Economic Development Activism for Broad Community Ownership

This white paper proposes a practical formula to describe how economic development activism can work to put community members into community development deals as owners. It combines Community Power (organized resident voice) with the Capital Stack (who pays, who benefits) to achieve broad community ownership.

In the Community-Led version, a community-owned vehicle (COV) co-sponsors with a developer, holding a key role in governance and cash-flow rights. In the Passive Slice version, it buys a small passive share—no governance, but real upside if the deal is successful long-term—building. Specific types of anchor partners (hospitals, universities, public agencies) hardwire demand through local purchasing and hiring. Social impact lenders fill lending gaps. Success is measured in local ownership share, anchor dollars captured locally, quality jobs, and improved income opportunities.

 The result isn’t slower development; it’s fairer development that keeps money flow local and puts residents in the capital stack.

Stand. Speak. Control what is yours. Words and Picture by Myron Wilkerson

Why Economic Development Activism

Economic development activism (EDA) is the practice of putting the neighborhood into the deal—not just into meetings. It marries organized resident power with the way money actually moves in projects (the capital stack) so communities share in risk, returns, and—when feasible—governance. It is a replacement for “community benefits” as a side agreement; when the community owns a stake, the benefits flow through the deal itself. This approach draws on the community-wealth-building tradition: build local ownership, root value locally, and align institutions to buy and hire where people live. (The Democracy Collaborative)

Why the old playbook breaks down

For decades the standard pattern has been: public subsidies attract outside capital, values rise, and long-time residents are priced out. Traditional Community Benefits Agreements tried to patch that with promises about jobs, hiring, and space. CBAs can be enforceable contracts, but in practice they often hinge on who signs, how they’re monitored, and whether anyone has the resources to enforce them across ownership changes and market cycles. EDA flips the script: own the cash flows and the rights, don’t rent promises. (Good Jobs First)

The formula in practice: Community Power + Capital Stack

• Community power is organized, disciplined voice: clear priorities, credible messengers, and consistent presence at each decision point—from planning to loan closing to lease-up.

• The capital stack is the map of who invests, who gets paid (and when), and who votes. When a Community Ownership Vehicle (COV)—a co-op, trust, nonprofit LLC, or JV—sits in that stack, upside isn’t begged for, it’s earned by contract.

  
  

There are two clean versions that communities can run:

A) Community-Led (Governance + Economics)

The community initiates and leads alongside an experienced development partner—holding JV/GP rights, votes on key actions, and a share of cash flow and promote. This is the full “power + stack” expression: residents help decide plan, pace, tenanting, and exits—and capture returns. Anchors (hospitals, universities, public agencies) become demand engines by committing to buy and hire locally, stabilizing the business model for community-owned or local firms. (The Democracy Collaborative)

B) Passive Slice (Economics-Only)

The community takes a small limited-partner position in a values-aligned project already in motion. There is no governance—just the same economics as other passive investors: distributions if it performs and a share at sale/refinance. It’s fast, achievable, and builds investor literacy so the next deal can be larger or community-led. The Community Investment Trust (Portland’s Plaza 122) shows how small monthly investments ($10–$100) can bring hundreds of neighbors onto the cap table and generate dividends plus share appreciation over time. (Brookings)

A short story: two blocks, two paths

Block One—Community-Led. A vacant grocery sits on a disinvested corridor. A neighborhood COV secures a low-cost option and a predevelopment grant, then JVs with a capable developer. A hospital anchor commits part of its outpatient spend and food procurement to the site if local operators can supply it. The COV holds two JV votes: tenant mix and any sale before year ten. CDFI debt and a city credit enhancement close the gap. When leases stabilize, cash flow pays the debt, local firms get anchor purchase orders, and the COV receives distributions that capitalize the next project. The benefits didn’t need a side letter; they’re in the operating, loan, and anchor-MOU documents. (The Democracy Collaborative)

