Foundation makes rare ‘impact investment’ in local project
Philanthropic organizations typically invest their endowment
funds in traditional vehicles — stocks, bonds, hedge funds, real estate — that
offer high returns with as little risk as possible, and they use the earnings
from those investments to make grants.
But in recent years, foundations have begun exploring what’s
known as “impact investing,” where endowment funds are invested in entities
that align more closely with the causes the foundation supports.
It can be hard to do. Only 5% of foundations’ assets are
currently devoted to this kind of investing, according to a
recent study by the consultancy Bridgespan Social Impact.
“In the world of philanthropy, you have a lot of foundations
talking about it. Few are doing it,” said Sheena Strawter-Anthony, director of
impact investment strategy at the William Caspar Graustein Memorial Fund in
Hamden. The Graustein Fund is working to make 100% of its investments
“mission-aligned,” she said.
Earlier this year, the foundation took an important step
toward that goal by providing $10 million in financing to a community
redevelopment project in New Haven known as ConnCAT Place at Dixwell. The $200
million master-planned development includes 180 units of affordable housing, a
child care facility, health care center, spaces for workforce training and
education programs, retail and restaurants, a public plaza, performing arts
center, greenhouses, offices and more.
Connecticut Community Outreach Revitalization Program
(ConnCORP), the economic development organization leading the project, has
spent the last several years seeking community input, acquiring adjacent
parcels of land and clearing blighted structures to make way for ConnCAT Place.
It is slated to break ground on the development early next month.
Strawter-Anthony said the loan was structured “with
intentionality,” designed to be paid back over a longer term and with a lower
interest rate than a typical real estate investment deal. She said she had to
force herself to look at the terms in a new and different way, taking into
account the broader impact of the investment rather than just the financial
returns for her organization.
“ConnCORP is helping to build wealth in the Dixwell and
Newhallville communities,” she said. “The loan was structured in a way to
support the community impact of the project.”
Dixwell and Newhallville are historically Black
neighborhoods that have experienced high rates of poverty over the past 70
years, and much of the block that will house the new development had fallen
into disrepair. In community meetings, residents told ConnCORP leaders they
wanted to revitalize the neighborhood, have a place that felt safe, with
high-quality early childhood care and education, where they could buy fresh
food and gather for events.
Erik Clemons, chief executive of ConnCORP and ConnCAT — the
education and workforce training organization around which the development was
designed — said he sees the project as an extension of the work ConnCAT has
already done, training hundreds of local residents for jobs in New Haven and
the surrounding area.
“I was thinking about what is the next iteration of impact,
given that these folks are now walking in the world differently, with a job,
with pride, with dignity,” Clemons said. “What can we do next to create a world
where they wouldn’t be working poor?”
Clemons said he hadn’t aspired to run an economic
development project, “but it was natural calling, given the work I had already
done.” ConnCORP launched in 2018, and soon the plans for ConnCAT Place began to
take shape. “It was really about: How do we create economic infrastructure,
capital formation and wealth generation in a community that quite frankly has
been forgotten?”
Strawter-Anthony said she hopes the foundation’s deal with
ConnCORP can offer an example to other foundations that want to do more impact
investing.
The financial returns on such deals may not be as strong,
but the overall effect is far more powerful, she said. That’s because not only
do these investments generate value for the loan recipients, they also redirect
philanthropic dollars away from the kinds of for-profit investment vehicles
that often extract resources from communities like Dixwell and Newhallville,
she said.
“Most foundations don’t invest their endowments in line with
their mission. They can invest in things that are counter to their
mission,” Strawter-Anthony said. For example, a foundation with a mission to
end poverty might be invested in for-profit companies that don’t paying living
wages or offer benefits, she said.
“A lot of the harm in the world has been created through
investments,” she said. “When I look at the foundation, I look at us becoming
conscious of the harm in our actions and changing the way we behave and our
impact on the world overall.”
South Windsor warehouse expansion project pitched
ASouth Windsor property owner is looking to build a new
accessory warehouse for consolidation and expansion of a logistics operations
tenant along Sullivan Avenue.
