RATIONALE FOR IMPLEMENTING A WEALTH BUILDING INITIATIVE IN PITTSBURGH
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1 RATIONALE FOR IMPLEMENTING A WEALTH BUILDING INITIATIVE IN PITTSBURGH The Pittsburgh Metrplitan Statistical Area (MSA) has becme a natinal and internatinal mdel fr successful ecnmic transfrmatin. This regin has been able t transfrm its ecnmy ver the last 30 years by diversifying its ecnmy and creating an ecnmic base that is bth resilient and resistant t ecnmic challenges. But we have a significant prblem remaining in ur regin. Our regin s ecnmic success is nt benefitting all cmmunities. The disparities f wealth are prnunced within ur regin s African American ppulatin. Current US Census Bureau Statistics rank the Pittsburgh MSA as having the highest percentage f pverty fr African American wrking age adults within the 40 largest metrplitan areas in the US 1. Mre than ne-quarter (28 percent) f the regin's African- Americans ages 18 t 64 lived in pverty in That's twice as high as in regins such as Baltimre and Charltte, N.C 2. Tday, the mst pressing prblem that ur regin faces is the sizeable, cncentrated pverty that exists despite ur ecnmic transfrmatin. If this pverty is nt systematically and urgently addressed, it will undermine the prgress that we have achieved ver the last thirty years. Tackling wealth disparity in Western Pennsylvania will require the same cmmitment frm bld, innvative leaders, wh are ready t add t their legacy the fight against pverty within ur regin 1 US Census Bureau, Harld Miller. 2010
2 The Pittsburgh Wealth Building Initiative (PWBI) is based n a visin f cmmunity wealth building, Cmmunity wealth strategies aim at imprving the ability f neighbrhds and individuals t increase asset wnership, anchr jbs lcally, strengthen the municipal tax base, prevent financial resurces frm leaking ut f the area, and ensure lcal ecnmic stability. It aims t address the wealth gap by using a new mdel fr cmmunity develpment that engages key Pittsburgh anchr institutins and cmmits their ecnmic strength (particularly prcurement and investment prgrams) t create pprtunity within the city s neighbrhds. The Anchr institutins participating in this initiative will d this wrk in cnjunctin and with the supprt f cmmunity based nnprfit rganizatins. The PWBI will wrk t catalyze the creatin f emplyee-wned/ cmmunity based businesses in lwincme neighbrhds enabling lcal residents t build wealth and incme thrugh the prductin and delivery f gds and services that meet the needs f area anchr institutins as well as ther custmers. By explicitly linking business develpment t the supply chain f large, lcally anchred purchasers, this Initiative wuld allw anchr cmpanies t meet their existing crprate needs while als redirecting existing capital t disinvested neighbrhds while at the same time building the skills, knwledge, incme, and wealth f lcal residents. The Pittsburgh Wealth Building Initiative will als implement the best wrkfrce develpment mdels t create a successful pipeline t cnnect residents t the wrkfrce f with PWBI anchrs. The Pittsburgh Wealth Building Initiative Gals: Initiate the PWBI (thrugh a tw tier cllabratin f anchr and cmmunity based institutins). Organizing Institutins will be thse which prvide initial funding fr the PWBI and participate in the develpment and directin f the PWBI. Participating Institutins will be thse which may nt be able t prvide funding but alng with the Organizing Institutins will assist in pening their supply chains, prviding wrkfrce develpment guidance and supprting the marketing and business planning activities. Phase One - PWBI Develpment Enlist Organizing Institutins and acquire Phase One funding t supprt the initial rganizatin, marketing, and utreach. Enlist a brad base f Participating Institutins which will pen their supply chains t the PWBI s that market needs fr gds and services can be identified. Cnduct marketing wrk t identify key gds and services within PWBI institutins which culd serve as the seed fr cmpany frmatin. Identify sustainable new business pprtunities anchred by the needs fr gds and services starting with anchr institutins and grwing t include reginal, natinal, and internatinal clients Select the candidate pprtunities fr cmpany frmatin. Obtain cmmitments frm anchr institutins t purchase frm PWBI cmpanies. Research best wrkfrce develpment mdels that will create a pipeline and career ladder t successfully cnnect residents f targeted cmmunities t PWBI anchrs.
