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Lawmakers weigh $17 million to continue CA RISE employment social enterprise grants
Summary
The Office of the Small Business Advocate requested $17 million to continue CA RISE, a statewide program that funds employment social enterprises (ESEs) that hire people with employment barriers; LAO questioned the program's evidence base and urged a rigorous evaluation.
Terrilyn Gray, director of the Office of the Small Business Advocate (CalOSBA) housed within GO‑Biz, requested $17,000,000 in one‑time funding to continue CA RISE, a program that provides capital and technical assistance to employment social enterprises (ESEs) serving individuals who face barriers to employment.
Gray told the subcommittee CA RISE differs from Los Angeles County's LA RISE model and emphasized that CA RISE focuses on capacity building rather than short‑term wage subsidies. She said the first round of CA RISE grantees included 61 ESEs with a combined headcount “over 13,000.” Gray said a midterm evaluation is in progress with data expected by mid‑April and a final evaluation due in September 2025.
Why it matters: Supporters told the committee ESEs produce durable employment pathways for people returning from incarceration, experiencing homelessness or with behavioral health challenges. Supporters cited placement and earnings gains among participants and argued CA RISE builds both employers and worker supports.
Evidence and oversight: The Legislative Analyst's Office said it relied in part on an external evaluation of LA RISE, which found no persistent post‑program employment gains, and recommended rejecting the proposal unless the legislature requires a rigorous third‑party evaluation of CA RISE. CalOSBA and program supporters countered that CA RISE is a different model focused on enterprise capacity that warrants continued support and evaluation.
Public testimony: Multiple ESEs and intermediaries including REDF, Downtown Streets Team, Goodwill affiliates and Homebridge described program outcomes they attributed to CA RISE funding — workforce placements, payroll growth and employer capacity building. REDF cited external evaluations that it said show longer‑term income growth and reduced reliance on benefits for participants.
Quotes and attribution: “We have over 13,000 headcount among the 61 ESEs that are grant recipients in the first iteration of the program,” Terrilyn Gray said. An LAO analyst recommended requiring a rigorous third‑party evaluation before extending ongoing funding.
Ending: Committee members pressed for evaluation data and asked whether the midterm findings would be available before a funding decision; CalOSBA said the midterm assessment will be ready in mid‑April but the final report is due September 2025. The item was presented as a governor's budget proposal; no final appropriation or committee vote was recorded in the hearing transcript.
