Community Benefits CommunityAgreements Benefits Agreements Making Development Projects Accountable by Julian Gross Legal Director, California Partnership for Working Families with Greg LeRoy of Good Jobs First and Madeline Janis-Aparicio of LAANE published by Good Jobs First and the California Partnership for Working Families, a collaboration 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. © Copyright 2005 Good Jobs First and the California Partnership for Working Families. All Rights Reserved. Community Benefits Agreements Making Development Projects Accountable by Julian Gross Legal Director, California Partnership for Working Families with Greg LeRoy of Good Jobs First and Madeline Janis-Aparicio of LAANE published by Good Jobs First and the California Partnership for Working Families, a collaboration 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. © Copyright 2005 Good Jobs First and the California Partnership for Working Families. All Rights Reserved. Good Jobs First The organizations that founded the California Partnership for Working Families are: Good Jobs First is a national resource center pro- moting corporate and government accountability Center on Policy Initiatives (CPI) in economic development. GJF provides research, 3727 Camino del Rio South, Suite 100, training, model publications, consulting, and testi- mony to grassroots groups and public officials San Diego, CA 92108 seeking to ensure that subsidized businesses pro- 619-584-5744 vide family-wage jobs and other effective results. [email protected] Good Jobs First is also active in the smart growth www.onlinecpi.org movement, bringing development subsidies and labor unions into the suburban sprawl/smart East Bay Alliance for a Sustainable growth debate. Economy (EBASE) 1714 Franklin Street, Suite 325, Good Jobs First Oakland, CA 94612 1311 L Street NW, 510-893-7106 Washington, DC 20005 202-626-3780 [email protected] [email protected] www.workingeastbay.org www.goodjobsfirst.org Los Angeles Alliance for a New Economy (LAANE) California Partnership for 464 Lucas Ave, Working Families Los Angeles, CA 90017 The California Partnership for Working Families 213-486-9880 (CPWF) is a statewide economic justice organi- [email protected] zation. Our goal is to ensure that public resources www.laane.org are invested in ways that are economically sound and provide a return to their communities. Working Partnerships USA CPWF is working to reform development policy 2102 Almaden Road, Suite 107, in California so that the social and economic return on investment is tracked and reported to San Jose, CA 95125 the public. CPWF also seeks to secure a systemat- 408-269-7872 | Community Benefits Agreements: Making Development Projects Accountable Making Development Projects | Community Benefits Agreements: ic and timely process for accommodating com- [email protected] munity input into development decisions. www.wpusa.org 2 Table of Contents Introduction ..............................................................................................................................3 Acknowledgments ..................................................................................................................7 Chapter One: CBA Basics ........................................................................................................9 Chapter Two: CBA Pros and Cons ..........................................................................................21 Chapter Three: Implementation Experience—The Staples CBA ............................................29 Chapter Four: Living Wage Programs as Part of CBAs ............................................................35 Chapter Five: Targeted Hiring Programs as Part of CBAs ........................................................43 Chapter Six: Addressing Environmental Issues Through CBAs ................................................51 Chapter Seven: Other Community Benefits as Part of CBAs ..................................................57 Chapter Eight: Monitoring and Enforcement of CBA Commitments ....................................69 Conclusion: Changing the Paradigm ........................................................................................75 About the Authors ................................................................................................................81 Appendix A: Current Community Benefits Campaigns ........................................................85 Appendix B: Past Community Benefits Agreements ............................................................88 Appendix C: Wall Street Journal’s Real Estate Journal Article on CBAs ..................................91 Appendix D: Staples CBA ..........................................................................................94 T Appendix E: Los Angeles Times Article About Staples CBA ................................................113 able of Contents | Appendix F: Living Wage Section of the NoHo Commons CBA ..........................................117 Appendix G: CIM Project—Memorandum Attachment to DDA ........................................120 Appendix H: “Economic Prosperity Element” from Preliminary Draft of General Plan for the City of San Diego. ....................................................................................................125 1 2 | Community Benefits Agreements: Making Development Projects Accountable Introduction The Community Benefits Movement the CBAs described in the original edition.We and CBAs have added extensive material in this preface on the community benefits movement; a new chap- Community Benefit Agreements (CBAs) — deals ter describing implementation of the landmark between developers and coalitions of community CBA for the Staples development in Los Angeles; organizations, addressing a broad range of com- a new appendix listing past CBAs; a new appen- munity needs — are safeguards to ensure that dix describing some current community benefits affected residents share in the benefits of major campaigns; and several new sections on legal developments.They allow community groups to issues, community benefits victories, and new have a voice in shaping a project, to press for approaches.We have also included an overview of community benefits that are tailored to their par- the recent CBA for the Los Angeles International ticular needs, and to enforce developer’s promises. Airport, providing for community benefits valued CBAs are only one aspect of a growing new at over half a billion dollars, and a special section movement towards community benefits in land- on unusual legal aspects of this CBA. use planning, taking shape through labor-com- | Introduction The Economic Development Context munity partnerships around the country. Over the past decade, a growing number of cities We have updated and revised this publication to across the country have pinned their hopes for share our experience in implementing some of renewal on ambitious and expensive economic 3 development programs accomplished through after construction they have little information public/private partnerships. By the late ‘90’s, about actual jobs created. Standards for assessing states, counties and cities were spending close to the costs and benefits of development for com- $50 billion per year on these programs, reflecting munities, if such standards exist, are generally a deepening reliance on these partnerships to fuel applied on an inconsistent and piecemeal basis. economic growth. Sports stadiums, entertainment arenas, hotels, office parks,“big box” retail outlets, Therefore, while economic development projects upscale residential projects and other such devel- are often heavily subsidized by taxpayer dollars, opments are increasingly being built with public they produce decidedly mixed results for city money in cities all around the country. dwellers.While many of these projects bring sorely needed jobs and tax revenues back to areas The new emphasis on aggressive economic devel- that have been disinvested, there is usually no opment is closely linked to the “back to the city” guarantee that the “ripple effects” of the projects phenomenon. For the first time in decades, many will benefit current residents. Many new develop- large U.S. cities are experiencing population ments cause inner-city gentrification, pushing out increases, with growing populations of both mid- low-income residents as housing prices rise. dle-class “urban pioneers” and Latin American Other projects create large numbers of dead-end and Asian immigrants taking up residence in low-wage retail and service sector jobs, leaving urban neighborhoods. low income, families, mostly people of color, mired in an endless cycle of poverty.While some Local government has played a central role in the Smart Growth proponents have advanced the push for urban economic development.As the notion that development should be governed by federal government has slashed its contribution to the “Three E’s”—the economy, the environment, urban budgets, and devolution has shifted pro- and equity—few if any jurisdictions have pursued grams like workforce development and housing “growth with equity” policies in a systematic way. construction away from federal and state govern- Consequently, even after investing billions of dol-