Home Invest 'Weak neighborhoods hurt us all:' Invest STL pulling private dollars into neighborhood development

'Weak neighborhoods hurt us all:' Invest STL pulling private dollars into neighborhood development

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For years, federal support for neighborhood development has dwindled.

And unlike other cities, there hasn’t been as much of a backstop from the philanthropic community to keep community development groups in the business of place-based initiatives focused on fixing up housing and improving neighborhoods.

“There’s a lot of older industrial cities that have been tackling this work for a while, recognizing the importance that quality of life plays in shaping educational outcomes, health outcomes,” said Karl Guenther, a community development specialist with the University of Missouri-St. Louis’ Public Policy Research Center.

A new group he helped form, Invest STL, is working to plug that gap and link private donors with community development organizations focused on services that stabilize and revive neighborhoods.

“St. Louis is known as a generous philanthropic community,” said Bob Herleth, who is heading Invest STL from the St. Louis Community Foundation, the region’s big charitable fund administrator. “However, there has been very limited focus on the community development sector, which is what we’re trying to address here.”

After years of planning and pulling together people from the private sector, academia and nonprofits, Invest STL issued its first request for proposals in December. Over 10 proposals representing more than 20 neighborhood-focused groups were submitted by the Feb. 2 deadline, Herleth said.

The goal is to fund two to four applicants with a significant enough amount — likely a few hundred thousand dollars over three years — to help them pay for staff, neighborhood planning or whatever activities they include in their proposal. The selected organizations will also receive technical support and training from Rise Community Development. Invest STL will choose its first round of successful proposals next month.

They are declining in number, getting less money from the government and struggling to establish themselves as a major force in St. Louis.

A consortium of area banks has signed on and helped Invest STL raise about $700,000 so far. Beyond funding local groups directly, Invest STL backers hope to build the infrastructure to attract the resources of more local charities and big organizations outside of St. Louis. The Bill and Melinda Gates Foundation already has one of its staff on Invest STL’s board.

“We think we’ve now got the right mix of people at the table so that we can interest more local philanthropies in Invest STL, and then we can also leverage that and go to the big national philanthropies and say look, we do have our act together in St. Louis, come and help us,” said Loura Gilbert, a board member and vice president of community development at Commerce Bank.


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Loura Gilbert

Loura Gilbert, vice president of community development at Commerce Bank.

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Cities such as Cleveland, Chicago and Milwaukee already have strong neighborhood development support networks between on the ground nonprofits and the big charities that can fund them.

“The question became, could we replicate this here,” said Hank Webber, Washington University’s Executive Vice Chancellor for Administration and an Invest STL board member who has focused on community development in his career.

While St. Louis has a strong philanthropic community, they often support specific institutions or human services that serve individuals based on need, not location. Except in extremely strong markets like San Francisco, cities where neighborhoods have rebounded and stabilized often have strong community development corporations behind them, Webber said.

Feds forcing St. Louis to rework community development grants

Nearly $17 million in funding at risk if no change made.

He pointed as a model to Park Central Development, which has worked to support the Forest Park Southeast revitalization.

Once a pretty rough patch of St. Louis, developers are now pouring millions of dollars into apartments and houses in the neighborhood while businesses are thriving along Manchester Avenue. Park Central helped rebrand the area into the Grove, a popular entertainment district, paying for security and other services that got the private sector interested in the area once again.

But Washington University, through its medical center redevelopment corporation, has supported Park Central’s work. And strong anchors like the nearby BJC Hospital complex and, more recently, the Cortex tech employment district, have helped that neighborhood’s rejuvenation.

By putting enough resources into a handful of organizations instead of spreading out money over too many, Invest STL’s leaders hope to strengthen a couple of groups enough so they can make real progress in their neighborhoods.

Gilbert, at Commerce, said she envisions private lenders supplementing the on-the ground-work of those groups with loan funds and other vehicles. She suspects more charities could also be convinced to aid Invest STL’s mission.

“A number of philanthropies are interested in diversity and inclusion, a lot of things that were called out in the Ferguson (Commission) report, so there’s some natural intersections in what we’re trying to with community development,” she said.

After this first round, Herleth said Invest STL hopes to raise enough funds to do annual requests for proposals to support neighborhood development groups. And while it’s limited to St. Louis and St. Louis County now, they hope to expand to other counties in the region.

“Let’s be clear,” Webber said. “Weak neighborhoods hurt us all.”

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