A state-based pilot program launched last month aims to provide 125 permanent supportive housing slots for especially vulnerable unhoused individuals by Sep. 30, 2025 using private investor funding.
The pay-for-success program — which reduces the government’s investment risk by only paying private investors if they achieve specific targets — will serve those who are high utilizers of Medicaid, have a high level of involvement with the Department of Corrections, or are high utilizers of homelessness services based on Homeless Management & Information System data.
According to Allison Arden, the program’s director at the state Executive Office of Health and Human Services, this is the first time the state has used a pay-for-success funding model that could be applied to other social services.
The program, led by the EOHHS and The Rhode Island Coalition to End Homelessness, partners with nonprofit organizations, including Crossroads Rhode Island, East Bay Community Action Program, House of Hope and OpenDoors RI, to deliver support services.
According to the program description, those partners will help beneficiaries navigate the housing search process, providing resources like vouchers and subsidies, so they can obtain stable housing. Juan Espinoza, communications and development manager for RICEH, explained that supportive housing includes additional services, like helping recipients access mental health support, health care and career opportunities.
The program, Espinoza said, seeks to help at-risk individuals “move back up the ladder” through housing and auxiliary services, like weekly in-person check-ins from service providers.
Arden shared that some of the successful outcomes for the program will include fewer instances of unnecessary emergency department use, lower re-incarceration rates and increased retention of stable housing for individuals.
In 2022, the General Assembly allotted $6 million for the pilot program, The Herald previously reported.
The pay-for-success program will be partly funded by Maycomb Capital, a venture capital firm that funds “workforce development, early childhood, homelessness, healthcare, social services and financial services,” according to its website.
Espinoza said he believes that the program is “a way where everyone wins.”
“The private sector makes a little bit, but also communities across the country win because the social service investments, safety net investments, are keeping people housed, educated (and) working,” he said.
The program is estimated to save between $15,000 and $20,000 per individual on an annual basis, according to EOHHS.
Program recipients will be selected from a list of roughly 300 eligible individuals created by RICEH.
“We’re casting as wide a net as we can,” Espinoza said. He explained that, because eligible individuals can be difficult to reach, a large list is useful for providers.
Espinoza added that “the larger number highlights the need” for the program.
A major factor affecting individuals' ability to access housing is the lack of affordable housing in the state, Espinoza said. In an email to The Herald, Arden wrote that EOHHS “anticipate(s) challenges in placing enrolled participants into housing as the program relies on existing housing inventory.”
“The absence of dedicated housing vouchers for this program, poses potential difficulties in connecting participants with available housing subsidies,” Arden added.
As of October 2023, only five Rhode Island communities possess at least 10% of affordable housing.
Espinoza stressed the necessity of affordable housing to tangibly address the housing crisis. “I think one of the major worries that we have at the coalition … is that we don’t have enough affordable units currently to move people that are in shelter, out of shelter.”
“When people are leaving shelters in our system in Rhode Island …in (the) most likely cases they’re going back out on the street,” he added.
In the fall, Crossroads Rhode Island began construction on a housing development that will provide 176 apartments to formerly unhoused adults. The town of Middletown has been working to convert two former schools into affordable housing. In addition, Governor McKee’s 2025 fiscal budget proposes a $100 million bond to support the production of affordable and middle-income housing and infrastructure.
Still, Espinoza noted that there is a significant delay between planning and beginning construction on affordable housing projects and getting individuals into housing. “Between breaking ground and actually having folks live in units, it takes about two years,” he said.
Espinoza recognized the high costs of projects targeting housing, but emphasized their importance nonetheless.
“When you’re in a housing crisis, such as we are in, and such as our country is in, you need to fund that to get out of it.”
Mikayla Kennedy is a Metro editor covering Housing and Transportation. She is a sophomore from New York City studying Political Science and Public Policy Economics.