COVID-19 Economic Response and Recovery

Place-Based Strategies: Promote Neighborhoods and Increasing Access to Commercial Space

Background

Immigrants and refugees start an outsize share of “Main Street” businesses — grocery stores, restaurants, and other establishments that help drive neighborhood-level economic development. Cities can play a role in supporting immigrant commercial corridors — and immigrant-owned food businesses in particular — through the implementation of place-based strategies, including providing access to commercial kitchen space for early-stage food entrepreneurs.

Strategies:

A. Promote commercial corridors where immigrant businesses are located. Immigrant- and refugee-owned businesses are often concentrated in specific commercial corridors and neighborhoods (e.g., Koreatown, Mexicantown, Little Italy, etc.). Cities can encourage residents to frequent these areas through creative marketing and promotion efforts. For example, each summer, the City of Philadelphia issues “passports” to Philly residents through a program called Passport PHL that encourages people to explore the city’s minority- and immigrant-owned businesses.

B. Support neighborhood-based community development organizations that serve immigrant small business owners. Community Development Corporations (CDCs) and other community development organizations provide business development services and opportunities for businesses to come together to improve and co-market their business districts. Cities can partner with these organizations to help develop commercial corridors and business districts where immigrant and refugee-owned businesses are concentrated. For example, Philadelphia’s HACE, a community development organization that primarily serves Philadelphia’s Latino community, runs a Main Street Program that provides technical support to business owners and encourages collaboration and networking among business owners in the community.

C. Launch a business incubator with commercial kitchen space. Access to commercial kitchen space is often a hurdle for aspiring food entrepreneurs and can be a barrier to growth. Food business incubators that provide access to affordable commercial kitchen space, as well as business training, technical assistance, and other resources can help immigrants, refugees and other underserved entrepreneurs grow their businesses. See case study: SPICE Kitchen Incubator.

Case Study

S.P.I.C.E. (Supporting the Pursuit of Innovative Culinary Entrepreneurs) Kitchen Incubator, Salt Lake City, UT

Highlights:

SPICE Kitchen Incubator is a project of the International Rescue Committee (IRC), a refugee resettlement organization, in partnership with Salt Lake County. IRC has offices around the U.S.
Salt Lake County promotes SPICE Kitchen as an economic development priority for the region, helping to attract private and public funding to start and grow the effort.
The program, which has served more than 130 low- to moderate-income entrepreneurs since its founding and is currently serving 50 enrollees during COVID-19 (10 of which are new since April), as individuals seek to adapt to changing economic conditions through self-employment.

Overview:

Launched in 2013 — and modeled on the work of La Cocina in San Francisco, CA — SPICE Kitchen Incubator provides training, technical assistance, and affordable commercial kitchen space to refugees and other underserved residents who are interested in starting food businesses in Salt Lake County. SPICE Kitchen’s partnership with Salt Lake County dates back to its inception, when county officials helped attract seed funding from American Express to establish the project, and stems from a county-wide focus on integrating and supporting new Americans. Today, the incubator’s annual operating budget is $400,000, 15% of which comes from local public dollars. An additional 20% is funded by income generation, while the majority of funding comes from private foundations, corporations, and Community Reinvestment Act dollars from financial institutions.

Project Components:

SPICE Kitchen Incubator provides access to affordable commercial kitchen space; industry-specific technical assistance in areas like marketing, operations and access to capital; workshops from staff and partner organizations on key food business topics; and support with market access and positioning. The SPICE incubation model includes these four phases:

Application and enrollment (<1 month): Participants who are recruited from the local community and via local refugee resettlement networks attend an orientation session and go through an intake assessment to determine product viability, entrepreneurial drive and other necessary characteristics.
Pre-incubation (6-8 months): Participants receive training and technical assistance to develop their business plans, including product development, marketing, finances and operations. This can include financial coaching and credit repair, if necessary, in anticipation of the soft launch of the enterprise.

Incubation (8 months-4 years): Those who succeed during pre-incubation are invited to set up shop in the commercial kitchen, where they continue to receive technical assistance, opportunities to access capital and resources to grow their business, and market access support.
Graduation (ongoing): After meeting certain incubation benchmarks, participants graduate from the program and most move their business out of the commercial kitchen, though as alumni they can continue to rent space and access technical assistance and support.

During COVID-19, SPICE Kitchen has shifted entirely to digital training, building in remote digital skills training via phone first to ensure access to their training platform. The primary focus has been on guiding entrepreneurs through the types of relief support available, eligibility for different forms of relief, and one-on-one help completing the application process.

Since its founding, SPICE Kitchen has served over 130 low- to moderate-income participants, helped launch eight food trucks and three brick-and-mortar restaurants, and helped entrepreneurs collectively earn over $3,230,000.

Adapt this Approach:

Partner with an organization that works to empower immigrants and refugees economically, such as through refugee resettlement.
Fund the effort through a combination of public and private investment, tapping into resources from community foundations, private corporations, and Community Reinvestment Act funds that already prioritize low- and moderate-income residents.
Position the project as a unique regional asset and identifiable brand, allowing program graduates to benefit from their association with the incubator.

Learn more about the Tactical Guide

Download the PDF

COVID-19 Economic Response and Recovery

Outsource programming to a local chamber, business, or other organization to improve delivery and cost savings

Download the PDF

Action:

Cities should revisit their economic development programming to see if it would be cheaper to use vendors for particular programs.

Why:

It can be sometimes cheaper and/or more effective to hire a third party to deliver your programming. This can be a public-private partnership, which leads to both cost-savings and greater community support.

The practice of outsourcing is similar to, but not the same as, the more common practice of cities contributing to a regional economic development marketing organization, that then pools these funds with private sector resources to deliver larger-scale campaigns and programs.

Cities have successfully used outsourcing to deliver:

Regional branding and marketing
Local business retention and expansion programs
Proposal preparation
Prospect lead identification
Inbound and outbound business recruitment missions (both planning and execution)

Case Study

Oklahoma City

Oklahoma City outsources components of its economic development programming to the Oklahoma City Chamber of Commerce.

The parties agree to an annual contract for services, with rigorous reporting requirements and proper oversight. This contract, which can be found in Appendix N, is an excellent example of a comprehensive engagement agreement, containing all key elements needed to define the relationship.

The arrangement was put in place during a period of economic turbulence. The leadership was provided by the mayor and the leaders of local companies, like Kerr-McGee, Devon Energy, Chesapeake Energy, Oklahoma Gas and Electric, and Opubco.

They agreed that the city should focus on infrastructure and public improvements, while the Chamber should deliver branding, marketing, and business recruitment, retention, and expansion.

Critical to the arrangement were a very high level of trust, aligned vision and goals, and shared commitment to partnership.

The chamber subsequently led a successful campaign to win residents’ approval for the city’s MAPS programs for public improvements (see case study referenced in “Reallocating Funding” Section).

The relationship between the city and chamber has evolved over two decades and changes in leadership, but it continues to be based on a shared vision for the community.

Impact:

The chamber leverages a 4:1 return on city funding, with contributions from private corporations and local foundations.

A portion of the funding has been used to deliver four MAPS campaigns, which have delivered more than $3 billion in public improvements.

How to Adapt this Approach

Undertake an analysis of program returns on investment and potential cost savings. (Note: this will be challenging if program owners report only activities delivered, and not outputs and impact).
Identify potential organizations which have the experience and capacity to deliver the programs.
Draft a request for proposals which clearly defines the scope of work, output-focused key performance indicators (not activities delivered), and how the organization will be expected to engage the City.
Create a contract for service that clearly outlines roles, responsibilities, and expectations.
Require a say in the recipient organization’s governance arrangements (e.g., board observer, quarterly reporting, step in audit rights, etc.). In all likelihood, the city will become the recipient’s largest funder. As such, it is appropriate for the city to have a role in governance and oversight.
Make sure the contract includes output focused key performance indicators, with agreed definitions and metrics and clear milestones.

If the recipient is likely to be a chamber of commerce, or free-standing economic development corporations, satisfy yourself that the organization:

Has a credible track record of success.
Has performed at a high level over a long period of time.
Will be viewed by stakeholders and residents as credible and apolitical.
Will be able to deliver the program more effectively.
Will be able to leverage third-party funding for the program.

