Welcome to our latest www.Community-Wealth.org e-newsletter. This quarter we bring you the following new developments:
- The Democracy Collaborative continues to work with the Cleveland Foundation to build wealth in Cleveland’s Greater University Circle neighborhoods while also meeting environmental objectives. A recent case study by Living Cities, Blueprint for a Green Economy, outlines this path-breaking initiative in more detail.
- We’ve added to the site a new section on Green Collar Jobs. Green collar jobs have been defined as “blue-collar work force opportunities created by firms and organizations whose mission is to improve environmental quality.” But will the green economy produce wealth and asset accumulation for low- and moderate-income workers? Here you’ll find the latest information about strategies for shaping the development of the “green economy” to support community wealth building.
- We feature the seventh in our continuing series of conversations with community wealth-building leaders: John Logue of the Ohio Employee Ownership Center, based at Kent State University. Over the past 20 years, this employee ownership technical assistance center has assisted 81 Ohio companies convert to employee ownership, producing 14,685 new employee owners.
- We also profile our twelfth community wealth city: Pittsburgh, Pennsylvania, home to more than 30 wealth building programs and models.
As always, we have added dozens of new links, articles, reports, and other materials to the site - our webmaster tells us that C-W.org now contains more than 2,000 pages of material. Look for this symbol to find the most recent additions. And don’t forget to view our regularly updated C-W Blog.
Executive Director, The Democracy Collaborative
NEW & RECOMMENDED:
City Support for Community Land Trusts Grows
“Municipal officials have increasingly come to accept the policy prescription that, when public assets or public powers are used to create affordably priced, owner-occupied housing, something must be done to preserve those units for lower-income people for years to come,” write John Emmeus Davis and Rick Jacobus in a new policy report from the Lincoln Institute of Land Policy, The City-CLT Partnership: Municipal Support for Community Land Trusts. As a result, community land trusts, which provide permanently affordable housing, are expanding rapidly, with nearly 20 new community land trusts started every year. In this report, Davis and Jacobus discuss this trend as well as identify some “of the best-and worst—ways for cities to support CLTs.”
For more information or to purchase a printed copy (cost $15), see:www.lincolninst.edu/pubs/PubDetail.aspx?pubid=1395
The Challenge of “Philanthrocapitalism”
Michael Edwards, Director of Civil Society and Governance for the Ford Foundation, challenges the growing belief within some sectors of philanthropy that “business principles can be successfully combined with the search for social transformation.”In Just Another Emperor? The Myths and Realities of Philanthrocapitalism, Edwards surveys the growth of this new phenomenon, and argues that “the increasing concentration of wealth and power among philanthrocapitalists is unhealthy for democracy.”
Will the Rust Belt Rise Again?
Published by the Brookings Institution, based on a 2007 conference organized by the American Assembly, Retooling for Growth contains a series of essays that examine ways to rebuild, support, and sustain economic well-being in older industrial areas. Topics covered include the role of local government, workforce development, education, business development, anchor institutions, and community development finance. Central to the approach outlined in the essays is an emphasis on building an inclusive economy, one that combines equity and economic growth goals.
For more information or to purchase a copy, see:www.brookings.edu/press/Books/2008/
IN THE NEWS:
Heron and Lehman Brothers Launch “U.S. Community Investment Index”The F. B. Heron Foundation has engaged Lehman Brothers to create a new U.S. Community Investing Index, a positively screened subset of S&P 900 firms that demonstrate a commitment to strengthening America’s underserved communities. This project is part of Heron’s broader effort to enable investors to apply social criteria in all asset classes, including market-rate stocks. The index will be listed under the ticker CMTYIDX.
