federal, state, and local governments to partner with high-performing service providers by tapping private investments to expand effective programs.
If, following an independent evaluation, the program achieves predetermined outcomes that benefit society and generate value for government, then government will make outcomes payments to investors. However, the government pays only at the level of outcomes achieved.
Spotlight: Children and Families
Decades of research has demonstrated the importance of stable home and family environments for healthy physical, cognitive, and social and emotional child development. Supporting parental mental and physical health and economic stability will help strengthen families and give children a better start from the very beginning.
A Landmark Moment for Pay for Success
“SIPPRA represents an enormous opportunity to more deeply embed Pay for Success in our governmental infrastructure, better providing critical services to those in need and accelerating systems-level change.”
– Tracy Palandjian and Matt Bannick
Our CEO, Tracy Palandjian, and Managing Director at Omidyar Network, Matt Bannick, wrote a blog about the historic importance of the Social Impact Partnerships Pay for Results Act and the opportunity it presents to nurture a performance-based mindset in state and local governments nationwide. Read more in A Landmark Moment for Pay for Success.
Additional Resources for the Results Act
Social Impact Partnerships to Pay for Results Act — Text of the SIPPRA legislation
SIPPRA: Little Known Legislation with Big Implications — Blog by Nicole Truhe, former Government Affairs Director at America Forward
Investors, mine for diamonds in your own backyard — Op-Ed by Jim Sorenson, founder of the Sorenson Impact Center at the David Eccles School of Business at the University of Utah and the founder of the Sorenson Impact Foundation.