Title 42
State Affairs and Government

Chapter 160
Rhode Island Pay for Success Act

§ 42-160-4. Definitions.

For the purpose of this chapter:

(1) “Coordinated entry system (CES)” means the partnership of all homeless service providers in the state through this initiative of the Rhode Island continuum of care. CES manages all diversion/entry to the shelter system through the coordinated entry hotline and manages the permanent housing placement part of the program, once persons are in a shelter or are living on the street.

(2) “Executive office” means the Rhode Island executive office of health and human services.

(3) “Homeless management information system (HMIS)” means the database used to collect information in order to track and report on the scope of homelessness prevention/assistance and human service needs across the Rhode Island continuum of care (COC) as well as individually at each organization. The Rhode Island Coalition to End Homelessness is the current HMIS state lead.

(4) “Homelessness” means the category 1 and category 4 definitions outlined by HUD:

(i) Category 1 — Literally homeless: the situation of an individual or family lacking a fixed, regular, and adequate nighttime residence, meaning:

(A) Has a primary nighttime residence that is a public or private place not meant for human habitation;

(B) Is living in a publicly or privately operated shelter designated to provide temporary living arrangements (including congregate shelters, transitional housing, and hotels and motels paid for by charitable organizations or by federal, state and local government programs); or

(C) Is exiting an institution where he or she has resided for ninety (90) days or less and who resided in an emergency shelter or place not meant for human habitation immediately before entering that institution.

(ii) Category 4 — Fleeing/attempting to flee domestic violence: Any individual or family who:

(A) Is fleeing, or is attempting to flee, domestic violence;

(B) Has no other residence; and

(C) Lacks the resources or support networks to obtain other permanent housing.

(5) “Independent evaluator” means an independent entity selected by the state whose role includes assessing and reporting on the achievement of performance targets at the frequency required in the pay for success contract.

(6) “Nonprofit organization” means a nonprofit organization that is exempt from federal taxation pursuant to section 501(c)(3) of the federal Internal Revenue Code, 26 U.S.C. § 501(c)(3).

(7) “Outcome payor” means the the Rhode Island state government.

(8) “Pay for success contracts” are contracts designed to improve outcomes and lower costs for contracted government services that are subject to the following requirements:

(i) A determination that the contract will result in significant performance improvements and budgetary savings across all impacted agencies if the performance targets are achieved;

(ii) A requirement that a substantial portion of any payment be conditioned on the achievement of specific outcomes based on defined performance targets;

(iii) An objective process by which an independent evaluator will determine whether the performance targets have been achieved;

(iv) A calculation of the amount and timing of payments that would be earned by the service provider during each year of the agreement if performance targets are achieved as determined by the independent evaluator; and

(v) Payments shall only be made if performance targets are achieved. Additionally, the success payment made pursuant to this chapter shall not exceed ten percent (10%) more than actual costs incurred by the program intermediary.

(9) “Performance targets” means the level of performance, as measured by an independent evaluator, that represents success. Success is defined in the pay-for-success contract.

(10) “Permanent supportive housing (PSH)” means a permanent deeply subsidized unit, tenant or project based subsidy, with supportive services, generally for persons experiencing homelessness for long periods of time who also have other significant challenges such as disability or mental illness.

(11) “Program intermediary” means a firm that contracts with a state agency to establish and deliver a service or program intervention by doing any of the following:

(i) Delivering or contracting for relevant services or outcomes;

(ii) Raising capital to finance the delivery of services or outcomes;

(iii) Providing ongoing project management and investor relations for the social impact funding instrument.

(12) “Social impact bond,” “pay-for-success bond” or “bond” means a contract between the public and private sectors in which a commitment is made to pay for improved financial and social outcomes that result in public sector savings. These contract agreements are funded by appropriation.

(13) “Success payments” refer to the payments that the state will make only if contractual performance targets are achieved as determined by the independent evaluator and approved by the office of management and budget.

(14) “Target population” means highly vulnerable persons who experience long-term homelessness and incur significant costs within the criminal justice, shelter, and/or healthcare systems, likely related to their housing instability, with an estimated average per person cost of Medicaid claims for adults in shelter, top twenty-five (25) clients, totaling two hundred twenty-nine thousand, six hundred ninety-five dollars and forty-four cents ($229,695.44), as per the Rhode Island Medicaid and HMIS data match for adults in shelter. Eligibility will be confirmed by data matching, case conferencing, and coordination with healthcare providers and the coordinated entry system (CES); data sources will be provided by the department of corrections, executive office of health and human services, and the Rhode Island homeless management information system.