Moores Property Management LLC wants to build a new
32,200-square-foot accessory warehouse on a 4.27-acre property that it owns at
500 Sullivan Ave.
The site contains an existing building used by United
Delivery Inc., a family-owned logistics management, product distribution, and
warehousing company that has been operating there since 2020. The site was
formerly operated by New England Transportation Inc.
United Delivery is currently leasing off-site storage space
in multiple buildings around South Windsor, and the new building would limit
the need for off-site storage space and transportation between facilities, the
application reads.
The United Delivery facility has roughly 25 employees, which
“may increase due to future business growth but is not anticipated to increase
immediately with the construction of the warehouse,” the applicants said.
Plans for the expansion project include building two new
loading docks, adding to the existing building’s nine active loading bays, and
seven trailer parking spaces, all of which will remain. Additional parking
spaces for employees will also be added to the site.
United Delivery office space in the existing building will
be relocated to the new warehouse, the application said.
Members of the development team incluse PDS Engineering and
Construction of Bloomfield as general contractor; Design Professionals
Inc., of South Windsor for civil engineering, planning, landscape architecture
and land surveying; F.A. Hesketh & Associates Inc., of East Granby for
traffic engineering; and Ian T. Cole, of Middletown, for wetlands and
environmental work.
White House calls for stronger labor standards
President Joe Biden signed an executive order Sept. 6
calling on federal agencies to adopt a series of “high-road labor
standards,” according
to an announcement from the White House, continuing the
administration’s push toward expanding the federal workforce while pushing
certain standards.
The announcement calls the move the “first in history to
specify a clear list of labor standards that all Federal agencies should look
to prioritize.”
The federal government considers
itself a “model employer,” in that private sector employers often
follow suit when it moves to change standards. The “Good Jobs Executive Order”
calls upon agencies to adopt a number of standards around wages, union
organizing, workforce development and workplace safety.
Among those standards, agencies are directed to prioritize
project labor agreements, community benefits agreements, voluntary union
recognition and neutrality in regard to union organizing when such takes place,
the announcement said. The EO also directs agencies to “consider incentivizing
specific high-wage standards for manufacturing grants,” similar to Davis-Bacon
rules for construction jobs, which require contractors to pay workers
“no less than the locally prevailing wage,” according to the U.S. Department of
Labor.
Associated
Builders and Contractors opposed the order, calling it exclusionary and
saying it removed competition and favored union builders.
“The executive order will undermine the efficient and
economical delivery of taxpayer-funded infrastructure, clean energy and
manufacturing projects and is consistent with the Biden-Harris administration’s
politically motivated policy schemes,” said Ben Brubeck, ABC vice president of
regulatory, labor and state affairs, in a statement.
He added he looked forward to reviewing the official text to
see if it would be challenged in court.
Indeed, unions do feel the order favors them and their
workers, but also other U.S. workers looking to support themselves.
Mark McManus, general president of the United Association of
Union Plumbers and Pipefitters, praised the executive order, which Biden signed
at his union’s chapter, Local 190, in Ann Arbor, Michigan, on Sept. 6. McManus
called Biden, “the most pro-worker and pro-union president,” a title he’s worn
with pride.
Bottom of Form
“With incentives to strengthen our gold-standard registered
apprenticeship programs, to guarantee the rights of all workers to collectively
bargain for a better future, and to expand family-sustaining wages for all,
this Executive Order will help ensure all Americans have a fair shot at
success,” McManus said in a statement.
Apprenticeship rule
Workforce development through registered apprenticeships was
also mentioned as a priority for federal agencies — a focus of the Biden
administration, which has invested in creating
training pipelines and tightening
registered apprenticeship standards to ensure the program retains its
high quality, leaders previously said.
That apprenticeship rule has
come under fire from Republicans, who say the rule will disincentivize
apprenticeships due to heavy administrative requirements.
The executive order also states federal agencies should
encourage contractors to focus on equitable and fair hiring as well as support
workplace safety by prioritizing solid reporting structures.
To that end, the administration has pushed for an extreme
heat standard. The Occupational Safety and Health Administration proposed
such a rule earlier this summer and will be taking comments until Dec.
30.
The Investing in Good Jobs Task Force is responsible for
ensuring these standards are implemented, according to the announcement, and
will be co-chaired by the Secretary of Labor, currently Julie Su, who is
serving as acting secretary.