Economic Development Director Tracey Nichols will join Steve Dubb of the Democracy Collaborative to present “Community Wealth Building In Cleveland Through Anchor Institutions Purchasing And Cooperative Development” at the Global Social Economy Forum in Montreal, Canada on September 7, 2016. The presentation discusses co-operatives in general and the Evergreen Cooperatives of Cleveland in specific and how these business models can lead to economic and social inclusion. The panel includes presentations by cooperative groups in Seoul, South Korea and Mondragon, Spain. The conference will bring over 2,000 participants from every continent discuss the collaboration between local governments and social enterprises and how they benefit cities. It is a great honor to have a presentation be selected to proffer at this forum.

1. Community Wealth Building In Cleveland Through
Anchor Institutions Purchasing And Cooperative
Development
Montréal, Quebec
Global Social Economy Forum
7 September 2016
Tracey Nichols, Director, Economic Development
City of Cleveland, Ohio, United States
Steve Dubb, Senior Fellow
The Democracy Collaborative

2. Evergreen Cooperatives
TOTAL EMPLOYMENT:
119
CLEVELAND RESIDENTS:
99 (83%)
MINORITIES:
100 (84%)
COMMUNITY RE-ENTRY:
47 (39%)
COOPERATIVE MEMBERS:
31 (26%)

3. Governance Structure
Evergreen
Business Services
Evergreen
Cooperative
CorporationEvergreen
Cooperative
Development Fund
Evergreen Real
Estate Corp.
Evergreen Energy
Solutions
Green City
Growers
Evergreen
Cooperative
Laundry
Co-Op 4
Co-Op 5
EBS Board
I
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v
i
d
u
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l
C
o
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o

4. Why did the partners come together in
Cleveland?
• Large areas of City of Cleveland living in poverty
• Mayor Jackson interested in possible solutions
• 2005-Greater University Circle Initiative (GUCI)-Working with
the Anchors to create wealth and assets for low income
individuals in the surrounding community
• Created a basis for continued conversations about economic
inclusion
• Cleveland Foundation led the effort/interest in cooperatives

5. Is place-based
Emphasizes equity and inclusion
Promotes local ownership and control
Creates and anchors living wage jobs
Keeps wealth local
Builds “ecosystem” & institutions of support
Leverages local assets
The Community Wealth Building approach

6. Criteria for Business Selection
1) Potential for sustainable profitability.
2) Short payback period.
3) High level of local job creation.
4) Low barriers to entry for workforce.
5) Active engagement of multiple anchors (i.e., preference for a
business that meets the procurement needs of multiple institutions).
6) Potential to improve family living standards.
7) Ability to generate community wealth.
8) Potential for business growth.

7. Setting the Conditions for Co-op Success
1) System for screening employees
2) Life skills training
3) Management training (coaching supervision model)
4) Co-op governance training
5) Business-specific training
6) Learning what it means to be a business owner

8. What was the government role in Cleveland?
• Government funding
• Banks Would Not Fund A Start-Up
• City/Federal funds could leverage New Markets Tax Credits
• City created strong project reserves to reduce risk- greenhouse
required a “workout” & reserves saved the project
• Requested Public benefit waiver from Federal government
• Zoning and land assembly
• City had available landbank land for projects & funding to acquire
remaining parcels using Federal Uniform Relocation Act
• City assisted with expedited zoning and permitting

9. Other inclusion efforts in Cleveland
• Community Benefits
• City has a long history of economic inclusion for City funded projects
via codified ordinances passed by City Council
• What if we asked other organizations to follow suit? Hire local and
Contract local to support our community?
• University Hospitals leads the way; Other Anchors, Institutions and
even a developer follow
• Supply Chain
• University Hospitals required supplier company (Owens Minor) to
move to City – creates City jobs and investment in neighborhoods
• City helped with site selection, incentives

10. Business Challenges
1) Anchor contracts were hard to secure.
2) Businesses were not always well designed to meet anchor needs
(e.g., lack of processing facilities at Green City Growers).
3) Competition with unions limited the kinds of jobs that Evergreen
Energy Solutions could bid for.
4) Insufficient operational systems existed at launch (e.g., back
office, manager and worker training).

11. Building in Other Cities
What was unique about Cleveland?
1) Foundation led
2) Represented first large-scale U.S. philanthropic use of co-ops
as part of urban development strategy
3) Had high profile (e.g., media, political attention)
4) Prioritized capital-intensive businesses (laundry US $5.7M,
greenhouse US $16M)
5) Used complex financing (Section 108, New Markets)
6) Launch of first two businesses preceded development of overall
structure (i.e., Foundation incubation, 2009-2012)

12. Richmond, VA and Rochester, NY: What’s different?
1) Co-ops are now part of the community development
landscape—no longer completely novel
2) Public launch from the get-go: City Council-led
3) Less direct philanthropic involvement
4) Far less available capital than in Cleveland
5) Desire to invest in infrastructure first
6) Broader strategy also envisions conversions of existing
businesses to employee ownership
7) Different kinds of business ideas emerging

13. 1. Local Food Processing Facility
2. Workforce Transportation Provider/Shuttle
3. Green Construction Company (LED, solar, refer.)
4. Cooperative of Independent Childcare Centers
Richmond, Virginia
1. Community health worker business
2. Property maintenance business (turnover of units,
grounds maintenance)
3. Construction finishing business
Emerging Business Ideas
Rochester, New York

14. Current Challenges and Opportunities
“In past decades, the overarching trend has been where
we might have seen people use worker co-ops to exit
the economy and create an alternative for themselves.
Now, we are really seeing people using the form to enter
the economy. And that is a substantial difference, which
has huge implications for how we develop support in the
form of capital, technical assistance and policy.”
Melissa Hoover, Democracy at Work Institute
Co-op Issues Forum, Washington, DC, USA, May 4, 2016
”

15. Tracey Nichols
Director of Economic Development
City of Cleveland
TNichols2@city.cleveland.oh.us
Steve Dubb
Senior Fellow
Democracy Collaborative
sgdubb@yahoo.com
Thank you!