Ann Stern – Houston Endowment


Tony Rodriguez: Hello.  Hi, I’m Tony.

Ann Stern: Hi– hi, Tony.  I’m Ann–

Tony Rodriguez: I’m looking forward–

Ann Stern: –Stern.

Tony Rodriguez: Ann.  Nice to meet you.

Ann Stern: Welcome.

Tony Rodriguez: I’m looking forward to–

Ann Stern: Welcome to Houston Endowment.  I’m glad to meet you.

Tony Rodriguez: Nice offices.

Ann Stern: So these are our offices, and Houston Endowment was founded about almost 80 years ago by Jesse Jones.  So you can see a bust of Mr. Jones in front of us.  He was a businessman here in Houston.  Loved the city.  Felt like it really contributed, allowed him to be successful and wanted to give back to the city, so that’s the legacy that we’re living into.  So come right in here.  Go into my office.

Tony Rodriguez: Oh, boy.  Oh, what role does Houston Endowment play in the homeless issue here?

Ann Stern: We have certainly been supporting individual organizations that address the needs of the homeless here in Houston for many, many years, for decades, and we saw several years ago then-Mayor Parker announced that she wanted it to take a different approach, and it really was an important issue to her, for personal reasons, and she wanted to see what we could do if we collectively came together and tried to align all the systems and all the providers of services for the homeless, and she wanted to do that using data.  She wanted to really look at where the need was and where the capacity was in the system, to be more efficient and to serve more people, and the premise of it was to start with veterans and to start with the chronic homeless.  With the idea that while those might not have been the greatest numbers of homeless, that they were actually those who needed services the most and who represented also the greatest cost to the system, and so the idea was that, “Let’s get people into housing first and let’s bring the services to them.”  You know, that sounds so logical, but it was different than we had approached things here before.  It was a time when the city came together, the county came together, a number of the providers came together and said, “We’re tired of pouring money into a problem and not really helping people in the way that they need to be served and not really solving the problem, and we believe that if we try this new model that we can actually end homelessness, effectively end homelessness is Houston,” and that became this very big and ambitious goal that we as a community really felt like we could achieve.

Tony Rodriguez: And are achieving. <laughs>

Ann Stern: And are achieving.

Tony Rodriguez: Yeah, that’s amazing.  Yeah.

Ann Stern: So Houston Endowment wanted to be part of that.  We said, “This is something that represents a unique opportunity to see the community coming together right now.”  We try to take advantage of opportunities to have outsize [ph?] impact in issues that we care about and so we said, “We want to come to the table, we want to be part of this, and then if we feel confident about the work that’s going on we’ll be open to investing in it in a fairly significant way.”

Tony Rodriguez: Wow, that’s incredible.  Yeah.  We’re trying to work on that in San Diego too.  We’re learning how to do it from you guys. <laughs>

Ann Stern: Yeah.  Well, you know, we learned from people when we were doing this.  We don’t need to reinvent the wheel on this stuff.

Tony Rodriguez: <laughs>

Ann Stern: It’s great to be able to look at other communities and see what’s working and then see how that might fit here.  But I do think having the public entities, the city and the county, from the very beginning, express support for this and express an openness to how public dollars would be used was a big driver of the success here, and certainly having the mayor step up and say, “This is important and we’re going to do this together,” brought people to the table.

Tony Rodriguez: Yeah.  It’s really nice to see everybody having the willingness to work together.  That–

Ann Stern: Yes.

Tony Rodriguez: So how much charitable money are we talking about that played a role in this?

Ann Stern: I would say there was some ongoing philanthropy to support providers.

Tony Rodriguez: Yeah.

Ann Stern: Here in Houston, those are organizations like SEARCH, like Healthcare for the Homeless, like Star of Hope.  What we were suggesting is that that philanthropy continue, because some of those really strong organizations doing the core work, they need to continue to do their work going forward and no one should stop funding those as long as they’re participating in this collective effort.  But there was also a 30 million dollar capital requirement, and that was going to be private dollars that were going to be used to fund the needed additional units of permanent supportive housing, and so the really great thing about that was that 30 million dollars of private funds were going to leverage over 600 million dollars’ worth of public funds, and so we thought, “Wow.  As a funder, it doesn’t get a whole lot better than that, that you can draw down that much wraparound service support with those capital dollars,” and so we actually funded dollars to ourselves and we also encouraged some of our peers to do the same thing.  Housing is complicated, and so for a lot of funders, they’re a little bit nervous about investing directly in housing developments, and especially when some of those developments were being led by organizations by developers that aren’t even from Houston, and so they were names that weren’t familiar to us.  Despite the fact they were very highly rated, highly regarded, high-quality developers, they just weren’t familiar to people in Houston.  We set up a fund, it was the Permanent Supportive Housing Fund, and we asked Corporation for Supportive Housing, which is a nonprofit expert in this field, to administer those dollars for us, and it gave us comfort, Houston Endowment gave us a lot of comfort, to know that they were really underwriting those developments and we could feel confident that our dollars were going to be spent well.  But it also allowed us to say to other philanthropists, “Look, you may be slightly uncomfortable funding housing.  We are too.  But you can feel good knowing that Corporation for Supportive Housing, CSH, has a really good track record in this field and they’ll make sure that your dollars are well spent.”

Tony Rodriguez: Did you continue to fund suppliers that weren’t aligned with your new way of being or thinking? <laughs>

Ann Stern: Yeah.  Yeah.  It’s a great question.  We didn’t make any immediate decisions to cut funding off from people.  What we said is that, “Our city, our community, is going to work together, and we would really like for everyone who’s serving the homeless to be part of this overall initiative,” and we had a light touch at first, I would say.  We had a few grantees that we fund who said, “Well, we’re not sure that we really fit into that system.  We’re different.  We serve a special need, and we’re going to continue to serve that need and you should continue to fund us.”  We gave them time to acclimate.

Tony Rodriguez: <laughs>

Ann Stern: We gave them time to understand what it meant for them.  We gave them time to think about how they could do their work differently.  What was really exciting was over time, yes, there were a couple of people that we said, “You can continue to do the work the way you want to do it, but we’re not going to fund you anymore, because we are 100 percent behind this collective initiative.”  But what was really exciting was we had one group that came to us and said, “You know, we’ve learned so much through this work that we realize we don’t really add anything to this ecosystem anymore, and we think that we should probably go away,” and they merged into another organization.  We had one organization that came to us and said, “You know, we have diversified so much that we’re doing six different things within this space, and what we’re really good at is coordinating the wraparound services for the homeless, and so we’re going to let go of some of this work that we used to do and we’re going to be all in on providing the coordination of care for people,” and so it was really fun to see, inspiring, actually, to see organizations that were willing to step back and say, “Okay.  We’re realigning all the work in this area.  What does that mean for my organization and could we be more value-add to the system if we did our work a different way and had the courage to make those decisions?”

Tony Rodriguez: Wow.

Ann Stern: So we provided support, if was needed, for them to transition to that new role, but today everyone that we’re funding within the space of homelessness is completely aligned and adding value to the system.  That’s pretty exciting.

Tony Rodriguez: Wow, and it’s nice to see it all grow like that.

Ann Stern: It’s nice to see it all–

Tony Rodriguez: And together.

Ann Stern: –grow like that.

Tony Rodriguez: <laughs>

Ann Stern: Yeah.

Tony Rodriguez: And what kind of things do you fund?

Ann Stern: In the space of homelessness, we fund a number of different providers.  There are some organizations in Houston that are just providing services to the homeless on an ongoing basis.  We fund them.  We have funded individual housing developers who are running particularly effective sites or units of permanent supportive housing.  We’ve also funded places that provide food.  We’ve also provided shelters.  One thing that we have been particularly keen on is there was a study that was done that realized that homelessness in many cases plays out as a healthcare issue and so we saw people who were homeless who weren’t getting the healthcare services that they needed and therefore they were going back again and again and again on a very episodic basis to get treated in the emergency rooms of the medical center and we thought, “Well, that’s not good for anyone.  It’s certainly not good for those individuals and it’s really not good, it’s not cost-effective for the system,” and so we had one provider that had a pilot project to identify who those frequent flyers were and to say, “Let’s step back and let’s figure out how we can provide medical care for those individuals in a way that starts to really prevent these episodes from happening, and let’s not be so crisis-driven.  Let’s be much more preventive and comprehensive,” and so we continue to fund that organization as well.  We think that’s pretty exciting work.

Tony Rodriguez: Mm, yeah.  Yeah, that’s true.  What is the role of your foundation in issues like homelessness?

Ann Stern: One thing that we have to acknowledge is that we don’t have the dollars ourselves to solve these issues.  Almost every issue that we’re concerned about, be it homelessness, be it education, be it healthcare, is part of a very large primarily public system.  Our dollars can’t fill in gaps, our dollars can’t solve problems, but what our dollars can be used to do is to bring people to the table.  They can be used to test innovative approaches.  They can be used to align those public dollars around a common goal, and so homelessness was a perfect example of that for us, and that relatively small private dollars, which is what we have, could be used to redirect the public dollars, both at the federal, the state and the local level, and I think that that was a sense of the leverage that we had.  I would also say that our work, Houston Endowment’s work, is focused on equity of opportunity in this community, and that inevitably takes you to poverty, and if you think about homelessness, homelessness is really the sharp end of the point of where poverty sits, and so if you can start to align the systems that address homelessness and the community can learn the power of collectively working on an issue like that, and you can see what you can accomplish with those philanthropic dollars to really change the system, then think of what we can do.  Because you start with veterans and chronic homelessness.  You move on to families.  You move on to youth, and then you can start to address all the other issues that act as barriers to people really being able to take advantage of opportunities and being able to live fulfilling lives and ultimately those people having the opportunity to contribute back to this community, which is what, you know, what all of us want at the end of the day.

Tony Rodriguez: Yeah, it’s true.  I think so.  How do you use your money to channel large amounts of public money?

