Opportunity NYC Demonstrations


In March 2007, former New York City Mayor Michael R. Bloomberg announced his intention to test a set of antipoverty initiatives, called Opportunity NYC, that would use temporary cash payments to poor families to boost their income in the short term, while building their ability to avoid longer-term and second-generation poverty. Such payments are known internationally as “conditional cash transfers” because the payments are contingent on family members making investments in their futures, typically by building children’s educational achievement and family health.

In the United States, prominent examples of this type of policy include the federal Earned Income Tax Credit (EITC) and Temporary Assistance for Needy Families (TANF), both of which make cash transfers contingent on work effort. Opportunity NYC went further than these programs by offering payments for a broader set of activities.

Opportunity NYC included three separate demonstration projects, each of which took a somewhat different approach. Family Rewards was a comprehensive, two-generation strategy that focused on children’s education, family preventive health care, and parents’ workforce efforts. Work Rewards targeted the workforce efforts of low-income adults living in subsidized housing. A third project called the Spark program focused solely on children and their school performance. All three projects were supported by a consortium of private funders.

In collaboration with the mayor’s office, a host of city agencies, and Seedco (a private, not-for-profit workforce and economic development organization), MDRC helped design Family Rewards and Work Rewards and led random assignment evaluations of the effectiveness of these programs. The Spark program was designed and evaluated by a team headed by Roland Fryer of Harvard University, in collaboration with the New York City Department of Education.

Opportunity NYC was an initiative of Mayor’s Office for Economic Opportunity (NYC Opportunity), originally established in 2006 as a unit of the mayor’s office to implement promising antipoverty programs in New York City. NYC Opportunity oversees evaluations of the initiatives to determine their success in reducing poverty and increasing self-sufficiency among New Yorkers.

After early evidence of began to emerge on the effects of Opportunity NYC-Family Rewards, NYC Opportunity and MDRC collaborated again on the design and testing of a modified version of the model intended to strengthen its potential effectiveness. That project, dubbed “Family Rewards 2.0,” was operated in the Bronx, New York, and Memphis, Tennessee, with partial funding from the federal Social Innovation Fund (SIF). For more information on the model and evaluation results, click HERE.

The following sections describe the evaluations of the original Family Rewards demonstration and Work Rewards. For more detailed information on Work Rewards, click HERE.

Agenda, Scope, and Goals

Family Rewards Pilot Program

The Family Rewards program operated from 2007 to 2010. It was inspired by the model of successful conditional cash transfer programs in a number of developing countries, including Mexico’s Progresa/Oportunidades program. It was a two-generation initiative to reduce poverty that included both short-term and long-term poverty reduction goals. It operated in six districts in the Bronx, Brooklyn, and Manhattan that were among the city’s most persistently poor communities. The relative disadvantage of these areas can be seen clearly in U.S. Census data: In 2000, about 40 percent of the households had incomes below the poverty level, compared with a citywide rate of 21 percent. The unemployment rate across the districts was 19 percent, on average, compared with 5 percent for the city as a whole. Compared with the city’s population as a whole, considerably higher proportions of residents of these communities relied on public benefits, including TANF, food stamps, and Medicaid.

Family Rewards used the offer of a new set of cash transfers to achieve three interrelated objectives: (1) to lessen immediate income-related hardships for poor families, (2) to help and encourage poor families to increase — or sustain — positive efforts to improve their own futures, and (3) to help poor families as they made investments in their children’s futures. Thus, the payments to families were to function as a short-term income supplement to reduce the immediate hardships of poverty, but one that built on the concept of mutual obligations embedded in the nation’s major income-support programs for low-income families (including EITC, TANF, and food stamps), by linking the payments to steps that could improve a family’s economic security and reduce intergenerational poverty. The payments were awarded only when households met specific conditions in three areas: children’s education, family preventive health care practices, and parents’ workforce efforts. For example:

  • Education-based conditions included children’s superior school attendance, improved performance on standardized tests (or sustained high achievement), and parental engagement in children’s education.

  • Health-based conditions included maintaining adequate health insurance coverage for all children and adults in participant households, as well as age-appropriate preventive medical and dental visits for each family member.

  • Workforce-related conditions included sustaining full-time work and participating in approved education or job training while working either part time or full time.

Work Rewards Pilot Program

The Work Rewards initiative targeted recipients of Section 8 Housing Choice Vouchers administered by New York City’s two housing authorities: the Department of Housing Preservation and Development and the New York City Housing Authority. It was designed to test the effects of alternative strategies to improve adults’ labor-market outcomes and family well-being. Some participants were enrolled in a New York version of the federal Family Self-Sufficiency (FSS) program — a case management and asset-building program funded by the U.S. Department of Housing and Urban Development (HUD) and designed to promote economic advancement for low-income families receiving housing subsidies. Other participants were also enrolled in this FSS program but, in addition, were offered the same workforce-related incentives used in the Family Rewards pilot program (without the children’s education and family health care components). And still others were offered just the workforce incentives alone.

