Can We Achieve Both? (Strengthening Families and Reducing Poverty)

1
Strengthening Families and Reducing Poverty Can
We Achieve Both? Alexander SanchezSenior Vice
PresidentCommunity Impact Leadership United Way
of AmericaSeptember 19, 2007
2
United Way System

• United Way has 100 year history of improving
  lives
• 1,297 local United Ways in the United States
• Thousands of affiliates worldwide
• United Way volunteers and partners work in 46
  countries
• United Way in the U.S. raises 3.8 billion from
  14 million donors annually
• Around the world an additional 830 million is
  raised annually

3
U.S. United Way System1,297 Local United Ways
4
Community Impact Model What is it we must do to
be successful?
Paul C. Light, Rebuilding Confidence in
Charitable OrganizationsNYU Robert F. Wagner
Graduate School of Public Service, Public service
brief, October, 2005
Only 19 of Americans said charitable
organizations do a very good job running their
programs and services, while just 11 said the
same about spending money wisely. In addition,
66 of Americans said charitable organizations
waste a great deal or a fair amount of money,
while almost half said the leaders of charitable
organizations are paid too much.
The survey also suggests that rebuilding
confidence must involve sustained investment in
strengthening the capacity of charitable
organizations to achieve measurable impact toward
their missions.
5
Community Impact Model What is it we must do to
be successful?
Paul C. Light, Rebuilding Confidence in
Charitable OrganizationsNYU Robert F. Wagner
Graduate School of Public Service, Public service
brief, October, 2005
Showing the impact involves more than pictures of
need. Such pictures do little to reassure
Americans that their contributions are being used
wisely.
Charitable organizations must do a better job of
producing measurable results, whether in lives
saved and enriched, disease averted, housing
rebuilt, pride restored, education enhanced,
great art produced, and/or economies strengthened.
6
Community Impact Model What is it we must do to
be successful?
Paul C. Light, Rebuilding Confidence in
Charitable OrganizationsNYU Robert F. Wagner
Graduate School of Public Service, Public service
brief, October, 2005
Charitable organizations must do a better job of
producing measurable results, whether in lives
saved and enriched, disease averted, housing
rebuilt, pride restored, education enhanced,
great art produced, and/or economies strengthened.
7
Mission of the United Way System

• To improve lives by mobilizing
• the caring power of communities

8
United Ways Traditional Approach to Improving
Lives
DIRECT IMPACT
9
New Model for Improving Lives Uses Two Approaches
COMMUNITY IMPACT
?
DIRECT IMPACT
10
Most Direct Service Programs Address Only One or
Two Factors
11
Addressing Those Pressing Issues Requires New
Approaches and Additional Partners
12
Change 2 Who Helps Create Community Change?
Whoever can play a role

• Agencies

• Individuals
• Corporations
• Labor groups
• Government
• Foundations
• Media
• Academia
• Institutions
• Systems
• Formal organizations
• Informal associations
• Neighborhood networks
• Faith-based groups
• etc.

13
Change 4 What Resources Will We Need?

• Not only money

• People
• Relationships
• Time
• Talent
• Wisdom
• Expertise
• Leadership
• Influence
• Technology
• Financial assets
• . . .
• . . .

14
Essential Steps in United Ways New Business
Framework

1. Develop impact strategies that improve lives
2. Turn them into investment products
3. Segment investor markets
4. Connect investor aspirations with
   needs/opportunities/strategies

15
What Makes the New Business Model Viable?
? Occupies on an open niche (mobilizing
community partnerships to achieve community
change on pressing issues) ? Aligns with customer
interests ? Relates to United Ways traditional
mission ? Builds on United Way strengths
16
United Ways Strengths

• Relationships with diverse stakeholders
  (business, government, individuals, nonprofits)
• Reputation as a neutral player
• Ability to mobilize communities
• Knowledge of community assets and needs
• Focus on outcomes/results
• 17 million donors
• 5 billion raised or leveraged
• Locations everywhere

17
Implications of the New Business Model

• The new model requires new ways of thinking
  about
• Strategies
• Partners
• Ownership
• Resources
• United Ways role
• Resource development
• United Way operations

18
United Ways Implementing Impact Areasin their
Resource Development Plan
Percent
Source UWA Research
19
United Ways Actively Positioning Impact Areas in
their Resource Dev. Plan
Percent
Source UWA Research
20
Community Impact Mission - Taking Hold

• United Ways that report they are actively
  communicating the Community Impact Mission are
  much more likely to believe its making a
  difference. They believe
• - the Community Impact Message is having a
  positive effect (72 vs. 48 system)
• - the Community Impact Mission is resonating
  with their donors (73 vs. 47 system)
• - it is having a positive affect on their
  ability to raise funds (40 vs. 24 system)
• This is not just attitudinal performance is
  better. Those United Ways that believe the
  community impact message is having a positive
  effect have stronger than average resource
  development performance.

