Group to Raise $150M for Economic Development

Group to Raise $150M for Economic Development
WASHINGTON, DC - A working group of major philanthropic and financial institutions, Investors for Sustainable Communities, has announced an effort to coordinate up to $150 million in investments to build stronger communities grounded in more resilient, regional economies that provide opportunity to all residents and that firmly embrace environmental stewardship.

Investors for Sustainable Communities is sponsored by Living Cities, a consortium of 22 of the world's largest foundations and financial institutions working to revitalize America's cities. Participants in Investors for Sustainable Communities include national philanthropies such as the Ford, Surdna and Rockefeller foundations, regional funders such as the McKnight Foundation, and financial institutions such as Citi and Morgan Stanley.

The working group's three-part approach, known in policy circles as equitable Transit-Oriented Development (equitable TOD), seeks to: develop healthier, more affordable neighborhoods that offer convenient and safe access to jobs, stores, schools and services; expand transportation options connecting these neighborhoods to the regional economy (e.g. job centers); and ensure that all people—regardless of income, race, age, ability, and similar considerations, can participate in development decisions and share in the benefits.

From 2008 through 2010, participants in Investors for Sustainable Communities invested over $100 million in equitable TOD. Going forward, participants will coordinate their investments, aligning them as appropriate with federal grants such as the U.S. Department of Housing and Urban Development's (HUD) Sustainable Communities Planning Grant Program, and invite others to invest alongside them - leveraging more than $150 million over the next three years. The effort will also benefit from the participation of national nonprofit organizations such as the Funders' Network for Smart Growth and Livable Communities, a learning and action collaborative of national and regional foundations and other funding partners, and Reconnecting America, a national organization working to integrate transportation systems and the communities they serve.

"Transit-Oriented Development is a powerful way to make metro areas, the engines of our economy, more competitive, inclusive and environmentally sustainable," said Pablo Farias, Chairman of Living Cities and Vice President of Economic Opportunity and Assets at the Ford Foundation. "Just as important, it offers a chance for low-income people to contribute to and share in the benefits of metropolitan growth. The participants in this collaborative, and the members of Living Cities more broadly, are committed to making this agenda a pillar of our effort to strengthen American cities."

Economic growth is a critical dimension to the effort. "As America begins to rebuild its economy following the Great Recession, we need to ensure we are laying the foundation for lasting and broadly-shared prosperity," said Lee Sheehy, Director of the Region and Communities Program at the McKnight Foundation and co-chair of the working group. "Our ability to innovate and create jobs depends on our ability to connect business, capital and talent as efficiently as possible. China and India get this, and are way ahead of us. We need to grow our options in order to compete." Audrey Choi, Head of Global Sustainable Finance at Morgan Stanley adds, "Designing new, innovative ways to achieve growth by blending public, philanthropic and private capital will be critical to this work."

TOD is also a quality-of-life issue, noted Nick Turner, Managing Director at the Rockefeller Foundation. "Families must have more options to live in places where they can bike or walk to school or the grocery store, or take the bus or train to work," said Turner. "Providing more walkable and transit-oriented development would help hardworking Americans to save more of their time and money. This effort is one step in making sure people have those affordable options."

The working group is particularly interested in the equity dimension of TOD: ensuring that all people can participate in development decisions and share in the benefits and opportunities TOD creates. This means, for example: expanding housing options for working families and seniors near train stations and bus routes; using transit to revitalize distressed neighborhoods while taking measures to prevent low-income residents from being priced out; connecting local residents and businesses to the employment and contracting opportunities created by these investments; and intentionally engaging disadvantaged communities in decision-making to ensure that development meets their needs.

"Millions of working families, particularly those living in 'first-ring' suburbs, have seen their combined monthly housing and transportation costs rise to more than half of their incomes," said Phil Henderson, President of the Surdna Foundation. "At Surdna, we believe there is an economic, environmental, and equity imperative to expand quality transportation options throughout the country, improving residents' access to available jobs, education and training, and other opportunities in their regions."

The working group's emphasis on equity and inclusion was a major factor in the AARP Foundation's decision to participate, according to foundation president Jo Ann Jenkins. "Equitable TOD can provide options for all people, regardless of age or income, so that access to auto transportation does not determine their ability to live independently, connect to their families and communities and access the job market," said Jenkins.

Participants' shift toward collaboration is an important one, stated Living Cities' CEO Ben Hecht. "Our members have been investing individually in this work for years," said Hecht. "But they recognize that no one institution has the means to achieve this agenda on its own. By working across sectors, coordinating their resources and pooling their influence, these organizations can move the needle far more effectively."

The name Investors for Sustainable Communities signals the working group's intent to reinforce the federal policy framework emerging from the recently established Interagency Partnership for Sustainable Communities. The Partnership, launched in 2009, consists of several federal agencies including HUD, the Department of Transportation and the Environmental Protection Agency. Partnership agencies are working to align their rules and funding programs so that efforts in housing, transportation, environmental infrastructure and economic development reinforce and leverage one another. Many local and state governments are following suit. Within weeks, HUD, through its Office of Sustainable Housing and Communities, is expected to announce grants tallying over $200 million toward the Partnership's goals.

The working group is taking measures to promote the successful adoption of the Sustainable Communities framework at the regional, state and local levels. In early 2011, it will sponsor a "Sustainable Communities Boot Camp" tailored to the needs of regions that will receive grant awards from HUD. The Boot Camp will help arm practitioners with the approaches and strategies they need to build systems that advance economic prosperity, equity and inclusion and environmental stewardship simultaneously.

"The emerging Sustainable Communities Framework is critical to our work," said Sheehy. "This is not a partisan issue. We want to see the Sustainable Communities approach become the way government at all levels does business. We welcome the opportunity to partner with the administration to advance our common goals."

Investors for Sustainable Communities is one of several efforts under way or in development at Living Cities that seeks to address issues affecting people, places and economic opportunity, such as access to education, housing, health care, transit and jobs, simultaneously. On October 28, for example, Living Cities will announce the five urban regions selected to participate in the Integration Initiative, which will provide up to $80 million in grants, loans and Program-Related Investments (PRIs) to support game-changing, cross-sector efforts to create opportunities for low income people.
Source: Living Cities

More Stories

Get The Newsletter

Get The Newsletter

The latest multifamily industry news delivered to your inbox.