Community benefits agreement

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A community benefits agreement (CBA) in the United States is a contract signed by community groups and a real estate developer that requires the developer to provide specific amenities and/or mitigations to the local community or neighborhood. In exchange, the community groups agree to publicly support the project, or at least not oppose it. Often, negotiating a CBA relies heavily upon the formation of a multi-issue, broad based community coalition including community, environmental, faith-based and labor organizations.

Contents

In the United Kingdom, Section 106 agreements and in Canada, "Section 37" agreements [1] similarly require certain benefits from developers, but differ from CBAs in that they are part of development agreements with governments, not communities. CBAs are generally private, contractual agreements, although they can in some instances be made part of a development agreement with a city. [2] [3]

Purposes

Economic development projects are often heavily subsidized by taxpayer dollars, but there is usually no guarantee that a project's "ripple effects" will benefit current residents. [4] Developments can cause inner-city gentrification, pushing out low-income residents as housing prices rise, or they may create only low-wage retail and service sector jobs. As a result, many metropolitan regions continue to experience problems related to poverty and housing, despite major investments in economic development.

Responding to these problems, the CBA model was created in the late 1990s as a way for the communities most impacted by economic development projects to participate in the planning process and seek to ensure that development benefits will accrue to existing communities. [5] For developers, negotiating with community representatives can be an attractive way to gain community support and help move their projects forward. Participating in CBA negotiations can eliminate surprises in the development approvals process and allow developers to work with a unified coalition rather than having to engage community organizations one by one. [6]

The community benefits movement

As local governments grappled with their responsibility to shape development and land use patterns, the community benefits movement emerged to challenge conventional thinking and offer a broader vision. Related to smart growth and environmental justice, the community benefits movement aims to ensure that the main purpose of economic development is to bring measurable, permanent improvements to the lives of affected residents, particularly those in low-income neighborhoods and communities of color. Organizations allied with the community benefits movement have pressured the public sector to play a more strategic role in land use planning and urban growth, and to leverage economic development subsidies toward the creation of good jobs, affordable housing, and neighborhood services that improve the quality of life for all residents. [5]

The community benefits movement began in Los Angeles, with successful implementation at mixed-use projects at Hollywood and Highland, [7] and Staples Center / LA Live. [8] It has since spread rapidly to other cities, including Atlanta, Chicago, Denver, Milwaukee, Minneapolis, New Haven, New York City, Philadelphia, Pittsburgh, San Diego, San Francisco, San Jose, Seattle, Syracuse, Washington, D.C., and Wilmington. [9] Leading organizations[ non-primary source needed ] include National Community Reinvestment Coalition, [10] The Partnership for Working Families, [11] Los Angeles Alliance for a New Economy (LAANE), [12] Strategic Actions for a Just Economy (SAJE), [13] SCOPE Los Angeles, [14] and Pittsburgh UNITED. [15]

CBA advocates contend that the community benefits approach improves the development process for the community, developers and local officials by creating an overall win-win-win scenario. [16] Some of the principles and goals that CBA advocates seek to promote include: [3]

CBA coalitions

At the heart of the community benefits strategy are community organizing and coalition building. [17] [18] Organizing and maintaining a coalition, facilitating compromise and crafting a shared agenda are essential to creating a successful CBA. Coalitions can include a variety of community groups, such as neighborhood groups, environmental organizations, good-government organizations, labor unions, and faith-based organizations. [6] Coalitions are usually unincorporated, but member community groups may enter into an operating agreement to govern their relationship in the coalition. A model CBA coalition operating agreement has been created by the Public Law Center at Tulane University Law School. [19]

Elected officials and government agencies often play an active role in CBA negotiations. In California and other jurisdictions where development agreements are authorized, government representatives may be formal CBA signatories. In other cases, government officials may play a more informal role by facilitating CBA negotiations and encouraging cooperation. [6]

