Building a Sustainable City: Green Jobs for Buffalo
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Building a Sustainable City:
Green Jobs for Buffalo
July 2010
© 2010, Green For All and PUSH Buffalo. All rights reserved.
Table of Contents Table of Contents.................................................................................1 Introduction.........................................................................................2 Ready for Recovery: Buffalo, New York.................................................5 Community Efforts in Buffalo..................................................................7 The Community Reinvestment Act.........................................................20 Green Jobs for Buffalo: A Qualified Investment.....................................25 A Policy Proposal...............................................................................29 Conclusion........................................................................................32 Appendix A: Triple-Bottom-Line Scorecard............................................33 Appendix B: Sample Career Pathways in Three Green Sectors...............37 Acknowledgements............................................................................40 Endnotes...........................................................................................41
Building a Sustainable City: Green Jobs for Buffalo
Introduction
O
ver the past forty years, the loss of them for occupancy by low-income residents.
its manufacturing and transportation They are transforming vacant land by growing
industries has mired the City of community gardens, planting tree farms, and
Buffalo in a steady economic downturn that constructing rain gardens. These efforts will
has led to twin crises of unemployment and reverse environmental degradation, improve
neighborhood decline. The opening of the St. community health, and increase property
Lawrence Seaway and the slow death of steel values.
manufacturing have devastated the city. In
addition, much of Buffalo’s housing stock is The organizations collaborating on the
at least 100 years old, uninsulated, and posing Green Development Zone are also assessing
significant energy challenges to city residents. job-growth and revenue-generating
As a result, Buffalo is the third-poorest city in opportunities in the three sectors in which
the country and has the fourth-highest home they are currently working: green rehab and
heating costs. One out of five of its structures is retrofitting of affordable housing, regional
vacant. It has 78 U.S. EPA and 15 state cleanup food system development, and environmental
sites1 (an average of more than two per square stewardship. In green rehab and retrofitting
mile). About half of Buffalo students drop out of affordable housing, the state’s Green Jobs–
before graduating high school, and more than Green New York initiative will generate more
half of the area’s black men are unemployed. than 5,000 energy-efficiency job-years in
Buffalo over the next five years. In regional
Community-based, nonprofit organizations food system development, annual revenues
are working to directly address the economic, from the sale of locally and sustainably grown
environmental, and social needs of the Buffalo produce and fish to area restaurants alone are
community and contribute to the city’s projected to surpass $100,000 by year two. In
economic revitalization. Several groups have environmental stewardship, local, state, and
come together to meet the needs of low-income federal initiatives to improve community
communities and communities of color in health will drive demand for remediation of
the Green Development Zone on Buffalo’s indoor and outdoor environmental hazards.
West Side. They are reclaiming abandoned
houses, retrofitting them to use less energy This work in the Green Development
and generate renewable energy, and preparing Zone will create a demand for qualified
READY FOR RECOVERY: COMMUNITY EFFORTS THE COMMUNITY
INTRODUCTION
BUFFALO, NEW YORK IN BUFFALO REINVESTMENT ACT
3
green workers; Green Jobs for Buffalo is an achieve triple-bottom-line returns, yielding
innovative initiative to prepare workers to positive results for people, for the planet, and
meet this increased demand. The program for profit margins. In other words, it will
will provide on-the-job training, employment promote equitable opportunities and benefits,
placement, career pathways, and green environmental restoration and protection, and
business incubation for low-income people economic growth and prosperity. As the local
and people of color in emerging green sectors community-based organization PUSH Buffalo
of the economy. Green Jobs for Buffalo will (People United for Sustainable Housing) says,
Photo courtesy of PUSH Buffalo.
GREEN JOBS FOR BUFFALO:
A POLICY PROPOSAL CONCLUSION APPENDICES
A QUALIFIED INVESTMENT
Building a Sustainable City: Green Jobs for Buffalo
going green is not just a lifestyle; it’s about part by creating, retaining, and improving jobs
survival. for low- to moderate-income persons.
As with any startup during a general economic Although Green Jobs for Buffalo should be
downturn, these green endeavors need seed a qualified investment under current CRA
capital and other financial support. Yet, rules, changing those rules to encourage
such support is hard to secure in the current depository institutions to support triple-
recession. The Community Reinvestment Act bottom-line activities would make it much
is one tool available to such projects. easier for projects like Green Jobs for Buffalo
to enjoy the benefits of the CRA. Specifically,
Under the Community Reinvestment Act
activities having positive impacts in terms of
(CRA), federal agencies evaluate whether
equity, environment, and economy should
regulated financial institutions are helping to
meet the credit and community development receive favorable consideration under CRA
needs of their local communities, including performance assessments. This subtle but
low- and moderate-income communities. important change would expand the types of
Financial institutions receive favorable community development activities for which
consideration from federal regulatory agencies institutions may receive CRA consideration to
for community development loans, qualified include activities resulting in triple-bottom-
investments, and community development line benefits. Allowing banking institutions
services. Seeding and supporting Green to receive CRA consideration for supporting
Jobs for Buffalo with grants and loans triple-bottom-line activities serves the
would qualify community lenders for such core purpose of the CRA while creating an
consideration under the CRA, as the primary opportunity to realize environmental and
purpose of Green Jobs for Buffalo is community health benefits through sustainable economic
development. The program will stabilize and development in low- to moderate-income
revitalize low- to moderate-income areas — in communities.
READY FOR RECOVERY: COMMUNITY EFFORTS THE COMMUNITY
INTRODUCTION
BUFFALO, NEW YORK IN BUFFALO REINVESTMENT ACT
Ready for Recovery: 5
Buffalo, New York
B
uffalo, New York, is America’s third- advancement is in short supply for Buffalo
poorest city. More than a quarter — residents; 53% don’t even finish high school.5
28.7% — of its residents live below the
poverty line. 2 This poverty makes it even These economic problems are citywide, but
harder for residents to cope with Buffalo’s have hit the African American communities
the hardest. In a city that is 52% white and 39%
astronomical home-heating costs, which rank
African American,6 African Americans make
fourth highest in the country. 3 Extremely
up 48% of Buffalo’s poor,7 while whites make
cold winters and old housing stock (much
up 37%.8 More than half of Buffalo’s African
of it at least 100 years old) mean that low-
American men (52%) are unemployed or not
income residents’ heating bills often exceed
in the labor force, versus 23.8% for white men.9
their rent or mortgage payments. Many of
those homes have been abandoned; more than Cold is not the only environmental challenge
20,000 houses are empty and 17% of the city’s facing Buffalo residents. The New York State
housing units stand vacant.4 Opportunity for Department of Environmental Conservation
considers most of the city a potential
“environmental justice area.”* Land pollution
* Environmental justice areas are places that
have largely low-income or minority populations
and face a number of environmental challenges.
These challenges can include disproportionate
concentrations of pollution; high density of
industrial facilities, or pollution from such
facilities; high asthma rates or other health
disparities; lying in non-attainment areas for
Clean Air Act criteria pollutants; high truck traffic
or vehicle miles traveled; and less open space per
capita. Environmental Justice Issue Brief: New
York State Energy Plan 2009, at 4–5. Available
Buffalo, New York. Photo by dougtone, available under a
Creative Commons Attribution-Share Alike license. at http://www.nysenergyplan.com/final/
http://www.flickr.com/photos/dougtone/2962680005/ Environmental_Justice_IB.pdf
GREEN JOBS FOR BUFFALO:
A POLICY PROPOSAL CONCLUSION APPENDICES
A QUALIFIED INVESTMENT
Building a Sustainable City: Green Jobs for Buffalo
is also common, as Buffalo is littered with require hard work. Hard work is exactly
brownfield sites. The U.S. Environmental what struggling Buffalo workers are looking
Protection Agency has designated 78 cleanup for to support themselves and their families.
sites; the New York State Department of
Putting the two together requires only vision,
Environmental Conservation has designated
effort, and investment.
15.
All of this makes Buffalo a prime candidate Right now, Buffalo community leaders are
for a green economic revival. Addressing stepping up to provide these things and move
its significant environmental challenges will their city towards a green recovery.
READY FOR RECOVERY: COMMUNITY EFFORTS THE COMMUNITY
INTRODUCTION
BUFFALO, NEW YORK IN BUFFALO REINVESTMENT ACT7
Community Efforts in Buffalo
S
eeing the opportunity to achieve real and GREEN DEVELOPMENT ZONE
lasting advances for their communities,
local Buffalo organizations are working Since the mid-1970s, Buffalo’s West Side has
on many fronts to spark a green economic experienced falling population, increased rates
revival. Chief among these projects are the of housing vacancy, and the decline of local
Green Development Zone, Green Jobs for small businesses. The unemployment and
Buffalo, and local implementation of the poverty rate on the West Side far exceed area
statewide Green Jobs–Green New York averages. Through the efforts of PUSH and
program. Leading these efforts is PUSH its partner community-based organizations,
Buffalo (People United for Sustainable new investment and community engagement
Housing). have begun to reverse these trends. These
community groups have designated 25 square
PEOPLE UNITED FOR SUSTAINABLE blocks in the West Side, from the Niagara
River to the Elmwood Village, as a “Green
HOUSING
Development Zone.”
People United for Sustainable Housing, or
The objective of the Green Development
PUSH Buffalo, is a nonprofit, community-
Zone partnership — including HomeFront,
based organization working to rebuild the West
Side of Buffalo. PUSH’s mission is to mobilize Inc., WNY Americorps, Re-Tree WNY, and
residents to create strong neighborhoods with the Massachusetts Avenue Project — is
quality affordable housing, to expand local to demonstrate the potential of the green
hiring opportunities, and to advance economic economy to immediately improve the lives of
justice in Buffalo. Member-driven and Buffalo residents. To maximize the chances
grassroots, PUSH organizes residents to build of success, PUSH has spent thousands of staff
a democratic, action-oriented organization hours canvassing the neighborhood, collecting
capable of addressing practices that contribute community input on development projects.
to the high poverty rate on the West Side. PUSH believes that effective community
PUSH and its members are working to create planning processes rely on people’s knowledge
and implement an action plan for investing in and understanding of what they need in their
and improving the neighborhood. neighborhoods.
GREEN JOBS FOR BUFFALO:
A POLICY PROPOSAL CONCLUSION APPENDICES
A QUALIFIED INVESTMENTBuilding a Sustainable City: Green Jobs for Buffalo
This intensive research has yielded three key income residents. These improvements
triple-bottom-line community priorities. include energy-efficient and renewable-
energy technologies such as solar electricity,
Green Housing Rehabilitation and solar hot water, and geothermal heat. These
Retrofitting rehabilitated homes provide environmental and
health benefits: they conserve energy, improve
To address poor housing conditions and the air quality in the home, reduce carbon
high rate of housing abandonment, PUSH emissions, and produce clean energy. These
and its partners are acquiring abandoned homes promote economic development: they
properties and rehabilitating them as green increase property values and reduce utility
affordable rental housing for low- to moderate- bills. They also promote equity: rehabilitated
homes provide efficient and affordable
housing for low- to moderate-income people
(who often live in the least efficient housing
stock) and alleviate high energy-cost burdens
for low- to moderate-income residents (for
whom energy bills represent a much larger
burden as a proportion of their household
income compared to the average household).
Regional Food System Development
To add value to vacant lots, the Massachusetts
Avenue Project (MAP) is developing urban
agriculture and aquaponics by managing
an urban farm, developing sustainable
fish production systems, and supporting
community gardens. This regional food system
initiative focuses on localizing food system
components — including food production,
food processing, waste management, food
transportation, and sale of food — toward
the end of developing infrastructure and an
environment that will employ local people.
In Buffalo, MAP is simultaneously creating
models for sustainable urban food production;
Photo courtesy of PUSH Buffalo. advocating for structural changes to increase
READY FOR RECOVERY: COMMUNITY EFFORTS THE COMMUNITY
INTRODUCTION
BUFFALO, NEW YORK IN BUFFALO REINVESTMENT ACT9
remain) self-sufficient while expanding access
to affordable, nutritious food, and they enable
local communities to improve the physical and
behavioral health of their youth and families.
Environmental Stewardship
To address local pollution, PUSH and its
partners are developing environmental
stewardship projects. These projects include
green stormwater infrastructure (e.g., rain
gardens and tree farms) and environmental
remediation activities (e.g., brownfield
Photo courtesy of the Massachusetts Avenue Project. remediation, lead abatement, and asbestos
removal). These activities provide multiple
local job creation; and providing nutritional environmental and health benefits: they conserve
education and on-the-job training to youth in water, increase urban cooling, reduce
the areas of urban agriculture and aquaponics pollution, and enhance public health with
sales, outreach, and farming science. clean water, air, and access to green space.
They promote economic development: such
Regional food systems have environmental and projects tend to appreciate in value, require
health benefits: they provide neighborhood less maintenance over time than traditional
residents with access to affordable, locally- forms of infrastructure, and increase property
produced, fresh, healthy food. Regional food values. Environmental stewardship also
systems promote economic development: they promotes equity: it beautifies low-income
contribute to revitalization of neighborhoods neighborhoods with a surfeit of impervious
by transforming vacant lots and increasing surface and vacant lots, and protects the health
surrounding property values; promote food of low-income communities. These projects
security by making healthy, fresh food more have the potential to rejuvenate communities
available in communities; and build career by enhancing quality of life and community
pathways for residents. For example, MAP health.
has provided jobs and training to more than
300 neighborhood youth as well as pathways Concentrating strategic investments in these
to college and further job training. Regional three areas, PUSH and its allies hope that
food systems promote equity: they help low- the Green Development Zone will become a
and moderate-income people become (and national model of urban revitalization.
GREEN JOBS FOR BUFFALO:
A POLICY PROPOSAL CONCLUSION APPENDICES
A QUALIFIED INVESTMENTBuilding a Sustainable City: Green Jobs for Buffalo
GREEN JOBS FOR BUFFALO Green Jobs for Buffalo has four primary
operational goals:
This work in the Green Development Zone will
create a demand for qualified green workers; 1. Employ trainees with each community
Green Jobs for Buffalo is an innovative organization partner.
initiative to prepare workers to meet this
2. Support the advancement of participants
increased demand. It is a collaboration
along designated career ladders as they
between local lending institutions and earn certifications in green skills.
community-based organizations, with PUSH
Buffalo as the lead community organization. 3. O b t a i n c o m m i t m e n t s f ro m l o c a l
Green Jobs for Buffalo will combine education, contractors to place program participants
job training, and employment placement in in full-time jobs that pay family-
green affordable housing rehab/retrofitting, sustaining wages and allow for career
regional food system development, and advancement.
environmental stewardship in the Green
4. Provide 75% of trainees with immediate
Development Zone. As the program develops,
acceptance into apprenticeship programs
it may prepare workers for employment in
(i.e., direct entry) within registered
other emerging green sectors in other areas in
sectors at the conclusion of the first cycle
Buffalo.
of on-the-job training.
By training, employing, and providing
career ladders for residents, Green Jobs for Benefits for Vulnerable Communities
Buffalo will address a range of community Greening Buffalo’s neighborhoods, as well as
development needs, from pathways out of preparing residents for that work, will yield
poverty and employment to career pathways significant benefits to low- to moderate-income
and green business enterprise opportunities. communities and individuals, including
It will provide immediate access to on-the-job communities and people of color.
training with community groups across the
• Community organizations participating
city, assist with placement into high-quality
in Green Jobs for Buffalo will pay
jobs that include family-supporting wages and
on-the-job trainees living wages based
benefits, and create career pathways for low- to
on Buffalo’s living wage ordinance — at
moderate-income individuals in the growing
least $10.57 per hour with health benefits
green economy. Green Jobs for Buffalo will or $11.87 without health benefits.
be a laboratory for green job training and
employment that can expand throughout and • Green Jobs for Buffalo will help place
beyond Buffalo. participants into high-quality jobs,
READY FOR RECOVERY: COMMUNITY EFFORTS THE COMMUNITY
INTRODUCTION
BUFFALO, NEW YORK IN BUFFALO REINVESTMENT ACT11
which will provide employment, career improve the health of low- to moderate-
pathways, and potential for business income communities and communities
ownership. of color.
• Green rehab and retrofits of affordable Participating Community Organizations
housing will provide real savings for
working people who cannot afford high Community organizations that participate in
heating bills. Green Jobs for Buffalo must have experience
and a demonstrated record of success in
• Regional food production and community improvement and job training
environmental stewardship projects will in green sectors of the economy. In addition
Photo courtesy of PUSH Buffalo.
GREEN JOBS FOR BUFFALO:
A POLICY PROPOSAL CONCLUSION APPENDICES
A QUALIFIED INVESTMENTBuilding a Sustainable City: Green Jobs for Buffalo
to PUSH Buffalo (green affordable housing accordance with Buffalo’s living wage
rehab and retrofitting), The Outsource Center ordinance; and
(energy-efficiency retrofitting training and
contracting), and the Massachusetts Avenue • agree to participate in quarterly meetings
Project (regional food system development), to track career development progress
these partners may include the Environmental and issue semi-annual progress reports.
Justice Advisory Group (environmental
stewardship: outdoor hazards), Environmental Certifying Green Jobs for Buffalo Trainees
Education Associates (environmental
Workers in Green Jobs for Buffalo will
stewardship: indoor hazards), and C&R
earn certifications (e.g., in weatherization,
Housing (environmental stewardship).
horticulture, brownfield remediation, lead
Additionally, Green Jobs for Buffalo will
support a network of twelve community- hazard control, asbestos abatement, mold
based contractors and trainers convened by remediation) from accredited institutions,
PUSH to implement the Green Jobs–Green helping them advance along specific career
New York residential energy-efficiency retrofit ladders. Each of the three sectors — green
program. rehab and retrofitting, regional food system
development, and environmental stewardship
Participation Requirements — will have one certifying agency. These
agencies may include:
Participating community organizations will
submit proposals for funding from Green Jobs • Green rehab and retrofitting of affordable
for Buffalo in which they: housing: Environmental Education
A s s o c i a t e s , N e w B u ff a l o I m p a c t
• commit to creating opportunities
for trainees to proceed along a clear Environmental Efficiency Training
career ladder, including applicable Center, Buffalo Building Trades Council,
certifications, and where standard Acumen Weatherization
certifications are not common, as is
• Regional food system development:
the case in urban agriculture, research,
Massachusetts Avenue Project*
develop, and implement certification as
appropriate;
* Because certification in urban agriculture is not
• demonstrate the capacity to engage a widespread practice, MAP will research existing
community residents in the program; models and, based on research results, possibly
develop a certification process that is applicable
• commit to pay living wages to fulltime to youth, in collaboration with local educational
Green Jobs for Buffalo trainees in institutions.
READY FOR RECOVERY: COMMUNITY EFFORTS THE COMMUNITY
INTRODUCTION
BUFFALO, NEW YORK IN BUFFALO REINVESTMENT ACT13
• Environmental stewardship: reduce the region’s carbon footprint (the food
Environmental Education Associates sector is the largest contributor to greenhouse
gas emissions).
Aligning Job Training with Job Creation
Green Jobs for Buffalo will align its training
Green Jobs for Buffalo will ensure that its program in environmental stewardship
trainees have real opportunities to obtain jobs to meet the region’s increasing demand for
and careers in Buffalo. These trainees will be
the remediation of indoor and outdoor
prepared for actual jobs in the marketplace,
environmental hazards. A number of
not hypothetical jobs they will never be able
programs are driving this demand, including
to find.
Wipe Out Lead, † LeadSAFE, ‡ the national
Green Jobs for Buffalo will connect trainees Green & Healthy Homes Initiative, § the
learning about green rehab and retrofitting EPA Brownfields Economic Redevelopment
of homes to an unprecedented engine for job
creation in that sector: the state initiative † Wipe Out Lead is led by a coalition of
Green Jobs–Green New York, which will foundations, government, associations, concerned
provide upfront financing for residential citizens, and faith-based organizations to help end
energy-efficiency improvements. Green Jobs lead poisoning in children in Western New York.
for Buffalo will ensure that low- and moderate- ‡ LeadSAFE, Erie County’s HUD-funded Lead
Hazard Control Program, provides lead hazard
income trainees have access to these high-
identification and remediates lead hazards for
quality energy-efficiency retrofitting jobs. individuals and families who have children under
the age of six and whose household income is
Green Jobs for Buffalo’s partner Massachusetts
less than 80% of the median county household
Avenue Project is preparing low-income youth income. The program contracts with certified lead
to work in the local food sector so that they are contractors to perform lead hazard control work
prepared for long-term success in green jobs and covers costs up to an average of $10,000 for
and careers. MAP is helping create green jobs supplies and labor.
by cultivating current market demand from § GHHI promotes federal support for the
area restaurants for locally and sustainably interagency adoption of Green and Health Home
grown produce and fish. In addition, MAP is Standards for all housing intervention programs
and is working to efficiently leverage health into
advocating for structural changes that increase
investments in areas such as weatherization and
demand for locally produced food among local
energy efficiency. The initiative is led by the
food consumers, including hospital systems, Coalition to End Childhood Lead Poisoning in
school districts, businesses, and food service partnership with the Annie E. Casey Foundation,
companies. This will drive local job creation, Kresge Foundation, the Council on Foundations,
promote capital retention in the region, and the Federal Interagency Work Group (HUD, CDC,
GREEN JOBS FOR BUFFALO:
A POLICY PROPOSAL CONCLUSION APPENDICES
A QUALIFIED INVESTMENTBuilding a Sustainable City: Green Jobs for Buffalo
Initiative, the U.S. Department of Housing Green Jobs for Buffalo has already identified
and Urban Development (HUD) Community emerging entrepreneurial opportunities in
Development Block Grant program, the New each of its three focus areas.
York State Department of Environmental
In green affordable rehab and retrofitting,
Conservation’s brownfields programs
the New York State Energy Research and
(environmental restoration, brownfield Development Authority (NYSERDA) will
cleanup, brownfield opportunity areas), and partner with community-based organizations
the City of Buffalo’s Brownfield program to recruit customers to the Green Jobs–Green
(which implements CDBG funds). New York program. Under the pending
Green Jobs–Green New York operating plan
Future Possibility: Fee-for-Service Social for program outreach, contracted community
Enterprises
To ensure program and financial sustainability,
Green Jobs for Buffalo intends to develop
fee-for-service LLCs that could be employee-
owned and/or managed (e.g., worker
cooperatives). These social enterprises would
provide hands-on services and consulting
in the program’s three focus areas: green
rehabilitation and retrofitting of affordable
housing, regional food system development,
and environmental stewardship. They
would also provide employment and career
advancement opportunities for workers
who have completed on-the-job training
and received relevant certifications in green
skills. Each social enterprise would be
affiliated with and supported by a parent
community organization, which would
provide organizational support, oversight,
and technical assistance.
EPA, DOE), local project sites, and the philanthropic
community. Photo courtesy of PUSH Buffalo.
READY FOR RECOVERY: COMMUNITY EFFORTS THE COMMUNITY
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BUFFALO, NEW YORK IN BUFFALO REINVESTMENT ACT15
organizations will be paid for delivering exterior painting, general maintenance, light
households or businesses that sign contracts construction, and snow removal services. It
to have work performed. PUSH Buffalo has is a worker-controlled cooperative business
developed a network of home performance that provides on-the-job training and living-
contractors to deliver energy-efficiency wage jobs with profit-sharing to formerly
services based on demand from both Green unemployed and low-income people. It
Jobs–Green NY and the Weatherization generated $500,000 in sales in 2008. United for
Assistance Program, a federal program Hire is a Section 3 (Fair Housing Act of 1968)
providing similar services to low-income Business Concern.
households. Currently, the Green Jobs–Green
New York network includes ten community-
based contractors and workforce training GREEN JOBS–GREEN NEW YORK
organizations.
Green Jobs–Green New York, a statewide
In regional food system development, the program, is the largest energy-efficiency
Massachusetts Avenue Project has already retrofit program initiated so far in the U.S.
begun to offer consulting services and and will be a major driver of economic
technical assistance to other community- development in New York State. The program
based organizations about how to replicate will dramatically increase demand for and
their urban agriculture programs (community access to retrofits by low- to moderate-income
gardens, aquaponics, youth training). In communities.
addition, MAP anticipates that a social
In Green Jobs–Green New York, New York
enterprise could generate more than $100,000
State has created a policy roadmap to achieve
annually in revenues from urban aquaponics
mass-scale, high-quality energy-efficiency
based on market demand for locally grown
retrofits of one million housing units over the
produce and fish. Moreover, MAP is working to
next five years. This will drive job creation
identify and support additional opportunities
over that time, creating 60,000 green job-years
for robust job creation in the local food system.
directly related to the expansion of retrofit work
In environmental stewardship, Green Jobs for (which translates to long-term employment
Buffalo will look to the example of the Alliance for about 28,000 people) and another 60,000
to Develop Power to deliver environmental job-years indirectly through related economic
remediation services. In 2001 this Western activity. Based on population, this initiative
Massachusetts-based organization created will generate 5,400 green job-years directly
a wholly owned subsidiary and dues- and 5,400 job-years indirectly in Buffalo.
paying affiliate, United for Hire, which Green Jobs–Green New York will also save
provides landscaping services, interior and New York households more than $1 billion
GREEN JOBS FOR BUFFALO:
A POLICY PROPOSAL CONCLUSION APPENDICES
A QUALIFIED INVESTMENTBuilding a Sustainable City: Green Jobs for Buffalo
annually through reduced home energy use • Stakeholders, including PUSH Buffalo,
and energy bill savings. are working with NYSERDA to ensure
that the work created by Green Jobs–
Green Jobs–Green New York is also Green New York includes “high-road”
noteworthy for its strong commitment to contractor and employment standards,
making significant impacts in terms of both such as family-supporting wages,
environmental quality and social equity. Some benefits, career pathways, and hiring
of the program’s more distinctive features from high-quality training programs that
include: prepare historically under-represented
people for energy-efficiency jobs.
• It will combat climate change by reducing
home energy consumption, which is Financing10
responsible for about 40% of New York’s
One of the obstacles to generating large-
greenhouse gas emissions, by 30-40%.
scale demand for home retrofits has been the
This impressive reduction will obviate inability or unwillingness of homeowners and
the need for new power plants. residents to pay the upfront costs required
to make such improvements. This has been
• It will enable moderate- and middle-
especially true for low-income households.
income homeowners and small
Green Jobs–Green New York will overcome
businesses to obtain energy upgrades,
that obstacle by providing funding for those
such as insulation and air sealing, upfront costs.
without the need for large amounts of
capital or risky loans. Targeted Areas for Funding
• It will generate energy-efficiency Financing will be available to retrofit all
retrofitting work in local communities. housing types in New York State — provided
Under current plans, the state agency that owners are utility customers in good
NYSERDA will contract with community- standing — that are located in targeted
based organizations like PUSH Buffalo geographic areas facing environmental and
to use a community outreach and economic burdens including but not limited
to:
engagement approach to recruit low- to
moderate-income residents to sign up for • High concentration of energy cost
energy-efficiency improvements to their burdens, where the cost of energy is
homes. Community-based organizations high enough in relation to income that
will form agreements with contractors to it impairs households’ ability to obtain
deliver work to these homes. energy or other essential needs (requiring
READY FOR RECOVERY: COMMUNITY EFFORTS THE COMMUNITY
INTRODUCTION
BUFFALO, NEW YORK IN BUFFALO REINVESTMENT ACT17
an index of energy costs, other costs of of requests for financing. Requests will be
living, and income). evaluated based on capacity, feasibility, cost
effectiveness, and repayment strategy to
• Geographic concentration of high ensure project completion, secure repayment,
emissions (CO 2 and other pollutants) and provide a modest rate of return that would
and high levels of air, water, and soil appeal to a range of investors.
pollution.
Green Jobs–Green New York’s capitalization
• Significant housing stock that is energy- strategy establishes two funding streams and
inefficient through disrepair or lack of includes grants and other financial resources.
capital for upgrades and improvements. The first is $112 million in Regional Greenhouse
• High unemployment, where access to Gas Initiative (RGGI) funds for setting up
training for work in emerging industries and operating the program. The second is a
has been severely limited. Residential Retrofit Investment Fund (RRIF),
which will use some of the RGGI funds to
These target areas generally overlap with leverage $5 billion in private investments. The
low- to moderate-income areas as defined RRIF will be established as a limited liability
by poverty rate and area median income. corporation to facilitate the flow of capital
Households who do not qualify for existing from individuals and financial institutions to
grant-funded weatherization programs— finance up-front contracting costs of residential
those with incomes too high for means-tested energy-efficiency retrofit measures. The RRIF
programs including the Weatherization will borrow from investors to pay contractors
Assistance Program and too low for energy for work performed and equipment installed
affordability—as well as those who are eligible in residential dwellings.
but face unduly long waits for funding, are
appropriate audiences for Green Jobs–Green Homeowners will execute ten-year repayment
New York funding based on their geographic contracts that obligate them to pay a monthly
location in these target areas. Investments charge that covers both the cost of the fund’s
in Green Jobs–Green New York’s funding borrowing and a small administrative override.
programs, described below, should be CRA Most customers’ repayments will be designed
eligible based on these defined target areas and to leave customers with 20 percent of savings.
the benefit provided to the low- to moderate- The program may utilize the Property Assessed
income people who live in these communities. Clean Energy (PACE) repayment mechanism,
which links loan repayments to property tax
Once a project has been identified in a target payments and secures loans through a lien on
area, Green Jobs–Green New York will participating properties. New York State is
apply a rigorous analysis and underwriting also considering on-bill recovery legislation
GREEN JOBS FOR BUFFALO:
A POLICY PROPOSAL CONCLUSION APPENDICES
A QUALIFIED INVESTMENTBuilding a Sustainable City: Green Jobs for Buffalo
(S7565/A11427) that would enable utility and other sources that may include New York
customers to pay back the loan through their Power Authority funds, federal funds, or grant
utility bill, with monthly repayment amounts funding.
less than expected savings. Sale or transfer
of ownership of the building would pass the Investing in Green Jobs–Green New York
outstanding obligation to the new property
owner. Green Jobs–Green New York will provide
investors with healthy, multi-bottom-line
In addition to the two funding streams returns. Investments will be relatively low
established by Green Jobs–Green New York, risk since repayment is paid through energy
the U.S. Department of Energy has awarded savings via property taxes or utility bills. To
a highly competitive Retrofit Ramp-Up grant that end, investors will have adequate security
for $40 million to NYSERDA. Ten percent through either liens on the real estate developed
($4 million) of the grant may be used for (via PACE) or repayment obligations that “stay
administrative expenses, and twenty percent
with the meter” (via on-bill recovery) and will
($8 million) may be used to finance a revolving
rely on debt service and loan loss reserves. To
loan fund. In this latter capacity funds may
provide additional security, the program is
be used as a credit enhancement or a loan loss
reserve or may be blended with higher cost exploring the use of grant and public funding
capital or Program Related Investments (PRIs) for credit enhancement or loan guarantee
to reduce the overall cost of funding the owner. programs, similar to the U.S. Department of
Health and Human Services Loan Guarantee
Retrofits will be self-financing only with Program for Health Center Facility Projects.
respect to direct contracting costs, which will be
repaid from energy savings created by retrofits. Green Jobs–Green New York is also exploring
Costs for program administration, energy the use of capital raised from New Markets
audits, and other management expenses will Tax Credits or Investment Tax Credits, which
be supported by several renewable funding may provide an important source of equity for
sources: RGGI and Retrofit Ramp-Up dollars the projects to be developed. These tax credits
(to pay for administrative costs) and Systems are designed to attract investments from
Benefit Charge dollars (to pay for audits). banks and other large institutions in projects
The RRIF may be supported by a loan loss that result in catalytic community benefits for
reserve of at least 5% populated by the monthly low- to moderate income persons. The loans
flow of funds pooled via the Systems Benefit provided by Green Jobs–Green New York may
Charge (a small charge on the utility bill of be used to leverage equity or low cost capital
most New York State electricity customers) through a NMTC structure.
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BUFFALO, NEW YORK IN BUFFALO REINVESTMENT ACT19
Secondary Market Financing meet agreed-upon underwriting and term
criteria.
Green Jobs–Green New York may structure
its funding programs for secondary market Green Jobs–Green New York may use models
take-out (i.e., to access a secondary market for such as the Clean Energy Works Program to
the loans, including life insurance companies, develop the infrastructure and support to
government-sponsored entities such as Fannie sustain a secondary market. Clean Energy
Mae and Freddie Mac, socially motivated Works blends limited public subsidy with
investors, and pension funds). One strategy capital raised from private institutions to create
currently being explored is to “warehouse” a revolving loan fund for retrofitting homes
loans or obtain advance commitments from for weatherization and energy savings. Loans
an institution or institutions to purchase loans from the program are offered to homeowners
made by Green Jobs–Green New York that at low fixed interest rates for a 20-year term.
