Purpose and Scope of the Management Audit

The purpose of this management audit has been to evaluate the purpose and effectiveness of Communities of Opportunity, a public-private initiative begun in 2006. The management audit assessed the appropriateness of the initiative's goals and objectives, its strategies and plans for accomplishing those goals and objectives, the degree to which its goals and objectives are being accomplished, and the data it uses to evaluate the goals and objectives. The scope of the management audit included Communities of Opportunity business planning and performance measurement, City governance, City department and agency implementation of Communities of Opportunity programs, and community involvement.

Audit Methodology

The management audit was conducted in accordance with Government Auditing Standards, 2007 Revision, issued by the Comptroller General of the United States, U.S. Government Accountability Office. In accordance with these requirements and standard management audit practices, we performed the following management audit procedures:

• Conducted overview interviews with the Director and Deputy Director to gain an understanding of Communities of Opportunity.

• Conducted confidential interviews with representatives from City departments and other City agencies, foundations, community-based organizations, community advocacy organizations, public housing tenants association and Communities of Opportunity resident association staff, and other Communities of Opportunity residents.

• Reviewed Communities of Opportunity business plans, year-end reports to the private foundations, community-based organization contracts, and other data and information collected by City departments and agencies and Communities of Opportunity staff.

• Prepared a draft report based on analysis of the information and data collected, containing our initial findings, conclusions and recommendations, and submitted the draft report to the Director of Communities of Opportunity for review and comment on September 16, 2008.

• Met with the Director and Deputy Director of Communities of Opportunity on September 23, 2008, and provided sections of the draft report to the respective City department representatives. During the period between delivery of the draft report and the exit conference, the Director of Communities of Opportunity was able to request clarification of findings and recommendations and provide additional information related to the findings. Based on the additional information provided, a final report was prepared. The Director of Communities of Opportunity then provided a written response to the final report, and the final report and the response were delivered to the Board of Supervisors on October 15, 2008.

Overview of Communities of Opportunity

Communities of Opportunity is intended to create a framework to more effectively provide services to low-income families in San Francisco. The Mayor announced the creation of Communities of Opportunity in October 2004, stating that the initiative was a major policy shift in community development, creating a partnership between the City and philanthropic donors that would assist low income families in acquiring home ownership and gaining access to childcare, education, health care, employment, business opportunities, and housing. Communities of Opportunity grew out of the Human Services Agency's Seven Corners Study that found that the City and County spends millions of dollars on a small number of children and families, but the services are disconnected.'

The Communities of Opportunity 2006 Pilot Phase Business Plan

The Communities of Opportunity Pilot Phase Business Plan was completed in May 2006 (2006 Plan) with the assistance of a consultant, the Bridgespan Group, funded by private foundation grants. According to the 2006 Plan, a steering committee consisting of 13 Mayor's Office staff and City department directors participated in the business planning process.

Under the 2006 Plan, Communities of Opportunity would be implemented in four locations in the Bayview/Hunters Point and Visitacion Valley neighborhoods adjacent to the (1) Hunters Point, (2) Hunters View, (3) Alice Griffith, and (4) Sunnydale public housing projects. The 2006 Plan called these four locations nodes.

Communities of Opportunity was intended to address the problem of costly services with poor results. According to the 2006 Plan, although the City spends an estimated $98 million for services and income support in the Bayview/Hunters Point and Visitacion Valley neighborhoods, the economic status of families in these neighborhoods has not improved.

Communities of Opportunity focuses poverty reduction programs on location rather than specific groups to be served. According to the 2006 Plan, Communities of Opportunity is built on five principles:

1. Focus on outcomes for both people and place rather than delivery of particular services.
2. Build the capacity of families, communities, and local institutions to realize the benefits of economic improvements in surrounding neighborhoods.
3. Direct efforts toward places where people are in the greatest need, yet where the scale of change is manageable.
4. Create a shared strategic vision with high expectations and accountability among residents, community-based organizations, and philanthropy.
5. Manage change dynamically by quantifiable outcomes; expand successful approaches; and introduce new evidence based approaches.

According to the 2006 Plan, of the 2,600 families living in the four locations, 650, or 25 percent, were in chronic crisis, including domestic violence and child neglect, severe economic crisis, limited educational and work opportunities, and inability to meet basic needs. Another 1,100 families were considered economically fragile, earning less than 185 percent of the federal poverty level. Only one-third of the 2,600 families, or 850 families, were considered stable or self-sufficient.

The goal of Communities of Opportunity was to move families from a state of chronic crisis or economic fragility to self sufficiency. The specific goals to be achieved by 2011 are:

• The majority of families will be stable or self-sufficient;
• The majority of children will be flourishing;
• Less than 10 percent of families and children will be in crisis; and
• Communities will provide a safe environment, sound physical infrastructure, connected social networks, and sustainable economic vitality.

