Panel Paper: Can Asset-Building Strategies Help Housing Choice Voucher Households Improve Their Earnings and Credit Scores?

Thursday, November 2, 2017
Horner (Hyatt Regency Chicago)

*Names in bold indicate Presenter

Jeffrey Lubell, Judy Geyer, Lesley Freiman and Micah Villarreal, Abt Associates, Inc.

The non-profit Compass Working Capital (Compass) has teamed up with the Lynn and Cambridge Housing Authorities in Massachusetts to run Family Self-Sufficiency (FSS) Programs that employ a number of unique features. This paper describes these innovative FSS programs and presents results from an evaluation using quasi-experimental methods (for the analysis of earnings and public benefits receipt) and a benchmarking approach (for the analysis of credit and debt) to provide evidence regarding the effects of the programs on the earnings, public benefits receipt, credit scores, and debt levels of program participants.

FSS is a HUD program designed to help HUD-assisted tenants increase their earnings and build assets and financial capability. While the overwhelming majority of FSS programs are run by housing authorities, the FSS programs in Lynn and Cambridge are run primarily by a non-profit organization, Compass. Compass’ background is in asset-building programs, and it brings this expertise to its FSS programs. This can be seen in Compass’ focus on providing financial coaching to help residents increase their credit scores, pay down debt, build savings, learn and apply budgeting, and utilize mainstream financial services – emphases built into Compass’ core model for FSS along with the traditional focus of helping residents to increase their earnings. Other innovative features of these FSS programs include: (a) a marketing approach that builds on residents’ motivation to succeed and helps enroll a larger share of HUD-assisted tenants in FSS than in many other programs; (b) a successful track record of raising funding from philanthropy to grow the program; and (c) a modified FSS escrow account in one of the sites, Cambridge, that is less generous than the standard FSS escrow.

Our evaluation focuses on a sample of 269 FSS participants in the Lynn or Cambridge Housing Choice Voucher (HCV) programs for whom we have at least one year of follow-up data. We compare earnings growth and public benefits receipt for the FSS participants to that of a comparison sample of HCV holders in other PHAs in Massachusetts, Rhode Island or Connecticut, selected through propensity score matching. We also compare changes in credit scores and debt over time for Compass participants to changes in a comparison group provided by a major credit bureau. This presentation will report on encouraging findings from this evaluation. It will describe the earnings and financial well-being-related changes experienced by the Compass FSS participants compared with those of the comparison groups.

Full Paper: