CHAMPION Network Financial Literacy Incentivized Savings Program

CHAMPION Network provides practical and meaningful pathways for impoverished young people to enter the workforce and retain employment.

Photo of Cypress Grants
4 2

Written by

Eligibility

  • I am not an employee of BNY Mellon, or an immediate family member of a BNY Mellon employee
  • I am over 18 years of age
  • My organization is incorporated as a non-profit, for-profit, or hybrid organization, or I have a partner that is incorporated and could accept funds on my behalf
  • I have already piloted my initiative and have some initial evidence of impact
  • My organization is headquartered and creating impact in the United States

Gender

  • Not specified

Where are you making a difference?

New York: Brooklyn (11207)
Our services are provided at our Employment Solutions office located at 2930 Fulton Street, Brooklyn, NY 11207.

Focus Areas (required)

  • Development & Prosperity

Date Started

01/05/2015

Organization Type

  • nonprofit/NGO/citizen sector

Project Stage: Select the description below that best applies to your approach.

  • Established (successfully passed early phases, have a plan for the future)

Budget

  • $250k - $500k

Website or social media URL(s) (optional)

www.cypresshills.org

Twitter URL

twitter.com/chldc

Facebook URL

www.facebook.com/CHLDC/

1.Founding Story: Share a story about the "Aha!" moment that led the founder(s) to get started or the story of how you saw the potential for this to succeed.

In the spring of 2014, Lowell Herschberger of CHLDC received a phone call from the Director of Operations at Maggie’s Paratransit. He needed 50 new drivers due to a systemic problem: 3 out of 4 new drivers at Maggie’s ended up leaving before the 3-month mark. Other paratransit company in the area had a similar vacancy gap of 30-70 drivers and high turnover rates. Lowell’s first “Aha!” moment came when he learned that Paratransit companies generally hire people with both Class C and Class B CDLs though only a Class C is needed. New drivers were taking a paratransit job until they were able to access a much better paying job using their Class B. It was clear to us that the drivers and the sector needs a tiered career pathway.

2. The Problem: What problem are you helping to solve?

In our community, young adult unemployment and the dearth of qualified paratransit drivers are problems. Our CHAMPION Network has successfully tackled these problems by offering training for the Class C license and developing deep relationships with transportation employers. We now seek to better help young adults advance in the sector by assisting them in securing the costly Class B license which leads to even better paying jobs.

3. Your Solution: How are you planning to solve this problem? Share your specific approach.

CHLDC seeks to add an incentivized saving component to the CHAMPION Network that will facilitate career advancement. After graduating from our paratransit training with their Class C licenses, young adults stay connected to the Network by attending monthly workshops and support sessions. At these events, they meet with their paratransit driving peers and a financial counselor who help them map out long-term career and financial plans. Here, members will be invited into the Class B incentivized savings plan. Our financial partner, TD Bank, agreed to open fee-free accounts for our students and to incentivize their usage of the accounts by adding an initial $25 to each one. The financial literacy counselor will then work with them to set up a budget and savings plan. When they save up to $900, we will match their savings with the final $300 needed. The total account value of $1,200 will pay for the lessons and fees to earn a Class B license. This fee is substantially lower than the $2,000-$4,000 they would otherwise pay because we are able to negotiate a lower rate based on the volume of students we send. We will also negotiate training hours that match our students’ schedules.

4. Example: Please walk us through a specific example of how your solution is working to solve the problem.

Through our training, Stephen Isaacs attained his CDL Class C license and was hired as a driver by a local Access-A-Ride company, earning $15 per hour. This was a life-changing opportunity, but his dream was to drive a large bus--requiring training we do not provide.

Stephon found a bus company in NJ whose 3-week driver training program was unpaid and required the trainee to pay for their DMV road testing and licensure fees. It also required the applicant to sign an employment agreement to remain employed with the company for 6 months. We were able to offer him career guidance and classroom training during this period. He was able to become a driver for a 45-foot Coach Bus with a Class B license and Air Brake endorsement. With the assistance of CHAMPION, he later found better employment closer to home. Today, he drives for a charter bus company and makes $52K year with full benefits.

5a. Too many people in the U.S. have unmet needs for financial products and services. How is your work reaching a population(s) that is currently underserved? If it is not reaching an underserved population yet, how might it in the near future?

A majority of our community members are either immigrants or first generation Americans. Many speak a language other than English at home. Less than 20% hold Bachelor’s degrees. Many are vulnerable to predatory practices/scams and check cashing services with large fees. Our organization has advocated for better lending options and expanded financial services in our community. Despite progress, many people, particularly young people and new arrivals, are vulnerable.

5b. Please specify if the population you are reaching is underserved due to any of the following characteristics:

  • geography
  • work status
  • language
  • race/ethnicity
  • age - youth
  • socio-economic class

6. Marketplace: Who else is addressing the same problem? How does the proposed project differ from these approaches?

In our survey of non-profit and proprietary driving schools, we have not found any others who are implementing Class C CDL training specifically for the paratransit sub-sector. Others are running Class B training for a general population but not for our specific population: low income young adults and immigrants. There certainly are other savings programs and financial literacy initiatives, but our effort is unique in the way that it ties the financial counseling with an immediate, high-yield vocational goal and creates a tiered career pathway in the transportation sector.