The 2006 Plan identified eight catalysts for changing the conditions in these four locations contributing to crisis and economic fragility, including:

• Establishing safety;
• Adults finding employment;
• Strengthening social networks and institutions;
• Establishing partnerships between residents of the four locations, City agencies, community-based organizations and other institutions, and private donors.
• Chronic crisis individuals and families receiving services;
• Children and youth having access to educational, employment, and other opportunities;
• Improving physical infrastructure; and
• Providing direct benefits from economic development in the City's southeast neighborhoods.

The Communities of Opportunity 2008 Business Plan Update

Because Communities of Opportunity was unable to implement many of the programs outlined in the 2006 Plan during the first two years, and because its fundraising fell far short of its targets, the May 2008 Business Plan Update (2008 Plan) streamlined the approach to achieving Communities of Opportunity's goals. According to the 2008 Plan, Communities of Opportunity is designed to address the need for:

• Reducing barriers to City services for low-income residents; and improving City service coordination, reducing service gaps and duplication.
• Building mechanisms for community participation in planning and delivering services.
• Creating a hub for collaboration between private and public agencies and organizations.

The 2008 Plan focuses on three strategies, rather than the eight catalysts in the 2006 Plan, to improve conditions for families in the four nodes, including:

• Housing,
• Employment, and
• Youth and education.

According to the 2008 Plan, the role of Communities of Opportunity is not to develop new programs but to link City programs, community participation, and private and public collaboration. The 2008 Plan identified on-ramps to existing City programs as discussed in Section 2.

Organizational Structure and Oversight

The 2006 Plan assigns ultimate responsibility for Communities of Opportunity to the Mayor. In January 2008 the Mayor appointed the Director of Communities of Opportunity as a senior staff member overseeing the Communities of Opportunity initiative.

Organizational Structure

Although the 2006 Plan envisioned 6.8 fulltime positions to provide program administration, analysis, and support, Communities of Opportunity currently has only two program staff positions: the Director of Communities of Opportunity noted above, and the Deputy Director of Communities of Opportunity, who is paid by private foundation grants.

The 2008 Plan described the Communities of Opportunity organizational structure as follows:

Chart 1
Communities of Opportunity Organizational Structure Under the 2008 Plan

Source: 2008 Business Plan

The Director of Communities of Opportunity reports directly to the Mayor and is responsible for relationships with the private funders, the City departments and agencies and the community, and for general oversight. The Deputy Director supports City departments in planning programs as part of Communities of Opportunity, and collects and analyzes data for program planning and evaluations.

The Director of Communities of Opportunity also performs the functions of the vacant Community Manager Position. Section 5 of this report discuss the community-based staff, including (a) the four site coordinators assigned to the four Opportunity Centers located at Hunters View, Hunters Point, Alice Griffith, and Sunnydale public housing sites; and (b) the peer coaches, including the housing, truancy and jobs/benefits (or self-sufficiency) coaches.

Governance

A steering committee of City department directors participated in the 2006 business planning process, but although the 2006 Plan expected an ongoing steering committee, it never defined the role. Communities of Opportunity is now helping to form an Interagency Council of City department directors to oversee Communities of Opportunity and other City anti-poverty and violence prevention initiatives. Communities of Opportunity governance is discussed in Section 1.

Communities of Opportunity Funding

Private foundations have provided most funding for the business planning process and first two years of Communities of Opportunity, granting $1.8 million in FY 2006-2007 and $2.0 million in FY 2007-2008 for a total of $3.8 million over two years, as shown in Table 1 below. Details of Communities of Opportunity revenues and expenditures are in the Attachment to the Introduction

City expenses for Communities of Opportunity program administration costs consist of the Director of Communities of Opportunity's salary and fringe benefits of approximately $186,000 annually, and office space provided by the Mayor's Office of Community Investment of approximately $7,000 annually. When City departments collaborate with Communities of Opportunity on specific initiatives or programs, as discussed in Section 2, existing staff resources are allocated to Communities of Opportunity. No City department directly budgets for Communities of Opportunity expenditures.

The Department of Children, Youth, and their Families has also provided funding to several Communities of Opportunity programs as part of their grant-making process. These programs are discussed in Section 2.

Table 1
Communities of Opportunity Revenues and Expenditures
FY 2006-2007 and FY 2007-2008

Source: Communities of Opportunity

As shown in Table 1, during the first two years Communities of Opportunity spent approximately 55 percent of funds on program office expenditures, including several one-time programs to generate awareness of itself, both within the four nodes and among community development professionals. The largest community event was the Communities of Opportunity Comedy Shop, presenting performances by six comedians and the hip-hop group Def Jam. The largest event for community development professionals was the National Community Developer Association annual conference in June 2007 at a cost to Communities of Opportunity of more than $500,000.

While several of the foundations currently funding Communities of Opportunity will most likely continue to fund the initiative over the next year or two, the extent of the funding is not yet known. The foundations met with the Mayor and the Director of Communities of Opportunity on September 15, 2008 to discuss future programs and funding. The proposed Communities of Opportunity budget for the next two years is shifting from programs and services to program planning and oversight and community outreach through paid community staff, as shown in Table 2. However, the foundations have not yet committed to this level of funding, and actual Communities of Opportunity expenditures over the next two years will be less than proposed.

