CSBG INNOVATION PROJECT 200809

1
CSBG INNOVATION PROJECT 2008-09

• Coastal Cash
• An Alternative to Commercial Payday Lending
  Check Cashing

2
Performance Against Goals

• Goal The first year of the two year proposal was
  to research payday lending alternatives and
  options, gain an understanding of the regulatory
  process governing banks and lending institutions,
  identify potential brick and mortar locations,
  determine feasibility, and provide feasibility
  study / recommendations for the second year of
  funding.

• Actual CCAP held coordinating meetings with
  potential banking partners interviewed payday
  lending institution clients, interviewed staff
  from the Department of Financial Institutions
  developed and implemented a questionnaire for
  potential clients and developed a feasibility
  study and recommendations.

3
Performance Against Schedule

• Plan summarize original schedule of project
• Coordinating meetings, 1/4ly
• Feasibility study based on a number of factors

• Actual summarize what really happened in
  relationship to plan
• All first year milestones accomplished.

4
Planning
5
Project Planning

• The project was primarily coordinated by CCAP CFO
  Craig Dublanko and staff member Shawna Myers.
  Also working on the project was Executive
  Director Troy Colley and the former
  President/CEO/current board member of Anchor
  Bank, Jim Boora.
• The project was designed for research and
  recommendations in the first year. The team were
  able to accomplish the goals of the first year.

6
Was the Plan the Right One?

• The research part of our plan was good.
• As the research began to come in, it was obvious
  that we underestimated the costs of
  implementation.

7
How Effective Efficient Was RD?

• Identifying solving technical problems
• We identified gaps quickly, including client
  needs, bank partners, alternative options to
  payday lending institutions.
• Estimates execution
• The first year of the project was under budget.

8
How Was the Project Managed?

• Meetings who/when/how often
• Though the project called for quarterly meetings
  of the coordinating committee, they meet 10 times
  during the year. The coordinating committee
  consisted of Jim Boora of Anchor Bank, Craig
  Dublanko, CCAP CFO, Shawna Myers, CCAP staff.
  The CCAP Executive Director attended 4 meetings.
• Communication who/when/how often
• Shawna Myers, CCAP staff, kept records of the
  meetings and disseminated information to the
  coordinating committee. Craig Dublanko and Jim
  Boora maintained phone and email contact on a
  regular basis with assignment reports.

9
Marketing

• Since this was a research project in this phase,
  CCAP and the coordinating committee did not
  market the program except to discuss the plan
  with potential partners in the banking community.
  The responses were good from Timberland, Anchor,
  Great NW Credit Union and the Bank of the Pacific.

10
Outcomes

• 250 clients responded to a questionnaire
  regarding payday lending and check cashing needs.
  The questionnaire determined level of usage,
  reasons for using, level of banking experience.
• Feasibility study completed.
• Long term funding solutions were researched.
• Foundations / bank investment
• Financial education programs researched.
• Rules and regulations of FDIC and Washington DFI
  governing payday lending / check cashing
  institutions.
• Researched potential fee structures.
• Researched potential brick and mortar locations.
• Conducted multiple interviews with 5 individuals
  who are regular users of payday lending / check
  cashing institutions.
• Staff toured an existing alternative lending
  institution.

11
Key Lessons
12
What Went Right

• Meetings with banks were productive and
  supportive.
• Interviews with payday lending clients were
  helpful and enlightening.
• 250 current CCAP clients surveyed for lending
  needs and current use were very helpful.
• Staff education on existing programs rules and
  regulations was good.
• Contracted company doing the feasibility study
  did an excellent job.

13
What Went Not So Right

• Significant issues affecting the project.
• The individual who put together the Innovation
  proposal was forced to shift priorities into
  another project about halfway through the year.
• The cost of implementation.
• How did team respond to problems?
• The Executive Director began attending meetings
  to keep the project on track.
• CCAP began looking at alternative funding
  opportunities and put the implementation phase on
  hold.

14
Recommendations

• The Coastal Cash concept is feasible and needed
  within this community. Usage of payday lending /
  check cashing institutions remain high in the low
  income populace.
• The cost of implementing a payday lending
  alternative is expensive and prohibitive within
  the funding available for the second year of
  innovation grant funding.
• CCAP will continue to meet with our banking
  partners to continue the project while seeking
  appropriate and sufficient funding for
  implementation.

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Questions Comments