Philadelphia-Based Nonprofit Starts For-Profit Pharmacy
Resources for Human Development serves people who are homeless, mentally ill, developmentally disabled, and drug addicted. The group, which has a budget of $165 million and operates in 11 states, increasingly engages in social enterprise to raise revenue and meet service needs. Owning a pharmacy, for example, lets the nonprofit “improve the quality of the service,” Executive Director Robert Fishman tells the Philadelphia Inquirer. “We can recapture ultimately 75 percent of the profit produced by the pharmacy and donate it back to nonprofit needs of the uninsured. We call this a crossover business. A portion will be used to address social needs without dependence on a taxing authority.”
Aspen Institute Releases Set of Nonprofit Policy Recommendations
Nonprofit sector growth continues to outpace the growth of the U.S. economy as a whole and as of 2004 represented 7.2 percent of GDP. But policy has been slow to recognize and support the trend reports Cinthia Schuman Ottinger in a study commissioned by the Aspen Institute’s Nonprofit Sector and Philanthropy Program. Mobilizing Change puts forth ten policy proposals to support nonprofit and social enterprise development, including a Social Investment Fund Network to increase capital availability and a “Small Business Administration for nonprofits.”
New Framework Aims to Guide Community Development
In Managing Neighborhood Change, Alan Mallach of the National Housing Institute offers a framework to guide neighborhood market assessments by community development corporations, local officials, and other stakeholders to support sustainable and equitable revitalization. According to Mallach, assessment of market conditions is key to determine which community wealth building tools are likely to be most effective in meeting community and equity needs. Implemented appropriately, such “market-sensitive” strategies offer great promise “for preserving affordable housing and minimizing displacement.”
Community Investment Gains Institutional Investor Support
“Institutional investors such as public pension funds, insurance companies, foundations, and universities are increasingly allocating capital to community investments,” writes Anna Steiger in Community Banking, a publication of the Federal Reserve Bank of Boston. Steiger notes that public pension funds have committed $11 billion to economic development investments (a figure that does not include broad in-state targeted investments) while market-rate, mission-related investments from foundations have grown since 2000 at a 19.5 percent compound annual rate.
Regional Economic Development Program Shows Success
In 1997, a federal government agency known as the Appalachian Regional Commission (ARC) began the multi-year Entrepreneurship Initiative to invest in projects designed to promote economic growth across Appalachia. To date, according to the findings of an independent research team led by Deborah Markley of the Rural Policy Research Institute, ARC has invested almost $43 million in various projects, helping create or retain over 12,000 jobs at a cost ranging from $600 to $4,000 per job—an amount that is less than one-tenth of the cost of many conventional economic development “job attraction” efforts.
Philanthropic and Nonprofit Leaders Debate Social Enterprise
In October 2007, Community Wealth Ventures gathered 40 nonprofit sector leaders to discuss how to use market strategies to fulfill nonprofit missions. This report summarizes the discussions. Brief essays in the volume were written by Bill Shore of Community Wealth Ventures, Jennifer Vanica of the Jacobs Center for Neighborhood Innovation, Mario Morino of Venture Philanthropy Partners, Sean Closkey of The Reinvestment Fund, Clara Miller of the Nonprofit Finance Fund, Julius Walls of Greyston Bakery, and George Gendron of Clark University.
Report Proposes Public-Social Enterprise Partnership to Meet Social Needs
“So far, collaboration between social-entrepreneurial organizations and government has occurred in isolated incidents,” writes Andrew Wolk, CEO of RootCause and senior lecturer in social entrepreneurship at the Massachusetts Institute of Technology’s Sloan School of Management. Yet this may be changing: “In partnership with government, social entrepreneurs can augment their ability to generate and implement transformative, cost-effective solutions to the most challenging societal problems facing our nation and the world.” Wolk outlines a 13-point policy agenda to enable government to more effectively leverage social enterprise activity for public benefit.
C-W.ORG INTERVIEWS WITH COMMUNITY BUILDERS:
John Logue is Founder and Executive Director of the Ohio Employee Ownership Center, based at Kent State University. Over its first 20 years, the organization has helped more than 81 companies became partly or wholly employee owned, creating 14,685 new employee owners. Follow-up research on data through 2003 for 49 of these firms found that they had created $349 million in equity for their employee owners.
