In 2012, the City of New York launched the nation’s first social impact bond—an innovative form of pay-for-success contracting that leverages private funding to finance public services—to fund the Adolescent Behavioral Learning Experience (ABLE) program, a large-scale initiative serving 16- to 18- year old youth detained in New York City’s Rikers Island jail. The ABLE program aimed to break the cycles of reincarceration for adolescents in the jail using Moral Reconation Therapy (MRT), an evidence-based intervention that focuses on improving social skills, personal responsibility, and decision making. Under this model, the funder—the global investment banking, securities, and investment management firm Goldman Sachs—will receive a return on its investment if the number of recidivism bed days—the number of days that people are held in jail custody following their initial release—are reduced by at least 10 percent.
New York City’s social impact bond initiative was created on the premise that investing in evidence-based programs will not only lead to better outcomes for those who participate; it will also produce a significant return on investment for both the City of New York and private investors. Vera’s Substance Use and Mental Health Program is independently evaluating ABLE to determine the program’s impact on readmissions.
For more information, contact research director Jim Parsons.