John Roman
Senior Fellow At NORC, University Of Chicago
Key Findings
- The Pay for Success (PFS) model uses private capital to fund social programs with the option for additional funding as they reach their objectives.
- The Pay for Success (PFS) model solves two of the traditional barriers in criminal justice: under-funding and the burden of risk.
- The program aims to build relationships between offenders and the community, known as social impact bonds (SIBs), to help with the reintegration process and to reduce recidivism.
Description
In the review, “Five Steps to Pay for Success: Implementing Pay for Success Projects in the Juvenile and Criminal Justice Systems,” Roman and his co-authors examine implementing the Pay for Success (PFS) model of rehabilitation to reduce recidivism for juvenile and adult offenders. The PFS model uses private capital to fund social programs with the option for additional funding as they reach their objectives. The PFS model solves two of the traditional barriers in criminal justice: under-funding and the burden of risk. The program aims to build relationships between offenders and the community, known as social impact bonds (SIBs), to help during the reintegration process and to reduce recidivism. Currently, seven states have either proposed or instituted PFS programs. SIBs have been launched successfully in the United Kingdom and New York City–both raising private funds to reduce recidivism. Critics of the PFS model question how the program will be able to transfer risk to the investors and save the government money. Additionally, it may be difficult to evaluate the success of the program, which will in turn make funding difficult without being able to show quantifiable results. Successful PFS programs, take time to value the PFS product, assess the risk, set performance standards, develop strong business proposals and infrastructure, and evaluate their goals. The authors note that scaling of PFS will require more research to help the government create metrics to build investor confidence and continue to build revenue for PFS programs.