**Pumping Up Your IDA**

**Performance with Public Housing Partners**

Is it possible to find an IDA partner who can provide a large pool of
AFI-eligible applicants, conduct financial education and asset training,
and insure ongoing supportive services and case management for clients?
A partner who can also multiply AFI accountholder capital many times
over? *And* do this with little or no direct cost to AFI?

The answer is yes, but, like most things worth having, it does take some
work. One promising partner may be your local public housing authority.
Some are already implementing AFI Projects themselves in Alabama,
Kentucky, New York, Ohio, Pennsylvania, and Tennessee. Many more are
working with community-based grantees to help housing agency-run Family
Self-Sufficiency (FSS) programs and IDA programs blend together. Both
FSS and IDA programs focus on achieving self-sufficiency by accumulating
assets.[^1] In this situation, participants get the benefit of both
opportunities. Together, the two approaches may increase the pace and
percentage of successful graduates who are truly on the road to
long-term asset building.

Outlined below are basic FSS parameters, followed by a brief
illustration of one FSS-IDA partnership among members of the Valley
Individual Development Account (VIDA), as managed by CASA of Oregon
(Community Shelter and Assistance Corporation), a multi-year AFI
Project.

**What Family Self-Sufficiency Programs Do**

Many housing authorities operate housing voucher choice programs, which
allow residents to choose private sector housing that accepts Section 8
vouchers as full or partial rent. The "choice" programs are required to
offer FSS services to their participants with the goal of helping the
individual think ahead and work toward self-sufficiency. Under an FSS
plan, the participant enters into an agreement with the housing agency
to implement a long-term (up to five years) Individual Training and
Services Plan (ITSP). The plan is based on an analysis of the
participant's barriers to economic self-sufficiency, such as low
education, high debt, lack of transportation, weak employment history,
and the like. The participant and housing agency staff agree on steps
the participant will take to increase household earnings over the long
run. Options may include securing a GED if necessary or other training,
paying off debts, getting or keeping a job, or advancing in a career
path.

Under FSS, the housing agency provides direct support through ongoing
case management and requires, or at least offers, financial education,
homeownership counseling and training, and sometimes small business
training or other services. If unable to provide these directly, the
housing agency refers FSS participants to partners who can fill the gap.

As the participant progresses in education and employment, earnings are
likely to go up. As earnings rise, so does rent (30% of household
income), but the housing agency establishes an escrow account for the
participant and deposits a percentage of the rent increase monthly. Upon
successful completion of the ITSP, the participant is "refunded" the
balance in the escrow account to be used for any purpose. Further,
interim draw downs on the accumulated balance may be used (if approved
and in the ITSP) for education, job training, business start up, auto
purchase for transportation to work, or home purchase. All agreements
require the individual to maintain consistent employment and to become
independent of welfare cash assistance for at least a year in order to
receive FSS funds.

**How IDA and Family Self-Sufficiency Programs Can Work Together**

While this FSS summary leaves out many details, it is easy to see
parallels and potential areas of synergy between IDAs and FSS. An AFI
grantee's work with public housing residents participating in an FSS can
take many forms, from simply receiving referrals of likely candidates to
the IDA program to more integrated efforts. Integration might entail the
IDA provider and housing agency each taking on a service component
required for IDAs, such as financial education or asset training, as
well as maintaining close coordination and communication about the
status of participants in the IDA. The closer the partners work
together, the better the results and the more efficient the use of the
limited resources of both.

**Valley Individual Accounts (VIDA)**

Valley Individual Accounts (VIDA), run by Community and Shelter
Assistance \[http://www.casaoforegon.org/who.html\], an AFI Project in
Oregon, is one example of an effort to embrace coordination with public
housing FSS plans. This coordination began in 1998, when a number of
organizations in the Willamette Valley of Oregon---community development
corporations, community action agencies, affordable housing
organizations and others---sought to merge resources and offer IDAs to
residents. The group evolved into VIDA, which, in 2005, has 19 members,
eight of them housing authorities, along with eight cooperating
financial institutions. While members continue their individual missions
and programs, all participate in the IDA initiative, with CASA as the
administrator and fiscal agent. Following are a few features of how VIDA
works.

*[Linn-Benton Public Housing Connections]{.underline}*

VIDA's housing authority members offer FSS programs of varying size and
approach. Typical is the IDA-FSS partnership with the Linn-Benton Public
Housing Authority in Albany, Oregon. There, an FSS participant may
become an IDA participant early on. Many FSS programs refer clients for
enrollment into the IDA option only after they achieve some of their
ITSP benchmarks.

