Any vibrant and inclusive neighborhood requires a few essential ingredients, including well-paying jobs, affordable housing and abundant small businesses. Yet many low- and moderate-income areas don’t enjoy this recipe for success. The ripple effects are felt far and wide: When these neighborhoods struggle, the entire local economy loses. When they are healthy, everyone wins.
PRO Neighborhoods is JPMorgan Chase’s $125 million philanthropic initiative to support locally driven solutions for revitalizing neighborhoods in urban and rural communities across the United States. Through the effort, we are leveraging our deep expertise in community development banking to drive collaboration, provide seed capital to preserve and build affordable housing, and develop forward-looking data tools designed to help nonprofits and communities most effectively target investments.
A complex set of factors must come together to create and sustain vibrant, inclusive neighborhoods — meaning no one actor can do it alone. That’s why catalyzing collaboration is at the heart of our PRO Neighborhoods strategy. We believe that a powerful lever for expanding opportunity in struggling neighborhoods is supporting and encouraging partnerships among local organizations that have a deep understanding of the needs of their communities.
We are leveraging our deep expertise in community development banking to drive collaboration
One way we do this is through an annual PRO Neighborhoods competition, which motivates local CDFIs to work together to tackle a specific local challenge such as blight, lack of affordable housing or barriers to accessing capital. Through these unique partnerships, CDFI collaboratives can tackle large projects that are beyond the capacity of any one of them individually — and yield a far greater impact.
In Orlando, Florida, for example, we awarded $5 million in 2017 to the Florida Community Loan Fund and New Jersey Community Capital to create scalable, self-sustaining models for affordable housing finance and development by bulk purchasing foreclosed homes and selling them to nonprofit housing organizations. The investment also supports the exploration of innovative housing development practices, such as repurposing shipping containers for use in constructing multifamily apartment complexes.
units of affordable housing created or preserved with 350 housing loans
loans to small businesses
new jobs created and supporting nearly 2,500 existing jobs
To date, PRO Neighborhoods has hosted four competitions — awarding a total of $84 million to 62 CDFIs serving over 25 states — to boost opportunity in distressed communities across the country. It’s working. An impact assessment by The Joint Center for Housing Studies of Harvard University found that the 42 winners of our first two competitions have issued a wide range of loans totaling more than $320 million.
Through PRO Neighborhoods, we are supporting collaborative approaches to community development in other ways as well. The Uplift America Fund, for example, is a unique public-private partnership aimed at addressing poverty in rural America. The effort brings together the U.S. Department of Agriculture with philanthropic and private sector partners, including JPMorgan Chase, to fund vital community services and strengthen community-based lenders in distressed communities. Another example is the Urban-Rural Kentucky Collaborative — awarded a $2.6 million PRO Neighborhoods grant in 2015 — which provides loans and credit counseling to help mobile home residents increase homeownership, develop businesses and create and retain jobs. To date, the collaborative has leveraged close to $50 million in additional public and private funds and has made more than $27 million in loans to low- and moderate-income small business owners and homeowners.
Affordable housing is fundamental to developing inclusive communities. That’s why another key part of the PRO Neighborhoods strategy is providing capital to launch and scale new ways to meet the formidable challenge of affordable housing. One example is Equity with a Twist (EQT), a collaboration between the Low Income Investment Fund and JPMorgan Chase that provides flexible, low-cost financing to support and incentivize solutions to poverty. Investments through EQT will accelerate the transformation of large-scale public housing in San Francisco and Los Angeles, and in a New Orleans community still rebuilding a decade after Hurricane Katrina.
We are also supporting the use of forward-looking data tools to advance equitable growth. For example, in San Antonio we are supporting the National Association of Latino Community Asset Builders (NALCAB) to map and analyze demographic changes in low- to moderate-income communities. With the investment, NALCAB’s data has informed local housing and community development policy and helped to develop the capability of local partners to achieve more equitable investment in gentrifying neighborhoods.