Do:

Collaborate with organizations that you trust.
Be very clear on your expectations regarding deliverables, key performance indicators, metrics and reporting.
Agree on a process and chain of command for decisions and communications.
Schedule regular update meetings to discuss progress/roadblocks and issues.
Keep councilmembers and administrators regularly informed.

Don’t:

Don’t let cost savings be the only driver in deciding whether or not to outsource. You must also trust that the vendor can do the job effectively.
Don’t expect the vendor to know about challenges/issues that you have experienced in previous years. If there are skeletons in the closet, disclose these before contracting.
Don’t forget that you may be the organization’s largest single source of funding. That means the impact of the relationship goes beyond the parameters of the contract. It is in your interest to ensure the recipient remains financially viable and civically responsible.

Learn more about the Toolkit

Download the PDF

COVID-19 Economic Response and Recovery

Launch a Microloan/Microgrant Program

Download the PDF

Problem:

Microfinancing is an important tool to assist small businesses with a documented history of success. When businesses are first starting out, they often are unable to get access to capital. And yet, the costs to start a microbusiness can be quite low with some estimates at a few thousand dollars. In some cases, a larger loan may be detrimental if a recipient is not ready to expand the business quickly and will not have the necessary earnings. Through the Small Business Administration, small businesses have received almost $900M in a mix of grants and loans, and have gone on to create almost 250,000 jobs (as of 2017).

These small grants and loans can be critical to enabling businesses to start successfully and can provide an important lifeline to businesses looking to continue operations. New businesses are integral to the success of communities, accounting for high proportions of net new job creation. This funding can be particularly important for Black Americans who start businesses at a slower rate than other groups due to many barriers, chief among them access to funding. This inequality will only get worse with COVID-19.

Action:

Cities should work with local philanthropic partners and community leaders to launch a microgrant program that offers small grants (e.g., $1,000-$3,000) to individuals looking to start businesses. This can be done successfully with minimal city investment; instead, city officials should use their bully pulpit powers to convene local leaders and galvanize support.

Cities should consider leveraging CARES Act funding to jumpstart this action if they have not already allocated funds by the end of 2020. As the economy starts to recover, many people will think about starting a business, as happened after other recessions. Additionally, this action will be more effective if combined with developing an entrepreneurial ecosystem.

Case Study

Minneapolis, MN: Microgrants

Microgrants was launched in Minneapolis by a private philanthropist over 15 years ago as part of an effort to help individuals achieve financial stability. Microgrants awards grants of around $1,000 to jumpstart businesses and cover expenses that would not typically be allowed for traditional loans.

The program, which focuses on Minnesota, awarded $1,200 grants in 2019 to 250 entrepreneurs and small businesses that needed supplies to start or conduct business. An example of a supported business was an entrepreneurial photographer, who booked up within weeks of getting funding to purchase camera equipment. The program partners with local community organizations to develop business plans for entrepreneurs who receive funding and establish clear goals and metrics related to the funding.

One of the main challenges the program has encountered is how to locate and vet applicants. To accomplish this, the team empowered 52 partner agencies that have close ties to the community. These organizations share proposals from residents and help manage the workload, making it easier to facilitate grants for those who can benefit the most.

This model may be suitable for cities that want to launch a microgrants program. With a small initial investment and staff, a team could similarly leverage community organizations.

How To Adapt this Approach:

Identify local non-profits and philanthropic organizations which could fund and administer the program. The city can help facilitate the creation and initial projects while serving as an integral partner throughout.
- This can be a small pot of money as a pilot program (e.g., $50K, $1K per grant, to offer to 50 individuals)
  If possible, partner with a non-profit which already has expertise.
- Cities should also consider high net worth individuals and successful entrepreneurs within their communities, who may be willing to sponsor this effort.
Determine which industries are underrepresented in your community and are positioned to grow during the recovery. Direct microgrants to new businesses in these sectors. Kauffman’s “My Sidewalk” program can help with identifying existing resources and which industries have opportunities for growth, as well as speaking with stakeholders in the community to understand gaps
Secure funding from a philanthropic or corporate partner. Develop and launch the microgrant program.
Create a marketing and outreach campaign to relevant entrepreneurship support groups. Ensure that explicit outreach is done to groups working with disadvantaged communities and communities of color.
Track progress from the first cohort and provide technical assistance and support to those individuals (See template in resources section)

Benefits:

Provides support for entrepreneurs looking to start businesses
Supports local entrepreneurial ecosystem growth by establishing cohorts and facilitating access to technical assistance
Low-cost action

Risks:

Can be poorly targeted and, without structured business planning and support, many supported businesses will not succeed

Impact: Medium
Implementation time: Slow
Cost: Low This can be launched at a very low cost, since it requires a small allocation (e.g., around $50K-$100K) and can leverage partner organizations to handle vetting.

Learn more about the Toolkit

Download the PDF

COVID-19 Economic Response and Recovery

Leverage strong philanthropic partnerships to “seed” an Income Sharing Agreement fund that pays up-front tuition.

Download the PDF

Innovative Ways to Fund Workforce Development and Training Programs

Background:

Cities and regions across the country are looking to act upon what the data clearly shows: that investment in middle-skill attainment pays huge economic and social dividends by supporting business expansion and the movement of vulnerable citizens into the middle class. Paying for those investments, however, is increasingly challenging given the consistent decline in federal job training funding over the last several years coupled with decreased tax revenue due to the current recession.

So why make these investments now when funding is tighter than ever and leadership and staff are stretched thin responding to COVID-related crises? The answer is clear: because these investments are part of the long-term solution to managing current and future economic volatility.

But how do communities pay for it? The two case studies in this section provide examples of alternative ways, beyond traditional federal funding, to identify and structure financial investments in skills training that leads to credential attainment. Both have been highly successful in early implementation stages, and leadership for each model note the investments made through these programs over the last few years have left their cities in a better position to respond to the economic downturn. Each example, to varying degrees, includes the following essential elements:

Tapping into new funding sources:

In San Diego, that meant establishing and leveraging strong connections with the philanthropic community to “seed” an Income Share Agreement fund that pays for tuition up front for students who will then “pay it forward” for future students. In Virginia, the General Assembly has injected state funding into a program to “share” tuition costs with students.

Accountability:

Both of these examples show the value of students and, in the case of Virginia, education providers having “skin in the game.” In Virginia, students pay only one-third of the tuition cost up front. Community colleges receive the second and third thirds from the General Fund upon student completion of the course, and successful credential attainment, respectively.

Focus on equity and inclusion:

Although each of the case studies do involve some payment by students, both have intentionally sought out and included mechanisms to not only ensure access for those with the greatest financial need, but to target them as primary participants in the programs.

Prioritization and initiative:

Neither of the examples highlighted in this section would have ever been designed or launched if the stakeholders had simply accepted the reduction in federal resources as “the new normal” and scaled back their workforce development programs accordingly. In Virginia, a few champions in the state legislature understood the clear evidence for investment, pushed for a plan and then ushered it through to codification.

In San Diego, an idea initially heard during a conference presentation sparked the design and implementation of a program recognized as so innovative that it has already received foundation funding to support the sharing of outcomes and technical assistance to help other cities potentially replicate the model.

Case Study #1

Workforce Income Share Agreement Fund, San Diego, CA

In 2019, the San Diego Workforce Partnership (SDWP) established a new model for expanding access to training in high-growth industries called the Workforce Income Share Agreement Fund. An Income Share Agreement (ISA) is an alternative way to pay for education, where there are no upfront costs to the student.

Instead, the student agrees to pay a small proportion of their income after landing a job above a minimum income threshold. This threshold also means payments stop if income falls below the identified wage or the individual experiences a period of unemployment. Not only is there a strict cap on the maximum that students repay, each dollar repaid replenishes the fund for future students.

This innovative financing mechanism increases equity by basing access to funding on competency, need and motivation rather than traditional indicators such as credit scores, savings rates or educational achievement. While the specific terms vary slightly depending on the program, students will pay back between 6% and 8% of their income for 36–60 months.

The San Diego Workforce Income Share Agreement Fund provides $6,500 in funding per student and is inclusive of education and wraparound services. Students may pay up to 1.8X the cost of the contract, a max of $11,700, based on their individual earnings. Students repay between 6%-8% of their income, based on the program once they earn above $40,000 per year. Income determination excludes public assistance, disability benefits, alimony/ child support and social security, but does include pensions.