-   **Case Management Services.** In the FSS program, one of the two
    Linn-Benton FSS coordinators has primary responsibility for case
    management and contacts participants at least monthly, if not more
    often. Linda Woods, interim IDA manager for CASA, says that, like
    other early IDA implementers, "We learned that successful graduates
    are the ones with case management throughout." Yet case management
    is difficult to fund given the administrative spending cap under
    AFI. It is not easy for housing agencies either, but the Department
    of Housing and Urban Development does provide limited coordinator or
    case manager support for FSS programs with 50 or more participants.

> In fact, this is one of the criteria that housing agencies wishing to
> join VIDA must meet: having the staff and expertise to provide strong
> case management. Other criteria include successful histories with
> previous resident self-sufficiency services and with other
> partnerships in the community. These application criteria have not
> dampened housing agency interest. In January 2005, Woods said there
> were three additional applications under review, which would bring the
> number of VIDA's housing agencies to eight.
>
> Gina Reynolds, one of two FSS coordinators at Linn-Benton, says, "We
> do all the case management together, for FSS and IDA." The FSS
> coordinators/case managers also collect and forward all the necessary
> documentation when a participant is referred for IDA enrollment or to
> demonstrate achievement of IDA requirements and benchmarks.
> Linn-Benton also provides financial education, taught by Wendy
> Younger, the other FSS coordinator, or through other VIDA members,
> such as Corvallis Neighborhood Housing Services. For education
> advising, they work closely with Linn-Benton Community College.
> Reynolds says, "Often the client has just gotten the GED" and is ready
> to move forward to higher education.

-   **Training Staff.** Exploiting any relationship between housing
    agencies and IDA programs, however, does require training. FSS and
    AFI are generous but complex to administer. To maximize positive
    results for participants and minimize frustration and confusion for
    staff, training must be frequent and regularly updated. Woods says
    that VIDA offers training twice a year for all members and has
    detailed operating manuals and materials for members and
    participants.

-   **Sequencing: Leading Up to an IDA***.* The Linn-Benton model
    illustrates "sequencing," where various services to move toward
    self-sufficiency under an FSS could result in opening an IDA. To
    illustrate: an individual could earn a GED, secure a job or a better
    job as a result, and then enroll for an IDA and begin saving some of
    the increased earnings. Concurrently, the participant would also be
    benefiting from a growing escrow account set up under FSS. Added to
    the client's skill base is the substantial financial education
    component of their ITSP.

> At Linn-Benton, financial education typically includes not only
> classes but also "homework" and ongoing communication with case
> managers/coordinators about progress in managing household finances.
> Reynolds says Linn-Benton plans to put more support into education
> through monthly advising and "sequencing of education and home
> ownership." Further, because the ITSP plan may be active up to five
> years, and VIDA's usual term of IDA participation is three years, it
> makes sense to have participants progress under FSS before being
> referred for IDA enrollment.
>
> Reynolds says that acceptance into FSS itself requires applicants to
> establish a savings account on their own and make at least three
> deposits to show their commitment to the concept. While these savings
> cannot be carried over to the IDA account, they demonstrate the
> participant's ability to save.

-   **Eligibility**. The typical FSS participant, once steadily
    employed, is very likely to be AFI eligible on the basis of income
    and assets, although there are differences in how the income
    threshold is defined under AFI and FSS. Rather than defining income
    using a fixed dollar amount, HUD uses a percentage of local median
    income. Further, having the FSS savings does not affect eligibility
    determination for TANF, so participants may remain TANF eligible
    while building their FSS escrow, and thus remain eligible for AFI.
    At Linn-Benton, Reynolds says that most participants are "single
    mothers on Section 8. Their kids are older so that they can go back
    to school and get jobs." Thus, FSS often tracks AFI's priority for
    households with children as well.

