The Legacy: Race.
“There is no reason to believe that bureaucrats and politicians, no matter how well meaning, are better at solving problems than the people on the spot, who have the strongest incentive to get the solution right.”
It was never a level playing field.
Mortgages, especially with the GI Bill in the 1940s, helped people in the working class accumulate wealth so they could take care of themselves, their families and be self-sufficient in their retirement. Entire neighborhoods were denied those mortgages for generations. “Redlining” was accepted lending policy in cities across the country for generations. In economic terms it was a market failure or lack of access to capital.
During the 1970s economic development through urban renewal was seen as a way to spur investment. The tax subsidies were not given to existing neighbors so they could close the gap themselves. The nonprofit sector focused on services to meet basic needs rather than investing in closing the gap.
The assumption was that the only way to bring opportunities to people in those previously redlined communities was through private sector investment and job opportunities. By 1990 private sector subsidies in the name of economic development grew to attract investment and jobs in cities in industrial decline especially after the recession in 1989. When cities began subsidizing businesses (those with access to capital), they took a scale that was tipped and, in an attempt to right it, tipped it more.
Those neighborhoods were redlined because they were traditionally African-American. “Mapping Inequality,” a featured project of the Digital Scholarship Lab of the University of Richmond, has compiled maps of the practice nationally. (Charlotte’s Opportunity Task Force also addresses it.)
Per the City’s Opportunity Task Force and subsequently the strategy adopted in the FY2019 and FY2020 City of Charlotte Adopted Budgets, the most in need are those living in poverty which is concentrated in our previously redlined neighborhoods. The City’s strategy has been to create Opportunity Zones to make federal tax incentives available to private sector investors. These are subsidies to those who have already accumulated wealth. Our nonprofit investment will offset this displacement-inducing policy with direct investment in the people who already live in these communities.
City of Charlotte Opportunity Zones (9/1/2019)
Economic Development Incentives are benefiting the Charlotte region not Charlotte’s most in need.
The Solution:
Close the Redlining Gap
Access to Capital - Absorb Market Risk
“Resources in good condition have users with long term interests, who invest in monitoring and building trust.”
“The Commons”
The proposal in BuyingItBack is modeled after the work of Indiana University Professor Elinor Ostrom, the only woman to date to be awarded the Nobel Prize for Economic Sciences (2009). It was long unanimously held belief among economists that natural resources that were collectively used by their users would be over-exploited and destroyed in the long-term. Ostrom disproved this idea by conducting field studies on how people in small, local communities manage shared natural resources, such as pastures, fishing waters, and forests. She showed that when natural resources are jointly used by their users, in time, rules are established for how these are to be cared for and used in a way that is both economically and ecologically sustainable.
Let’s invest in the most in need in our city together. If we buy historic property as a nonprofit to benefit current neighbors, we can help them prevent their own gentrification (the “Project”.) As the neighborhood changes, they can benefit from the changes more directly. When the neighborhood property values have risen, the community will continue to own some property together that will help them maintain its personality. We have to do this ourselves (the “Pledge.”)
Challenge to Mayor Lyles to use economic development incentives with a Public - Nonprofit partnership to close the redlining gap. This economic development approach intended to illustrate the underlying flaw in current economic development strategy was made public one month prior to choosing to host the 2020 Republican National Convention. It illustrates the advantage given to those who benefit from special taxes. A link to my public comments to the Council and Mayor are linked under “About.”
City of Charlotte contracts to Black American-owned businesses:
$52 Million of $1.8 Billion (2.9%) over five years.
“love and justice are not two. without inner change, there can be no outer change; without collective change, no change matters.
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Systemic Racism… It’s personal.
My name is Leslie Dwyer. 21 years ago I was recruited to Charlotte by then-NatonsBank (Bank of America) Public Finance after serving as an Independent Municipal Financial Advisor to the special taxing district for the original financing of MLB’s Milwaukee Brewers’ Miller Park. My role was to represent taxpayers or the “all of us” side of the table in the debt financing. The bank’s Sports Finance Group was MLB’s bank. They had just created the PSL-backed construction loan that enabled the original Panthers Stadium to be built/financed by the NFL fans who wanted the expansion team.
My work, BuyingItBack.com, is based on that experience. We are monetizing our social and political capital to invest in Charlotte. We’re making Charlotte a better place for all of us. At the recommendation of Charlotte’s Opportunity Task Force, the City of Charlotte and Mecklenburg County have created more public policies and programs designed to escape poverty. The only policy the task force recommended related to economic development says to do more of it. Subsidizing the private sector makes that gap worse for all of us but especially those most in need.
I propose we come together in Charlotte to be the first city to use a stadium financing to benefit all of us. Let’s invest in the one thing that closes the gap and shrinks the need for government services.
I am heartbroken by what Charlotte has become. Those who benefit the most and immediately from our economic development investments have a partnership with the City based in law. It assumes taxpayers should provide those subsidies. It merely looks like it works. Taxpayers should never subsidize the overhead of healthy companies. What seems like fiscal responsibility, ensuring the companies are financially sound, is the very reason we should remain hands off.