The model offers access to UC San Diego Extension certification programs lasting 9–15 months in fastgrowing technology fields with career readiness, mentoring and job placement support. As well as receiving instruction from industry professionals at UCSD Extension, participants in the program also have access to extensive career counseling, placement and supportive services.

Current UCSD Extension eligible programs are in the business management and information technology sectors. A complete list of programs, including targeted careers and starting salary, are available at UCSD Extension’s ISA site.

Key Partnerships:

Like most innovative models, success of the Workforce Income Sharing Agreement Fund required broad and deep collaboration. Key partners for this project include:

Workforce Partnership, which launched and manages the implementation and coordination of the initiative through dedicated staff resources.
UC San Diego Extension which serves as the education provider.
Google.org, the James Irvine Foundation, Strada Education Network and a private philanthropist contributed the start-up resources needed to launch the fund.
Vemo Education, a contracted partner who services the fund by processing payments through an online portal, alongside related customer service support.
Local technology executives and businesses who engaged in a variety of ways from helping inform the design of the program to providing support to students through mentorship, internship and job placement opportunities post-graduation.

Funding:

To date, Workforce Partnership has raised $3.35 million from philanthropic sources to support ISAs. Funders include the Strada Education Network, Google.org, James Irvine Foundation, and a private San Diego philanthropist.

In terms of costs, as noted previously, Workforce Partnership budgets $6,500 per student, which is the face value of the ISA and is covered by the fund. When students need additional support services, such as childcare or transportation, Workforce Partnership leverages other existing programs through co-enrollment. The Workforce Partnership Income Share Agreement Fund currently does not include Workforce Innovation Opportunity Act (WIOA) or other federal funding.

Key Challenges:

Lack of a regulatory framework:

A regulatory framework does not currently exist at the federal policy level, and there is much debate in the market regarding whether or how existing federal and state consumer protection laws that apply to loans, such as the Truth in Lending Act, the Equal Credit Opportunity Act, the Holder Rule, and usury laws, legally apply to ISAs. Without proper guardrails, regulatory ambiguity increases the risk of opportunities for predatory contracts.

In lieu of federal policy, Workforce Partnership collaborated with other workforce boards to develop a set of student-centric Statement of Principles that all workforce development ISAs should include. The core promise of the ISA model is shared opportunity. In an ISA, education providers and participants have a single, shared benchmark for success: stable employment at a living wage. Every component of a workforce development ISA program should further this promise.

Local Workforce Boards may not be structured to receive funding from diverse sources:

ISAs can enable their users to consider a diverse set of funding sources from private philanthropy to public dollars or investment capital. Depending on the workforce board’s legal and governance structure (e.g., 501c3, government entity,) the board may not be set up to accommodate all types of funding.

This should be analyzed up front to determine if, based on the needs of the program, the funding sources will be restricted to only those that the existing entity can receive or if a partnership or the establishment of a new legal entity may be needed to accomplish the board’s goals.

In the case of Workforce Partnership, the organization is a 501c3 that is able to accept both public and private philanthropic funding but not return-seeking capital from impact investors. While the current ISA fund does not include impact capital, Workforce Partnership quickly understood that its future needs might, and partnered with a separate legal entity, called Workforce Ventures, positioned to blend capital sources and provide fund management.

Summary of Project Impact

The program currently has 181 signed ISA contracts, with 89 students in training programs. The 34 students scheduled to graduate this December will join the 29 participants that have already graduated the program in 2020. Of 181 signed ISAs, 87 are women, 130 are people of color and 118 are firstgeneration college students. Workforce Partnership plans to enroll 200 additional students during 2021 and scale up enrollments in 2022 and beyond, with a goal to support 1,000 new participants in ISAs annually by 2025.

Adapt This Approach:

Workforce Partnership received a grant to test, document and amplify good practices for the application of ISAs as innovative workforce training financing models, and has since established the Outcomes Center, which serves as a hub for tools, resources and learnings around new and innovative outcomes-focused funding models.

The steps below are also outlined in an ISA Development Lifecyle located in the Outcomes Center, which includes additional detail, suggestions and strategies that correspond with each step. Visit this tool and others in the Outcomes Center to support local adoption of this model.

Steps to Success:

Cost and Time Commitments:

Because of Workforce Partnership’s reliance on philanthropic giving to seed the fund, and the model’s “pay it forward” feature, ISAs themselves, are not necessarily expensive. The level of staff time required, and time overall, to stand up and implement the model will depend on a variety of factors including:

Existing relationships with philanthropy — the ability to leverage existing relationships to identify potential funders will greatly impact the time and effort required to fund the model.
Depth of established partnerships with education and the business community.
Ability to commit staff to an in-depth lead role to oversee the communication, organization and execution of the work required to usher the model through the implementation process.
Type and duration of support that will be provided to participants as part of the ISA product; programs providing education only may require a very different model from those including active case management and other wraparound services

Do:

Do focus the program’s efforts. The most successful ISA programs are those linked to a clear, locally connected use case rather than a broad set of national concepts. Moving into the design phase without articulating a clear need can waste time, increase costs, and make buy-in difficult. Workforce Partnership targeted “workforce credentials for in-demand fields in the San Diego market which provide quality jobs above $40,000, currently have underrepresentation by women and minorities, and are not eligible for federal loans or Pell grants.”
Do customize. Effectively matching the components — income thresholds, certifications, repayment provisions, etc. — to the unique needs of students and business in the community is essential to success.
Do seek guidance from expert legal counsel to ensure compliance with state and federal laws as well as engage in a dialogue directly with relevant regulators about the program’s intentions, structure and terms. This process can vary dramatically between different legal jurisdictions and programs. The best stage at which to begin seeking legal counsel is when the program has a clear mission and initial design in place (but before finalization). Legal and financial support for this model requires expertise in income share agreements and impact funding (if part of the funding model), which may not be available at the city or county level due to their relatively new status. Workforce Partnership noted that seeking out and contracting for those services supported their ability to make informed and expedient management decisions.
Do carefully consider the terms of the ISA. An ISA is fundamentally a contract. Core terms of an ISA contract include the payment cap, payment term and payment window, income share and income threshold and APR cap. The interplay between these terms can dramatically influence not only the participant’s repayment requirements but also the types of capital best suited to the program. For example, impact investment capital seeking a 6% return in the short term would not be well aligned to a design predicated on a low APR cap with a multiyear repayment window. To model a desired set of terms, see the Workforce ISA Modeling Tool.

Don’t:

Don’t give up control. To achieve buy-in and avoid re-work, it is crucial early in the process to engage those who may be affected by the decisions or can influence the implementation of decisions. However, while engagement is key to ensure there will be a market for the ISA product once launched (e.g., education providers will use it, participants will sign it), boards are encouraged to retain control of ISA design to ensure that guardrails for participant protection are strong, even if contracting out aspects of service delivery.

Resources:

Specific terms of Workforce Partnership’s ISA payment model
Income Share Agreement basics
Key feasibility considerations when designing an ISA to determine if the program is a good candidate for this model
A framework to help workforce agencies build ISAs centered around quality jobs
An ISA Development Lifecyle for developing an ISA lifecycle
Workforce Partnership’s Outcomes Center

Case Study #2

FastForward Program – Virginia

In 2016, the Virginia Assembly codified the New Economy Workforce Grant Program, which was quickly rebranded FastForward by the Virginia Community College system. FastForward provides a pay-for-performance model for funding noncredit workforce training that leads to a credential in a high demand field. FastForward program specifics:

Courses are 6–12 weeks, on average, and designed so students can continue working while earning a credential.
Program is delivered by Virginia’s Community Colleges and is designed to help students enter and advance in a career pathway. Some credentials stack based on skill (e.g., basic and advanced), while some stack to allow the student to become a more well-rounded job candidate (e.g., Certified Clinical Medical Assistant, EKG Technician, Phlebotomy
Technician). Some programs may offer a short internship or externship before graduating and can also propel the student towards an associate degree.
Costs vary, but the average out-of-pocket cost is $1,100, and financial assistance may cut costs even more.
A career coach at the local community college helps participants explore training options, pursue financial aid for the up-front payment (if needed) and access wraparound services such as transportation and childcare. This additional support is critical as many of FastFoward’s students face multiple barriers. Over half of FastForward students are minorities; students are twice as likely to receive SNAP/TANF benefits as other college students; and over 70% have dependents to support.
The program offers in-person and online training programs for 40 high-demand careers in the following industries: logistics and transportation, healthcare, welding and manufacturing, skilled trades, information technology, business and customer service and education.

