The Next Frontier in Equity is All About Data
Source: Route Fifty
Developing strategies centered on data collection is critical for governments to make sure resources are deployed in an effective and equitable way.
Many municipalities are pushing to be more equitable in everything they do, and rightfully so. For example, in 2019, Milwaukee County became the first county in the United States to declare racism a public health crisis and resolved to assess internal policies to ensure a focus on racial equity and address health disparities between communities of color and their white counterparts. Since then, roughly 70 counties throughout the United States have passed similar resolutions.
This focus is not only occurring at the local and state level, but also at the federal level. As a result of this push for increased equity, many localities want their equity goals to be reflected in their budgets and are tying their investments to equitable outputs and outcomes.
A key way for states and cities to budget for equity and achieve more equitable outcomes is by leveraging data. Data collection ensures that public dollars are used for their intended purposes and equity targets are reached. This can be challenging since different communities have different equity challenges. For example, in areas prone to weather disasters, it could mean the ability for communities of color to adapt to flooding or heat waves. In large urban areas, it could mean providing systematically excluded individuals access to mass transit.
When the International City/County Management Association observed the data collection of social equity in several communities, it identified a wide range of outputs and outcomes measured, such as employment, access to technology, support for immigrants, affordable housing and impacts from exposure to lead. While this is a helpful starting point, there is a need to standardize the way communities collect data and what is measured as it relates to equity initiatives. Standardization allows suppliers to develop common technological platforms, constituents to benchmark with other communities and communities to better identify risks caused by social inequities.
The American Rescue Plan Act offers a starting point for how to create consistent equity measures. Recipients of money from ARPA’s State and Local Fiscal Recovery Funds are required to report on usage of funds to service “disproportionately impacted communities” or communities historically disadvantaged and prone to adverse impacts from a disaster like the Covid-19 pandemic. The federal government has made tools for assessing equitable outputs from programs (not limited to SLFRF-funded programs) available, along with case studies, on its website.
The SLFRF reporting requirements include qualitative and quantitative reporting on plans to ensure equitable outcomes from funded programs. Quantitative data requirements include “using … quantitative data on how the jurisdiction’s approach achieved or promoted equitable outcomes or progressed against equity goals,” and “describing the demographic distribution of funding, including whether it is targeted toward traditionally marginalized communities.”
Societal Best Practices
More guidance along societal-based data collection can be found with the Government Finance Officers Association best practices for measuring social factors in relation to debt issuances. Although the guidance is specific to disclosures for societal issues that could impact credit quality (or the ability to pay debt obligations), this best practice is also applicable for collecting data for monitoring equity.
GFOA’s guidance focuses on Environmental, Social and Governance reporting. This discipline, used for disclosing risks for investors, could also be used to monitor equity within a municipality. For example, availability of housing for impoverished or disadvantaged population groups is one societal factor investors may find useful and it should be disclosed.
ESG reporting is a newer concept and is…
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