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HomeMy WebLinkAbout02-01-17 Community Relations pU T$& W PEACE a a a 1865 OFFICE OF THE CITY CLERK KAREEMAH FOWLER,CITY CLERK COMMUNITY RELATIONS FEBRUARY 1, 2017 5:30 P.M. Committee Members Present: Regina Williams-Preston, Karen White Jorden Giger(Citizen member), LaQuita Hughes (Citizen member) Committee Members Absent: Randy Kelly, Gavin Ferlic Other Council Present: Jo Broden Others Present: Pastor Hardie Blake, Kelly Hoggard Agenda: Presentation from Jessica Bonnano from the Democracy Collaborative about their work in cooperative business models as a means of building community wealth and ending income inequality Committee Chair Regina Williams-Preston called the meeting to order at 5:31 p.m. Committee Chair Williams-Preston introduced members of the committee and explained how different the meeting was going to be in regards to how the meeting was going to flow. Engagement, learning, and educating were the main themes Committee Chair Williams-Preston wanted to highlight for the meeting's objectives. She stated, We'll have a couple community members talk about the work they are already doing in regards to the issues being brought up, have the presenter give a bit more information, and then have an opportunity for you all to engage with one another and close the meeting sharing the feedback from the citizens to the committee. Committee Chair Williams-Preston reminded the committee and citizens the meeting is public,recorded, and going into the record, so it is an important part of how people in the community have a say in what happens and how things move in the City going forward. Committee Chair Williams-Preston explained the community sign-in sheet which was circulated to all citizens in attendance and went on to announce the topic of the meeting to be Community Wealth Building. She referenced the Alice Report done by United Way that found fifty-three percent (53%) of people living in South Bend are at or below the poverty line,to which she found incredibly unacceptable. We talk about the problem a lot,but this is an opportunity to address that problem. Community Wealth Building focuses on the principle to invest in people, specifically the traditionally marginalized groups of inner-city residents. She then went on to 455 County-City Building•227 W.Jefferson Boulevard•South Bend,Indiana 46601 Phone 574-235-9221 •Fax 574-235-9173•TDD 574-235-5567•www.SouthBendIN.gov JENNIFER M.COFFMAN ALKEYNA M.ALDRIDGE JOSEPH MOLNAR CHIEF DEPUTY/DIRECTOR OF DEPUTY/DIRECTOR OF POLICY ORDINANCE VIOLATION CLERK OPERATIONS reference Mayor Pete Buttigieg's executive order signed last year supporting the City of South Bend's Diversity and Inclusion Initiative. She believes it to be an important document because it looks at real ways to address the issues that are constantly talked about. She read an excerpt from enable each and the document, We believe that we must every individual to reach their full potential. In order to do that, we must erode the barriers that exist...We must work intentionally to incorporate into the whole those persons, or groups, who have historically been underrepresented and underserved by the government...The Office and Director of Community Investment will invest in people to create opportunities for everyone to thrive." Committee Chair Williams-Preston then showed a video titled `The Cleveland Model,' found here: https://www.youtube.com/watch?v--s_kLye-6VBc The video calls upon what are defined as `anchor institutions' —i.e. local non-profits such as hospitals, universities, municipal governments—and challenges them to invest in people starting cooperative organizations within their local community. Kelly Hoggard, 735 Huey St.,talked about the 1,000 homes in 1,000 days initiative and the effect of that initiative in his immediate neighborhood. There are people, young people,who want to work on solutions to unemployment and homelessness. He referenced the Cleveland Model and how it has expanded to Rochester,NY, highlighting the fact that Rochester has a progressive mayor who has allocated funding toward vacant properties. He then stressed the importance of finding people with gravitas and grass-root experience to champion the idea of a Community Land Trust in specific areas. Pastor Hardie Blake, 144 N. Summit, shared his idea termed `Blakenomics.' Current programs like Project Impact work with ex-offenders, unemployed persons, and homeless persons in effort to transform their lives, primarily looking for jobs for these individuals. Blakenomics focuses on creating wealth for the whole community, as opposed to just a few people, from the bottom up, making the poorest of people the actual owners of businesses. A possible way of accomplishing this would be to offer stock shares or savings incentives for these individuals by attending classes that teach economics and personal finance knowledge. Jessica Bonnano, Cleveland, OH, introduced herself as the presenter of the evening representing the Democracy Collaborative, a think-tank