FastForward Payment Points:

Students are required to pay one-third of the total cost of the program upon enrollment. Students may use third-party funds, such as noncredit financial aid, training vouchers or employer payment to cover this cost.
If the student completes the training, the state provides one-third of the cost of the program, up to $1,500, to the institution. If the student does not complete the program, then the student is required to pay this portion of the total cost.
If the student satisfactorily completes the workforce credential (after completing the training), the institution receives the remaining one-third of the cost of the program up to $1,500. The combined maximum award to an institution is $3,000 for completion of training and a credential.

Key Partnerships:

Leadership in Virginia noted that the launch and initial implementation of FastForward primarily involved the following partners:

VCCS, comprised of state, system-level leadership and staff and individual colleges — the system-level staff who develop statewide policy and infrastructure (e.g., statewide website that directs interested potential students to their local college) to ensure key consistencies in implementation, and the 23 community colleges in Virginia that operate the program at the local level.
State Council for Higher Education in Virginia (SCHEV), responsible for administering the program, conducting periodic program assessments, collecting student data, and making final decisions on disputes between eligible institutions and grant recipients. SCHEV also handles the financial management of the program including reimbursing colleges for successful student outcomes.
The Virginia Board of Workforce Development, which provides on a bi-annual basis a list of highdemand occupations for potential inclusion as certification programs in FastForward.

As the program has matured and demonstrated success, additional partners have come to the table including:

Workforce partner programs such as WIOA, SNAP and TANF that are interested in FastForward as a training option for their participants. Local community colleges are working in pockets of the state with local program providers to define processes for collaboration and co-enrollment.
Industry associations that quickly saw the benefit of a new pool of talent skilled up with industry-recognized competencies and credentials. These groups work with local colleges to inform program design and curriculum development and have even helped pay for training costs when the FastForward program funds ran low.

Funding:

Funding for the FastForward program comes from the Virginia General Fund, which is primarily state-level tax revenue appropriated by the Virginia General Assembly. In the first year, the Assembly appropriated $4 million. That funding, which was awarded for training on a first-come, first-serve basis, quickly ran out and the Assembly stepped in with an additional $1 million in the first year (totaling an annual investment of $5 million).

Annual appropriations have increased significantly each year with the evidence of positive outcomes driving increased interest by businesses and students:

2016 ___ $5 million
2017 ___$7.5 million
2018 ___$9 million
2019 ___$13.5 million

It is also important to note the program receives an additional $3 million from the general fund annually to help low-income students pay up to 90% of the first one-third (or up-front) tuition payment. Students eligible for those funds are generally below 200% of the poverty level or on SNAP or TANF benefits. Local career coaches are also working with partner programs, such as WIOA, to cover tuition costs when available and allowable.

Summary of Project Impact

FastForward has demonstrated success both in terms of outcome measures and participant satisfaction. More than 37,000 Virginians have enrolled in FastForward training programs to date, with a completion rate of more than 90%. More than 19,000 credentials have been earned since 2016, and one in four graduates saw an 85% increase in salary postcredential. In addition, graduates report key indicators of success, including:

67% have paid vacation
68% have employer-paid medical insurance
86% are satisfied with their job duties
83% report being satisfied with their work schedule
75% are satisfied with their pay
85% are happy with their job stability.

The FastForward team is also working on using wage data to calculate an increase in tax revenue and overall return on investment for the program.

Additional Impacts

FastForward is now in the DNA of what the colleges do — it is no longer an “add on” program. The success of the program has led to a much greater focus, on both the non-credit and credit side of the college, on the critical importance of embedding credentials into degree programs to drive strong employment outcomes.
FastForward has also been used as a tool to respond to the economic shifts in labor demand due to COVID-19. Several colleges quickly established or ramped up enrollment in programs such as personal health testing and phlebotomy to meet the rising need for healthcare workers with specific skills.

Adapt This Approach:

Cost and Time Commitments:

FastForward leadership identified the program as very staff-intensive to stand up, which was especially challenging as the allocation did not include funding for additional staff. Initially, 15–20 VCCS staff were focused on implementing the program, but they are now down to two staff full-time. The FastForward team noted, however, that it should be much less complicated to implement at a city level as leadership can control its own guidelines, policy, etc. and will not have to ensure consistency across a statewide system.

FastForward was also implemented relatively quickly — in less than six months — due to a mandate from the Virginia Assembly. Leaders noted, however, that if afforded more time, they would have further explored up-front partnerships and additional wraparound services to offer at the beginning of the program. Those partnerships have evolved over time and, consequently, improved the program. The time required at a city level would likely be dependent upon the depth of existing relationships with the education and business communities.

Do:

Do be intentional around identifying partners and their roles. FastForward leaders noted that a city should ensure that the roles of the local education provider, WIOA partner, city workforce office and local economic development are ironed out before launching to ensure an efficient and collaborative implementation.
Do align with industry associations. These relationships support conversations that help align credentials with desired skills and lead to helpful business practices, such as mentioning specific desired credentials in job postings. Partnerships with industry can also lead to financial investments from businesses if city funding runs low.
Do identify and leverage all potential partner resources. All partners have needs, but they also have resources, some of which may not be readily apparent. For example, in Virginia, local community colleges have access to a higher education equipment trust fund that can help pay for equipment costs associated with hands-on instruction.
Do connect the college’s academic credit side with the non-credit side to maximize options for the students to advance along a pathway without duplicating effort.

Don’t:

Don’t involve your industry partners in the “bureaucratic side” of running the program. Shield business from any public partner issues that include administration, red tape or discussions regarding “turf.” They should see one unified system of partners working together for common goals.
Don’t focus on weeks and hours when defining programs. What matters are the competencies and skills obtained, and ensuring alignment with employer demand. The length and structure of the program can be flexible to meet the needs of the students and business.

Resources:

Learn more about the Workforce Tactical Guide

Download the PDF

COVID-19 Economic Response and Recovery

Implement a Financial Counseling and Work Assistance Program

Download the PDF

Problem:

COVID-19 is wreaking havoc on many peoples’ lives. In addition to the high levels of unemployment, financial planning has become more challenging given the uncertainty of markets and asset values. Evaluating all the available sources of capital — and how best to leverage them — is daunting. In addition to financial counseling, services can include examining resumes to identify skillsets.

A financial counseling and work assistance program is critical for cities to support an equitable recovery. Studies have identified a significant gap in financial literacy between Black and white Americans. Equally important, those who have more financial literacy are more likely “to plan and save for retirement, have non-retirement savings and better manage their debt.” To work towards a goal of equity, this wraparound service is key to helping lift low-income people and communities of color, and lowering barriers for small business owners and entrepreneurs.

Action:

Cities should develop a partnership to provide a free 1-1 financial counseling program for local residents. The counseling should be integrated into other public services (e.g., assistance when applying for a microgrant).

Case Study

Nashville, TN: Financial Empowerment Center

The Nashville Financial Empowerment Center (FEC) operates under a simple premise: that an “increase in the economic well-being of any Nashvillian improves the overall economic climate of the whole city.” Founded in 2013, the Nashville FEC is a free 1-1 counseling program for all residents in Nashville provided by the government and United Way. Counselors will help with a variety of personal finance issues — such as how to negotiate debt, what to look for in a loan, or even just general financial literacy.

The City recognized the need to establish the center because there was a relative lack of financial empowerment services in the city. After researching nonprofits that work in the space, it settled on a partnership with United Way, given the organization’s visibility and track record in this space. Nashville chose to place the FEC within the Mayor’s office to ensure prominence and attention. It has since established an office dedicated to implementing financial counseling and integrating it with other government and social services (e.g., affordable housing). Nashville set aside ~$250,000 per year to cover the shared costs with United Way.

As the FEC was growing, Nashville made a dedicated effort to attract and develop partnerships. The City hosted a summit with existing and prospective partners in the community to discuss how best to provide counseling, and identify additional opportunities for collaboration. They used these partners to better understand residents’ needs (e.g., debt reduction, increasing savings) and how the center could best reach and support residents. These same partners provide ongoing feedback to the FEC to help them continually improve their offerings. For example, they have prioritized hiring counselors who speak Spanish as a primary or secondary language after they noticed that Spanish was the main language of 12.4% of clients.