-   **Benefit of Extra Assets**. Coordinating FSS and IDAs may also mean
    that participants can secure multiple assets, or secure them more
    rapidly. For example, the first leg could be entry-level vocational
    preparation under FSS and more advanced postsecondary training with
    the IDA, or homeownership under FSS and business development with
    the IDA. FSS participants may accumulate quite large sums, as the
    amounts grow throughout the life of the ITSP. FSS program surveys
    have shown five-figure amounts in escrow, with an average payout of
    over \$7,000.[^2] Adding several thousand dollars to the capped AFI
    matches considerably increases participant options, especially in
    the areas of home ownership and business. It could also considerably
    decrease the amount of a mortgage or business loan taken on by a
    participant in conjunction with the asset purchase. The FSS funds
    may be used for any purpose, including retirement and investment,
    flexibility that AFI cannot offer.

*[Results to Date]{.underline}*

Coordination with housing authorities is challenging but definitely
rewarding, Woods and Reynolds agree. Since activating their IDA linkage
in 2002, Linn-Benton has enrolled 33 participants and graduated six by
early 2005. Reynolds says they are still refining the process and have
waiting lists for both programs. She doesn't anticipate increasing the
dual enrollment above 40 at any one time, to allow for the sequencing
and case management limitations. Since its first AFI award in 2001,
VIDA, collectively, has graduated 89 participants, who have used their
IDAs to purchase homes, start or expand small businesses, or access
education and training. VIDA currently has 216 active savers. Another
183 are actively saving.

**Other Housing Authority Linkages**

There are other ways for IDA programs to benefit from existing housing
authority resources:

-   Housing authorities often have staff assigned to preparing residents
    for homeownership. They may provide homebuyers' clubs as well as
    homeownership training that allows participants to meet requirements
    for soft second mortgages and other gap financing options from
    public funds, local, state, or Federal. They may assist residents in
    locating homes and are eager to refer eligible residents to IDA
    programs.

-   Some housing authorities also offer small business training to
    residents, and a few have their own microloan funds.

-   Housing authorities that have HOPE VI projects, which aim to
    completely rework developments and create mixed-income communities,
    also offer homeownership training and home buyers' clubs, financial
    education, and other services designed to prepare residents to buy
    in the revamped developments, or elsewhere in the market.

-   Resident organizations, such as tenant councils and resident
    management corporations, may have Resident Opportunity and
    Self-Sufficiency (ROSS) funds to support services like those above,
    as well as vocational training that may lead to higher household
    incomes. All, of course, could make eligible referrals to IDA
    programs.

**Caveats**

Working with housing authorities may not be easy. The FSS regulations,
as well as other Housing Assistance Programs (HAP), are complex. Not all
residents are eligible for HAP or for AFI, and the number of FSS slots
per housing authority is limited. Further, housing authorities have
uneven track records in the level of participation, progress, and
completion in their FSS programs. Historically, not all FSS programs
have required or provided financial education, directly or through a
third party. Yet, financial education is a key component of any asset-

building initiative. As noted above, limited staff and the need for
expertise may lead the housing authority to rely on external partners
for substantial services, diluting or canceling benefits to a potential
IDA partner. While HUD has offered funding for FSS coordinators on a
competitive basis, case management in general is not fully or
sufficiently funded across the board. In particular, FSS is an unlikely
option for small or rural agencies, because HUD requires a large number
of units for participation. However, exploring such relationships with
the local housing agency may be well worth the time of an IDA program
director.

**Additional Resources**

-   For a housing authority perspective, contact the Linn-Benton Housing
    Authority in Albany, Oregon: FSS coordinators Gina Reynolds, (541)
    926-4497, ext. 213; or Wendy Younger, ext., 217;
    [www.l-bha.org](http://www.l-bha.org/)

-   For a summary comparison of FSS and IDA programs, contact Jeff
    Lubbell at
    [www.fsspartnerships.org](http://www.fsspartnerships.org/), or (202)
    270-5251. The Web site includes or links to a wealth of information
    on how FSS operates and how housing agencies are succeeding with
    them, with or without IDA partnerships.

-   The U.S. Department of Housing and Urban Development offers
    information and FSS guidelines on its website:
    [www.hud.gov](http://www.hud.gov/). Search for Family
    Self-Sufficiency under the Housing Choice Voucher Program, or reach
    the site via [www.fsspartnerships.org](../www.fsspartnerships.org)
    link.

[^1]: Many housing agency grantees or partners may be identified by
    searching the CFED program survey list on www.cfed.org, or the
    project locator on the AFI website:
    [www.acf.hhs.gov/assetbuilding](http://www.acf.hhs.gov/assetbuilding).

[^2]: There is, at present, no formal database on FSS programs and
    participants. These figures come from research by FSS Partnerships.
    See resource notes.