The Cleveland Model: Building Wealth in Disinvested Neighborhoods October 14, 2015 Ted Howard, President
Neighborhoods & People in Distress Ø Dramatic increase in the number of high poverty neighborhoods Ø Number of people living in high poverty ghettos, barrios and slums has nearly doubled since 2000 Ø Survey of 339 cities with population over 75, 000: 90% of inner cities declined in terms of poverty and unemployment Ø 1 in 4 US jobs pay less than poverty-level wages Ø Half of all children up to the age of 5 live in low-income families.
What is Community Wealth Building? Ø Community wealth building is a systems approach to economic development that creates an inclusive economy built on local and broad-based ownership. Ø The aim is creating a new system where communities thrive and families enjoy economic security. Ø More than business development – rebuilding community.
Drivers of Community Wealth Building Drivers Community wealth building Drivers Place Community wealth building Leverages many kinds of assets rooted in community, for benefit of local citizens. Place Ownership Leverages many kinds of assets rooted in community, for benefit of local citizens. Promotes local, broad-based ownership as foundation of a thriving local economy. Ownership Multipliers Collaboration Promotes local, broad-based ownership as foundation of a thriving local economy. Encourages institutional buy-local strategies to keep money circulating locally. Brings many players to the table: nonprofits, philanthropy, anchors, City. Inclusion Aims to create inclusive, living wage jobs to create economic security. Aims to create inclusive, living wage jobs to enhance economic security. Workforce System Links training to employer needs, focusing on those with barriers to employment. Multipliers Links training to employer needs, focusing on those with barriers to employment. Develops support ecosystems, to create a new normal of business practices.
The Greater University Circle Initiative is creating jobs, building wealth, and encouraging reinvestment in seven low-income neighborhoods. An ambitious strategy to stimulate reinvestment in this vital urban area, leveraging the power of anchor institutions.
Anchor Institution Procurement > $3 Billion Annually Cleveland Clinic Veteran’s Affairs Medical Center University Hospitals Case Western University Cleveland Museum of Art
NEIGHBORHOODS AT RISK
Place Matters
120+ Employees - 35 Members
4 Where • • and Why? 7 specific neighborhoods were identified Of 50, 000 residents, 40% live below poverty line • Median household income less than $18, 500/year • Previous attempts at economic development failed • “A job alone is not enough. ” – We decided to try something new… 12
4 Our • Goals Promote wealth-building for residents of specific Cleveland neighborhoods • Anchor capital so it doesn’t leak out of NE Ohio • Launch new Green, cooperatively-owned companies • Stabilize and revitalize Cleveland neighborhoods via innovative job creation • Develop a model for national impact 13
Evergreen Energy Solutions Cleveland, OH
Evergreen Cooperative Laundry Cleveland, OH
Green City Growers Cleveland, OH
The Cleveland Model
The Cleveland Model The Evergreen Cooperatives Economic Impacts: Current Number of Employees/Owners: 120 Output Amount Gross Wages $6, 260, 703 Payroll Taxes $500, 856 Health Benefits $305, 547 Training $143, 400 Profits Distributed $54, 730 Property Taxes Paid, 2012 -2014 (65% of which supports Cleveland Municipal School District) $479, 502 TOTAL $7, 744, 738
MONDRAGÓN 100+ networked cooperatives
For more information: www. community-wealth. org www. democracycollaborative. org Ted Howard President Democracy Collaborative thoward@democracycollaborative. org
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