CBA negotiations

Typically, negotiations between a CBA coalition and a developer begin after a project has been announced but prior to governmental approval. However, there are examples of legislative CBA requirements attached to subsidies that impose community benefit standards on land within particular districts. For example, developers participating in the Atlanta Beltline project that opt to use tax increment financing are required to incorporate community benefits through a development or funding agreement. [9]

Possible benefits

The CBA contract model allows each particular CBA to be tailored to the community's needs, the size and type of the proposed development, and the relative bargaining power of the community groups and the developer. Benefits may be provided by the developer itself, or a CBA may require the developer to impose CBA provisions on its tenants, vendors, and contractors. Typically, CBAs include job quality standards, local hiring programs, and affordable housing requirements. [6]

Other benefits include, among other things:

The range of benefits offered by a CBA has been explored extensively in the scholarly literature, [20] as well as conferences, [21] in an effort to raise awareness about the benefits of CBAs for developers, local government, and struggling communities.

Monitoring

Community groups should consider how each provision in a CBA will be monitored and enforced. Although financial commitments and other one-time benefits may be fairly easy to monitor, other developer and tenant commitments, such as living wage and local hiring requirements, may be in place for decades and require long-term oversight. To address this issue, CBAs have included periodic reporting and disclosure requirements, complaint investigation mechanisms, and provisions establishing oversight committees. Where a CBA is incorporated into a development agreement, government agencies may also play a role in monitoring the CBA's implementation. [5]

Enforcement

As a CBA is a legally binding contract, [22] it can be enforced only by the parties that signed it. CBAs that are incorporated into development agreements can be enforced by the government as well as by community groups. [6] There is no case law regarding the validity and enforceability of CBAs. Donald Trump's 1993 CBA-like contract relating to the New York City Riverside South project was the subject of a 2008 New York Appellate Division opinion, but the court held that the contract's terms were expired. [23]

Concerns and issues

Although numerous CBAs have proven to be successful tools to improve the economic development process, a variety of criticisms have emerged. Perhaps the most significant criticism is that CBAs offer no way to ensure that they are truly representative of community needs and desires. The Atlantic Yards CBA, for example, has been criticized because it was negotiated by only a handful of community groups, all of which are receiving funding from the developer, while many other community groups were excluded from the negotiations. A report from the New York City Bar Association has also questioned whether CBA negotiators will drive appropriate bargains with developers, and whether CBAs will interfere with the planning process. Various legal problems relating to exactions and consideration may also weaken the effectiveness of CBAs. [24]

Examples

CBAs have been negotiated for numerous projects. The most well known CBA is likely the Los Angeles Staples Center CBA, which has generally been viewed as a success. [25] Other projects that have had CBAs include the Dearborn Street Goodwill project in Seattle, the Consol Energy Center arena (for the Penguins hockey team) in Pittsburgh, [26] San Francisco's Bayview–Hunters Point residential development, the Gates-Cherokee redevelopment project in Denver, and the Ballpark Village development in San Diego. [27]

The "CBAs" of some projects have not been accepted as legitimate CBAs by advocates of the community benefits movement. For example, the "CBA" for the new Yankee Stadium has not been considered to be a "true" CBA because it was negotiated by elected officials, not community groups. [3] The agreement did include significant community benefits such as $28,000,000 in grants and free tickets for local organizations. [28] However, the CBA has not been smoothly implemented. In 2009, the former administer the community fund sued the Yankees' community charity, claiming that the fund had been mismanaged. [29]

