National Capital Region Pay for Success Demonstration Project for Permanent Supportive Housing

Between 20 and 40 percent of the annual correctional population is homeless and has an arrest record for nonviolent nuisance crimes. Many have mental illness and/or substance abuse problems and return from incarceration only to live on the streets, often cycling back into the justice system. Working with the U.S. Department of Housing and Urban Development and the U.S. Department of Justice, AIR is testing a Pay for Success (PFS) model in Maryland to support people experiencing chronic homelessness in Montgomery and Prince George’s Counties, a population frequently involved in the criminal justice and health care systems.

PFS models bring together investors with local, state, and federal government agencies to fund and improve education, health, and social services.

This project will determine if PFS-financed permanent supportive housing can achieve taxpayer savings and/or improve cost-effectiveness by decreasing government spending on corrections systems, homeless services, Medicaid and crisis services. As the intermediary organization, AIR leads the project and manages the contract until outcomes are achieved. Third Sector Capital Partners serves as AIR’s intermediary advisor and ICF International is the independent evaluator.