There was considerable evidence, even before the COVID-19 pandemic began, that the United States was marking levels of income and wealth inequality unseen for a century, all during the longest economic expansion in modern history. The stark economic inequalities that individuals and families in our nation are experiencing have been exposed and exacerbated by the pandemic.
The persistence and depth of income and wealth inequality have prompted serious national reflection on the fairness and sustainability of our current policies and systems.
The last 18 months, lived in the context of the COVID-19 pandemic, have opened eyes across our country to the inherent inequities that communities of color and communities living with low incomes experience in all aspects of life. Community Development Financial Institutions (CDFIs) have a particular mandate to address these inequities and implement practices that help communities thrive. What has the racial reckoning of the past several months meant for CDFIs?
Oakland, Ca. is a vibrant place, a reflection of the multicultural communities within its borders. However, Oakland also experiences poverty, limited social services, and crime, which hold its communities back – particularly communities of color – from achieving their full potential.
Over the past several years, Oakland has seen an influx of residents as the demand for housing in the San Francisco Bay area has driven many people there, on top of the residents who already called the city home.
By Ellis Carr, President and CEO of Capital Impact Partners and CDC Small Business Finance
Last year I opened up my Annual Report letter with a reference to COVID-19. While we were still grasping the seriousness of the situation, we could never have realized the extent to which the pandemic would dominate almost every facet of our lives. Now, as vaccines continue to roll out and many begin to “return to normal”, what we feared then has become reality. Communities of color will be grappling with the long-term impacts for months, if not years to come.
Capital Impact Partners and Nonprofit Finance Fund (NFF) are decades-old Community Development Financial Institutions (CDFIs) with long-standing commitments to supporting disinvested communities. In recent years, both organizations have explicitly recognized the opportunity to expand their impact by addressing structural racism, both internally and externally, as they deliver products and services to their communities.
Capital Impact and NFF have come together to form Catalyzing Finance for Racial Equity (CFRE), a collaborative that will engage staff, community-centered organizations, and CDFIs in identifying new ways that CDFIs can advance health justice and better support communities by refining or developing new lending products and processes.
This blog also appears on the Nonprofit Finance Fund website. You can read it here.
Community Development Financial Institutions (CDFIs) were founded as part of the civil rights movement, to make access to capital more equitable for communities living with low incomes, often communities of color. However, despite the work of this part of the financial services industry, disinvested communities still suffer from unequitable capital access and thereby fewer opportunities for wealth building and shared prosperity. New models are needed to re-envision how transformation of community development can work for disinvested communities and develop local solutions to persistent issues.
At Capital Impact Partners, we condemn the recent and ongoing acts of violence against our Asian-American and Pacific Islander (AAPI) community, and are fervently opposed to any language or thoughts that justify or lend themselves to such terrible acts.
In February, our President and CEO Ellis Carr sat down with the Greater Washington Partnership’s CEO J.B. Holston for a conversation about economic power and inclusive growth in disinvested communities, and the role that Community Development Financial Institutions (CDFIs) play in transforming communities nationwide into places of opportunity, including in the Washington Metro area.
CDFIs have long operated hand-in-hand with our neighbors, living and working in close proximity to the communities in which we invest; community investment is at the center of our work. Working shoulder-to-shoulder with communities, we help foster the future they see for themselves, using inherent community assets to build an equitable and prosperous future. That community-centric approach helps us create tools and solutions that both work for communities and foster transformative change.
Ellis Carr is now the president and CEO of Capital Impact Partners and CDC Small Business Finance. Kurt Chilcott, formerly president and CEO of CDC Small Business Finance, has transitioned to Board Chair of the combined organization. We invite you to learn more about our new enterprise at www.investedincommunities.org
With a mission to empower equitable community growth, CDC Small Business Finance and Capital Impact Partners recently launched three place-based pilot programs as part of our new alliance. The pilots are in Detroit, Los Angeles, and Washington, D.C. Metropolitan (D.M.V). Cross-organizational teams have been engaging with these communities to identify the unique issues of each city.
As part of the alliance’s focus on Detroit, CDC Small Business Finance’s CEO, Kurt Chilcott, and Capital Impact Partners CEO, Ellis Carr recently wrote an op-ed about their holistic approach to community and economic development that was published in The Detroit News.