organization that publishes and promotes different community economic development strategies that emphasize equity and inclusion. Primarily, they rely on broad-based ownership as a best practice strategy, while also recognizing how different communities have different outcomes. She shared her experience in Notre Dame graduate school and her excitement to be back in the city. She stated her hope of sharing some national best practices to spark conversation and thought toward implementing something similar in South Bend. The presentation title is Community Wealth Building (CWB), a term used by the Democracy Collaborative to describe an approach to economic development that emphasizes broad-based ownership,place-based development strategies and seeks to produce more inclusive outcomes. Two (2)principles that are fundamental to CWB: The first principle recognizes the relationship between system structure and system behavior—the structure will determine the behavior. Because behavior produces outcomes, system structure indirectly affects the outcome. The key lever in system structure is ownership,the second principle to CWB. Ownership matters because the people that own assets are the ones directly affected when decisions or investments 2 are made. A dominant business model currently being utilized in society is the investor-owned corporation. Though that is not inherently a bad thing, sometimes the needs and priorities that face the investors may be different or even conflict with the needs and priorities of the communities in which those businesses are located, the workers or even the consumers of that business. So broad-based ownership structure helps disperse the concentration of needs and priorities to have other types be considered. Broad-based ownership means more people's priorities and needs are being met. She then played a video in the presentation that can be found on the South Bend Common Council's website. In the video,the concepts of inequality and community wealth building were addressed by focusing on a new system of economic cooperatives. Ms. Bonnano stated Community Wealth Building is a systems approach to economic development with the goal being to create an inclusive economy built on local and broad-based ownership. This is achieved by tapping large sources of demand, fostering enterprises rooted in the community, all around trying to create a cumulative system where communities thrive and families enjoy greater economic stability. She noted that CWB is not an oppositional to the traditional way of economic development, rather it is more supplemental and complimentary. She went on to describe the importance of ownership by way of capturing the flow of all the economic benefits and harnessing the power of decision-making. A slide brought up in the presentation showed the Continuum of Wealth Building Strategies. This continuum showed the importance of micro-enterprise for individual wealth building. Whatever the importance may be, there are still those that are not able to participate in entrepreneurship for it takes a tremendous amount of assets, resources, capital and connections. CWB focuses on other ways for individuals to acquire entrepreneurship without having access to those aforementioned variables. For example, raising a pool of capital and having twenty (20) or thirty (30) employee-owners spreads the risk, necessary investment but also spreads the overall number of people benefited by the profitability. Ms. Bonnano transitioned by explaining a few different types and models of broad-based ownership. The first model described was a Community Land Trust. A Community Land Trust (CLT) is when a non-profit or some other community-based organization gets together, raises a pool of capital, buys some land and uses the land for housing development, business development or another purpose toward the community's specific problem they intend to address. Another broad-based ownership model is public ownership. These are municipal enterprises, owned by residents and taxpayers, are for-profit businesses that are set up to provide goods and services and operate like regular companies, but their profits go back into the public treasury. This allows the community to have revenue generated and also allows the company to offer lower rates, competing with already existing traditional companies. Employee-owned businesses is another broad-ownership model of business. Employee-owned businesses include workers cooperatives and are, by definition, owned by the people that work for them. Another employee-owned business model is an ESOP (Employee Stock Ownership Plan.) Worker Cooperatives and ESOPs are the two (2) most common employee-owned business structures. The ESOP is actually a trust, it is set up as a tax-advantage retirement plan for employees. The trust structure owns the business to varying percentage ratios (twenty percent(20%),thirty percent(30%), or otherwise.) Publix Supermarket is an example of an ESOP. A worker cooperative is a more direct ownership where all the controlling stock