Source UWA Research
21
Community Impact Model What is it we must do to
be successful?
Gallagher has worked to move the mission away
from How much did we raise? to How much impact
can we have in our communities? The new model
is to focus on outcomes, not dollars -- Knight
Ridder News, 10/19/05
22
United Way. Advancing the Common Good
Creating the opportunities for a good life for
all by focusing on
Health
Education
Income

• Maximized income
• Increased savings
• Financial assets for
• long-term stability

• Preventive / Everyday Healthcare
• Healthier Teens Drug-free, within weight and
  reduced pregnancy rates

• Quality child care
• School readiness
• Academic completion

Draft Measurement Areas
Community Volunteer Engagement
Community Investment
Donor Relationships
2-1-1
Strategies
Resource Generation
Inclusion
Public Policy
Partnerships
23
United Way. Advancing the Common Good
Creating the opportunities for a good life for
all by focusing on
Health
Education
Income

• Maximized income
• Increased savings
• Financial assets for
• long-term stability

• Preventive / Everyday Healthcare
• Healthier Teens Drug-free, within weight and
  reduced pregnancy rates

• Quality child care
• School readiness
• Academic completion

Draft Measurement Areas
Community Volunteer Engagement
Community Investment
Donor Relationships
2-1-1
Strategies
Resource Generation
Inclusion
Public Policy
Partnerships
24
Economic Challenges

• Over 38 million Americans have incomes below the
  federal poverty level. More than fifty percent
  are employed.
• Income Disparities Top 20 control 85 of
  wealth Bottom 60 control 4
• One out of three households reported using credit
  cards to cover basic living expenses.
• The personal savings rate in 2006 (as a
  percentage of disposable income), was a negative
  1 percent.
• 2 million people filed for bankruptcy in 2005.
  Approximately 50 of bankruptcies are caused by
  medical debt.
• Average credit card debt among American
  households is about 9,300.

25

Building the Case Strategic Planning/Initiative
Framework Development
Partners, Funders, LUWs, key UW staff, and others

UWA and 25 Local United Way Leaders
New and Existing Research
UW Network and External National Thought Leaders
26
Economic Drivers

• Key economic factors affecting the ability of
  average persons to achieve long-term financial
  stability, include
• Lack of Economic Mobility
• Soaring Personal Debt
• Wealth Inequality
• As evidenced in recent articles in
• The New York Times
• The Washington Post
• Wall Street Journal
• Miami Herald
• The Chronicle of Philanthropy

27

United Ways Financial Stability Partnership
A National Initiative Focused on Financial
Stability An initiative focused on financial
stability leading to independence designed in
steps to can help individuals and families to get
off the financial tightrope, overcome basic
subsistence needs, and allow them to plan for the
future.

28
A Stepped Approach to Financial Independence

29
Who Benefits From the Work?

• Low to moderate income workers by helping them
  develop and implement strategies that
• Increase Income
• Build Savings
• Gain and Sustain Assets
• Employers by creating a stronger, more
  crisis-resistant workforce
• Communities by increasing home and business
  ownership, and the financial stability of its
  residents

• This Work Matters
• Five years ago, Brownsville, Texas had the
  highest poverty rate in the nation. In just a
  years time, United Way worked with 1,000
  Brownsville families to apply for the Earned
  Income Tax Credit, resulting in nearly one
  million additional dollars in that community.

