President Biggs was invited to participate in a June 9 presentation hosted by Secretary of Health and Human Resources William A. Hazel and featuring Ted Howard, a leader in the field of “community wealth-building” – a strategy that combats generational poverty by assisting individuals in attaining self-sufficiency through building assets. Community wealth-building aims to create an “ecosystem” where the economic power of anchoring institutions such as universities and hospitals is leveraged to support locally-owned enterprises, which in turn generate assets for local workers. Advocates for this approach argue that holding a job is not enough to break the cycle of poverty: workers must be able to accumulate enough assets to cushion ordinary disruptions in life so that they can stay out of poverty. Similarly, a local economy with a number of locally-owned businesses is less vulnerable to the economic disruption caused by one large employer relocating to another area or undergoing large layoffs.
Mr. Howard spoke about his work in several areas of the country, in particular efforts in Cleveland, Ohio, where his organization has helped to establish several local enterprises that provide goods and services to large institutions in the city. For example, a commercial laundry service, a worker-owned cooperative, contracts with the Cleveland Clinic. The laundry hires local residents, who are often graduates of a job-training program run by a local nonprofit. The business has been profitable, allowing the workers to share in its growth and enabling them to build assets to bolster their long-term self-sufficiency.
During the question and answer period, there was some conversation about the application of this model to smaller and more rural areas. Mr. Howard has typically worked in cities where there is enough population density in close proximity to anchoring institutions to allow small businesses to be established in distressed neighborhoods; he suggested that smaller jurisdictions or rural areas may need to work regionally in order to aggregate enough demand for local businesses to supply. Agriculture was also discussed as a sector where wealth could be created in rural areas.
At the conclusion of the meeting, Secretary Hazel asked attendees to offer suggestions on what the state could do to support similar efforts in Virginia. President Biggs sent a letter in response making several recommendations. First, the state could provide technical assistance to interested localities. State help is also needed to address the problem of transporting residents to workplaces in rural areas where it is difficult to provide public transit. The state could also support agriculture in rural areas by continuing to fund the Virginia Cooperative Extension, which provides technical assistance to farmers, and by exploring opportunities to find markets for locally-grown food. Lastly, the state may wish to work with local planning district commissions in developing community wealth-building strategies, particularly in rural areas where programs may need to be regional in order to be sustainable.
President Biggs said, “The projects we learned about were innovative approaches to using existing assets to tackle entrenched poverty. I look forward to having more conversations about how this model might be adapted to support local solutions in our urban, suburban and rural counties.”
VACo Contact: Katie Boyle