Building a Systems Approach for Community Wealth Building with Democracy Collaborative | Cityscapes Insights Series
Written by Jackie Robles and Cuevas Peacock
This insight piece, written by NGIN advisors, is based on sessions led by speakers from various organizations at the Cityscapes Summit 2024.
What do land trusts and worker cooperatives have in common? They are both community wealth building, as articulated by the Democracy Collaborative at NGIN’s Cityscapes Summit in Durham, NC in May2024. The session titled, "Building a Systems Approach for Community Wealth Building with Democracy Collaborative", was led by Neil McInroy and Sarah Mckinely, who both lead the Community Wealth Building Program at the Democracy Collaborative.
Community Wealth Building (CWB) is an economic development model that aims to transform local economies through community ownership and control of their assets. It integrates progressive strategies like community land trusts, worker cooperatives, and public banking while challenging traditional economic development approaches aiming to address inequality at its core. Unlike traditional approaches, CWB aims to fundamentally change local economic operations to produce consistently better outcomes for people, places, and the planet. True CWB is "pre-distributive," rather than “redistributive,” focusing on rebalancing the economy from the start to achieve sustainable and equitable results.
CWB focuses on how wealth is generated, circulated, distributed, and who benefits from it. By broadening asset ownership, CWB fundamentally changes wealth flows within local economies, keeping money recirculating, anchoring jobs, and fostering economic resilience. This approach counters long-term economic inequality and decline by ensuring that wealth generated by people and communities remains within their hands from the outset and the start. To understand CWB, it is essential to explore the structures and pillars that shape our society’s wealth and economies. The five pillars of Community Wealth Building are:
Inclusive and Democratic Enterprise
Supporting worker and consumer cooperatives, social enterprises, and municipal enterprises, recognizing that ownership of productive capital is where power lies.
Locally Rooted Finance
Redirecting money to serve the real economy through public and community banks, credit unions, targeted public pension investments, and new community investment vehicles.
Fair Work
Ensuring every worker receives a living wage, workplace control, decent conditions, and trade union rights.
Just Use of Land and Property
Mobilizing land and property assets to build community wealth, bringing land and real estate development under community control, and combating speculation and displacement.
Progressive Procurement
Local governments and anchor institutions leading with procurement practices that localize economic activity, build local multipliers, and end financial leakage and extraction.
The Democracy Collaborative’s session provided valuable insights into implementing CWB principles. Collaboration between local governments, community leaders, anchor institutions, and economic development teams is essential for CWB's success. While universally applicable, CWB is most effective when adopted by local governments seeking substantial transformations rather than superficial changes, directly addressing the root causes of wealth inequality. U.S. cities like Detroit, Nashville, and Lafayette, LA, have successfully piloted CWB initiatives, creating ecosystems that support community ownership and equitable economic development. The City of Chicago has even developed a strategic plan for advancing CWB locally.
Cleveland’s Evergreen Cooperatives represents one of the most well-known examples of CWB in the U.S. Launched by Cleveland institutions with a focus on economic inclusion, Evergreen Cooperatives focuses on creating worker-owned cooperatives that provide services such as laundries, energy, and fresh produce to local institutions. Employees share profits through a Patronage Account, building wealth over time. Evergreen also helps retiring small business owners transition their businesses to employee ownership via its Fund for Employee Ownership, ensuring job stability and significant ownership stakes for employees while keeping local businesses open.
Despite numerous successes, the Community Wealth Building approach remains underutilized in the U.S., presenting a significant opportunity for broader adoption through the following methods:
Education and Awareness: Raising understanding of CWB models among residents, economic leaders, and governmental officials is crucial. Comprehensive education initiatives can illuminate the benefits and potential of CWB, fostering greater interest and support.
Courageous Champions: As awareness of CWB grows, it is essential to have individual and institutional champions who advocate for piloting these strategies, even though they represent a departure from traditional economic development methods. Supporting these champions through mentorship with experienced practitioners can facilitate the development of a national CWB strategy tailored for local success.
Advancement of CWB Policies: Policies that expand economic opportunities are vital. Supportive CWB policies should not only introduce new approaches but also enhance existing ones to provide more widespread benefits. This includes policies that support worker-owned companies, zoning for land trusts, and ordinances that mandate community benefit agreements for tax incentive programs. Such policies create a conducive environment for CWB initiatives to flourish.
Patient Investment: All seeds take time to produce fruit, and CWB is no different. To advance CWB, potential funding sources must recognize that immediate ROI is not always feasible. However, by investing in CWB with a long-term perspective, sustainable local economic growth for all can be achieved.
Imagination: Embracing CWB requires us to imagine a world where everyone can thrive. This vision necessitates a shift from the belief that our current local economic system is the only way. We owe it to our community, our future, and ourselves to imagine what can be until we find what works for everyone to thrive economically.
While this is not an exhaustive list, it represents crucial first steps toward the broader adoption of local CWB strategies.
Looking ahead, the future of CWB is promising. Emerging trends and innovations, such as digital platforms for cooperative management and new financing models for community land trusts, are expanding the reach and impact of CWB strategies.
Community Wealth Building reimagines local democracy by placing citizens at the heart of decision-making processes as workers, caregivers, consumers, and community members.
These are worthy goals in alignment with NGIN’s commitment to advance inclusive economic development strategies and ensure that economically disenfranchised individuals and communities can lead, shape, and benefit from regional economic growth and prosperity.
The “Building a Systems Approach for Community Wealth Building with Democracy Collaborative” session at Cityscapes reinforced the need to prioritize areas that advance CWB strategies locally. The session emphasized principles that advocate for an alternative approach to building the local economy, prioritizing the recirculation of community wealth over incentive-driven business attraction models. According to Brookings, “While incentives-driven business attraction remains one part of local economic development, numerous studies have found that it has not solved many of today’s local economic challenges. Rather, an increasing number of local leaders are going beyond measures of job growth to instead prioritize job quality, productivity, income growth, or other quality-of-life measures, especially in smaller communities where job creation is not a realistic objective” (Liu, 2020).
By investing in local assets and prioritizing inclusive, sustainable economic practices, communities can foster a more equitable and prosperous environment for all residents. Community Wealth Building represents a clear path forward for advancing such investments. Embedded within a local strategy, CWB strategies can create a sustainable economy that benefits the many, not just the few.
To learn more about CWB, read the Democracy Collaborative’s Action Guide.
Liu, A. (2020). Making local economies prosperous and resilient: The case for a modern Economic Development Administration. Brookings. Retrieved from Brookings.
