What do we do now? Five things CDCs can do to get ready for CDPA Implementation

August 16th, 2012 by Joe Kriesberg

In the nine days since Governor Patrick signed the Community Development Partnership Act into law, a number of my members have asked me "what should I do now?" It's a good question. With $67.5 million available for community development over the next seven years, every community developer in the state should be asking that question.  While the regulations and guidelines have not yet been written and the tax credits don't even take effect until January 2014, there is still much to do to get ready. Here are five things that I would suggest:

1. Re-read the statute: While I'm sure everyone read the bill before it passed, I would recommend that community developers re-read the actual CDPA statute now to make sure they really understand what it said. Those words are now law and they will matter as the program gets implemented.

2. Get certified by the state as a CDC: To participate in the CDPA program, a local non-profit organization must first be certified as a CDC under MGL Chapter 40H. So far, 17 organizations have been certified under this program which was first launched at the beginning of 2012. Ten more organizations have applications that are pending. However, we know that there are at least 30 more organizations that will likely qualify and potentially many more, including groups that have not traditionally considered themselves to be a CDC. This requirement is not simply designed to create a bureaucratic hurdle like those new voter suppression laws being adopted around the country. This requirement, which is modeled after the highly successful CDFI model, was created to achieve two goals. First, it ensure s that the recipients of CDPA resources are organizations with meaningful community representation on their board of directors - a core value of the CDPA program model. Second, it ensures that these resources flow to organizations for whom community development is a core purpose and one to which they are committed for the long term. CDPA funds organizations, not programs, so it is essential to fund community development organizations.

3. Start planning to plan: At the core of the CDPA is the requirement that applicants submit a multi-year business plan to DHCD. The statutes spells out in some detail the elements that must be in those plans, including the requirement that local residents and businesses play a signficant role in its development. Many CDCs already operate with well thought out business and/or strategic plans so this requirement may not be difficult for them. Others will need to develop new plans or revise existing ones to meet the requirements of the program. This requirement was included because CDPA is structured to fund organizations, not just individual programs, so it requires an organizational plan. This element was modeled after what we have learned from the Boston Foundation, Neighborworks America and other funders who provide "enterprise level" funding or venture philanthropy.

4. Reach out to private donors: The newly created Community Investment Tax Credits are not worth anything unless you can find donors to use them. For many CDCs, this will require a new approach to fundraising in which they move beyond government and foundation sources to find corporate, small business and individual donors. MACDC, the United Way and others will be helping to promote the program to donors, but every CDC should be thinking about how it will develop its own fundraising campaign.

5. Get ready to lift your game to a new level: The CDPA is designed to be highly competitive and to drive the field to new levels of impact. It is not meant to simply sustain business as usual. The Legislature, the Governor, the private donors, the United Way and our community residents are all going to expect these new resources to result in new and expanded results. What's exciting about CDPA is that these stakeholders are not simply lecturing CDCs to "do more with less," but rather they are saying and we are saying to ourselves that we should use this new, flexible, multi-year resource to reach toward our aspirations.

MACDC will be working closely with DHCD, DOR and other stakeholders to develop the regulations, guidelines and RFPs needed to implement this exciting new program. We would expect DHCD to issue the RFP for the one-year grant program in the fall of 2012, with the tax credit program to be rolled out during the second half of 2013.

My next blog post will offer ideas for what other stakeholders should be doing now that CDPA has been signed into law.

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10 Reasons CDPA is Now Law

August 10th, 2012 by Joe Kriesberg

After an exciting two-year campaign, the Legislature has passed and the Governor has signed the Community Development Partnership Act into law. I believe this is the most significant community development legislation in Massachusetts since the late 1970's when Mel King led an effort to pass the original CDC enabling law, created CEDAC and CDFC (now merged into MGCC) and the CEED program. Over the past few days, many people have asked me how we did it. Well, it's a long story, but here are my top ten reasons that we were able to pass the CDPA.

1. We laid a strong foundation: For years MACDC has cultivated a strong presence in the State House and strong relationships with many legislators and legislative aides (never under-estimate the importance of the aides.)  At the same time, our members have been cultivating strong relationships with their elected officials so those legislators know the important role that CDCs play in their communities. MACDC has also worked hard to build strong relationships with many other advocacy organizations: we have helped them so when the time came they were happy to help us.  We also laid a strong policy foundation by working on and winning passage of numerous bills and budget items in recent years, most significantly, the new and updated CDC enabling law in Chapter 40h.

2. We took the time to develop a strong policy proposal based on best practices in other states and in federal programs: MACDC spent years developing this proposal. We looked at similar tax credit programs in other states as well as federal models like the CDFI program and the CHDO program. Politics and advocacy matter, as you see on this list, but you need to have a sound policy proposal that can be supported by facts and evidence. We did that.