Since it was launched in 2013, the Center has helped 7,700 clients reduce their debt by $14.2 million and increase their savings by $2.9 million. It has made a concerted effort to reach out and serve low-income and people of color. 54% of FEC clients identified as African American/Black and 21.2% identified as Latino/Latina. Nearly 18% had not completed high school and 61.8% of clients had very low incomes (relative to the median income). The FEC also conducted targeted outreach to certain sectors of the population (e.g., low-wage workers, those seeking assistance with food, utility, etc.) to determine how the center could be helpful.

How To Adapt this Approach:

Research potential partners (e.g., education institutions, non-profits, etc.) that are present in the community.
- These partners should have some experience either with financial planning (e.g., workers in a school’s financial aid office) or have already worked in the community.
- Identify non-profits that work in this space (e.g., United Way) and have relevant expertise
Understand the needs in the local community
- Reach out to community leaders to determine who would take advantage of this service.
Design the program
- Discuss with local banks and financial institutions (especially those serving low-income and communities of color) and ask for their assistance (e.g. offering the services to anyone reaching out about a loan, or facing foreclosures and other financial hardships)
- Reach out to potential partners and propose collaborations. Some non-profits may be willing to offer funding or expertise. Partners can provide funding, expertise, and/or community reach and engagement. All are useful and should be sought.
  A successful partnership requires having these non-profits committed to this work.
  Partners will be necessary to help train counselors, promote the service, etc.
- Determine where program should be housed
  - This will be dependent on which partners are involved. Cities may want to house the program in the mayor’s office, keep it as a standalone department, or have a non-profit take the lead and the city provide funding and support.
- Offer 1-1 appointments and have call/email options
  - A group class is much less effective, as people are hesitant to discuss personal financial circumstances in this format.
- Draft general information sheets on handling financial hardships
  - Have this readily available (e.g., on website, at local financial institutions) so that people can learn about the services provided
  - This should include key topics that the program can help with (e.g., debt reduction, improving credit score, increasing savings)
Launch program with active outreach and media campaigns in local communities
- Promote at community meetings (e.g., religious services)
- Ensure that banks and financial institutions provide information about the service
- Hire staff. Size depends on % of the population that is low-income, but assume at least 2 FTE for the program.
  - Staff must be trained professionals with experience in financial counseling.
  - Make sure to have clear training standards for counselors.
- Reach out proactively to small business owners and low-income individuals (e.g., those on SNAP) to offer the service
Track progress/program usage and revise as necessary (See template in resources section below)
- Note: metrics need to be tied to improvement in residents’ lives, not merely visits/time spent (e.g., $$ debt reduced).

Benefits:

Enables residents to make more informed economic decisions
Offers additional guidance and pathways for careers
Builds residents’ ability to gain access to credit

Risks:

Assumes risk of providing financial guidance
Residents do not use the service and/or are unaware of the service

Impact: Low
Implementation time: Slow
Cost: Low Non-profit partners can take the lead on offering a lot of the programming, so costs should be minimal to administer.

Learn more about the Toolkit

Download the PDF

COVID-19 Economic Response and Recovery

Decide When to Seek Grants from Philanthropic Foundations, and Improve your Strike Rate

Download the PDF

Action:

Cities should pursue grants/donations from philanthropic foundations and other sources.

Why:

There are more than 119,000 philanthropic foundations4 in the U.S. and Canada. The potential to access philanthropic funding for economic activities is significant, growing, and often untapped or underutilized.

After the 2008–09 financial recession, many foundations increased funding for job and workforce programs, as well as other city economic development programming and operations that advance public welfare.

Background:

Cities should consider seeking 501(c)3 charitable status for their economic development agency or forming a partnership with an existing 501(c)3 organization. RDG estimates that 65% of city economic development agencies do not currently have 501(c)3 status.

In some states, such as Georgia, there are state-sanctioned equivalents of the 501(c)3 structure that allow for similar treatment of philanthropic financial support.

If a city does not have a s501(c)3, or state equivalent, it should first consult legal counsel to understand state and city rules and ethical standards around the solicitation and management of private funding.

Once it has established a 501(c)3, it should aggressively pursue philanthropic funding, while still leveraging all available public resources.

Philanthropic funding typically comes in the form of project grants, operating support, planning grants or program-related investment.

Appendix G lists examples of philanthropic for economic and community development activities.

Community Investment Act Strategy:

The Community Reinvestment Act (CRA) established an investment performance evaluation system, administered through the Federal Reserve, that “credits” banks for lending in low-income geographies. The credits can be used during mergers and acquisitions.

Banks which contribute to city-led projects which can demonstrate direct/ indirect impact on low-income geographies can receive such a credit, thus making the project more attractive.

Where to Begin:

Determine community development needs and opportunities that the city can address, including, but not limited to:

Affordable housing;
- Services for low/moderate individuals;
- Small business finance;
- Neighborhood revitalization; and
- Eligible activities that support areas designated under the Federal
- Neighborhood Stabilization Program, which targets high foreclosure levels (Source FDIC).
Inventory local financial institutions and their assessment areas.
Communicate your strategy to the financial institutions and seek their support and funding for specific projects.

CRA funding is well-established and can be substantial. It is particularly relevant now given the increased attention on equity and diversity. For example, Bank of America recently announced that it will reinvest $1billion in locally-based equity and diversity programs over four years.

Case Study

Indianapolis, IN – Develop Indy

Develop Indy is the economic development agency for the City of Indianapolis/Marion County (city/county unified government). In 2014, it was merged with the Indy Chamber and Indy Partnership (the regional marketing organization).

The impetus for the merger was: a history of under-performance by various economic development structures and multiple “starts and stops”; the appointment of a new chamber CEO; and the decision to commission the chamber to develop a regional community economic development strategy.

The merger was championed by the Mayor and Eli Lilly’s CEO, who also agreed to lead efforts to raise corporate and philanthropic funding. The city also agreed to continue to provide funding.

Each year, the city agrees with Develop Indy on a detailed contract of services and KPIs, which is then approved by the city council. The agency’s CEO reports to both the mayor and the chamber CEO.

The agency also created an advisory board, comprising Develop Indy investors, who are appointed by the chamber and approved by the mayor. The board provides both oversight and direction to Develop Indy staff.

The agency can access both private and philanthropic funding, via its 501(c)6 and the chamber’s 501(c)3. Its annual budget is ~$1.7 million, of which the city contributes ~$1 million and foundations and companies contribute ~$500,000.

Significant contributors include Indianapolis Power and Light, Anthem, IU Health, the Lumina Foundation, the Central Indiana Community Foundation, and the Eli Lilly Corporation Foundation.

Impact:

Develop Indy has been able to use corporate and philanthropic dollars to grow programs and staff. It also benefits from greater economies of scale, which supports better service delivery. Most recently, it created a micro-lending program for entrepreneurs/ small businesses which was funded by $25 million from the city, matched by foundations and corporations, and managed by the chamber. You can read more here.

How to Adapt this Approach

Cities must first determine if they are eligible to receive funding from a specific foundation.

For example:

Kresge Foundation’s American Cities Program focuses on urban centers and supports programming which increases access to jobs, education, housing, city services, and quality public places
JPMorgan Chase’s Advancing Cities Initiative provides funding to cities which are focusing on inclusive growth and economic opportunities. The foundation targets cities where conditions exist to help those who have not benefited from economic growth.

Cities should use the following checklist when applying for philanthropic funding:

Identify the specific funding need for your project/organization.
Conduct research to identify corporate and private foundations which have priorities that align with your goals. If your request does not match the foundation’s priorities, it is highly unlikely you will receive a grant.
- Websites, annual reports and 990 forms can provide insights on a foundation’s priorities.
- Foundation clearinghouses, such as the Foundation Center and GuideStar, can also be useful.
- But you will typically need to reach out to foundation staff for detailed information.
Determine application rules, such as eligibility, geographic focus, estimated size of grant, pre-application information, contacts, and URL for application. (Requests are usually submitted online).
Identify foundation staff and board members for one-on-one engagements.
Determine if current staff can write the application, or if you should hire a professional grant writer.
Identify an in-house lead for assembling the application.
Schedule regular update meetings to ensure data collection/ proposal development is on schedule.
Complete a first draft of the application within a minimum of two weeks prior to the deadline. Note that some foundations will review your application and provide suggestions for improvement prior to official submission. Check if this opportunity is available.
Have your organization’s highest-ranking officer sign the application and provide a cover letter.

