Today, the Low Income Investment Fund (LIIF) announces the launch of its Social Impact Calculator, a first-of-its-kind tool that allows us to monetize—or put a dollar amount on—the social impact of our investments in low-income communities. For LIIF, it’s a new way to assess how well we are achieving our mission of poverty alleviation.
The ability to measure results has become increasingly important for the field of community development. LIIF and other organizations in the sector must be able to effectively communicate the value of our work in order to unlock new sources of capital, form new partnerships—such as with health institutions and transit agencies—and channel public and private investment to the most impactful strategies.
We limited the calculator to indicators that are central to our mission of poverty alleviation, and which relate to our program areas of affordable housing, early care and education, K-12 education, health, and equitable transit-oriented development. But we also developed an online platform to “open source” the tool so that anyone can try it out, learn about its methodology, and offer feedback.
How does the social impact calculator work?
Estimating social return is an emerging area with several potential approaches. The Social Impact Calculator uses an “impact-by-proxy” approach, leveraging social science research to translate easily collected project-level output data into monetized impact estimates. For example:
- Investments in affordable housing create discretionary income for families by alleviating housing cost burdens. Research shows that low-income families will spend this additional income to purchase critical necessities such as food and health care.
For the rest of this article by Nancy O. Andrews and Dan Rinzler, go to: http://www.whatworksforamerica...impact/#.VA-dhkhUxiB
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