In preparation of the 2010 Winter Olympics, the city of Vancouver, British Columbia, Canada, awarded a contract to Millennium Development Corporation to build its 600,000-square-foot (56,000 m2), 600-unit athletes' village on south east False Creek. This development included a CBA with targets to create 100 jobs for locally sourced and trained inner city residents and to procure a targeted $15 million in goods and services from the inner city. It also included a $750,000 legacy fund to train inner city residents. [30] The CBA included investment and support from the Canadian Federal Government, BC Provincial Government, the City of Vancouver and Building Opportunities with Business Inner-City Society Building Opportunities with Business (a community economic development non-profit also known as BOB) these parties collectively are recognized under the Vancouver Agreement. [31] The CBA also received support from Bell, VanCity, the Canadian Housing and Mortgage Corporation and the Vancouver Regional Construction Association. Building Opportunities with Business oversaw the use of the legacy funds, sourced labor and supported the inner city residents with training and aid while the VRCA oversaw the training of residents. Though the Olympic Village was widely criticized for going over budget, in a 2008 report to the City prepared by BOB the creation of 120 jobs with procurement closer to $50 million is cited. The report also admits that tracking the actual economic activity from the development was difficult and that the procurement is not exact. Regardless of the difficulty tracking procurement and the fact that the project went over budget the CBA is widely considered to be a success.

An examination into CBAs can be found in "Summary and Index of Community Benefit Agreements", [32] published online in 2011 by the Public Law Center of Tulane University Law School. [33]