and voting stock is owned 3 by the workers, principled in the understanding of`One member, one vote.' This means that every person that works there is only able to own one share of stock. The CEO down to the cashier, all own the same amount of stock and decision power. There has been a lot of research to document the benefits of employee-owned companies. Folks that work in employee-owned companies are benefitting economically. When employees think like owners, that has an impact on productivity, stability and profitability. Ms. Bannano then referenced the upcoming Baby Boomer retirement wave. Having entered the first part of the wave, there are an estimated 150,000—300,000 businesses currently owned by Baby Boomers that, within the next fifteen(15) years, will be up for sale. Many of these business owners do not have a succession plan in place. This is an opportunity to encourage a transition to employee-ownership models. Midwest Orthotics is a South Bend example of an ESOP structure. She then went on to describe her experience with worker cooperatives in Cleveland and how that project came together. It was a multi-stakeholder community wealth building initiative and one of the most nationally visible examples of this concept. Cleveland, like South Bend,has experienced a lot of disinvestment over time. There is an area called the Greater University Circle Area in Cleveland where approximately fifty thousand (50,000)residents are living at or below the poverty line. There is a high vacancy rate, high school drop-out rate, unemployment rate, most all of which are indicators for poverty. Nearby this area is the University Circle Area, and it is one of the most prosperous areas of Cleveland because that is where the largest anchor institutions are located. Anchor institutions is a term used to describe large, usually non-profit, institutions that aren't going away. For example in South Bend,that might be Notre Dame or IU. Also since de-industrialization,these institutions tend to be the greatest economic engines for the community. However when looking at a map, it seems as though the economic benefits or prosperity are not so much spreading to the immediately surrounding neighborhoods. This was identified as a key problem, but also an opportunity to leverage assets to help those struggling communities. These institutions,partnering with the city government, the community foundation created a package of comprehensive investments in infrastructure, transportation, and housing. One of the interesting projects that came out of that was the Evergreen Cooperative Initiative. The anchor institutions in Cleveland thought about how they could do more local and inclusive hiring. They set up programs in workforce development and pipeline recruitment to attract and recruit folks from the surrounding communities so they weren't just hiring people from the suburbs. By looking at the supply chain of the anchor institutions, they found business development opportunities to create companies in the local community that can hire traditionally marginalized persons from within that local community. The Cleveland Foundation started the initial conversations with the anchor institutions. For example the two (2)hospitals,University Hospital and the Cleveland Clinic, identified that they produce a lot of laundry and linen, and created the Evergreen Cooperative as an industrial laundry facility. Philanthropy by way of$6 million was set in a revolving loan fund by the Cleveland Foundation to start the process. Ms. Bonnano then went on to share the statistics of the impacts and early outcomes of the project in Cleveland. She revealed the recent opportunity for the Evergreen Cooperative Laundry employees to vote on renewing the contract of their managing Chief Executive Officer. Antonius Northern, 234 Rue Flambeau, asked the presenter,Has a cooperative initiative ever addressed a food scarcity issue or poverty issue? 4 Ms. Bonnano answered that in regard to the food scarcity issue, these initiatives are still just businesses. Solving a food scarcity issue relies heavily on that business' execution. In regard to poverty, an example of that being addressed and reduced is the Basque region in Spain. This area of Spain has traditionally been marginalized. They began setting up cooperative businesses. Since creation, they now have international companies. E-Lexus Thornton, IUSB Student, asked, So you're putting businesses into communities that are owned by the communities, and these communities are putting money in the businesses and it's coming back to them. Why not take it a step further and put community center banks there as well? That way people can make their own businesses from there and have the community flourish even more? Ms. Bonnano agreed. Kevin Hoggard, 125 W. Marion St., asked Committee Chair Williams-Preston, Is there a South Bend Foundation? Committee Chair Williams-Preston answered that while there is a foundation, it is the St. Joseph County Community Foundation. She also stated that it was recognized as one (1) of the top one hundred (100) in the nation in terms of assets. Ms. Bonnano concluded that Community Wealth Building is a systems approach to economic development that is designed to try and think about ways to broaden economic benefits and participation in asset building. Taking inventory of what resources the City already has is key to moving forward. Strengthen support networks in the anchor institutions. Aim to keep wealth local. Committee Chair Williams-Preston thanked the presenter and entertained a five (5) minute recess to informally caucus with one another. She posed three (3) discussion questions to the body: Which model resonated with you? What local stakeholders need to be at this table? What things are already going on that we might want to bring together to align our efforts? [RECESS] Committee Chair Williams-Preston brought the meeting back to order at 7:15 p.m. Antonius Northern, 234 Rue Flambeau, stated, One of the things I was noticing was when we talk about wealth,we get this warm and fuzzy feeling, because we think of wealth as being something already built up sufficiently enough that it doesn't need to be touched. But I think a lot of the concepts being talked about today fits better into the term equity. The reason why I say that is because when I think about a cooperative, I think about the term equity. I can relate that to home ownership or any other type of ownership. When you think about owning a home, you're stilling paying into that through mortgage payments. The reason that concerns me is because I think a large number of people are concerned with sustainability. You're concerned that all individuals have access to the things they really care about. This community in particular is 5 concerned about homelessness and food scarcity. What we are talking about though are these models that don't actually eliminate the problem. What we are looking for is a system to make sure everyone has a bed. For example,just being a member of the Purple Porch Co-op doesn't deal with the issue of food scarcity. When I heard community wealth, I was hoping we were getting ready to have a conversation about how we can make sure that individuals always have that specific thing. The Land Trust situation is the recommendation that our group would give. Bill Doug, Southwood Ave., stated, Toward the end of the thousand (1000)home in thousand (1000) days study,they got to the question We're going to have all these lots, what do we do them? There was mention of a land bank solution. The last election for mayor, they were asked that in a debate and his only answer at the time was We don't have an answer, we need to get people back together and talk about it. I'm simply suggesting that I like that idea,that we have a cooperative ownership of these vacant properties and somehow feed it into the other structures that will make the best use of it for the best benefit for the most people. Anne Mannix, 724 W. Washington Blvd., stated, We talked about job creation and I liked the idea of the house-cleaning cooperative. There are a lot of women in the community that are underemployed and making fifteen($15) dollars an hour would be a great thing. I think there is a need for services connected to people's homes. We've got older people that need help,working mothers that could pay someone to clean, a lot of middle class people. As far as the land banks, I think it's a great idea. We have been very interested in getting the city to do that for a couple years. I work on the thousand (1000)houses and I don't think there's much interest in the land bank in the city so we would have to work on that a lot. They do have a big resource like the Business Development Corporation and I think they have a very large amount of money that's not invested and is just sitting there. Maybe we could get a little bit of that and do a feasibility study. Big employers that have a need for services should be at the table for this conversation. E-Lexus Thornton, IUSB Student, stated, I like what Antonius was saying about sustainability in our community. I like what you're saying, it's a good seed to plant, but what we have to focus on next is how we stem from that. We've got people who are appointed to businesses in the community, at what point do people in the community start making their own businesses and tracking people from outside the community to come in and make more money as a whole? So that's what I'm thinking about as far as development. So I like what you're saying, it maintains, but maintaining isn't really what we're striving for. We are striving to over achieve. I believe there need to be plans that keeps it going as far as the money coming in, as far as people getting better houses, as far as people getting better pay, it could be better. We could stem to SciTech, science and technology, clean energy, better schools, destroy justification completely so everybody could live.together to create absolute equity. Danielle Wood, 133 Wakewa Ave., stated, Admittedly I missed most of the presentation because I was