“We need the collective work and support from businesses, philanthropy and government to help more people find stable housing and create more pathways to economic mobility. When we remove barriers to opportunity, we reinvigorate the American Dream. That is a good thing for our neighborhoods — and it’s a good thing for business.”
Head of Community Development, Small Business and Financial Health Strategies within Global Philanthropy for JPMorgan Chase & Co.
Chairman and Cofounder of CityView and former Secretary of the U.S. Department of Housing and Urban Development
Director of Housing and Community Initiatives at Abt Associates
Cities are more likely to succeed when residents have the opportunity to realize their full economic potential, regardless of the color of their skin, where they were born or their family’s resources. Beyond simple fairness, there is growing evidence that more equitable cities are also more prosperous, achieving stronger and longer-lasting economic growth.
We believe that cities can promote economic mobility by combining place-based and people-based strategies. Place-based strategies focus on ensuring that people of all incomes, races, ethnicities, ages, genders and abilities have equitable access to essential services and resources, such as good schools and safe neighborhoods. People-based strategies focus on services not tied to a particular neighborhood, but instead delivered to anyone who needs support, regardless of where they live. These strategies are complementary, and together establish an ambitious agenda for U.S. cities to not only promote fairness and justice, but also expand and sustain their regional economies.
The pressing need to expand opportunities for individuals to move up the economic ladder may not be a new problem, but it requires new solutions. To build truly equitable cities, we believe that collaboration across the public, private and nonprofit sectors is the critical success factor. The private sector not only has a vested interest, but also can make a real contribution to fostering opportunity in ways far beyond, and with greater impact, than the traditional model of simply bringing dollars to the table. Companies like JPMorgan Chase are actively leveraging their core business, deep insight into the economy and the expertise of their people — coupled with an investment and philanthropic capital — to drive inclusive growth in cities around the world.
Several decades ago, Chef Michael Brown was so inspired by the Cajun-Creole cooking he tasted on a trip to New Orleans that he decided to combine his culinary creativity and entrepreneurial skills to launch Jamburritos Cajun Grill, his award-winning food truck in downtown Phoenix. The menu features his unique culinary creation, a jamburrito, which consists of jambalaya wrapped up like a burrito.
His thriving business is one of many that have benefited from a revitalization that has taken place along a transit line in Arizona’s Maricopa County, one of the country’s fastest-growing and culturally diverse areas. In addition to Brown’s truck, the area now has a newly renovated charter school for low-income students, 222 new units of transit-oriented affordable housing and a 70-bed residential facility for low-income residents. Indian, Middle Eastern and Asian restaurants have sprung up along the popular Spice Trail.
Each of these projects has been funded, in part, by an innovative local partnership working to address the area’s diverse cultural and economic needs. It all began in 2008, with the opening of a 20-mile light rail that runs through Phoenix, Tempe and Mesa — a region where 30 percent of the population is Hispanic or Latino, 20 percent are immigrants and the poverty rate is above the national average.
While the new transit ensured that people could get to places more easily, there were no guarantees the many immigrant, working-class and diverse communities along the corridor would benefit from the inevitable development to follow.
A coalition of committed local partners, Adelante Phoenix!, has banded together to make sure they do. In 2014, JPMorgan Chase awarded the partners — Raza Development Fund, Neighborhood Economic Development Corporation, MariSol Federal Credit Union and Trellis — $6 million for their innovative proposals. Focusing on low-income housing, education, healthcare, community development and financial services, the group has taken a thoughtful, ambitious and culturally competent approach to development.
Adelante Phoenix! has made an impressive impact. Over the course of three years, the partnership issued nearly 900 loans, amounting to over $32 million, and leveraged an additional $180 million in outside financing. This resulted in 51 small business loans — one of which financed a new wrap for Brown’s food truck — as well as 128 jobs created or preserved, and over 700 units of affordable housing.
And the work is far from done. As the city makes plans for the light rail’s extension, Adelante Phoenix! is doubling down on its commitment to underserved entrepreneurs, in support of a healthy small business ecosystem in South Phoenix.