Social service nonprofits in New York City could win thousands of dollars in prize money if they can prove their programs work.

That's the word from the Center for Economic Opportunity (CEO), a division within Mayor Michael Bloomberg's office, which is inviting nonprofits across the city to submit proof that they have a novel and effective way to help low-income New Yorkers.

Reducing poverty is a major focus of the NYC nonprofit community. About 20 percent of the city's population was below the official poverty measure in 2011, compared to 15.9 percent for the country as a whole, according to the U.S. Census Bureau. Poverty rates among families with children in New York City rose between 2008 and 2010. "It's an intractable problem," says David Berman, CEO's director of program management and policy, "but [a problem] to face."

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Entrants that win first- and second-place prizes would collect $20,000 and $10,000, respectively. The winners, along with other nonprofits with promising proposals, could receive technical and marketing assistance, as well as help in evaluating their programs.

The prize money itself is unlikely to represent a major source of funding for a nonprofit. But "it can go a long way" in covering one-time needs, says Shari Krull, executive director of the Grace Institute, a nonprofit that provides free computer and business skills training for 300 low-income women in New York City. An extra $20,000, for example, might cover consulting fees for a curriculum upgrade.

To put the prize money into context, the Grace Institute maintains an annual operating budget of $3 million; it collects roughly $50,000 a year in gifts from individuals, but groups such as the Robin Hood Foundation ($150,000) or Tiger Foundation ($200,000) provide a greater proportion of annual funding.

Probably more important than winning the prize money would be the potential for an independent evaluation, which Krull calls "a luxury for most nonprofits." Hiring an evaluation firm is usually cost-prohibitive for a small nonprofit, and it's not something they tend to specialize in. "We are very good at capturing the data," says Krull, "but we are not statisticians."

That's where CEO comes into play. The organization contracts with several evaluation firms and  believes in rigorous testing of anti-poverty programs, rewarding positive results with more funding. "That's part of our structure and DNA," Berman says. "We know that not every idea will work, [but] we're looking for interesting, data-driven approaches."

To win, the entries must demonstrate quality-of-life improvements for low-income New Yorkers, which could mean better results in areas that include employment, income, assets, education and health. "We didn't set out specific metrics per se," Berman says. "We wanted it to be flexible."

Although the competition restricts the pool of applicants to nonprofits in the Big Apple, the selection criteria favor proposals that could be replicated in New York and elsewhere. Corey Chambliss, a CEO spokesman, calls the competition a "hackathon for social service nonprofits" because it tries to expand anti-poverty programs pioneered by the community, not the government.

A panel of judges comprised of city staff and anti-poverty experts will announce the winners in late April.

Mayor Bloomberg's office said the competition will be an annual event, though its future would depend on the support of the next mayor. If it continues, the shortlist of winning nonprofits could benefit from the prestige afforded by a yearly city award. That kind of recognition, Chambliss says, can help an organization attract new partners and funders.