Design, Sites, and Data Sources

Family Rewards Pilot Program

The Family Rewards pilot program served 2,400 families, and an equal number of families were assigned to the control group. Eligible families lived in the selected community districts with incomes at or below 130 percent of the federal poverty level and had at least one child in public school in either the fourth, seventh, or ninth grade. These grades were chosen because they reflect critical transition points in students’ school careers. Students who fail to navigate them successfully fall behind their peers and have difficulty recovering, increasing their risk of dropping out, especially in the early high school years.

Seedco assembled a network of six neighborhood partner organizations in the designated community districts to recruit and enroll eligible families. Although the program had no formal case management component, participating families had several avenues — a telephone hotline, a website, and an in-person help desk at the community-based organizations — to get information on services in the community that could help them meet the program conditions (for example, information on where to get homework help for their children, on how to find a doctor, and on where to get help finding jobs and training). In addition, families could also get help opening bank accounts, so that the payments could be transferred electronically and so that they had access to the funds via debit cards.

The evaluation of ONYC: Family Rewards had three major components: an impact analysis, an implementation and process analysis, and a cost analysis: 

  • Impact analysis. This analysis examined the program’s effects on a wide range of outcomes, including children’s school performance; family health care practices and health outcomes; parents’ employment and training outcomes; and family income, benefit receipt, poverty, material hardship, and quality of life.

  • Implementation and process analysis. This analysis explored the operations of Family Rewards, focusing particularly on the roles and experiences of the implementing institutions (particularly Seedco and its community partners) and on the perceptions and experiences of the participating families.

  • Cost analysis. This analysis estimated the cost of operating Family Rewards, distinguishing how much was spent on various aspects of program delivery from the amount of cash transferred to the participating families.

MDRC published a series of evaluation reports on the project from 2010 through 2016. These reports show that participating families received over $8,700, on average, in rewards over the three-year program period, with virtually all families earning some rewards. The amount of money a family received varied according to the number of activities the family completed and compositional factors such as family size and number of high school students in the family. The impact evaluation found that by the end of the study, the program had produced some positive effects on some outcomes but left many other outcomes unchanged. It produced strong reductions in current poverty and material hardship (during the program). It also improved school achievement and graduation rates among a subset of ninth-graders (those who were somewhat more prepared for high school when they entered the study), and improved participants’ receipt of dental care. It had few overall effects on health or employment outcomes and no effects on school achievement among elementary and middle school students. The evaluation also included a special report that used in-depth qualitative interviews to explore families’ experiences with the program, including how families communicated about the educational incentives, and the influence of those incentives on parent-child interactions. Another special report used data from a survey of high school students to examine the program’s effects on how they spent their nonschool time, and on a variety of other behavioral, social, and psychological outcomes.

Work Rewards Pilot Program

A total of 3,987 Section 8 recipients were recruited for the Work Rewards study. Eligibility for the Work Rewards pilot program was limited to voucher holders whose household income was no greater than 130 percent of the federal poverty line. However, eligibility was not limited to particular community districts but extended to voucher holders across New York City. In addition, families with or without children under age 19 were invited to apply.

The program and evaluation design differed depending on the source of the participant’s Section 8 voucher. For holders of a New York City Housing Authority Section 8 voucher, the study tested whether the offer of incentives for sustained full-time employment and for taking up approved education or training programs improved labor market outcomes and other outcomes. Applicants were randomly assigned to a program group that received the offer of incentives or to a control group that did not receive the offer.

Holders of Section 8 vouchers through the city’s Department of Housing Preservation and Development were randomly assigned to three groups rather than two. One group was offered enrollment in the Department’s Family Self-Sufficiency (FSS) program operated by a number of community-based organizations located throughout the city, with some additional services. A second group was offered enrollment in FSS and received the additional workforce incentives. The third group was a control group offered neither of these options. Like the Family Rewards evaluation, the Work Rewards study included an implementation analysis and an impact analysis. In addition, a comprehensive benefit-cost analysis was conducted for participants involved in the FSS-related interventions.

The analysis comparing the FSS group with the control group constitutes the first-ever random assignment test of the Family Self-Sufficiency program, the main federal program intended to increase employment and earnings and reduce reliance on government subsidies among Section 8 voucher holders. Overall, the evaluation found little impact on employment or other outcomes among voucher holders who received FSS services alone or the financial incentives alone. However, the combination of FSS plus incentives produced substantial positive effects on employment and earnings over a six-year follow-up period among participants who were not already working when they entered the program. The benefit-cost analysis found substantial net economic gains for this group, although at a net cost to the government’s budget.