The U.S. financial and economic crises amplified fundamental challenges faced by the community development field and are ushering in a time for innovation. When three national CD heavyweights--LISC, Neighborhood Works America, and Enterprise--called for a summit in June, they described the field's problem this way:
The many CDCs, CDFIs and other institutions that have grown in the field over the past 30 years have done so in an environment of reasonable adequate public and philanthropic capital, thriving tax credit programs, and widespread access to private capital.
Today, however, the environment is radically different. The nation and the world are experiencing a liquidity crisis, the loss of wealth has reduced charitable giving, and the loss of profitability has reduced the corporate appetite for tax credit programs. To compound this, the foreclosure crisis is directly impacting neighborhoods where community development organizations have been working, and groups are ill-equipped to deal with the reality of large numbers of vacant properties in their communities.
They're right--but the crisis in community development began some years ago, as many in the field recognize, and won't go away even if the public, philanthropic, and private financing systems return to their former health. The crisis is not about money; it's about community development itself.
All fields evolve and face crises, as the environment in which they operate or the knowledge they use changes, and their "old truths" lose their effectiveness. Some fields stagnate or fail; others innovate and remake themselves.
Community development went through its first crisis in the 1980s when the Reagan administration killed federal funding for operating community development corporations (CDCs), which sought to increase low-income neighborhood and community access to public and private resources. But CDCs survived in a new form--focused on producing low-income housing--when the feds approved tax credits for investments in such projects.
Since the late 1990s, even as CDCs were spreading across the nation, the field was meeting new challenges:
- Emergence of a "community sustainability" framework. Community development became "siloed"--focused on housing mostly--but it's been increasingly recognized that community problems, including poverty, require "integrated," "comprehensive," and "systemic" solutions. The new wholistic framework is for community sustainability, which sees environmental sustainability and building vibrant communities as different dimensions of the same work. As some CDCs adapt to this, they take on much larger, more difficult, complicated and “integrated” development projects with many simultaneous outcomes, such as transit, affordable housing, environmental remediation, and local economic development. In many communities the need to respond to climate change--with mitigation and adaptation strategies--has accelerated the emergence of community sustainability, as comprehensive planning and action is required to have impact.
- Rise of regional dynamics. Community development focused on relatively small, bounded places--low-income neighborhoods--but economic, social, and political system dynamics increasingly occur at the regional level. A "40-square block" view of the world fails to recognize the need for broader geographic linkages to provide people in low-income areas with economic and social opportunities. And, some critics argued, community developers may increase concentrated poverty when they insist on amassing affordable housing in low-income areas.
- Attention on social capital, not just physical capital, solutions. Community development specialized in physical capital development--bricks and mortar--but social capital development matters too. Increasing the capacity of low-income families and youth to break out of poverty involves building their connectivity with each other and their bridges to other communities. Social mobilization is not a strength of the community development field.
- Need for development-brokering structures. Nonprofit community development organizations became heavily focused on their own institutional survival, rather than on producing results. Their organization-centric model of operations doesn't offer broad local leadership in a time of uncertainty. Social-change agents working on complex local problems increasingly act as "brokers" who assemble local collaborations, rather than as "owners and operators" of processes.
These and other changes in the community context within which community development operates have not escaped the notice of CDCs around the U.S. They realize that if their organizations don't change, they will become irrelevant. But where should the field of community development go next?
Our view is that CD and other place-based organizations bring a number of important assets to the community table. They have local knowledge; political capital; and project-management capacity. And they have opportunities to participate in the new sustainability-regional-social capital-brokering "infrastructure" that gradually will emerge in metro area. But to play the new game, they will have to rethink their role and retool their competencies. This will require:
- Broadening the business model of community development corporations so they are not so dependent on housing deals and assets for their operating budgets. This should include building place-based "community development philanthropy" funds and other kinds of equity assets.
- Building capacity to stay linked to neighborhoods, while working at a regional scale effectively.
- Extending CD work to the new problem of suburban poverty as low-income families are forced out of gentrified inner-city neighborhoods.
- Creating new forms of operational collaborations, including shared staff and services.
- Figuring out how they fit into new emerging markets, such as the place-based climate change action movement, which seeks to mitigate and adapt to global warming at a neighborhood level.
With innovations of this sort, the community development field can evolve and, even as the world keeps changing, be a force that supports the aspirations of low-income people and places. |
