Economic Opportunity Initiative
City of Portland, Oregon
Bureau of Housing & Community Development
NCDA ANNUAL CONFERENCE Howard Cutler
June 20, 2007
Evolution of the Initiative
• Historic CDBG focus was a place-based strategy to revitalize blighted areas
• 2003 Strategic Plan conclusion: Move to people-based strategies, Reduce # of activities, & Focus on those most in need
• By a deliberative and inclusive process, able to significantly change City’s community development focus
Economic Opp Initiative SnapshotGoal: Increase the incomes and assets of low income Portland
residents by a minimum of 25% within 3 years.
• Strategy: Build a poverty reduction system that builds on the assets of discrete low-income populations
– Programs in the system follow proven best practices – Programs provide training, supports, tools and evaluation
– System uses economy of scale as a leverage to attain added benefits on behalf of participants
• System of 29 projects today serves about 2000 participants– 12 adult workforce, 9 youth workforce, 8 microenterprise
The challenge in 2004...
• 50,000 disadvantaged households in City regardless of how strong the economy.
• “Nothing works” malaise; no improvement despite affordable housing; revitalization had not improved many residents’ living situations; no first rung on the ladder
• Local & national research in poverty reduction best practices: isolated cases, no scale
• CDBG challenging core funding source
Poverty Reduction Best PracticesWorkforce Development: • Build on population skills or sectoral opportunities • Comprehensive support services • Early employer involvement • Peer support • Long-term program relationship
• Sectoral projects develop niches
Key elements are length & comprehensiveness of support. “Give me a real shot at success!”
Poverty Reduction Best Practices
Microenterprise Development: • All Workforce elements/personal supports • Screen out/redirect some dreamers• Business training and mentoring• Multiple financial tools
• Credit repair
Key elements are length & comprehensiveness of support.
Not Your Ordinary RFP
• Directive
• Outreach & Education
• Intense Pre-Proposal Technical Assistance
• Outcome-Driven Designs
What did we fund?
• Homeless adults/multiple barriers
• Homeless and at-risk youth
• Ex-Offenders
• Chronically Mentally Ill
• Sectoral Workforce & Microenterprise
• Women/minorities in the trades
What did we fund - cont.
• Refugees and immigrants
• Underserved & home-based businesses
• Struggling craftswomen using recycled goods
Project Examples
Microenterprise
• Childcare Improvement Project
• 110 home-based bus.
• Unite for support, C.C. improvement, Bus. Ed, purchasing, marketing
Workforce
DevelopmentCorporate Connections• Standard Ins., Bar
Assoc., Comcast• Pre & post training &
support services for high risk youth
Maria Castillo - CCIP
• Immigrant with limited English; disabled abusive husband; 2 kids
• Women in family don’t work outside home, care for children with little or no pay
• Finances became desperate, took in more children but collected little, isolation compounded problems
• Saw notice at church about provider support group & joined CCIP, building
skills and confidence • Small grants improved quality of space and educational program; now
attracting higher paying clients • Emerged as business woman and educator, triple bottom line
• New confidence helped her end abuse, her own kids doing better in school & now buying a home
Christie Haynes – Open Meadow Corporate Connections
• Seriously troubled teen
• Enrolled at Open Meadow, but no motivation
• Heard presentations about Corporate Connections & took tours
• Preston Gates Law Firm had such a calm,warm but professional environment with staff that clearly want to help - “I was hooked”.
• Didn't believe that had anything to offer, but through Corporate Connections trainings, individual counseling and an internship, she began to believe in herself
• Now is firm's receptionist making $17/hr. with full benefits; "I can't believe they trust me to be their clients first impression”
• Preston Gates is paying for her training as paralegal so she can make $25.hr. and contribute even more to the firm’s work
Local HUD
Implementation:Contract Management Best Practices
• IT IS ABOUT RELATIONSHIPS
• Recognition of contractors as allies
• Continuous Quality Improvement; outcome-driven
• We work for them
BHCD
Community Based Organization
Participant
2007 Program Revenue
• Portland CDBG $2,398,281• Portland General Fund $1,560.362• NW Area Foundation $200,000• United Way $200,000
• TOTAL * $4,358,643• *Multiple grants/City increase pending
System Leverage & Coordination• Portland Family of Funds (loan fund) $850,000• Workforce Investment Bd (WIA) $200,000• State & Federal IDA funds (approx.) $32,000• Lewis & Clark Law School $150,000• OR Employment Department $500,000• Kaiser Permanente (health care for formerly homeless) $500,000 • TANF extensions (approx.) $72,000• Banking Services (Albina Bank) $35,000
• TOTAL from Leveraged Sources $2.339 Mil.
2006 Portfolio
• 2,000 participants
• 389 microenterprises
• 1,476 workers on the job or in training
75%
At or below 30% of MFI.
25%
Between 30% and 50% of MFI.
Year Two Results: Microenterprise Startup Businesses
Average Revenues by number of years enrolled.
Enrollment 1 Year 2 Years
Year Two Results: Microenterprise
Enrollment 1 Year 2 Years
Existing Businesses
Average Revenues by number of years enrolled.
Year Two Results : WorkforceWorkforce Goal: To increase participant income by at least 25% in three years.
The average hourly wage for youth at 6 months was $8.03 and at 12 months $8.83.
For adults, the average hourly wage at 6 months was $10.57 and at 12 months $11.49.
Percentage of participants meeting Workforce Goal by amount of time enrolled in the Initiative.
MEETING WORKFORCE GOAL
Return on Investment
• Average cost per participant:– $5,500 in Year 1 – $1,000 in Year 2 – $1,000 in Year 3
• Year 1 income gains for workforce participants average $15,059
• Average business revenue gains: $25,300 for start-ups, $23,900 for existing businesses
CDBG ELIGIBILITY
• Microenterprise assistance: 570.201(o) • For workforce: A) Maximize use of CBDO
designations (570.204) for non-profits undertaking Community Economic Development activities.
• B) Utilize 570.203(c) with LMC for the National Objective, for non-CBDO projects that train, place, and retain L/M clients
Replication
• NW Area Foundation has contracted with City to provide technical assistance to interested Minnesota communities
• Duluth is on track to introduce an increasing incomes program next April
• Meetings with other CDBG entitlements in Minn. are scheduled for July
Innovations of Economic Opportunity Initiative
• Intensive technical assistance to each project before and after the contract period.
• City choosing to allocate its CDBG monies solely for those at 50% MFI
• Figuring out how to use CDBG for people-based poverty reduction
• Making adherence to best practice models a primary selection criterion
• Leveraging system for participants benefit, i.e. health care, legal, TANF extensions, IDA’s...
Lessons Learned
• We can do this! Pushing the envelope pays dividends
• Intensive technical assistance + joint problem-solving strengthens programs
• Early tracking & evaluation is key
• Clear outcomes sell the program
• One size does not fit all
Lessons Learned cont.
• Best practices work. Scale it up!!
• Use expertise of community partners
• Not all projects, not all clients succeed
• Leverage, coordinate, advocate, innovate !
• Set moderate expectations, then beat them
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