30
Expanding Partnerships
Partnered with United Way and provided an
innovative process and support in researching and
analyzing Benefits Calculators which can scale
and revolutionize access to public benefits
system wide Exploring partnership to support a
national agreement for benefits calculator and
other technology to advance financial stability
work
Partnered with United Way to expand Earned Income
Tax Credit (EITC) outreach to 33 markets across
the country Host partner for the EITC and
Beyond 2007 Leadership Summit designed to bring
UW leaders and elected officials together to
focus on EITC and other asset building strategies
to strengthen communities
31
National UWA Goals

• System Wide Investment Over the next five
  years, the United Way will increase its
  investment by 50 percent to 1.5 billion by
  adding targeted, focused and proven strategies
  that impact financial stability.
• Increase Income Through Expanded EITC
  Outreach Increase the number of eligible
  families currently not claiming EITC by 25
  percent in 200 targeted communities over the next
  year. Increase the number of eligible families
  currently not claiming EITC by 50 percent in
  400 targeted communities over the next five
  years.
• Bank the Unbanked In 50 targeted communities,
  reduce by 10 percent the number of unbanked and
  under banked households over the next
  year. Across the United Way system, reduce by 25
  percent the number of unbanked and under-banked
  households over the next five years.
• Expansive Integration of Technology Through
  technology, increase enrollment by 25 percent of
  eligible families in earned public benefits in
  20 targeted states over the first year. Through
  technology, enable all United Ways to enroll
  eligible families in earned public benefits in
  50 states over the next two years.

32
National Launch Events

• Brand Forum (Communications)
• Los Angeles, January 24-26, 2007
• National Public Launch
• Washington, DC Press Club, May 7, 2007
• Staff Leaders Conference
• Pittsburgh, May 16-18, 2007
• EITC and Beyond 2007 Leadership Summit
• host partner National League of Cities
• San Francisco, July 11-13, 2007

33
Strategies to Leverage Income and Build Assets

• Earned Income Tax Credit (EITC) Outreach
• Volunteer Income Tax Assistance (VITA)
• Individual Development Accounts (IDAs)

• Financial Literacy Education
• Freddie Mac Credit Smart Initiative
• Freddie Mac Loan Prospector Outreach
• Lending Consumer Rescue Fund
• Dont Borrow Trouble Campaign
• FDIC Money Smart Train the Trainer
• Partnerships w/ Financial Institutions
• Marketing of Existing Financial Products
  Services
• Development of Alternative Products Services
• Multi-benefit Enrollment
• Use of Benefit Calculators (N2L)

34
Breaking the cycle of poverty.. by helping
individuals access information, save, and acquire
assets with long-term value
Access to Information Education Financial
Literacy
Introduction to Services
Community-based Case Management
Working Families
Change in Behavior

Acquire Assets

Homeownership

• Asset Development Strategies
• EITC / CTC / Edu. Credits
• IDAs
• Credit Rebuild
• Asset Building and Preservation Education
  Campaigns
• Multi Benefit Enrollment
• Marketing Development of Financial Products
  Services

Financial Literacy High-touch Case Management
Micro-Business
Higher-Education
35
EITC Return On Investment
San Antonio
2002 2003 2004 2005 2006
Numberof Sites 41 32 27 26 28
Returns Completed 10,400 15,244 20,850 25,962 30,000
E-Filed 3 73 93 98 100
Returned to Community 12 Million 21.8 Million 30 Million 40 Million 45 Million
36
EITC Return On Investment
Bank of America, 500,000 investment in FSP
30 Communities Tax Year 2005 Tax Year 2006
Total of Volunteers 4,698 8,931
Total of Volunteer Hours 100,386 276,329
Total of Filed Tax Returns 161,635 225,824
Total Amount of EITC Returned to Clients 61,905,252 83,262,273
Total Amount of Tax Refunds to Clients 199,306,955 269,336,295
Bank of America, gt 21,000,000 ROI
37
Community Impact Model What is it we must do to
be successful?
Paul C. Light, Rebuilding Confidence in
Charitable OrganizationsNYU Robert F. Wagner
Graduate School of Public Service, Public service
brief, October, 2005
Significant positive predictors of confidence in
the sector

1. Whether they have confidence in the United Way
2. Whether they believe charities do a god job
   helping people
3. Whether they believe charities do a good job
   spending money wisely
4. Whether they have higher levels of education
5. Whether they believe charities do a good job
   running programs and services
6. Whether they have confidence in the Red Cross
7. Whether they have higher income
8. Whether they are older
9. Whether they see less charitable waste
10. Whether they are female

38
Community Impact
When all of the pieces come together, not only
does your work move toward greatness, but so does
your life. For in the end, it is impossible to
have a great life unless it is a meaningful life.
Perhaps, then, you might gain that rare
tranquility knowing that youve had a hand in
creating something of intrinsic excellence that
makes a contribution. Indeed, you might even
gain the deepest of satisfactions knowing that
your short time here on this earth has been well
spent, and that it mattered. --Jim Collins,
Good to Great
39
(No Transcript)
40
Thank You