3. We had great champions in the Legislature: Senator Sal DiDomenico and Representative Linda Dorcena Forry were absolutely fantastic champions for this legislation. Not only did they chair the Joint Committee on Community Development and Small Business, but they embraced this as their number one priority for the year. When a legislator makes your bill their number one priority, you have a chance.  Sen. DiDomenico and Rep. Forry recruited 46 c0sponsors, held 7 field hearings around the state (the "listening tour") and continually kept the Legislative Leadership informed about the progress of the bill.  They also demonstrated real strategic insight by getting the bill incorporated into the larger economic development bill ensuring that CDPA was part of a vehicle that would make it to the Governor's desk. And I can't say enough about the outstanding work done by Rep. Forry's staff (John High and Stephanie Heller) and Sen. DiDomenico's staff (Chritie Ghetto Young, Wally DeGuglielmo and Ingrid Freire)

4. We built a strong partnership with the United Way:  The first meeting I had about this legislation was with Michael Durkin at the United Way. I knew that we needed their active support to win this campaign and Michael was enthusiastic from the beginning. It turns out that Mike had run a very similar tax credit program in Denver so he was familiar with how powerful this model is. The United Way was a powerful and important partner throughout the campaign and we expect to continue that partnership during implementation (the fact that Mike and I both grew up in Syracuse, NY also helped solidify the partnership!)

5. The MACDC GOALs report provided the data to demonstrate the impact CDCs have at the local level: MACDC launched the MACDC GOALs Initiative in 2002 so we have excellent data going back several years that can document the impact of this work. Having that data - and demonstrating a willingness to be held accountable - were key elements to making the case.

6. We devised a strong inside/outside legislative campaign: MACDC has always been committed to an advocacy model that involves both grassroots efforts and inside lobbying. Allison Staton (Ms. Inside) and Pam Bender (Ms. Outside) worked incredibly well as a team to bring both tactics to bear on this campaign. Over the past two years we held two major Lobby Days at the State House with over 200 people in attendance each time; we held over 40 in-district meetings with dozens of legislators where local residents could make the case directly; we generated dozens and even hundreds of calls at various points in the campaign; and we had a physical presence in the building every week to ensure that our bill was moving forward.

7. We took seriously the growing concerns about tax credits and addressed them in our legislation: CDCs are deeply familiar with tax credit programs so we know the benefits and challenges associated with them. We were also well aware of the growing concerns within the State House about tax credits in light of controversial tax credit programs that cost the state significant money without necessarily generating sufficient public benefits. We drafted the original bill to ensure high levels of accountability and transparency. When the Tax Expenditure Commission issued its recommendations in April we re-examined our bill to make sure we complied. We then worked with the Senate to amend the bill on the floor to strengthen these provisions. Both the substance of these changes and our explicit willingness to be responsive went a long way in winning over legislators and the Governor.

8. Legislators intuitively "get it" when we talk about place-based work: As I wrote in an earlier blog post, legislators understand our work because they represent the same places we serve. As a result, our message resonated with them as we talked about local solutions to local problems and devising strategies that responded the unique qualities of our communities.

9. Governor Patrick gets it when it comes to community building and community development: Since the beginning of his first campaign, Governor Patrick has talked about the importance of building strong communities and promoting civic engagement. He has been a steadfast supporter of CDCs for years so when this bill arrived on his desk he was strongly inclined to support it. Of course, as Governor, he has to consider other issues too, so he was determined to make sure our program complied with the Tax Expenditure Commission recommendations. Once he was assured that it did, he signed our tax credit program even as he vetoed three other tax credit programs that did not meet those requirements. 

10. At the moment of truth, our members, friends and allies rose to the occasion: Two times in the past month, the CDPA was in danger of defeat. First, the Senate Ways & Means Committee replaced our multi-year tax credit program with a one-year, $1 million grant program. In less than 48 hours, our members flooded the State House with calls and we had 24 out of 40 Senators sponsoring an amendment to restore CDPA to the economic development bill.  The Amendment was adopted 36-0, as Sen. DiDomenico worked the floor to ensure its passage. A few days later, the bill landed on the Governor's desk and there was concern that he might veto it because it created a new tax credit. Again, within 48 hours, we had generated over 300 calls to the Governor, sent a "sign-on" letter to him with 23 prominent individuals and organizations, sparked numerous calls from legislators, mayors and even a congressman to encourage the Governor to sign the bill. As I said above, the Governor is a big believer in community development, but he had concerns about the use of tax credit. These calls helped distinguish our program substantively and politically.

No campaign like this can succeed without careful planning, hard work, and a little bit of luck. We had all three working for us, as well as the efforts of hundreds of individuals each of whom did their part to pass this legislation. To be honest, I was surprised and humbled by the outpouring and I am forever grateful to everyone who helped.

My next few blog posts on CDPA will be about implementation. I'm looking forward to writing those!

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