7. Impact: How has your project made a difference so far?

The CHAMPION Network has supported 196 individuals to secure paratransit jobs. The median hourly earnings are $14.75 per hour and most positions include health benefits and full-time hours with overtime. Our retention rate is also high - 81% per year, exceeding the industry target of 65%. Of those 196 individuals placed, 35 already advanced in their career with an average wage increase of $3.02 per hour. Devon Gardner, unemployed with three young children to care for, began working for an Access-A-Ride company after completing our program. He was mentored by Jerome Paul, a CHAMPION Network alumni and dispatcher at the company. We helped Devon obtained a Class B CDL-- an upgrade on his original CDL. His family living situation improved dramatically and Devon often stops in to speak with trainees in CDL classes to offer encouragement and support.

8a. Spread Strategies: Moving forward, what are the main strategies for scaling your impact?

Many paratransit companies need and will continue to need Class B drivers in their school-bus or charter divisions. Such companies may be willing to incorporate a savings plan similar to ours as part of their employee benefits package. Employees could take a payroll deduction that goes directly into a special bank account. The employer would match the savings at some level in exchange for a commitment to stay with the company for a given length of time. This would be a cost-effective retention strategy that would retain ambitious employees.

8b. If applicable, which of the following scaling strategies have you launched?

  • Trainings, Consultation

9. Financial Sustainability Plan: What is this solution’s plan to ensure financial sustainability?

In 2017, we began receiving payments from some of our key employers for the services. This is key to our sustainability plan as employers continue to see the long-term benefit to their business. With participants contributing the larger share of the savings, the model is particularly cost-effective. The financially sustainable funding mix for this program is 35% government contracts, 57% foundation grants, 5% corporate, and 3% employer partners.

10. Team: What is the current composition of your team (types of roles, qualifications, full-time vs. part-time, board members, etc.), and how do you plan to evolve the team’s composition as the project grows?

The program director, Martin Newell, has decades of experience in the transportation sector. The other key leadership staff member, Lowell Herschberger, has decades of experience in youth and workforce development and a professional background in Social Work. This leadership team is a critical mix of sectoral and programming knowledge. There are also line staff with youth development and Social Work skills, and one alumna from the program who serves as an Outreach Aide to engage her peers.

Help Us Support Diversity! Part 2 - Do you identify as part of any of the following underrepresented communities? (optional)

  • Low-income community

How did you hear about this challenge?

  • Recommended by others
  • Email

Organization name

Cypress Hills Local Development Corporation

Program Design Clarity

Our services are provided at our Employment Solutions office located at 2930 Fulton Street, Brooklyn, NY 11207. Activities occur one cycle each month., including 45 hours of class time, 3 hours financial literacy education, and monthly 1 on 1 sessions for 4 hours total per month for 1 year. These services are delivered by our Transportation Director, Case Manager, and Financial Coach.

Approach to financial wellbeing: does your project focus on creating financial wellbeing through innovating on any of the following?

  • education / literacy
  • other

If you marked "Other" in the question above, please specify:

Budget and match-saving incentive.

Innovation type: Please select which of the following types of innovation best characterize your work

  • Product innovation (Introduction of a good or service or improvements made to existing products)

Partnerships in detail: tell us about your partnerships that enhance your approach.

In our work with financial literacy and combating predatory lending, we developed relationships with major financial institutions. We’ve been funded by HSBC, Bank of America, Citibank, Chase Bank, Ridgewood Savings and TD Bank. Banks partner with us for access to our community and the immigrant populations. We also have a history of holding banks accountable to high ethical practices through an annual analysis of lending practices and a public forum with banks and public and elected officials.

If you won the Unlocking ₵hange Challenge, how would you invest the prize money of $50,000?

With your support we will funding the salary and fringe of a Financial Coach, and use a portion of funding for our Case Manager. We will also use the funding to assist with the matching grant of $300 towards the $900 that participants will have saved for their CDL Class B.

Awards & Recognitions: What awards or recognitions has the project received?

We have been recognized for best practices by the Aspen Institute, “Promises and Perils of Using Sectoral Strategies With Young Adults”. UnidosUS, Aspen Institute, Jobs for the Future and others have sponsored us to present the program model in Cities all over the US. In NYC, we have been featured at Philanthropy New York, New York City Employment and Training Coalition, and Jobs First NYC events.

Attachments (1)

attachment.pdf

Additional Information.

4 comments

Join the conversation:

Comment
Photo of Sarah Dewees

I love this project! It is very specific, has immediate positive financial impact on people's lives, and recognizes an opportunity in the employment market and responds to it. Their effort is innovative and unique in that it "ties financial counseling with an immediate vocational goal and creates a tiered career pathway." This is a very promising model, and they already have outcome data. The only thing I would like to learn more about is their financial education and financial coaching approach and how this can be used to empower the clients.

Photo of Cypress Grants

Thank you for your insightful comments and critique! We will definitely incorporate it into our proposal.

View all comments