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Forging A Bond

Talk about an intense matching grant. According to the Chronicle of Philanthropy, Massachusetts (my place of residence from age 0 to 18) has begun consideration of “a financing approach for social-service projects that would require charities and philanthropists to obtain private financing and show results before getting state money.” In other words, public support would be contingent on a match from private donors and a “match” (in the form of results) from the non-profit itself.

Reuters reports that “President Barack Obama’s 2012 budget plan includes $100 million for these ‘social impact bonds,’ which more closely resemble private loans than debt.” For example? In the UK, the Rockefeller Foundation invested half a million dollars in an 8 million dollar project to reduce recidivism; were the project to succeed the Foundation “could reap the equivalent of up to a 13 percent annual interest rate payment.”

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