CLEVELAND – In late July, the US Economic Development Agency announced a $ 1.8 million award in support of the Urban League of Greater Cleveland in establishing a $ 2.25 million revolving loan fund. The self-replenishing RLF will help small businesses and entrepreneurs in Cuyahoga County fund a critical “gap” for post-pandemic reconstruction and expansion, with a particular focus on businesses in low-income areas. This is a huge win. But it did not come without a strategic vision and conscious coordination to steer the course of northeast Ohio recovery in the right direction.
According to the latest available data for Cuyahoga County, unemployment rates among black workers are in 2019 were three times higher than the tariffs among white workers, a bigger discrepancy even than at the bottom of the Great Recession that began in 2008. The racial wage gap has also widened, with black workers earning 70 cents on the dollar on average before the Great Recession, up to 63 cents on the dollar as of 2018, according to the latest analyzed data.
Behind these stats are real people struggling to make ends meet. A recovery that excludes some ultimately fails in all. Regions that maintain the same policies and practices that exclude blacks, Latinx and other minorities will continue to fall behind.
History cannot repeat itself to reach a more affluent northeastern Ohio. The influx of US dollars for federal recovery is providing northeast Ohio with an unprecedented opportunity to re-imagine what it can be – but it won’t happen without conscious, thoughtful action.
In the Fund for our economic future, a local funding alliance of more than 40 organizations and individuals, the efficient and fair use of federal funds is paramount given the scale of public investment. The way our organization supports more equitable access, distribution and the results of resource investments will be central to our future work.
When the US Economic Development Agency (EDA) announced recovery assistance under the CARES Act, our organizations came together to take advantage of this opportunity. Fund for Our Economic Future staff developed a relationship with the regional EDA representative and served as a liaison between this and other local proposals (including the successful MAGNET projects). bid). The fund also provided grant writing assistance and match funding, and brokered additional match funding from the George Gund Foundation and the Cleveland Foundation.
And the Urban League brought the technical know-how and the successful model (based on the four-year-old) Access to the UBIZ strategic capital program) from which the RLF is to be created. It will give small and medium-sized businesses access to credit for working capital, construction investments, and long-lasting equipment investments, all of which are vital to supporting businesses and the family-sustaining jobs they are creating as the COVID-19 recovery continues. The Urban League will strongly encourage applications from borrowers in Opportunity Zones; Minority, women and veteran companies owned / controlled by companies that carry out industrial, light industrial, service or commercial projects outside of retail; and borrowers running projects that have a significant impact on the surrounding community.
Equally important, the Urban League will serve as a hub for technical support and comprehensive services for lenders. By leveraging a robust network of innovative solutions to overcome work preparation and access barriers, this collaboration will enable a stronger staffing pipeline and help employers with location selection and transit considerations.
In the short term, the Urban League expects the RLF to help up to 35 local businesses, most of which are based in low-income census areas, save 300 jobs and create another 300, and mobilize an additional $ 3 million in private investment.
Northeast Ohio benefits from many organizations working towards a more competitive, fairer regional economy, each with unique assets, relationships and expertise. Together and with conscious steps so that the economy works for everyone, the region will not only rethink but also achieve a better future.
Michael Obi is Managing Director of Entrepreneurship for the Urban League of Greater Cleveland and Bethia Burke is President of the Fund for Our Economic Future.
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