COMMUNITY DEVELOPMENT FINANCIAL INSTITUTIONS FUND Measuring Outcomes PRESENTED BY Jeff Merkowitz Amber Kuchar-Bell Greg Bischak PRESENTED ON October 26, 2016 Presentation Overview: CDFI Fund Strategic Goals related to data. Where is the CDFI Fund now with its data collection and outcome reporting systems? What s new with the CDFI Fund s reporting systems and how will that change outcome reporting? Where do we want to go what new tools is the CDFI Fund developing to improve decision-making and awardee performance? Industry feedback and discussion of CDFI Fund objectives on performance measurement. 2 1
CDFI Fund Strategic Plan Goals Goal 1: Increase the impact of the CDFI Fund network by supporting the growth, reach, and performance of CDFI Fund awardees. Goal 2: Build the capacity of the CDFI Fund and its network to capture, produce, and utilize data to improve decision-making, performance, and accountability. Goal 4: Promote awareness of CDFIs in order to expand their access to new resources. 4 Outcome Reporting to Better Measure Accountability and Impact Outcomes documented with transactional reporting will become increasingly important in the CDFI/NACA application, awardmaking and compliance processes. Accountability to applicant s target markets, proposed lines of business, and increased activities will rely increasingly on transactional reporting and the Annual Certification Report. Planned Improvements in Measurement, Data Quality and Impacts: CDFI investments in large projects with multiple funding sources. Job estimates that reflect type of loan and relative contribution of CDFI to financing specific business activities. Social impact attributable to investments in educational, health, and other community facilities. Triple-Bottom Line Reporting. 5 2
Annual Certification Report (ACR) ACR data has been collected from 705 certified CDFIs in 2016. Data will be used to: Monitor compliance with CDFI certification requirements. Calibrate 12 Minimum and Prudent Standards (MAPS) metrics. Compile aggregate financial evaluation criteria for Certified CDFIs and FA program applicants. Develop CDFI Industry Assessment tool to facilitate the analysis of CDFI industry performance and trends and to increase datadriven decision making by the CDFI Fund. 6 CDFI Assessment and Risk Management (ARM) Overview ARM Objectives Understand and gather information on CDFI financial, programmatic, industry and program compliance performance. Project is developing assessment tools that will: Facilitate CDFI Certification processes and monitoring. Evaluate applicants to the CDFI and NACA Program. Monitor compliance among CDFI Fund award recipients. Provide industry-wide data analysis and reporting. These tools will help the CDFI Fund: Increase data-driven decision making. Establish industry and internal standardization. Increase transparency. 10/7/2016 7 3
CDFI Assessment and Risk Management Framework Overview Framework tool interdependency Leverage data collected by each CDFI Fund business unit to inform the Certification, CDFI and NACA Program, and compliance decision making processes Certification Process Industry Monitoring Process Applicant Review Process Compliance Monitoring Process Direct Loan Component 10/7/2016 8 CDFI and NACA Program 2017 and 2018 Goals Use new 2016 and 2017 ACR and application data to calibrate MAPS benchmarks and metrics. Develop Application Assessment Tool to conduct Financial and Compliance Assessment. Evaluate applicants against minimum financial and compliance performance standards. Determine applicants to advance to qualitative review phases. 10/7/2016 9 4
CDFI/NACA Program Draft FY17-19 Application Increasing the impact of CDFIs by supporting their growth, reach, and performance. Using the CDFI/NACA Program application to align awards more closely to performance. CDFIs will be expected to accomplish at least one of four statutory Financial Assistance Objectives: Expand Operations into a new investment area or areas; Serve a new targeted population or populations; Provide additional or new products or services; and/or Increase the volume of current products and services. 10 CDFI/NACA Program Draft FY17-19 Application Awards will be data driven and determined based on the extent: Of need/economic distress within the investment areas or targeted populations of the applicant; To which the proposed activities will expand economic opportunities; and To which a CDFI will increase its impact though coordination with other institutions. 11 5
Reaction Feedback on CDFI Fund plans for linking awards to performance and impact. FA Objectives Data-driven award criteria What are the key areas where improvement is needed for measuring outcomes and social impacts? 12 6