The Community Reinvestment Act: Maximizing Opportunities for Public Investment in Triple-Bottom-Line Programs

In Buffalo, New York, community-based, nonprofit organizations are working to directly address the economic, environmental, and social needs of the Buffalo community and contribute to the city’s economic revitalization.

Video: Green Jobs for Buffalo

Green For All is working with local partners in Buffalo to maximize opportunities for public investment in triple-bottom-line programs like Green Jobs for Buffalo.

Read our white paper, Building a Sustainable City: Green Jobs for Buffalo (PDF 8.5 MB)

Buffalo, NY

Over the past forty years, the loss of its manufacturing and transportation industries has mired the City of Buffalo in a steady economic downturn that has led to twin crises of unemployment and neighborhood decline. The opening of the St. Lawrence Seaway and the slow death of steel manufacturing have devastated the city. In addition, much of Buffalo’s housing stock is at least 100 years old, uninsulated, and posing significant energy challenges to city residents.

As a result, Buffalo is the third-poorest city in the country and has the fourth-highest home heating costs. One out of five of its structures is vacant. It has 78 U.S. EPA and 15 state cleanup sites (an average of more than two per square mile). About half of Buffalo students drop out before graduating high school, and more than half of the area’s black men are unemployed.

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Community-based, nonprofit organizations are working to directly address the economic, environmental, and social needs of the Buffalo community and contribute to the city’s economic revitalization. Several groups have come together to meet the needs of low-income communities and communities of color in the Green Development Zone on Buffalo’s West Side. They are reclaiming abandoned houses, retrofitting them to use less energy and generate renewable energy, and preparing them for occupancy by low-income residents.

They are transforming vacant land by growing community gardens, planting tree farms, and constructing rain gardens. These efforts will reverse environmental degradation, improve community health, and increase property values.

The organizations collaborating on the Green Development Zone are also assessing job-growth and revenue-generating opportunities in the three sectors in which they are currently working: green rehab and retrofitting of affordable housing, regional food system development, and environmental stewardship. In green rehab and retrofitting of affordable housing, the state’s Green Jobs–Green New York initiative will generate more than 5,000 energy-efficiency job-years in Buffalo over the next five years. In regional food system development, annual revenues from the sale of locally and sustainably grown produce and fish to area restaurants alone are projected to surpass $100,000 by year two. In environmental stewardship, local, state, and federal initiatives to improve community health will drive demand for remediation of indoor and outdoor environmental hazards.

Green Jobs for Buffaloblank

This work in the Green Development Zone will create a demand for qualified green workers; Green Jobs for Buffalo is an innovative initiative to prepare workers to meet this increased demand. The program will provide on-the-job training, employment placement, career pathways, and green business incubation for low-income people and people of color in emerging green sectors of the economy. Green Jobs for Buffalo will achieve triple-bottom-line returns, yielding positive results for people, for the planet, and for profit margins. In other words, it will promote equitable opportunities and benefits, environmental restoration and protection, and economic growth and prosperity. As the local community-based organization PUSH Buffalo (People United for Sustainable Housing) says,going green is not just a lifestyle; it’s about survival.

Leveraging the Community Reinvestment Actblank

As with any startup during a general economic downturn, these green endeavors need seed capital and other financial support. Yet, such support is hard to secure in the current recession. The Community Reinvestment Act is one tool available to such projects. Under the Community Reinvestment Act (CRA), federal agencies evaluate whether regulated financial institutions are helping to meet the credit and community development needs of their local communities, including low- and moderate-income communities.

Financial institutions receive favorable consideration from federal regulatory agencies for community development loans, qualified investments, and community development services. Seeding and supporting Green Jobs for Buffalo with grants and loans would qualify community lenders for such consideration under the CRA, as the primary purpose of Green Jobs for Buffalo is community development. The program will stabilize and revitalize low- to moderate-income areas — in part by creating, retaining, and improving jobs for low- to moderate-income persons.

Although Green Jobs for Buffalo should be a qualified investment under current CRA rules, changing those rules to encourage depository institutions to support triple-bottom-line activities would make it much easier for projects like Green Jobs for Buffalo to enjoy the benefits of the CRA. Specifically, activities having positive impacts in terms of equity, environment, and economy should receive favorable consideration under CRA performance assessments. This subtle but important change would expand the types of community development activities for which institutions may receive CRA consideration to include activities resulting in triple-bottom-line benefits. Allowing banking institutions to receive CRA consideration for supporting triple-bottom-line activities serves the core purpose of the CRA while creating an opportunity to realize environmental and health benefits through sustainable economic development in low- to moderate-income communities.