Cities can expect philanthropic funding applications to include:

Description of the funding purpose
Demonstration of fiscal and administrative stability
Budget history
Impact on specific community demographics and needs
Examples of broad community support and impact
Methodology for monitoring and reporting progress

Do:

Work with legal counsel to determine if you should seek 501(c)3 status. The approval process may take up to a year, but can be expedited if funding has been pledged from a donor that is both 1) substantial, relative to your budget and 2) has a specific expiration date. Moreover, the IRS will often grant conditional status which allows you to accept funds and place them in escrow until your application is approved.
Research the foundation’s priorities and only request grants that align with them. Websites, annual reports, and 990 forms can provide insight on priorities, geographical limits, staff contacts, board members, and grant application guidelines.
Know the timing/cycle for a funding request. Most foundations have a rigid grant cycle and deadline for submitting proposals.
Determine if there are other community entities undertaking similar initiatives and if it makes sense to partner and jointly request funding.
Analyze your staff’s capacity to complete the research and post-grant monitoring. Seeking and applying for grant opportunities can be time-intensive. See Appendix H for an example of a foundation request (Inasmuch Foundation).
Follow the foundation’s application directions/guidelines. Foundations receive large numbers of applications and tend to reward those that can follow directions.
Try to establish a relationship with the foundation staff member to whom your request will be assigned. If you have questions, contact the program staffer/officer.
Get your Mayor/leadership involved. Relationships are key for all foundations and your leadership’s engagement with board members and staff will help to build trust and confidence and increase your chances of success.
Make sure you understand all the grant approval requirements. Most grants have specific reporting requirements and performance benchmarks, and not satisfying them will put future grants in jeopardy

Don’t:

Don’t count on a philanthropic clearinghouse website to provide the detailed information required for your request. Websites, like GuideStar, GrantStation, and the Foundation Center, are good starting points, but you will need to do additional research.
Don’t take liberties with your proposal and add information that is not requested. If the directions ask for a one-page explanation of where the funding will be used, don’t send two pages.
Don’t send your application to multiple staff members at the foundation. Stick to the designated staff contact, unless instructed otherwise.
Don’t be elusive with your request. Your proposal should focus on specific needs and how the funding will fill a specific gap.

Learn more about the Toolkit

Download the PDF

COVID-19 Economic Response and Recovery

Develop a pay-for-performance model

Download the PDF

Innovative Ways to Fund Workforce Development and Training Programs

Background:

Tapping into new funding sources:

Accountability:

Focus on equity and inclusion:

Prioritization and initiative:

Case Study #1

Workforce Income Share Agreement Fund, San Diego, CA

Key Partnerships:

Like most innovative models, success of the Workforce Income Sharing Agreement Fund required broad and deep collaboration. Key partners for this project include:

Workforce Partnership, which launched and manages the implementation and coordination of the initiative through dedicated staff resources.
UC San Diego Extension which serves as the education provider.
Google.org, the James Irvine Foundation, Strada Education Network and a private philanthropist contributed the start-up resources needed to launch the fund.
Vemo Education, a contracted partner who services the fund by processing payments through an online portal, alongside related customer service support.
Local technology executives and businesses who engaged in a variety of ways from helping inform the design of the program to providing support to students through mentorship, internship and job placement opportunities post-graduation.

Funding:

Key Challenges:

Lack of a regulatory framework:

Local Workforce Boards may not be structured to receive funding from diverse sources:

Summary of Project Impact

Adapt this approach:

Steps to Success

Cost and Time Commitments:

Existing relationships with philanthropy — the ability to leverage existing relationships to identify potential funders will greatly impact the time and effort required to fund the model.
Depth of established partnerships with education and the business community.
Ability to commit staff to an in-depth lead role to oversee the communication, organization and execution of the work required to usher the model through the implementation process.
Type and duration of support that will be provided to participants as part of the ISA product; programs providing education only may require a very different model from those including active case management and other wraparound services

Do:

Do focus the program’s efforts. The most successful ISA programs are those linked to a clear, locally connected use case rather than a broad set of national concepts. Moving into the design phase without articulating a clear need can waste time, increase costs, and make buy-in difficult. Workforce Partnership targeted “workforce credentials for in-demand fields in the San Diego market which provide quality jobs above $40,000, currently have underrepresentation by women and minorities, and are not eligible for federal loans or Pell grants.”

Do customize. Effectively matching the components — income thresholds, certifications, repayment provisions, etc. — to the unique needs of students and business in the community is essential to success.

Do seek guidance from expert legal counsel to ensure compliance with state and federal laws as well as engage in a dialogue directly with relevant regulators about the program’s intentions, structure and terms. This process can vary dramatically between different legal jurisdictions and programs. The best stage at which to begin seeking legal counsel is when the program has a clear mission and initial design in place (but before finalization). Legal and financial support for this model requires expertise in income share agreements and impact funding (if part of the funding model), which may not be available at the city or county level due to their relatively new status. Workforce Partnership noted that seeking out and contracting for those services supported their ability to make informed and expedient management decisions.

Do carefully consider the terms of the ISA. An ISA is fundamentally a contract. Core terms of an ISA contract include the payment cap, payment term and payment window, income share and income threshold and APR cap. The interplay between these terms can dramatically influence not only the participant’s repayment requirements but also the types of capital best suited to the program. For example, impact investment capital seeking a 6% return in the short term would not be well aligned to a design predicated on a low APR cap with a multiyear repayment window. To model a desired set of terms, see the Workforce ISA Modeling Tool.

Don’t:

Don’t give up control. To achieve buy-in and avoid re-work, it is crucial early in the process to engage those who may be affected by the decisions or can influence the implementation of decisions. However, while engagement is key to ensure there will be a market for the ISA product once launched (e.g., education providers will use it, participants will sign it), boards are encouraged to retain control of ISA design to ensure that guardrails for participant protection are strong, even if contracting out aspects of service delivery.

Resources:

Specific terms of Workforce Partnership’s ISA payment model
Income Share Agreement basics
Key feasibility considerations when designing an ISA to determine if the program is a good candidate for this model
A framework to help workforce agencies build ISAs centered around quality jobs
An ISA Development Lifecyle for developing an ISA lifecycle
Workforce Partnership’s Outcomes Center

Case Study #2

FastForward Program – Virginia

Courses are 6–12 weeks, on average, and designed so students can continue working while earning a credential.
Program is delivered by Virginia’s Community Colleges and is designed to help students enter and advance in a career pathway. Some credentials stack based on skill (e.g., basic and advanced), while some stack to allow the student to become a more well-rounded job candidate (e.g., Certified Clinical Medical Assistant, EKG Technician, Phlebotomy
Technician). Some programs may offer a short internship or externship before graduating and can also propel the student towards an associate degree.
Costs vary, but the average out-of-pocket cost is $1,100, and financial assistance may cut costs even more.
A career coach at the local community college helps participants explore training options, pursue financial aid for the up-front payment (if needed) and access wraparound services such as transportation and childcare. This additional support is critical as many of FastFoward’s students face multiple barriers. Over half of FastForward students are minorities; students are twice as likely to receive SNAP/TANF benefits as other college students; and over 70% have dependents to support.
The program offers in-person and online training programs for 40 high-demand careers in the following industries: logistics and transportation, healthcare, welding and manufacturing, skilled trades, information technology, business and customer service and education.

FastForward Payment Points:

Students are required to pay one-third of the total cost of the program upon enrollment. Students may use third-party funds, such as noncredit financial aid, training vouchers or employer payment to cover this cost.
If the student completes the training, the state provides one-third of the cost of the program, up to $1,500, to the institution. If the student does not complete the program, then the student is required to pay this portion of the total cost.
If the student satisfactorily completes the workforce credential (after completing the training), the institution receives the remaining one-third of the cost of the program up to $1,500. The combined maximum award to an institution is $3,000 for completion of training and a credential.