Ann Stern: Well, I think it has to start with an interest and a desire from the public systems to increase their impact, and so certainly we would never go into a large public system and presume to know how they could do their work better, because we don’t.  There have been a number of situations where a public system has come forward.  This would be a great example.  And the system comes forward and says, “We think we can do better.  We’re not satisfied with the impact that we’re having right now.  We’re spending a lot of money and we feel like we could have a greater impact if we spent our dollars slightly differently.  Could you help us figure out how to do that?” and so sometimes philanthropy can pay for getting the data out there.  That helps people really understand where their dollars are going and where they’re having impact.  Sometimes philanthropy can be used to nudge people to come to the table to be part of that conversation.  Sometimes philanthropy can fund a pilot program or an innovation or say, “Look.  We have risk capital.  Use our money to test what works, and then if it works, you’ll feel confident moving your public dollars in that direction.”  But I would say that philanthropy has a very distinct role in that we have that risk-free capital, but we don’t have all the answers, and what we hope that we can do is fund the development of good information to support public leaders and public entities to really use their dollars more wisely.  But it starts with them, their willingness to do that and their interest in doing that.  There are a lot of reasons to do this.  There’re reasons of economics.  There are a lot of different interests in this.  But I think part of what our city came together around is, “We’re better than this.”

Tony Rodriguez: <laughs> Yeah.

Ann Stern: You know, this is a really vulnerable population.  The more you learn about it, the more you realize how fine the line is between people who are sort of getting along in poverty and then people who go across that line into homelessness.  It was really driven by a desire of this city to say, “This is what shows you what kind of city you really are,” and, “Do you care about people?” and, “Are you going to use the public will, the private will, the dollars that are available, to really make a difference?” and that became a lot of the inspiration for this work.  One powerful thing about this work too has been creating a sense of hope in people that you can solve this.  Because I think some of what you’re talking about is a product of frustration.  It’s a feeling that, “We don’t like this and we don’t know what to do and what we’ve been doing today isn’t working,” and so they almost lose hope at really sticking to it and doing what works.  Some of what becomes incumbent on the people working on this is to say to the community, “Look.  This is not a short-term fix, but we will be successful, and we have to stick with it, and we’re going to hit speed bumps and we’re going to have to learn from those.  We’re going to have to adjust, we’re going to have to perhaps do some things that we didn’t anticipate early on in the process.  But if we stick to this, if we are resolved to solve this problem, we will be successful.  Just stick with us here.”

Ann Stern: You have these optics of people–

Tony Rodriguez: Yes, that’s true.

Ann Stern: –looking at what’s going on and saying, “Well, I thought you fixed it, but look at all those people over there,” and so it’s also creating those–

Tony Rodriguez: There’s different kinds of homeless [ph?].

Ann Stern: –expectation– yeah.

Tony Rodriguez: Yeah, it’s true.

Ann Stern: Yeah.

Tony Rodriguez: There are.

Ann Stern: And then you start realizing, “All right.  Well, we’ve now got this wonderful plan for the chronic homeless, and we have inadequate mental health services.”

Tony Rodriguez: Yeah.

Ann Stern: And so now we’ve got to go figure that out and we’ve got to figure out, “How do we improve our community’s capacity for detox and substance abuse and mental health services?” and so– but that’s okay.  If you can stabilize this issue, then that frees up your resources to start focusing on the next and the next and the next and the next and, you know, that’s just–

Tony Rodriguez: You got to try this, I think.

Ann Stern: Well, you can see the city out here. <laughs>

Tony Rodriguez: Yeah.  Where’s City Hall?

Ann Stern: City Hall is–

Tony Rodriguez: <laughs>

Ann Stern: Do you see the–

Tony Rodriguez: Oh, yeah, that little building.

Ann Stern: –kind of gray building down there?  This is all the arts–

Tony Rodriguez: Oooh.

Ann Stern: –district down here.  You can see the very top of the funny-looking white building, the Alley Theatre.

Tony Rodriguez: Oh, yeah.  There’s a little Carnival Land or something over there.

Ann Stern: And– aquarium over there.

Tony Rodriguez: <laughs>

Ann Stern: Which is the carnival.

Tony Rodriguez: Oooh.

Ann Stern: And then if you look straight down the street, it’s kind of foggy today, but you can see the medical center down there.

Tony Rodriguez: Yeah.  Oh, yeah.

Ann Stern: And right behind it you can barely see a very pale white roof and that’s Reliant Stadium where they played the Super Bowl last weekend.

Tony Rodriguez: Oh, okay.

Tony Rodriguez: Wow.

Ann Stern: So…

Tony Rodriguez: It’s really big.

Ann Stern: Yeah.  Yeah.  Fourth largest city.

Tony Rodriguez: Okay. <laughs>

Ann Stern: Fourth largest city in the country.

Tony Rodriguez: Oh.  Oh, wow.

Ann Stern: <laughs>

Tony Rodriguez: All right.

Ann Stern: Thank you.

Tony Rodriguez: Thank you.  Thank you.  All right.

Ann Stern: Thank you.  Safe travels to you.

Tony Rodriguez: Okay. <laughs>

#### End of Ann_Stern_Houston_Endowment.mp3 ####