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Strengthening Families and Reducing Poverty: Can We Achieve Both? Alexander Sanchez Senior Vice President Community Impact Leadership United Way of America September 19, 2007. United Way System. United Way has 100 year history of improving lives

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Strengthening Families and Reducing Poverty: Can We Achieve Both?

Alexander SanchezSenior Vice PresidentCommunity Impact Leadership United Way of AmericaSeptember 19, 2007


United way system
United Way System Both?

  • 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


U s united way system 1 297 local united ways
U.S. United Way System Both?1,297 Local United Ways


Community impact model what is it we must do to be successful
Community Impact Model Both?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.


Community impact model what is it we must do to be successful1
Community Impact Model Both?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.


Community impact model what is it we must do to be successful2
Community Impact Model Both?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 jobof producing measurable results, whether in lives saved and enriched, disease averted, housing rebuilt, pride restored, education enhanced, great art produced, and/or economies strengthened.


Mission of the United Way System Both?

To improve lives by mobilizing

the caring power of communities


United way s traditional approach to improving lives

support services for individuals and families Both?

Mobilizing communities

that

to

improve lives

of program clients

financial resources of businesses and employees

United Way’s Traditional Approach to Improving Lives

DIRECT IMPACT


New model for improving lives uses two approaches

people, time, talent, relationships, expertise, technology, money, etc.

of community populations

create lasting changes in community conditions

support services for individuals and families

Mobilizing communities

improve lives

to

that

of program clients

financial resources of businesses and employees

New Model for Improving Lives Uses Two Approaches

COMMUNITY IMPACT

DIRECT IMPACT


Community Issue money, etc

Family characteristics

Personal choices

Most Direct Service Programs Address Only One or Two Factors


Historical trends money, etc

Economic conditions

Public attitudes

Media messages

Public sector practices

Health care system practices

Community Issue

Private sector practices

Educational system practices

Neighborhood conditions

System relationships

Family characteristics

Personal choices

Addressing Those Pressing Issues Requires New Approaches and Additional Partners


Change #2 money, etcWho 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.


Change money, etc#4 What Resources Will We Need?

  • Not onlymoney

  • People

  • Relationships

  • Time

  • Talent

  • Wisdom

  • Expertise

  • Leadership

  • Influence

  • Technology

  • Financial assets

  • . . .

  • . . .


Essential Steps in United Way’s New Business Framework money, etc

  • Develop impact strategies that improve lives

  • Turn them into investment products

  • Segment investor markets

  • Connect investor aspirations with needs/opportunities/strategies


What Makes the New Business Model Viable? money, etc

 Occupies on an open niche (mobilizing community partnerships to achieve community change on pressing issues)

 Aligns with customer interests

 Relates to United Way’s traditional mission

 Builds on United Way strengths


United way s strengths
United Way’s Strengths money, etc

  • 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


Implications of the New Business Model money, etc

  • The new model requires new ways of thinking about:

  • Strategies

  • Partners

  • Ownership

  • Resources

  • United Way’s role

  • Resource development

  • United Way operations


United ways implementing impact areas in their resource development plan
United Ways Implementing Impact Areas money, etcin their Resource Development Plan

Percent

Source: UWA Research


United ways actively positioning impact areas in their resource dev plan
United Ways Actively Positioning money, etcImpact Areas in their Resource Dev. Plan

Percent

Source: UWA Research


Community impact model what is it we must do to be successful3
Community Impact Model money, etcWhat 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


United way advancing the common good
United Way. money, etc 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


United way advancing the common good1
United Way. money, etc 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


Economic challenges
Economic Challenges money, etc

  • 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.


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

Economic Drivers


United Way’s persons to achieve long-term financial stability, include: 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.


A stepped approach to financial independence
A Stepped Approach to Financial Independence persons to achieve long-term financial stability, include:


Who benefits from the work

Low to moderate income workers persons to achieve long-term financial stability, include: 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 year’s 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.

Who Benefits From the Work?


Expanding Partnerships persons to achieve long-term financial stability, include:

  • 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


National uwa goals
National UWA Goals persons to achieve long-term financial stability, include:

  • System Wide InvestmentOver 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 OutreachIncrease 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 UnbankedIn 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 TechnologyThrough 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.


National launch events
National Launch Events persons to achieve long-term financial stability, include:

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


Strategies to leverage income and build assets

Earned Income Tax Credit (EITC) Outreach persons to achieve long-term financial stability, include:

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

Don’t 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)

Strategies to Leverage Income and Build Assets


Breaking the cycle of poverty….. persons to achieve long-term financial stability, include: 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


Eitc return on investment
EITC Return On Investment persons to achieve long-term financial stability, include:

San Antonio


Eitc return on investment1
EITC Return On Investment persons to achieve long-term financial stability, include:

Bank of America, $500,000 investment in FSP

Bank of America, > $21,000,000 ROI


Community impact model what is it we must do to be successful4
Community Impact Model persons to achieve long-term financial stability, include: 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:

  • Whether they have confidence in the United Way

  • Whether they believe charities do a god job helping people

  • Whether they believe charities do a good job spending money wisely

  • Whether they have higher levels of education

  • Whether they believe charities do a good job running programs and services

  • Whether they have confidence in the Red Cross

  • Whether they have higher income

  • Whether they are older

  • Whether they see less charitable waste

  • Whether they are female


Community impact
Community Impact persons to achieve long-term financial stability, include:

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 you’ve 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


Thank you

Thank You persons to achieve long-term financial stability, include:


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