The twelfth in our continuing series of profiles of Community Wealth Cities: Pittsburgh, Pennsylvania. Most people think of Pittsburgh as the historic center of the U.S. steel industry, almost all of which has now left the area. Yet the “Steel City” has also been a community wealth-building innovator. To name just one example: Pittsburgh’s Social Enterprise Accelerator, founded in 2002, has helped make Pittsburgh one of the leading cities nationally for nonprofit business development.
Co-op America Conference Explores Growing Green Economy
The mission of Co-op America, which recently celebrated its 25th anniversary, is to grow the green economy. To that end, Co-op America’s Green Business Conference brought together approximately 150 Midwest business leaders on May 14-15 in Chicago. Gathering at a time of growing enthusiasm for environmentally focused business, conference participants expressed optimism regarding the potential for future growth in green-oriented businesses, even as they acknowledged that many obstacles to moving “green” fully into the economic mainstream remain.
Brookings Institution Issues Policy Call to a “Metro Nation”
Over 900 people came to Washington, DC to attend the Brookings Institution’s Metropolitan Policy Program’s “Summit for American Prosperity.” As speakers at the conference pointed out, America has become a “metro nation” — more than 65 percent of the population and 75 percent of the nation’s GDP stem from the economies of the nation’s 100 largest metropolitan areas. The conference, held June 11-12, emphasized the need for policies that serve cities and suburbs alike in the areas of transportation, economic growth, housing, and workforce education and training. Among the highlights were addresses by Michael Porter of the Harvard Business School, Bruce Katz of the Brookings Institution, and Governor Edward Rendell of Pennsylvania.
US Worker Co-op Federation Holds Third Biennial National Conference
The US Federation of Worker Cooperatives held its 3rd National Conference in New Orleans, Louisiana on June 20-22. The event brought together 200 worker co-op members and allies. Highlights included a showcase on redevelopment issues facing community members in New Orleans and a presentation by Omar Freilla of Green Worker Cooperatives in the Bronx regarding the importance of building worker ownership in the green economy.
Founded in 1986, this for-profit Fair Trade coffee, tea, and chocolate company is a cooperative that is owned and governed by 85 worker owners. It currently works with 40 small-scale farmer co-ops in 20 countries. A major portion of its $30 million in annual sales flow through hundreds of consumer-owned food cooperatives and non-profit Fair Trade shops nationwide.
Genesee County Land Bank Authority
With passage of land banking legislation in 2002, the state of Michigan opened the door for communities to reclaim, reinvest in and rebuild their neighborhoods. Since then, the Genesee County Land Bank, based in Flint, has become a national leader in using land banking to guide community development. By avoiding the potential neglect or misuse that comes from selling land at auction, the County is able to acquire abandoned land through the foreclosure process and determine the best use of that land. The Land Bank assembles land for transfer to adjacent homeowners, develops long and short-term green spaces, and assembles land for new housing and commercial development. Overall, the Land Bank aims to restore the integrity of the community by removing dilapidated structures and redeveloping abandoned properties.
King Arthur Flour
Started in Boston in 1790 and now based in Norwich, Vermont, America’s oldest flour company has grown from a family-owned, mail-order business with five employees in 1990 to a 100 percent employee-owned (ESOP) business with over 180 employees and $45 million in annual sales. In the past year, King Arthur Flour has also become a B-corporation (indicating a commitment to public benefit as well as profit) and was among the 25 companies in WorldBlu’s 2007 list of most democratic workplaces.
State of Louisiana, Office of Social Entrepreneurship
Founded in 2007, Louisiana’s Office of Social Entrepreneurship marks the first example of a state agency being established to support social enterprise. Operating out of the Office of Lt. Governor Mitch Landrieu, it acts primarily as a clearinghouse to connect aspiring social entrepreneurs with support organizations, such as private foundations, that can lend expertise and resources.