See also

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References

  1. ↑ Keenan, Edward (January 16, 2015). "Section 37 — What it is, and why everybody's fighting about it". Toronto Star .
  2. ↑ Graser, Dina (May 2016), "Community Benefits and Tower Renewal" (PDF), www.evergreen.ca, Evergreen, retrieved 2021-04-23
  3. 1 2 3 Gross, Julian (2008). "Community benefits agreements: definitions, values, and legal enforceability" (PDF). Journal of Affordable Housing & Community Development Law. 17 (1–2): 35–58. JSTOR   25782803. Archived from the original (PDF) on 2011-07-25. Retrieved 2010-04-26.
  4. ↑ "Beginner's Guide to Accountable Development". www.goodjobsfirst.org. Retrieved 2021-04-23.
  5. 1 2 3 Salkin, Patricia E.; Lavine, Amy (2008). "Understanding community benefits agreements: equitable development, social justice and other considerations for developers, municipalities and community organizations". UCLA Journal of Environmental Law and Policy . 26: 291–331.
  6. 1 2 3 4 5 Gross, Julian; LeRoy, Greg; Janis-Aparicio, Madeline (2005) [2002]. Community Benefits Agreements: Making Development Projects Accountable (PDF) (Report). Washington, DC; Los Angeles: Good Jobs First and the California Public Subsidies Project, a partnership of the Center on Policy Initiatives, the East Bay Alliance for a Sustainable Economy, the Los Angeles Alliance for a New Economy, and Working Partnerships USA. OCLC   62794609. Archived from the original (PDF) on 2005-10-25.
  7. ↑ Lavine, Amy (2008-01-28). "Community Benefits Agreements: Hollywood and Highland Center". Community Benefits Agreements. Retrieved 2020-10-19.
  8. ↑ Lavine, Amy (2008-01-28). "Community Benefits Agreements: Staples Center CBA". Community Benefits Agreements. Retrieved 2020-10-19.
  9. 1 2 Patricia Salkin and Amy Lavine, Negotiating for Social Justice and the Promise of Community Benefits Agreements: Case Studies of Current and Developing Agreements, published at 17 J. Affordable Hous. & Cmty. Dev. L. 113 (2008).
  10. ↑ "Community Benefits Agreement Archives – NCRC". ncrc.org. Retrieved 2021-04-23.
  11. ↑ "Community Benefits 101 – The Partnership For Working Families". www.forworkingfamilies.org. Retrieved 2021-04-23.
  12. ↑ "Community Benefit Agreements Archives – LAANE". laane.org. Retrieved 2021-04-23.
  13. ↑ "Community Benefits Agreements – SAJE". www.saje.net. Retrieved 2021-04-23.
  14. ↑ "A New Economy for South Los Angeles – SCOPE". scopela.org. Retrieved 2021-04-23.
  15. ↑ "This Pittsburgh group wants all developers getting public subsidies to agree to community benefits. Including you, Amazon. – Pittsburgh UNITED". pittsburghunited.org. Retrieved 2021-04-23.
  16. ↑ "Community Benefits: Leveraging Partnerships for Successful Development (The Partnership for Working Families 2009)" (PDF). www.communitybenefits.org. Archived from the original (PDF) on 2011-07-25. Retrieved 2010-04-26.
  17. ↑ González, Erualdo Romero; Sarmiento, Carolina S.; Urzua, Ana Siria; Luévano, Susan C. (2012). "The grassroots and New Urbanism: a case from a Southern California Latino community". Journal of Urbanism: International Research on Placemaking and Urban Sustainability. 5 (2–3): 219–239. doi:10.1080/17549175.2012.693125. S2CID   144482084.
  18. ↑ Laing, Bonnie Young (2009). "Organizing community and labor coalitions for community benefits agreements in African American communities: ensuring successful partnerships". Journal of Community Practice. 17 (1–2): 120–139. doi:10.1080/10705420902862124. S2CID   143842872.
  19. ↑ "Community Benefits Coalition Operating Agreement" (PDF). law.tulane.edu. Retrieved 2021-04-23.
  20. ↑ Marcello, David A. (Summer 2007). "Community benefit agreements: new vehicle for investment in America's neighborhoods" (PDF). The Urban Lawyer . 39 (3): 657–669. JSTOR   23801009.
  21. ↑ "Win-Win-Win: The Advantages of CBA's for the Community, Developers, Government, and You" (PDF). law.tulane.edu. Retrieved 2021-04-23. Symposium on May 11, 2012 co-sponsored by Urban Land Institute: Louisiana CrossReach Initiative and The Public Law Center.
  22. ↑ Iyengar, Nikishka; Billingsley, Genia (2022-09-14). "Is there room for longtime residents in "that new Atlanta"?". Atlanta Magazine. Retrieved 2023-06-15.
  23. ↑ "Riverside S. Planning Corp. v CRP/Extell Riverside, L.P. (2008 NY Slip Op 10229)". www.nycourts.gov. Retrieved 2021-04-23.
  24. ↑ "The Role of Community Benefit Agreements in New York City's Land Use Process" (PDF). New York City Bar Association. March 8, 2010. OCLC   609607351 . Retrieved 2021-04-23.
  25. ↑ "Staples CBA – The Partnership For Working Families". www.communitybenefits.org. Archived from the original on 2011-07-25.
  26. ↑ "Hill District Consensus Group – Hill Community Benefits Agreement". hdcg.org. Archived from the original on 2012-12-19.
  27. ↑ "CBAs Currently in Effect – Community Benefits Agreements (CBAs) – The Partnership For Working Families". www.communitybenefits.org. Archived from the original on 2011-07-25.
  28. ↑ Williams, Timothy (2006-03-22). "$28 Million for the Bronx in the Yankees' Stadium Plan". The New York Times . Retrieved 2008-10-15.
  29. ↑ Santos, Fernanda (2009-04-01). "Former Administrator Sues the Yankees' Bronx Community Charity". The New York Times . Retrieved 2021-04-23.
  30. ↑ "Southeast False Creek Olympic Village Community Benefits Agreement" (PDF). vancouver.ca. City of Vancouver. Archived from the original (PDF) on 2012-03-28. Retrieved 2010-01-20.
  31. ↑ "The Vancouver Agreement". www.vancouveragreement.ca. Archived from the original on 2005-03-16. Retrieved 2014-02-05.
  32. ↑ LaSalle, Daniel J. (May 2011). "Summary and Index of Community Benefit Agreements" (PDF). law.tulane.edu. Retrieved 2021-04-23.
  33. ↑ "Community Benefits Agreements – Services – Tulane Law School". law.tulane.edu. Retrieved 2021-04-23.

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