The upward mobility data proved it doesn’t work in the long run. The argument that companies would not invest “but for” our investment failed. While those who benefit from the practice (high wealth companies/individuals, political candidates and foundations; see The System) may have legal arguments based in subjective data, the data clearly illustrated that in the era of mergers and acquisitions, companies sought states with Right-to-Work states (non-union/collective bargaining states.) We’re “competing with” the same cities over and over.
I have been attempting to build this new investment foundation for over four years. Since we don’t have a special tax, there’s no one advocating for “all of us” any longer. Elections require that candidates offer something for everyone in order to have enough voters say “s/he supported my cause.” There’s no place to advocate for our middle ground. It’s a conveyor belt: primary, budget, summer tourism announcement (by Tourism during July vacations), general election, training of new elected officials on budget and finance (including partner/private sector perspective) and December economic development business expansion/attraction announcement. (Rinse, repeat.)
Although I have not had the privilege of meeting Mr. McColl, his leadership is why I fell in love with Charlotte. He invested in all of us and we knew we were part of something greater. The use of PSLs to monetize the power of NFL fans to build the original Panthers stadium, the partnership that built the First Ward to create mixed income housing, and the creation of a community bank are a few of the reasons I am also confident this poverty/income gap was not Mr. McColl’s vision. That investment set us apart from other cities. I did not take this proposal to make our economic development a zero-sum game to him then. As a result I’ve watched Hope and the American Dream die. It was not malice.
Below is a list of dates that paint a picture of race in Charlotte. As a white woman, I must remain silent on the experience of race and what Charlotte needs to heal. Until white women can look someone raising an African American child in the eye and say “your babies are my babies now,” it’s not enough. I ask your patience as I continue to recognize when I say insensitive things. I will continue to try. I may not be able to speak to the experience of race but I can and will continue to speak to the economics.
25 years ago I helped create the analysis used to justify tax incentives. I am trying to accept responsibility for my role in this. My proposal will work. I just need leverage.
Economic development incentives with the private sector are causing the income gap for everyone. The City Council and County Commission have adopted policies based on the recommendations of a task force. It made the case that people born into poverty can’t escape it because of systemic racism. Candidates and foundations benefit from private sector donations particularly from economic development partners. Economic development incentives are causing the gap. The System failed. It also convicted itself. That’s leverage.
I am willing to vouch one last time for the people I’ve listed in liquidating my social and political capital (“Use of Funds”). We need their work but we have to restructure how we pay deliver and pay for it. It requires a system based on listening not explaining. We can prove that we do not want this for our city. But we have to do this ourselves.
Like other cities, we’ve become the bank. I’m confident the owner of our Carolina Panthers, David Tepper, doesn’t want this for all of us either. He invested in a restructuring of Bank of America in 2009 before the rest of us did in Too Big Too Fail. To restructure democracy in such a bold way will require his bullish investing style. If we set the precedent in Charlotte, we can collaborate with other cities to do the same. To be less recession sensitive, we have to make our greatest priority supporting those who are the most economically fragile. That’s true in any city.
It’s simple. It’s just one project and one pledge. No political parties and a level playing field. Let’s make 2020 a fair fight. This is the middle.
Please hire me to create the permanent solution. My terms are in BuyingItBack.com.
Respectfully,
Leslie Dwyer, Founder
BuyingItBack.com
MPA, Indiana University 1994
BA, DePauw University 1990
P.S. Talk to your neighbors.
Sep. 14, 2013
Jan. 2014
Harvard/UC-Berkeley Upward Mobility Report - "However, because inequality has risen, the consequences of the “birth lottery” – the parents to whom a child is born – are larger today than in the past."
It’s the Death of the American Dream for all of us.
Aug. 21, 2015
Hung jury, mistrial and protests in Charlotte related to the death of Johnathan Ferrell.
Sep. 20, 2015
Keith Lamont Scott killed. Protests Sept. 20 - 21, 2016
Oct. 3, 2016
Charlotte Community Letter - Programs, inclusion, jobs and workforce development recommended. No mention of business investment, small business advancement or economic development. “Heard” is not “listening.”
Mar. 1, 2017
Charlotte's Opportunity Task Force Report - Charlotte makes the case for systemic racism in the lack of upward mobility for children born in poverty. (See Report Ch. 7 for Recommendations.) Recommendations include asking current care-givers and nonprofits to work together and expanding current economic development by the County.
Oct. 2, 2017
Charlotte Community Letter - One-Year Report. Highlights programs.
Jul. 1, 2018
City of Charlotte Budget - Budget uses Opportunity Task Force Recommendations in creating the FY2019 Adopted Budget. County adopts the Pre-K programs recommended and expands the use of human services money for private sector subsidies.
Nov. 2019
Pledge to Liquidate social and political capital to invest in The New Charlotte that listens to the most in need and their direct care-givers. It’s not about us. Launch of BuyingItBack.com.