Smart Interaction

Program of the Charitable Foundation “Young Community”

Approbation of mechanisms of interaction with hromadas The project has an objective to implement social change in communities through implementing efficient solutions to the challenges of war, in particular by integrating the original Citizen Token System (CTS) mechanism into local governance procedures (public budget) and using it for the benefit of communities with the participation of residents.  

During the previous pilot of the CTS, the Young Community team recorded a number of benefits for communities. They include the ability to generate significant additional value to public goods in relation to costs, as well as to develop participatory self-government skills among residents. This project is the second cycle of CTS piloting.

Goal

The project’s goal is to introduce social change in the Rudky TH (Lviv region) and Dubechne TH (Volyn region) on the basis of the above statements, through implementing efficient solutions to the challenges of the war, in particular the integration of the CTS into the mechanism of the 2023 public budget in the pilot communities. The tasks are determined by the main stages of the second cycle: planning, launching smart contracts, pitching projects and balanced voting of residents with RV tokens, retrospective, publishing and discussing the obtained results during an online conference.

Relevance and Importance  

Adaptation of local communities to the conditions of war and its consequences requires the rational use of available resources on the basis of a participatory approach. When residents gain their own experience and skills in problem-solving, it is a prerequisite for democratic self-government and the formation of values incompatible with the dominance of paternalism. In addition, it motivates resistance to authoritarian regimes. These two opinions determine the need for this initiative and its current relevance. Expected qualitative impacts: strengthening of participatory local self-government of pilot hromadas, transparency of local self-government bodies, as well as the ability of hromadas to respond to large-scale challenges at the local and micro levels. After all, synergy with other teams and private initiatives is important for the team.

Changes Entailed by the Project  

• Strengthening the capacity of communities to respond to the challenges of war;
• Increasing the level of involvement of residents in participatory self-government;
• Improving the ability of our informal coalition to scale up new opportunities in other hromadas of Ukraine.

Outcomes

• 854 residents created 901 useful cases under 11 smart contracts for a total of UAH 349,470. The number of residents involved significantly exceeds the planned number (458 people), which demonstrates a successful communication and engagement strategy and its implementation by local teams. The amount of added values to public goods created by residents is less than planned (600,000 UAH). Some of the reasons include: 1) the negative effects of blackouts on the activity of residents, 2) the data of the previous more expensive military aid (goods, foodstuff) were used as the base ration. During this project, a significant part of useful cases was associated with less costly community improvement (services). Nevertheless, the achieved result demonstrated an important benefit for communities from the use of CTS in the ratio of 1 : 4.58 (each hryvnia of the grant provides 4.58 UAH of added value to the public goods of the community, (349,470 +97,650)/97,650). This is a significant advantage over the usual method of granting, with a ratio of 1:1, which can be considered as a more effective method of (social) impact investing.
• The involved residents of both communities received 1953 RV tokens for a total amount of UAH 97,650 under smart contracts. This is the total available amount in support of local projects by a balanced vote of 854 residents with the received RV tokens.
• 4 projects of entrepreneurs were supported for a total amount of 84,650 UAH. In accordance with the "CTS for community resilience" model used, this money was provided to entrepreneurs for temporary use and should be returned to the community after the completion of projects. Upon return, the community will be able to activate smart contracts and issue RV tokens for this amount to attract residents to useful things. Thus, it is expected that hromadas received all UAH 100,000 in subawards as a resource for long-term use.
• CTS is integrated into the mechanism of the 2023 public budget of the Rudky hromada, and funding from the local budget for UAH 30,000 has been approved.

The level of citizen engagement increased by 223% (expected to increase by 120% from the baseline for previous activities – 382 people), the level of (social) impact investing for communities exceeded the usual grant method by ~4.6 times due to the use of CTS, and community resilience improved due to the integration of CTS into public budgets, as well as the launch of the "CTS for community resilience" model to support the local economy and create added values of pre-social benefits.

Target Audience

• Representatives of local self-government bodies (city, village councils, starostas of 2 target communities) are interested in effective mechanisms for establishing a constructive dialogue and interaction with residents, to improve the well-being and solve urgent problems and increase investment attractiveness through the development of social capital.
• Leaders of volunteer groups, community initiatives of 2 communities.
• Residents of 2 communities.

Sustainability. Scaling up. Continuity

Piloting within the project was introduced to improve community resilience and sustainability. The creation of the hromada's capital and its renewal through repayable interest-free grants will make it possible to support residents' entrepreneurial initiatives on an ongoing basis. Integration into community budgets should add sustainability to the use of CTS for non-profit projects. At this stage, the possibilities for scaling look somewhat limited due to the lack of specialized digital tools for CTS. However, the lack of these tools is not critical for continuing to pilot CTS capabilities for individual communities. Increasing the level of involvement of residents, their knowledge and skills in entrepreneurship, investment and participation in decision-making are critical components in the development of human and social capital of hromadas, as well as participatory local self-government.  

Thus, for the sake of project’s continuity and as an immediate progress towards the defined goal, the Young Community Foundation considers building up the target capital of pilot communities, according to the CTS for community resilience model, and supporting non-profit projects according to the usual CTS model.  

The project is implemented by the Moloda Hromada Charitable Foundation thanks to financial support from ZMIN, as part of the grant program 2022.

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