Volume 3 Number 6
June 2006

In this Issue
Factors in Achieving and Retaining Homeownership
Performance Measurement Enhances Community Development
Mark-to-Market Preserves Affordable Rental Housing
Optimized Tax Credit Allocation Can Serve Those in Need
In the next issue of ResearchWorks

Performance Measurement Enhances Community Development

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Five communities with emerging reputations for carrying out effective performance measurement in community development programs - Charlotte, North Carolina; Austin, Texas; King County, Washington; Minneapolis, Minnesota; and Burlington, Vermont - are featured in a recent HUD-sponsored study, Promising Practices in Grantee Performance Measurement. The study details how these localities evaluate their community development programs to ensure that they're following a ‘best bang for the buck' approach to grants management.

In reviewing the performance measurement systems in these communities, the research team used a generic framework to examine each system in a standardized manner. The focus was on four elements: (1) goals, objectives, and the activities planned for achieving them; (2) performance measures; (3) assessment of outcomes; and (4) decisions made based on performance. For each element, the research team collected extensive background material and interviewed operating program managers, department heads, budget staff, city manager staff, and local elected officials. The result is a profile of performance measurement systems in each of five different communities, plus an analysis of findings and a step-by-step guide to developing a local performance measurement system.

These localities implemented performance measures for a variety of reasons, depending on local need and context. Certain personnel or conditions appeared to provide the momentum to adopt program evaluation processes. Key personnel, who demonstrated professionalism and an appreciation for strategic planning, policy-oriented action, efficiency, and accountability to the public, often led the way in establishing performance evaluation measures. Budget crises, support from community leaders, and pressure from dissatisfied constituencies also provided impetus.

The report sums up what works in these communities and what might be useful to other localities with an interest in implementing performance measurement systems. Lessons gleaned from the case studies relate to goal-setting, performance measurement and assessment, and to feedback. We will visit these lessons briefly below.

Lessons in Goal-Setting

• Learn from the experience of others. Setting goals for a performance measurement system does not require 'reinventing the wheel.' Numerous approaches and models are available to borrow from or adapt. For example, Charlotte adapted the "Balanced Scorecard" model, which was developed in the private sector. Austin's "Managing for Results" integrates program evaluation with widely recognized business planning and management principles. Minneapolis adapted Austin’s approach, and King County uses a logic model for evaluation developed by the W. K. Kellogg Foundation (see www.wkkf.org). Burlington combines information on production levels, such as the number of new and rehabilitated housing units made available, with achievement of objectives from the community’s thirty-year quality-of-life plan, such as revitalizing fragile neighborhoods.



• Let the community's vision for itself shape performance goals.



• Involve community partners and the public from the input and design stage throughout the implementation of a performance measurement system.

Lessons in Performance Measurement and Assessment

• Strive for more than efficiency. Performance measures need to focus on their relevance to the whole community. Besides knowing how many participants in a homebuyer program receive downpayment assistance, it's meaningful to have a measure of the program's community impact. Therefore, measures such as the percentage of families who move from temporary shelter to permanent housing or the change in local homeownership rates are valuable. As the report states, "It is important to be able to show not only the total number of 'widgets' produced but also the results of widget production."



• Link performance outcomes to program goals as a means of monitoring progress. Minneapolis, for example, builds a means of regularly reassessing progress into its annual budgeting process.



• Keep the number of outcomes and measures to a manageable size. Tracking too many outcomes is burdensome; it clogs the system and takes too much time. Ideally, measures add pertinent information to a program assessment without overburdening the system. That's why Austin cut its initial number of 4,400 indicators in half. A more manageable number of indicators allows city departments to work toward performance goals with a sense of owning, and being responsible for, these goals.



• Build accountability into a performance measurement system. Reporting and management meetings keep everyone apprised of progress, and in tune with the community's overarching vision. Charlotte, for example, posts an ongoing scorecard reflecting the status of departmental performance goals.

Lessons Related to Feedback

• Incorporate program evaluation into the daily procedural life of the agency. Austin and Charlotte demonstrate this by integrating performance measures into employee appraisals and customer service principles.



• Use performance measurement information in funding decisions. Subrecipients and Community Housing Development Organizations that are effective in achieving program goals have a better chance at future funding.



• Be willing to adjust the performance measurement system to improve community programs and services.

Finally, Promising Practices in Grantee Performance Measurement discusses tactics, tools, steps, and key decisions for communities to consider in developing a program-based performance measurement system. It's available as a free download at http://www.huduser.org/publications/econdev/prompractices.html.

Steps in Implementing Program Performance Measurement 1. Identify Performance Goals 2. Conduct Outreach and Research 3. Design Local System 4. Develop Tools 5. Implement Measurement 6. Analyze Results 7. Conduct Improvements 8. Continue Measuring & Assessing

Credit: Adapted from Promising Practices in Grantee Performance Measurement, p. 68.