teaching, but I come from a background of working with cooperatives. I think it's a very nimble model, but we need to think about starting intentionally at a leverage point that is population driven. Who are those that have the hardest time getting living wages in our communities and targeting a business development program that ensures that they are getting that living wage and starting small and trying to grow from there. There are so many approaches you can take,but we need to focus on single mothers, or ex-offenders, or a particular group that 6 is challenged in our community. Living wages to that group have multiplier affects throughout the community. Pastor Hardie Blake stated, A cooperative uses the word cooperation. We don't have a common unity community and we don't have poor people participating. There's always going to be a top down, but when I'm talking about Blakenomics I'm talking about systemic. Capitalism creates wealth, but it also creates poverty. The system has to change so it doesn't create poverty; instead of saying, If you build it,we will come. I'm saying if you come, we will build it. If I can't get you to come and participate at no cost, I'm not going to be able to participate. I'm talking about poor people, at a cost they can afford. Most of them aren't going to come and listen to this stuff. Everything everyone is saying has to be a part of it. We have to give the poor people something to be owners of, and they will be participants. Marty Wolfson, 7809 Park Ave., stated, One of the problems in traditional development models is that it leaves out whole communities and particularly communities of concentrated poverty and black and brown communities. One of the positive aspects of the Blakenomics is that he is trying to concentrate on the African American community. [Addressing the presenter] I wonder if you could take a brief minute and share with us some of the ways the Cleveland Model tries to address this? Ms. Bonnano replied, Sometimes I'm asked if the cooperatives in Cleveland have quotas or strict guidelines around who is hired and the answer is no they don't. However, they have a goal to hire exclusively from the surrounding neighborhoods and accept those that may have traditional barriers to employment such as low literacy, low skill, re-entry issues and others that keep them from other job opportunities. Companies have had to deal with trade-offs. For example, we have a large international refugee population that lots of folks were interested in including in this program. And so do we want to make opportunities available for that community if it takes away from the community members that have been there for generations?How do we think about that? There are decisions that have to be wrestled with. Marilon Gachaw, 2514 W. Kenwood, stated, I have two (2) questions. First question, is it possible to receive a copy of the presentation? Committee Chair Williams-Preston replied it will be posted on the city's website. Marilon Gachaw asked Kelly Hoggard about the Kennedy Neighborhood Association and asked to connect. Gabrielle Robinson, 1012 Riverside, agreed that neighborhood associations are tremendous community resources. Councilmember Jo M. Broden stated, City government has a redevelopment commission where a lot of these decisions about dollars are made and rarely anyone from the public is there. If you want to track some of these decisions, go and learn more about it. We can get that information to you through the Clerk's Office as a follow up to this meeting. Knowing the structures of government that deal with this area is important. On February 14'h at 6:00 p.m. they will be 7 looking at a Responsible Bidder resolution, learn more about it, it's taking a look at the use of taxpayer dollars on public works projects. St. Mary's College Women's Entrepreneurship Initiative is an organization that should be at the table of future discussions. There's not a cooperative model yet for that organization, but the Economic Development Department has kin at it for possible area of funding. The Indiana Economic Development been looking p g p Corporation is tasked with small business development. This summer there was a tremendous conference that the Indiana American Planning Association and the Indiana Association for Community and Economic Development hosted and one of the key organizations focused on models like these. How can we broaden out the opportunities across the entire community? The fourth(0) district has benefitted from the NNRO and the support of the neighborhood. As a community we will all thrive if the development is balanced. Committee Chair William-Preston encouraged the public to forward any follow up to the Clerk's Office, as well as the email of citizen member Jorden Giger at giger.jorden @gmail.com. She then announced the Community Relations Committee will be meeting every month on the first Wednesday. Committee Chair Williams-Preston adjourned the Community Relations Committee meeting at 7:48 p.m. Res jW lly Submitted, Re lliam s-Preston, Chairperson