Key Partnerships:

Leadership in Virginia noted that the launch and initial implementation of FastForward primarily involved the following partners:

VCCS, comprised of state, system-level leadership and staff and individual colleges — the system-level staff who develop statewide policy and infrastructure (e.g., statewide website that directs interested potential students to their local college) to ensure key consistencies in implementation, and the 23 community colleges in Virginia that operate the program at the local level.
State Council for Higher Education in Virginia (SCHEV), responsible for administering the program, conducting periodic program assessments, collecting student data, and making final decisions on disputes between eligible institutions and grant recipients. SCHEV also handles the financial management of the program including reimbursing colleges for successful student outcomes.
The Virginia Board of Workforce Development, which provides on a bi-annual basis a list of highdemand occupations for potential inclusion as certification programs in FastForward.

As the program has matured and demonstrated success, additional partners have come to the table including:

Workforce partner programs such as WIOA, SNAP and TANF that are interested in FastForward as a training option for their participants. Local community colleges are working in pockets of the state with local program providers to define processes for collaboration and co-enrollment.
Industry associations that quickly saw the benefit of a new pool of talent skilled up with industry-recognized competencies and credentials. These groups work with local colleges to inform program design and curriculum development and have even helped pay for training costs when the FastForward program funds ran low.

Funding:

Annual appropriations have increased significantly each year with the evidence of positive outcomes driving increased interest by businesses and students:

2016 ___ $5 million
2017 ___$7.5 million
2018 ___$9 million
2019 ___$13.5 million

Summary of Project Impact

67% have paid vacation
68% have employer-paid medical insurance
86% are satisfied with their job duties
83% report being satisfied with their work schedule
75% are satisfied with their pay
85% are happy with their job stability.

The FastForward team is also working on using wage data to calculate an increase in tax revenue and overall return on investment for the program.

Additional Impacts

FastForward is now in the DNA of what the colleges do — it is no longer an “add on” program. The success of the program has led to a much greater focus, on both the non-credit and credit side of the college, on the critical importance of embedding credentials into degree programs to drive strong employment outcomes.
FastForward has also been used as a tool to respond to the economic shifts in labor demand due to COVID-19. Several colleges quickly established or ramped up enrollment in programs such as personal health testing and phlebotomy to meet the rising need for healthcare workers with specific skills.

Adapt this approach:

Cost and Time Commitments:

Do:

Do be intentional around identifying partners and their roles. FastForward leaders noted that a city should ensure that the roles of the local education provider, WIOA partner, city workforce office and local economic development are ironed out before launching to ensure an efficient and collaborative implementation.

Do align with industry associations. These relationships support conversations that help align credentials with desired skills and lead to helpful business practices, such as mentioning specific desired credentials in job postings. Partnerships with industry can also lead to financial investments from businesses if city funding runs low.

Do identify and leverage all potential partner resources. All partners have needs, but they also have resources, some of which may not be readily apparent. For example, in Virginia, local community colleges have access to a higher education equipment trust fund that can help pay for equipment costs associated with hands-on instruction.

Do connect the college’s academic credit side with the non-credit side to maximize options for the students to advance along a pathway without duplicating effort.

Don’t:

Don’t involve your industry partners in the “bureaucratic side” of running the program. Shield business from any public partner issues that include administration, red tape or discussions regarding “turf.” They should see one unified system of partners working together for common goals.

Don’t focus on weeks and hours when defining programs. What matters are the competencies and skills obtained, and ensuring alignment with employer demand. The length and structure of the program can be flexible to meet the needs of the students and business.

Resources:

Learn more about Workforce Tactical Guide

Download the PDF

COVID-19 Economic Response and Recovery

Develop Targeted Micro Loans and Grants

Download the PDF

Action:

Work with partners to launch a small (i.e. $1k-$15k) financing product for individuals looking to start or expand their businesses.

Why:

These small grants and loans can be critical to enabling businesses — particularly MWBEs — to start or expand operations and can be done successfully with minimal City investment.

Case Study #1

LISC + Kiva Matching Fund – Indianapolis, IN

In April 2020 LISC Indianapolis established a $75,000 matching microloan program for MWBEs raising money through Kiva, the online crowdfunded microloan platform, which offers zero-percent interest loans up to $15,000, with no fees.

LISC partnered with local community development organizations (CDCs), incubators, and technical assistance providers to act as Kiva trustees. Trustees provide one-to-one support during the application and crowdfunding process, as well as business planning, financial coaching, marketing, and other services to help grow and stabilize the business.

When the trustee endorses the business’s loan, LISC matches dollar-for-dollar the incremental contributions made through the Kiva platform. The full campaign goal must be reached for the business to access the loan funds.

This program allows small businesses to meet their fundraising goal faster while also receiving additional marketing support for their Kiva campaigns and businesses through LISC social media and newsletters.

LISC prioritized MWBEs located in specific geographic areas — primarily LMI neighborhoods.

While this program is still new, LISC and Kiva have collaborated to help over 300 businesses access approximately $1.7 million in zero-interest microloans nationwide since 2015.

Case Study #2

MicroGrants – Minneapolis, MN

MicroGrants was launched in Minneapolis by a private philanthropist over 15 years ago as part of an effort to help individuals achieve financial stability. The program awards grants of around $1,000 to jumpstart businesses, which cover expenses that would not typically be allowed. The program partners with local community organizations to develop business plans for entrepreneurs who receive funding and establish clear goals and metrics related to the funding.

In 2019, the Minnesota focused program awarded $1,200 grants to 250 entrepreneurs and small businesses that needed necessary supplies to start or conduct business.

How to Adapt This Approach:

Assess the capital needs of small businesses in the community with a particular focus on which groups of small businesses and neighborhoods face the greatest challenges.
Identify local nonprofits, CDFIs, and philanthropic organizations, which could fund and administer the program. The City can help facilitate the creation and initial projects while serving as an integral partner throughout. In particular, it can:
– Identify a small pot of money as a pilot program
– Leverage existing platforms like Kiva
– Partner with a nonprofit that already has expertise
– Determine eligibility requirements and ensure the microgrant program is explicitly focused on supporting minority, women, and other LMI businesses owners
Secure funding from a philanthropic or corporate partner. Cities should also consider high net worth individuals and successful entrepreneurs within their communities, who may be willing to sponsor this effort
Partner with relevant small business support groups on a marketing and outreach campaign to MWBEs and LMI communities (e.g., through local/ethnic chambers of commerce, merchant associations, marketing campaign language appropriate channels, using community ambassadors, etc.)
Track progress of microloan recipients and provide technical assistance and support to those individuals

Learn more about the Tactical Guide

Download the PDF

COVID-19 Economic Response and Recovery

Empower Businesses with Financial Coaching

Download the PDF

Action:

Invest in financial coaching programs designed specifically for small businesses with a particular focus on serving minority, female and LMI entrepreneurs.

Why:

Businesses need financial coaching to secure grants and affordable loans and to keep their businesses and their personal lives financially healthy. By adding financial coaching to other business support services, Cities are improving outcomes.

Case Study #1

LISC + Ally Financial Coaching Program – Detroit, MI and Jacksonville, FL

In October of 2019, LISC and Ally Financial launched a $3 million program to provide financial coaching services to micro-entrepreneurs and aspiring homeowners. The micro-entrepreneurship program supports 500 minority and LMI microenterprises in Detroit, MI and Jacksonville, FL.

The program expands on LISC’s Financial Opportunity Center network, which includes more than 100 centers in cities across the US. These centers are operated by community-based organizations and help individuals find jobs, build credit, and improve overall financial health.

This program provides funding to hire financial coaches specializing in coaching microenterprises and entrepreneurs through the LISC Financial Opportunity Centers or micro-enterprise development community organizations.

The coaches integrate financial education into existing small business programming (e.g., business planning, accessing capital, marketing, etc.).

They offer one-on-one assistance for entrepreneurs as they navigate their personal and business finances, which are linked for many new entrepreneurs.

The coaching offered in each center is tailored to the needs of each community. In Detroit the program focuses on very early stage entrepreneurs and businesses. In Jacksonville, the coaching serves microenterprises that have been operating for some time with a few employees, but need assistance with their financial goals and planning to scale.

LISC estimates that it will support over 500 entrepreneurs across the two target cities, and anticipates that more than 50 percent will be women of color.

