Release: Policy Paper Urges Radical Shift in Approach to Revitalizing Distressed Communities
POLICY PAPER URGES RADICAL SHIFT IN APPROACH TO REVITALIZING DISTRESSED COMMUNITIES
Community Development, focused on new buildings vs. Community Wealth focused on people
Authored Bruce Katz and Ross Baird in collaboration with Accelerator for America, released at CityLab
October 29 – Accelerator for America, in coordination with Bruce Katz, Accelerator partner and Director of Drexel University’s Nowak Metro Finance Lab, and Ross Baird Founder of Blue Print Local, released the groundbreaking new policy paper “Towards a New System of Community Wealth” at the City Lab Conference in Washington, DC this week.
“We’ve spent billions of dollars on so-called ‘revitalization projects’ that at best provided subsidized rental housing without giving people the chance of truly accessing wealth -- housing is necessary, but not sufficient,” said Accelerator for America co-founder and CEO Rick Jacobs. “We must shift to a model that builds wealth for families and future generations to lift them out of poverty for good.”
For almost sixty years, governments, foundations, and banks in the U.S. have tried to solve issues of economic inequality through a top-down “Community Development” system. The goal: use large federal grants, big philanthropy, and subsidized bank debt to build units of low-income rental housing.
This paper explores how this long-standing system of top-down Community Development has failed us, and discusses a new system, which we have labeled “Community Wealth”, that has begun to emerge. This new system represents a radical shift in how private capital invests in distressed neighborhoods, and the paper details the systemic changes in policy, practice and institutions required to build Community Wealth across the country.
We define Community Wealth as “a broad-based effort to build equity for low-income residents of disadvantaged communities.” Community Wealth aims to build equity by:
Growing the individual incomes and assets of neighborhood residents by equipping them with marketable skills and enabling ownership of homes, properties, and businesses;
Growing the collective assets of neighborhood residents by endowing locally-run organizations with the ability to create, capture, and deploy value for local priorities and purposes;
Improving access to private capital that has high standards, fair terms, a long-term commitment to the neighborhood, and reasonable expectations around returns and impact; and
Enhancing inclusion by bringing fairness and transparency to neighborhood revitalization so that community voices are heard and respected and trust is restored, and local residents have the opportunity to participate in wealth that is created.
This evolution has been accelerated through the creation of the federal Opportunity Zones legislation. This tax incentive is an imperfect tool, but it has focused attention on what’s going wrong with our economy at the neighborhood level, and how we can improve it through a constellation of local leaders building a new system of Community Wealth.
Towards a New System of Community Wealth was produced through the collaboration of Accelerator for America, Drexel's Nowak Metro Finance Lab, and BluePrint Local. A shortened op-ed of the paper can be found here.
###
About Accelerator for America
Founded in 2017 by Rick Jacobs with Los Angeles Mayor Eric Garcetti, Accelerator for America finds and develops solutions to economic insecurity that it then shares with cities across the country to make national change from the ground, up. Its tools are being used by more than 50 cities nationwide. Visit Accelerator for America’s website, here.
Bruce Katz is the Founding Director of the Nowak Metro Finance Lab at Drexel University and a Partner with Accelerator for America to scale and replicate innovative economic development finance tools across the country. Bruce is the coauthor (with the late Jeremy Nowak) of The New Localism: How Cities Can Thrive in the Age of Populism.
Ross Baird is the founder of Blueprint Local and the founder and 10-year President of Village Capital, one of the world’s most active venture firms. He is the author of The Innovation Blind Spot: Why We Back the Wrong Ideas and What to Do About It.
Contact Information:
Yusef Robb, Accelerator for America, 323-384-1789
yusef@acceleratorforamerica.org