Social Impact Bond Project at Rikers Island
The Social Impact Bond (SIB) project at Rikers Island was the first of its kind in the United States, aiming to reduce recidivism among adolescents aged 16 to 18 detained at Rikers Island. The initiative was part of the Young Mens Initiative launched by former Mayor Michael Bloomberg and involved a cognitive behavioral therapy program called the Adolescent Behavioral Learning Experience (ABLE). The program focused on personal responsibility education, training, and counseling, employing Moral Reconation Therapy (MRT) due to its flexible curriculum suitable for the Rikers environment.
The financing model for this initiative was a Social Impact Bond, where private investors, in this case, Goldman Sachs, provided $9.6 million in funding, with Bloomberg Philanthropies guaranteeing $7.2 million. The government agreed to repay the investment only if the program achieved a predefined success metric—a 10% reduction in recidivism. The Vera Institute of Justice conducted an independent evaluation to determine the programs effectiveness. Unfortunately, the program did not meet its goals as it failed to achieve a statistically significant reduction in recidivism rates.
Pros
Allowed for innovative financing that transferred financial risk from taxpayers to private investors
Demonstrated the feasibility of large-scale interventions within correctional facilities and provided extensive data for evaluating such projects
Cons
Did not achieve its intended outcomes
Partners
Goldman Sachs
Bloomberg Philanthropies
MDRC
The Osborne Association
Friends of Island Academy
Vera Institute of Justice