Table 2
Communities of Opportunity Proposed Expenditures
FY 2008-2009 and FY 2009-2010

Source: 2008 Plan

Community-Based Organizations

In the first two years Communities of Opportunity provided 8 new programs through 12 community-based organizations, focusing on youth services and adult employment. The community-based organizations were selected through a community process and received capacity building training through Communities of Opportunity's Neighborhood Benefit Organization (or NBO) University.

Communities of Opportunity had mixed results in recruiting participants to the programs offered by the community-based organizations. The July 1, 2008 Fiscal Year-End Report stated that, while some programs successfully recruited participants, other programs did not reach full enrollment.

Under the 2008 Plan, Communities of Opportunity will no longer directly fund community-based organizations. Communities of Opportunity programs will be incorporated into the on-ramps to City programs and services, as discussed in Section 2. These on-ramps will include workforce development programs provided by the Office of Workforce Development within the Department of Economic and Workforce Development, and the Parent University funded jointly by the First Five Commission, the Department of Children, Youth, and their Families, and Communities of Opportunity. The City departments sponsoring these programs will award and manage contracts with community-based organizations.

Community-based Organization Certification

The 2008 Plan proposes a certification program for community-based organizations through the proposed Center for Social Equity to be housed at the Southeast Campus of City College. The program is intended to help community-based organizations and their employees build organizational and staff skills. According to the Director of Communities of Opportunity, City College is in the beginning stages of developing the certification program with expected community-based organization participation. Community-based organizations funded by the Mayor's Office of Community Investment, Human Services Agency, Department of Children, Youth, and their Families, and other departments would be eligible to participate.

The Role of Safety in Planning for Communities of Opportunity

From the beginning of residents' engagement with Communities of Opportunity, safety was consistently identified as the top priority. As stated in the 2006 Community Voices report prepared by the National Community Development Institutes, Far and away the greatest concern for residents in these areas was that they do not feel safe for themselves, their families, or their property (pg. 3). The Community Voice report included a summary of resident suggestions to address safety that included both enforcement and prevention strategies such as (pg. 3) Improve law enforcement by providing more police patrols, establishing satellite offices, improving surveillance, developing stronger community relations and providing witness protection for individuals that report crimes and stop youth from loitering and associated criminal and disruptive activity.

The immense concern over safety was addressed in the 2006 Plan which also recognized safety as its highest priority (pg. 34):

The Communities of Opportunity strategy places safety as its highest priority area for good reason. If safety cannot be established for families, they will continue to leave the nodes when the opportunity presents itself. Further, the efforts to enhance services and programs will have difficulty overcoming resident fear, not to mention cynicism.

In the 2006 Plan, the responsibility for safety is deferred to other agencies (pg. 36) Chief of Police Heather Fong and Mayor's Office of Criminal Justice Acting-Director Allen Nance will assume responsibility for the Safety initiatives. To that end, the Violence Prevention Plan was released by the Mayor's Office for Criminal Justice in June 2008, laying out a strategy for reducing violence throughout the city. Generally, the Plan frames all of Communities of Opportunity's tactical plans to reduce poverty as tactics to reduce crime. Communities of Opportunity is listed in the Violence Prevention Plan as the lead agency in charge of implementing Parent University (pg. 82), and while no timeframe for implementation was included in the report, Parent University is now open near the Hunters View node. Communities of Opportunity is also listed as one of many supporting agencies in a number of other violence reduction efforts which echo Communities of Opportunity tactics for poverty reduction (pgs. 86-88), all without timeframes.

Notably, the San Francisco Police Department worked with San Francisco Housing Authority to establish substations at the Alice Griffith and Sunnydale public housing properties (and other San Francisco Housing Authority sites that are not part of Communities of Opportunity) and to assign an officer as the liaison to San Francisco Housing Authority, providing monthly crime reports by property to San Francisco Housing Authority and Communities of Opportunity.

The extent of Communities of Opportunity's effort to reduce crime are limited to programs proposed in the 2006 Plan which stated that Communities of Opportunity was to provide violence prevention programs intended to keep at risk youth off the street provide conflict resolution and response resources. Communities of Opportunity provided those services through community-based organizations such as Heritage Camp, a summer program jointly funded by Communities of Opportunity and the Department of Children, Youth, and their Families; a number after school academic and athletic programs; and the Community Response Network. However, because community-based organization services are not included in the 2008 Plan, these programs may no longer be provided in the nodes. As safety is not addressed in the 2008 Plan, the extent of Communities of Opportunity's role in improving safety will be limited to whatever safety results from poverty reduction. In order to address the community's biggest concern of safety, Communities of Opportunity will need to create a plan to work with the San Francisco Police Department, San Francisco Housing Authority, and the Mayor's Office of Criminal Justice to increase safety.

Communities of Opportunity Revenues
FY 2007-2008 and FY 2008-2009

Communities of Opportunity Expenditures
FY 2007-2008 and FY 2008-2009