3 Phase Tw - PWBI Investment Develp business plan Seed business leadership Identify investment capital Site cmpanies near r within ur underserved cmmunities and which can serve as surces f emplyment. Prvide real wealth via emplyee wnership either thrugh a cperative mdel r sme ther emplyee wnership plan. Develp a pathway t management within these cmpanies fr minrity citizens by a cmbinatin f training and n the jb experience. Prvide training and supprt fr the embrynic cmpanies thrugh their initial frmative stage. Implement wrkfrce develpment strategy This effrt will be prttyped in the Hill District and Hmewd. The gal is nthing less than t create an ecnmic breakthrugh in the lives f residents f sme f ur city s mst disadvantaged neighbrhds. Frm there, it is the hpe and intentin t expand the mdel reginally and natinally.
4 PITTSBURGH S WEALTH BUILDING INITIATIVE (PWBI) The PWBI is a cllabratin led by Duquesne University between Pittsburgh s fr-prfit, nt-fr-prfit, and cmmunity ecnmic develpment rganizatins cmmitted t develping and supprting small and minrity wned businesses in the regin. Patterned after successful mdels in Cleveland and Mndragn, Spain, the PWBI will nt nly develp small and minrity wned businesses t meet identified needs and markets but will als prvide ecnmic supprt fr sme f this regin s mst underserved inner-city neighbrhds creating wealth fr residents f thse neighbrhds thrugh emplyee wnership within the businesses that are established. Anchr Institutins: Organizing Duquesne University UPMC Health Plan UPMC Mercy Pittsburgh Penguins Participating Pint Park University Carlw Univeristy PNC Bank PWBI Administratin: Pittsburgh Central Keystne Innvatin Zne with the assistance f the Pittsburgh Central Cllabrative and ther Organizing Nn Prfits. Nn Prfits: Organizing Pittsburgh Central Keystne Innvatin Zne Pittsburgh Central Cllabrative Key cllabratrs participating with Nn Prfits in verall PWBI gvernance and guidance thrugh quarterly meetings with all participating rganizatins. Prvide sme initial funding fr PWBI administratin n the rder f at least $25K cmmitted t the initiative A brad base f large cmmercial and educatinal institutins wh will participate as purchasers f the gds and services frm PWBI firms. Oversee initial business planning fr new businesses which meet business needs f large anchr institutins. Cmmit t and use start-up businesses gds and services. Hire Prject Manager Cnvene PBI partners and crdinate all wrk. Seek additinal funding. Engage and direct cnsultants Prvide cntinuing supprt t new businesses (grants, internships, tax credits, etc.). Research and implement wrkfrce develpment strategies Key cllabratrs participating with anchr institutins in verall PWBI gvernance and guidance thrugh quarterly meetings with all participating rganizatins. Prvide sme initial funding fr PWBI administratin n the rder f at least $25K Participate in verall PWBI gvernance and guidance thrugh quarterly meetings. Supprt develpment f business plans and cmmunity integratin. Lead cmmunity engagement and emplyment
5 Participating: Hill Huse EDC Hill Huse CDC Innvatin Wrks utreach. Cllabratrs participating with anchr institutins in verall PWBI gvernance and guidance thrugh an annual meeting with all participating rganizatins. Supprt develpment f business plans and cmmunity integratin. Prvide guidance t cmmunity engagement and emplyment utreach. Key PWBI Activities: Phase One PWBI Develpment Secure Anchr Institutins cmmitments. Secure Organizing Nnprfit Institutins cmmitments Develp mechanism fr invlvement by cmmunity and cmmunity based rganizatins. Secure initial PWBI funding and fllw n funding. Engage lead cnsultant t train cllabratrs and set verall strategy. Cnduct market analyses including needs f anchr institutins and wrk with them t identify first stage pprtunities. Develp viable business plans and c-p structure meeting PWBI bjectives needs. Research best wrkfrce develpment mdels Phase Tw - Investment Seed business leadership. Identify Investment Capital. Launch and supprt businesses. Develp Wrkfrce.
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