Block Two—Passive Slice. A separate mixed-use rehab is already capitalized. The COV pools $150,000 from 120 residents and takes the minimum LP ticket, with standard reporting. No seat, no vetoes—just participation in the upside. Quarterly distributions arrive; the COV posts a simple dashboard and uses proceeds to seed a larger check in a future JV. For many neighbors, it’s their first time owning a piece of nearby real estate—akin to the CIT ladder model. (catalog.results4america.org)

What makes the money align with the mission

Three design moves make EDA work across market cycles:

First, root demand. Anchor-institution procurement and hiring are not afterthoughts; they’re operating strategy. When institutions intentionally source from local, minority-owned, and cooperative firms, they create predictable revenue that reduces risk for lenders and equity alike. This is a documented pillar of community wealth building and “anchor collaborative” playbooks. (The Democracy Collaborative)

Second, use fit-for-purpose finance. Historically, Community Development Financial Institutions (CDFIs) existed to lend where banks don’t. With the current Administration eliminating the core CDFI Program, NACA, BEA, HFFI, EMC, and the small-dollar loan program, alternative sources of fit-for-purpose finance must be found. Right now the last hope is social impact funds, backed by mission-driven foundations, who are still doing deals. (Common Future)

Third, keep decisions public-facing even when rights are private. Ownership replaces traditional CBAs, but transparency still matters: simple quarterly dashboards, open meetings for major JV actions, and resident education on how waterfalls, prefs, and promotes work. Where public dollars touch the deal, participatory budgeting or resident-steering processes can align small capital items (façade grants, safety improvements) with what people actually want—an approach shown to build civic skill and trust when well-designed. (Taylor & Francis Online)

What to Measure for Outcomes

Success reads differently under EDA. Instead of counting shovels and square feet, look for:

• Ownership present: Does a COV or local entity sit in the stack (governance + economics in Community-Led; economics-only in Passive Slice)?

• Real-economy capture: Are anchors actually buying/hiring locally and are neighborhood firms growing?

• Staying power: Are cost burdens easing for residents and small businesses along the corridor?

• Wealth formation: Are there recurring, auditable distributions to the COV or CIT shareholders, and evidence of asset appreciation over time (the Plaza 122 pattern)? (The Democracy Collaborative)

  
  

Common worries, answered briefly

“Is a passive slice just symbolic?” It can be if it’s tiny and opaque. But with clear reporting and a plan to recycle distributions into larger future positions—or to graduate to a JV—the passive slice becomes an on-ramp to future potential wealth. CIT experience suggests small, steady buys can build meaningful local wealth and investor fluency. (catalog.results4america.org)

“Won’t governance slow the project?” Community-Led deals need smart term sheets: limited “reserved matters” so the sponsor can execute, paired with a few meaningful community approval points (e.g., early sale, tenant category mix). That’s how you get both speed and accountability—rights that survive leadership change and sale.

“What if the economy turns?” That’s the point of anchoring demand, right-sizing debt with CDFIs, and setting conservative coverage ratios; these tools exist precisely to make neighborhood projects durable. (CDFI Fund)

The takeaway

Economic development activism isn’t a protest against development; it’s a design for development that lasts. The community doesn’t ask for benefits; it owns them—sometimes with votes, sometimes with cash-flow participation only. Either way, the community is in the stack, which means it’s in the future.

When Community Power (the organizing muscle) meets the Capital Stack (the money map), neighborhoods stop being footnotes to other people’s spreadsheets. They become co-authors—and co-owners—of what gets built next.

Selected sources

• Democracy Collaborative: Community Wealth Building overview; anchor-institution procurement strategies and anchor collaborative playbooks. (The Democracy Collaborative)

• Good Jobs First & NYU Furman Center: what CBAs are and why they often under-deliver in practice. (Good Jobs First)

• Community Investment Trust (Plaza 122): small-dollar ownership model, dividends, share appreciation. (Brookings)

• Evidence on participatory budgeting’s civic and development impacts. (Taylor & Francis Online)