Community development corporation

From CEOpedia | Management online

Community development corporation (CDC) is a nonprofit, community-based organization focused on revitalizing the areas in which it is located, typically low-income, underserved neighborhoods that have experienced significant disinvestment. CDCs are involved in a variety of activities, including but not limited to development of affordable housing, economic development, childcare, youth development, health care, community organizing[1] .

Role in society

Community development corporations play a critical role in building a society[2]:

  • transform communities that suffered disinvestment as a result of urban renewal, loss of manufacturing jobs and outmigration into communities of choice,
  • anchor capital in the community by developing residential and commercial property, including affordable housing, stores and businesses,
  • compose of community residents, which provides for direct grassroots participation in decision-making,
  • work to enhance community conditions, involving neighborhood organizing.

Criticism and weaknesses

Community development corporations have suffered serious drawbacks during their initial growth years, particularly in the area of business development. Little attention has been given to economic feasibility and soundness of the business ventures selected for financing. This was primarily a result of the existing attitudes within the community development corporation administration as investments were considered more of a social giveaway than a business activity. Major factor in investment decisions was the estimated number of jobs that would be created as a result of the investment. Very little attention was given to the crucial areas of marketing, production, finance and management. As a result, a majority of the investments made during the initial years of community development corporations were fruitless. Many of the funded, newly formed companies have folded due to major weaknesses in areas mentioned above[3]. In addition, CDCs are considered a single voice advocating for neighborhood change, which alone is usually insufficient to induce changes in city policies, private sector or foundation policies[4].

Example of influence

In Indianapolis, neighborhood groups working together to benefit the local society can be traced back to the 1970s, when Near Eastside Community Organization was founded. The organization's goal was to serve as an umbrella group and to support the area's neighborhood. By the late 1990s, as a result of population and job loss, the neighborhood has dramatically declined. This was a turning point for the community development corporation. Design and implementation of resident-driven quality-of-life planning included operations in many different areas: housing, business, education, family strengthening, leadership, neighborhood connections and public safety. Community development corporation attracted more than 100 organizations and the endorsement of over 600 neighborhood residents. The project caught the eye of the Super Bowl Bid Committee, which provided funding toward the implementation of the plan. As a result, community actions led to partnering economic and neighborhood revitalization, bringing the residents and jobs back and turning the community into the community of choice[5].

Advantages of Community development corporation

Community development corporations (CDCs) offer a range of advantages to low-income and underserved neighborhoods. The major benefits include:

  • Access to capital: CDCs can access grant funding and private investments to finance projects in their communities, such as affordable housing, economic development, and other community-building initiatives.
  • Local knowledge: CDCs have unique insight into their local area, and can identify and understand the needs of the community. This helps them design and implement projects that are tailored to the specific needs of the community.
  • Community ownership: CDCs are managed and operated by members of the local community, so they are able to ensure that the projects they undertake are beneficial to the entire community.
  • Community partnerships: CDCs can form partnerships with local businesses, government agencies, and other organizations in order to maximize resources and increase the impact of their projects.
  • Multi-sector approach: CDCs are able to use a holistic approach to address the needs of the community, as they can tackle issues related to housing, economic development, healthcare, and other areas.

Limitations of Community development corporation

  • CDC's are limited by their resources, which often come from donations, grants, and government funding. These limited resources can limit the scope of potential projects and initiatives that CDCs can pursue.
  • CDC's also experience a lack of public and private sector investment in the communities they serve, which can further limit the potential of their projects.
  • There are also limitations in terms of CDC's ability to scale up their projects due to the lack of resources and funding.
  • Additionally, CDC's can experience difficulty engaging with community members and building support for their initiatives due to a lack of trust and engagement with the community.
  • Finally, CDC's can find it challenging to sustain long-term efforts due to the limited nature of their resources and the ever-changing needs of the community.

Other approaches related to Community development corporation

A Community Development Corporation (CDC) is a nonprofit organization that works to improve the quality of life of the people living in low-income communities. CDCs are involved in various activities, such as providing affordable housing, economic development, childcare, youth development, health care, and community organizing. Other approaches to community development that can be used in conjunction with this model include:

  • Social Service Delivery: CDCs can provide a range of social services to residents, such as food pantries, job-training, educational and recreational programs.
  • Civic Engagement: CDCs can work to engage local residents in the decision-making process, and ensure that their voices are heard.
  • Business Development: CDCs can provide resources and assistance to local businesses, in order to encourage economic growth.
  • Neighborhood Revitalization: CDCs can work to improve the physical environment of the neighborhoods they serve, by refurbishing public spaces, increasing public safety, and preserving historical sites.

In conclusion, CDCs are a key part of community development, but they can also benefit from leveraging other approaches to ensure comprehensive, sustainable development.


Community development corporation — recommended articles
Activity center — Voluntary sector — World Packaging Organisation — Third sector — Non-governmental organization (NGO) — Charitable foundation — Public tasks of local government — Examples of opportunities — Innovation platform

References

Footnotes

  1. ↑ Weekly F., (2018)
  2. ↑ Weekly F., (2018)
  3. ↑ Brewerton, F. J., Callahan, E. R., Jr., Gober, R. W., (1978)
  4. ↑ Galster G., Levy D., Sawyer N., Temkin K., Walker C., (2005)
  5. ↑ Weekly F., (2018)

Author: Gabriela Sambór

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