“City government holds the key to innovation in this area – they bring authority, credibility, and a platform.”
Living Cities is open sourcing our 2014 annual report, asking folks to respond to the question: “What will it take to achieve dramatically better results for low-income people faster?” In our efforts to showcase a diversity of points of view around this question, we are resurfacing this blog, among others. Look out for more to come – and follow the conversation on social media with #NewUrbanPractice.
During the most recent Project on Municipal Innovation (PMI) convening we held a roundtable discussion on how city halls and philanthropic organizations can best partner to disrupt inequality in cities. “Unless we do something to change the course we’re on,” Living Cities President, Ben Hecht, reminded us, “intergenerational poverty and lack of transfer of opportunity is going to continue.”
Foundation leaders noted that the public sector has a mandate to expand opportunity for low-income people. “City government holds the key to innovation in this area – they bring authority, credibility, and a platform,” said Benjamin Kennedy, Deputy Director for Community Development and Detroit at the Kresge Foundation. Philanthropy, on the other hand, brings a unique ‘risk tolerance’ to these endeavors. “Foundations can operate without political pressures – shining a light on less popular issues or elevating the interests of underrepresented communities,” Kennedy noted.
Panelists highlighted five key ingredients for effective collaboration between these two powerful and often conflicting forces in cities:
- Work with, not around city government : Because the public sector is a large driver of the urban economy, foundations recognize that working with city government is a powerful avenue to expand opportunity for low-income people. Foundation representatives acknowledged that, in the past, their strategy was to fund non-profits or NGOs as a way of avoiding engagement with city government. The impact was minimal. “Historically, philanthropy as a field has been guilty of doing a ‘work around’ as it relates to city government – we’d create a non-profit that would work around city agencies, but what we eventually discovered is that we weren’t getting the scale we needed and our funding would not provide the level of support to achieve the functionality that we would hope for,” said Scot Spencer, Associate Director of Advocacy and Influence at the Annie E. Casey Foundation. In Philadelphia, philanthropy and city government shared a table from the very beginning of Mayor Nutter’s anti-poverty initiative. They also found that staying focused, collaborative, and communicative was critical to their success. “We realized that philanthropy was interested in placing big bets on what the city was trying to do,” said Suzanne Biemiller, Philadelphia’s First Deputy Chief of Staff. “Philanthropy has been reluctant to engage with cities because cities were not always the best partners. That has changed and the private sector and foundations now seem to have more confidence in city government.”
- Fund key city positions : Once a foundation moves beyond working around government, diving deep into funding long-term positions within city government that are charged with bringing about systems change can reap tremendous benefits. In Detroit and Baltimore, the Kresge and Annie E. Casey foundations respectively have funded government staff positions embedded in city agencies that have significantly moved the needle on efforts to improve the lives of low-income people. Embedded staff positions in city government to support Living Cities’ Integration Initiative work in Detroit helped nurture a culture of innovation, clarified expectations, and provided long-term capacity to a city agency critical to expanding economic opportunity for local businesses. In Philadelphia, in order to keep philanthropy at the table, the city hired an initiative director that had experience working with local foundations.
- Foster sustained collaboration : Even though New York City had the unique advantage of a sitting mayor with his own foundation and access to private capital, building a collaboration of diverse funders was critical to establishing the city’sCenter for Economic Opportunity (CEO) initiative. Linda Gibbs, former NYC Health and Human Services Director, noted that while the Bloomberg Foundation money was an asset that brought other foundations to the table, the key was building philanthropic collaborations. ”Your mayor does not have to have his own foundation to make those collaborations happen,” said Gibbs. In Detroit, for example, ongoing ‘neighborhood forums’ have brought together municipal leaders, large and small foundations, and nonprofit leaders to discuss policy issues facing the city. \“Steady relationship building over time served us well when we had to address a big cross-cutting issue like the city’s bankruptcy – it was easier for people and institutions with strong pre-existing relationships to engage in collaborative problem solving,\” said Kresge’s Benjamin Kennedy.
- Provide early stage funding for the BHAG : Once a solid collaborative partnership exists between city hall and philanthropy, municipal governments can look to philanthropy to fund early stage strategies to support a “big hairy audacious goal” or BHAG. In Detroit, Kresge partnered with the city to create an innovation district during the height of the city’s bankruptcy. Kresge also worked with multiple partners to develop a long term vision for city-wide revitalization, the Detroit Future City strategic framework plan, and create the civic infrastructure for implementation. “In certain areas, we have more financial flexibility than city government and we were perfectly happy to advance larger efforts that improve quality of life across the board in Detroit,” noted Kennedy. In New York, the philanthropic dollars for their CEO initiative gave city government the opportunity to test out big ideas without using tax payer dollars. Linda Gibbs noted that Mayor Bloomberg wanted to maintain public confidence that tax dollars were used, first and foremost, for critical city services like garbage collection and public safety, and not directed at what might be perceived as grandiose ideas to tackle poverty in nontraditional ways.
- Replicate what works : The Cities for Financial Empowerment Fund (CFE Fund), supported by Bloomberg Philanthropies, is a replication of New York’s CEO initiative in cities across the nation, establishing financial empowerment centers within city governments. These centers provide professional one-on-one financial counseling to low-income residents as they engage with social services throughout city agencies. The integration of financial counseling into social service delivery is a logical pairing and helps remove barriers to success for those trying to move out of poverty. “From a municipal perspective, providing financial counseling has traditionally been done by the nonprofit industry, but through CFE, cities have a unique opportunity to dip their toe in this field and deliver services at a scale beyond what nonprofits could do,” said Anne Emig, Program Manager for the CFE Fund.
These five strategies highlight the critical engagement needed between the public sector and other key stakeholders aspiring to achieve meaningful, large-scale results in cities. For the public sector to be more innovative in how it uses its influence, authority, and resources to build shared prosperity for all people living in America’s cities, it needs to continue to build a shared dialogue and vision with philanthropy and other partners from across sectors and communities.