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Community Development Finance
Resources for Downtown Revitalization
Missouri Community Betterment Conference
Jefferson City, MO
October 19, 2009
Perspective
“All that is valuable in human society depends upon the opportunity for development accorded the individual.”
Albert Einstein
“Man was made for action, and to promote by the exertion of his faculties such changes in the external circumstances both
of himself and others, as may seem most favorable to the happiness of all.”
Adam Smith in The Theory of Moral Sentiments
Goals of DevelopmentIncrease economic opportunityEconomic well-being and equityEconomic growthProsperous places to live and workPersonal well-beingSafe, decent and affordable housingQuality of lifePublic welfareHealthy environmentEnvironment free from discriminationVital community facilitiesAid, counsel, assist and protect small businessesOthers?
Why?
Several views…there may be more:
The past, present and future of CD finance
Discrimination
Knowledge and information is costly
Requires special expertise
Scarcity of profitable opportunities
Roles
Explorer – “Discovery consists of seeing what everybody has seen and thinking what nobody has thought.”
Albert Szent-Gyorgyi, Hungarian biochemist, Nobel Prize, 1937
Innovator - “It is a key competency that quite possibly represents the difference between a community’s success and its potential failure” paraphrased from Andrew Papageorge, author
Entrepreneur – an entrepreneurial mindset
A new way to think and act?
Problems to Opportunities/possibilities
Problem-driven to Vision-led
Money to Meaning
Scarcity to Abundance
Using others to Collaborating with others
Transactions to Relations
Pessimism to Optimism
Deficits to Assets
Topics
Let’s start at the very beginning, a very good place to start.”
Capital
Finance
Community development
Community development finance
Definitions
CapitalHuman, social, financial, natural, etc…
Finance is the science of raising, investing and managing revenues and resources for the best possible advantage.
Community development finance is economic growth in which people come together and make the decisions to organize and pool their assets and resources for the purpose of addressing
unmet needs and opportunities.
Definitions
Assets are any advantages, resources, goods or services available for use.
Unmet needs are inadequately developed or insufficiently satisfied wants that may be met with community
development finance.
An opportunity is a favorable match of goals and objectives that may allow a good chance for community progress.
How?
Intermediation
Source and uses
Case studies
Tools and techniques
Tools and Techniques
The value of good design:
Mitigation
Flexibility
Customization
Recognition and use of cycles
Collaboration and community involvement
http://stlouisfed.org/community_development/selfstudy/
Matthew W. AshbySenior Specialist