Case Study #2

Financial Empowerment Center – Nashville, TN

Founded in 2013, the Nashville FEC is a free one-on-one counseling program for all residents in Nashville. It is run by the United Way and funded by a $250,000 annual City grant.

Counselors help with a variety of personal finance issues, such as how to negotiate debt, navigating loan options, and general financial literacy.

Since 2013, the FEC has helped 7,700 clients reduce their debt by $14.2 million and increase their savings by $2.9 million. It has made a concerted effort to serve low-income residents and people of color, with 54% of FEC clients identifying as African American/ Black and 21% identifying as Latinx.

How to Adapt This Approach:

Work with partners (e.g., local/ethnic chambers, technical assistance providers, merchant groups) to assess the financial education needs of local businesses, particularly MWBEs. Conduct a survey, hold focus groups and interviews with entrepreneurs to identify gaps and existing resources
Build a coalition of partners (e.g., education institutions, technical assistance providers, CDFIs, local/ethnic chambers etc.) that are trusted and located in target neighborhoods and have experience offering business support services to local entrepreneurs. Utilize these individuals to help design curriculum for small business financial coaching
Work with the coalition to develop a proposal for expanding financial coaching. The proposal should include the goal, the need/opportunity, the coalition of partners, the program design, location, staffing, budget, metrics, timeline/next steps
Determine where the program will be housed, which will depend on the lead partners involved. Cities may want to house the program at the City or have a nonprofit take the lead and the City provide funding and support
Use the proposal to raise funds to launch the program. Pitch local banks, philanthropic partners, and corporations (especially those serving low-income and communities of color) on contributing financially, providing in-kind support or advising the program. Partners will also be necessary to help train counselors, promote the service, etc.
Hire staff. Number of FTEs depends on how many locations financial coaching for entrepreneurs will be offered, or if the whole program will operate out of one location. If partnering with multiple community organizations, there should be at least 1 FTE per location. If housing in one primary location, consider hiring 2-3 FTEs and scaling as needed. Ensure staffing is representative of the community being served
– Staff must be trained professionals with experience in financial coaching for small businesses and entrepreneurs. Make sure to have clear training standards for counselors
– Offer 1-1 appointments and have call/email options. A group class is much less effective, as people are hesitant to discuss personal financial circumstances in this format
Launch program with active outreach and media campaigns. Leverage partners in the community to reach business owners (e.g., merchant associations, local/ethnic chambers, community groups, etc.). Ensure that banks and financial institutions provide information about the service
Track and publish KPIs on a regular basis. Include aggregated demographic and neighborhood data on entrepreneurs being served, services provided, outcomes, etc. (See KPIs section)

Learn more about the Tactical Guide

Download the PDF

COVID-19 Economic Response and Recovery

Cross-Sector coordination: creating a task force, committee or network to support new Americans

Download the PDF

Short-term planning: ensuring an inclusive recovery

For cities that have not already convened a multi-sector set of partners to identify and address the needs of immigrant and refugee communities as part of their overall COVID-19 response and recovery planning, the first step should be to bring the right set of partners to the table.

This effort should be:

Multi-sector: This group must include representation from local government, as well as organizations that serve immigrants and refugees, such as refugee resettlement organizations, local Offices of Immigrant Affairs, and other community-based organizations; and may also include chambers of commerce; universities; private corporations, community foundations, and financial institutions; and faith-based organizations.
Data-driven: Cities should make use of existing metro-level research on immigrants and refugees (e.g., New American Economy’s Map the Impact which provides metro-level economic and demographic data about immigration), as well as local surveys of immigrant and refugee business owners. Cities should collect data on country of origin and/or language requests as part of service delivery (e.g., through small business relief funds), taking care to not include questions about immigration status or keeping such information confidential, if it is necessary to collect.
Empowered to make and implement recommendations: Recommendations made by this group should be advanced as part of the city’s overall response, adaptation and recovery effort, including policy change and the development of new targeted programming.
Locally and/or privately funded: Due to federal funding restrictions, immigrants — especially undocumented immigrants — may be left out of COVID-19 relief funds and other forms of federal aid, assistance or benefits. Unrestricted local public dollars or private funding should be tapped to ensure that all small business owners, regardless of immigration status, are able to access the necessary support and resources.

Long-term planning: promoting inclusion through systems change

This same Task Force or Committee structure should also be tasked with developing a longer-term, multi-year inclusion plan — if such a plan is not already in place. Cities with strong immigrant inclusion plans typically follow a 6-month to 1-year timeline that includes the following core elements.

1. Partner with a university or research institution to gather data on immigrant and refugee entrepreneurship. Research studies have catalyzed efforts to support immigrant and refugee businesses by providing greater knowledge of the existing community, helping to identify the types of businesses and sectors in which immigrant entrepreneurs are concentrated, uncovering common challenges and concerns, and providing high-level talking points on the positive economic impact.

St. Louis, MO: A pair of studies conducted by a St. Louis University economist highlighted the economic impact of immigration on St. Louis and identified immigrant-driven strategies for promoting economic growth in the region, leading to the creation of the St. Louis Mosaic Project in 2012. Both studies were funded by the William T. Kemper Foundation.
Houston, TX: A report produced by New American Economy found that 13.4% of Houston’s immigrant population were self-employed, outpacing the national average for immigrants (11.9%) and the U.S.-born (8.8%). The study also found that immigrants in Houston were 53.2% more likely to be entrepreneurs than their U.S.-born counterparts, and that they generate more than $3 billion in business income annually.
New York, NY: A study conducted by the Association for Neighborhood and Housing Development, which included surveys and focus groups of immigrant business owners, found that 56% of immigrant business owners live in the neighborhood in which they operate their business, and that rent burden was the top concern across all neighborhoods surveyed.

2. Create a multi-sector steering committee or task force charged with developing recommendations to support foreign-born entrepreneurs. This group should include representatives from local government, chambers of commerce, universities, community-based organizations, financial institutions and other organizations. Entrepreneurship may be just one focus area among several — with the goal of facilitating immigrants’ economic, civic, and social integration.

Chicago, IL: The Chicago New Americans Plan, spearheaded by the Chicago Office of New Americans in partnership with a 50-person multi-sector advisory committee, resulted in 27 recommendations, including 5 to support immigrant entrepreneurship. These included creating a small business incubator, a “Chamber University” to train chamber of commerce leaders to better support immigrant entrepreneurs, and efforts to promote tourism in immigrant neighborhoods.
Salt Lake County, UT: The Salt Lake County Welcoming Plan — supported by New American Economy, Welcoming America, the Salt Lake Chamber and the Salt Lake County Mayor’s Office — resulted in three overarching goals and 11 strategies to support new Americans, including a recommendation to incorporate business centers serving immigrants and refugees into the mainstream Business Resource Center network.

3. Gather feedback directly from community members and entrepreneurs. Soliciting public comment, and creating opportunities for two-way dialogue between city leaders and the community, ensures that the recommended strategies are actually addressing the need. This also helps build public support and buy-in for the plan.

Akron, OH: As part of a year-long planning process to develop a Strategic Welcome Plan, the City of Akron and Summit County hosted a public Welcome Summit — attended by more than 250 community leaders and residents — to gather direct feedback. Access to capital, business training, and the creation of a business incubator were identified as community priorities.
Dayton, OH: The City of Dayton solicited public feedback on the Welcome Dayton Plan, which included the creation of an immigrant entrepreneur ambassador program to support a local immigrant commercial corridor.

4. Create a formal, long-term structure to advance the recommendations. To ensure implementation of recommended programs and policies, cities often establish long-term structures, such as a task force or Office of New Americans, staffed by local officials who work directly with community partners. This can include regular meetings, subcommittees focused on key issues such as entrepreneurship or economic development, and public-private partnerships to advance inclusion work.

Atlanta, GA: Welcoming Atlanta, an initiative started out of a multi-sector strategic planning process, is part of the Atlanta Mayor’s Office of Immigrant Affairs, and works to advance programs and policies that improve quality of life for newcomers — including multilingual COVID-19 resources.
Lincoln, NE: The Lincoln New Americans Task Force includes public and private organizations and community members who meet regularly to help promote policy change and programming that facilitates immigrant integration. The Task Force recently published its first-ever New Americans Task Force Immigrant and Refugee Survey Report, which included a focus on economic development and identified barriers to full participation.

Learn more about the Toolkit

Download the PDF