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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.

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Presentation on theme: "Strengthening Families and Reducing Poverty: Can We Achieve Both? Alexander Sanchez Senior Vice President Community Impact Leadership United Way of America."— Presentation transcript:

1 Strengthening Families and Reducing Poverty: Can We Achieve Both? Alexander Sanchez Senior Vice President Community Impact Leadership United Way of America September 19, 2007

2 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 3 U.S. United Way System 1,297 Local United Ways

4 4 Community Impact Model What is it we must do to be successful? 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. Paul C. Light, Rebuilding Confidence in Charitable Organizations NYU Robert F. Wagner Graduate School of Public Service, Public service brief, October, 2005 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 5 Community Impact Model What is it we must do to be successful? Showing the impact involves more than pictures of need. Such pictures do little to reassure Americans that their contributions are being used wisely. Paul C. Light, Rebuilding Confidence in Charitable Organizations NYU 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.

6 6 Community Impact Model What is it we must do to be successful? 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. Paul C. Light, Rebuilding Confidence in Charitable Organizations NYU Robert F. Wagner Graduate School of Public Service, Public service brief, October, 2005

7 7 To improve lives by mobilizing the caring power of communities Mission of the United Way System

8 8 United Way’s Traditional Approach to Improving Lives Mobilizing communities support services for individuals and families to  that  improve lives DIRECT IMPACT financial resources of businesses and employees of program clients

9 9 New Model for Improving Lives Uses Two Approaches create lasting changes in community conditions   Mobilizing communities support services for individuals and families to  improve lives that  DIRECT IMPACT COMMUNITY IMPACT people, time, talent, relationships, expertise, technology, money, etc. financial resources of businesses and employees of program clients of community populations

10 10 Most Direct Service Programs Address Only One or Two Factors Community Issue Personal choices Family characteristics

11 11 Addressing Those Pressing Issues Requires New Approaches and Additional Partners Economic conditions Public attitudes Historical trends Media messages Public sector practices Private sector practices Neighborhood conditions System relationships Family characteristics Personal choices Health care system practices Educational system practices Community Issue

12 12 Individuals Corporations Labor groups Government Foundations Media Academia Institutions Systems Formal organizations Informal associations Neighborhood networks Faith-based groups etc. Agencies Whoever can play a role Change #2 Who Helps Create Community Change?

13 13 Change #4 What Resources Will We Need?  Not only money People Relationships Time Talent Wisdom Expertise Leadership Influence Technology Financial assets...

14 14 Essential Steps in United Way’s 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 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 Way’s traditional mission  Builds on United Way strengths

16 16 United Way’s 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 17 Implications of the New Business Model The new model requires new ways of thinking about:  Strategies  Partners  Ownership  Resources  United Way’s role  Resource development  United Way operations

18 18 United Ways Implementing Impact Areas in their Resource Development Plan Source: UWA Research Percent

19 19 United Ways Actively Positioning Impact Areas in their Resource Dev. Plan Source: UWA Research Percent

20 20  United Ways that report they are actively communicating the Community Impact Mission are much more likely to believe it’s 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. Community Impact Mission - Taking Hold Source: UWA Research

21 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 22 United Way. Advancing the Common Good Education Quality child care School readiness Academic completion Maximized income Increased savings Financial assets for long-term stability Preventive / Everyday Healthcare Healthier Teens: Drug-free, within weight and reduced pregnancy rates Draft Measurement Areas Creating the opportunities for a good life for all by focusing on: Community & Volunteer Engagement Partnerships Community Investment Public Policy Donor Relationships Resource Generation Strategies Income Health Inclusion

23 23 United Way. Advancing the Common Good Education Quality child care School readiness Academic completion Maximized income Increased savings Financial assets for long-term stability Preventive / Everyday Healthcare Healthier Teens: Drug-free, within weight and reduced pregnancy rates Draft Measurement Areas Creating the opportunities for a good life for all by focusing on: Community & Volunteer Engagement Partnerships Community Investment Public Policy Donor Relationships Resource Generation Strategies Income Health Inclusion

24 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 Approximately 50% of bankruptcies are caused by medical debt. Average credit card debt among American households is about $9,300.

25 25 Building the Case Strategic Planning/Initiative Framework Development INTERVIEWS THOUGHT LEADERSHIP RESEARCH TASKFORCE Partners, Funders, LUWs, key UW staff, and others UW Network and External National Thought Leaders UWA and 25 Local United Way Leaders New and Existing Research

26 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 27 United Way’s 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 28 A Stepped Approach to Financial Independence

29 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 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.

30 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 31  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. National UWA Goals

32 32 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 National Launch Events

33 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 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)

34 34 Introduction to Services Community-based Case Management Access to Information & Education Financial Literacy Change in Behavior Financial Literacy + High-touch Case Management 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 Acquire Assets Homeownership Micro-Business Higher-Education Working Families Breaking the cycle of poverty….. by helping individuals access information, save, and acquire assets with long-term value

35 35 EITC Return On Investment Number of Sites Returns Completed 10,40015,24420,85025,96230,000 E-Filed3%73%93%98%100% Returned to Community $12 Million $21.8 Million $30 Million $40 Million $45 Million San Antonio

36 36 EITC Return On Investment 30 CommunitiesTax Year 2005Tax Year 2006 Total # of Volunteers 4,6988,931 Total # of Volunteer Hours 100,386276,329 Total # of Filed Tax Returns 161,635225,824 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, $500,000 investment in FSP Bank of America, > $21,000,000 ROI

37 37 Community Impact Model What is it we must do to be successful? 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 Paul C. Light, Rebuilding Confidence in Charitable Organizations NYU Robert F. Wagner Graduate School of Public Service, Public service brief, October, 2005 Significant positive predictors of confidence in the sector:

38 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 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

39 39

40 Thank You


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