GREEN JOBS FOR BUFFALO:
A POLICY PROPOSAL CONCLUSION APPENDICES
A QUALIFIED INVESTMENTBuilding a Sustainable City: Green Jobs for Buffalo
The Community Reinvestment Act
T
he Community Reinvestment Act of their CRA assessment areas (i.e., the local
(CRA) rewards banks and other lending communities in which they do business).
institutions for meeting the credit needs Federal financial supervisory agencies apply
of their surrounding communities, including the lending, investment, and service tests in
low- and moderate-income sectors of those evaluating the performance of most banks.*
communities. When these institutions wish
to open a new branch, relocate, merge, apply
for a Federal thrift charter, or make certain * Assessment areas consist generally of one or
acquisitions, federal regulatory agencies take more metropolitan statistical areas or metropolitan
into account their record of meeting CRA divisions or one or more contiguous political
objectives. subdivisions in which the bank has its main office,
branches, and deposit-taking ATMs or remote
service facilities. For a bank other than a wholesale
HOW THE CRA WORKS or limited purpose bank, the assessment area must
also include the surrounding geographies in which
The CRA requires federal agencies regulating the bank has originated or purchased a substantial
banking and thrift regulatory agencies to portion of its loans.
assess the record of each insured depository
institution in meeting the credit needs of the The lending test evaluates a bank’s lending
entire community in which it is chartered, performance by considering its home mortgage,
including low- and moderate-income small business, small farm, and community
development lending; performance criteria
neighborhoods, consistent with the safe and
include lending activity, geographic distribution
sound operation of the institution, and to take
of loans, borrower characteristics, community
that record into account when those agencies development lending, and innovative or flexible
evaluate an application by the institution to lending practices. The service test evaluates the
open a branch, relocate, merge, apply for a availability and effectiveness of a bank’s systems for
Federal thrift charter, and make certain delivering retail banking services (criteria include
acquisitions. the current distribution of the bank’s branches, the
bank’s record of opening and closing branches,
Under the current CRA rules, institutions are the availability and effectiveness of alternative
evaluated primarily on how they help meet systems for delivering retail banking services in
the credit and community development needs low- or moderate-income geographies and to low-
READY FOR RECOVERY: COMMUNITY EFFORTS THE COMMUNITY
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BUFFALO, NEW YORK IN BUFFALO REINVESTMENT ACT21
Financial institutions receive positive • the economic and demographic
consideration in their CRA examinations for characteristics of the assessment area(s);
community development loans, qualified
• lending, investment, and service
investments, and community development
opportunities in the assessment area(s);
services, all of which must have a primary
purpose of “community development.” • the institution’s product offerings and
business strategy;
Regulatory agencies also take context into
account when evaluating an institution’s • the institution’s capacity and constraints;
performance under these tests, looking
• the prior performance of the institution
at information about the institution, its and, in appropriate circumstances,
community, its competitors, and its peers. the performance of similarly situated
Examiners take the following factors into institutions; and
consideration:
• other relevant information.
and moderate-income individuals, and the range of
services provided in varying income geographies SPOTLIGHT ON THE
and the degree to which the services are tailored to
INVESTMENT TEST
meet the needs of those geographies) and the extent
and innovativeness of its community development
The investment test provides a good example
services.
of how examiners evaluate institutions under
Exceptions include wholesale and limited purpose the CRA. For this test, an examiner evaluates a
banks (to which the community development test bank’s record of helping meet the credit needs
is applied), intermediate small banks (to which of its assessment area(s) through qualified
the lending test and community development test investments that benefit either its assessment
are applied), small banks (to which the lending
area(s) or a broader statewide or regional area
test is applied), and cases in which a regulated
entity submits an approved strategic plan. The
that includes its assessment area(s). A bank’s
community development test evaluates the number investment performance is evaluated pursuant
and amount of community development loans; the to the following performance criteria:
use of innovative or complex qualified investments,
community development loans, or community 1. t h e d o l l a r a m o u n t o f q u a l i f i e d
development services and the extent to which the investments;
investments are not routinely provided by private
investors; and the bank’s responsiveness to credit 2. the innovativeness or complexity of
and community development needs. qualified investments;
GREEN JOBS FOR BUFFALO:
A POLICY PROPOSAL CONCLUSION APPENDICES
A QUALIFIED INVESTMENTBuilding a Sustainable City: Green Jobs for Buffalo
HOW THE LENDING, INVESTMENT, AND SERVICE TESTS WORK
Federal financial supervisory agencies assign each bank’s performance in lending,
investment, and service one of the five following ratings: outstanding, high satisfactory,
low satisfactory, needs to improve, and substantial noncompliance. Each rating is
assigned a quantitative score; the sum of these scores represents an institution’s overall
score.
COMPONENT TEST RATINGS LENDING INVESTMENT SERVICE
Outstanding 12 6 6
High Satisfactory 9 4 4
Low Satisfactory 6 3 3
Needs to Improve 3 1 1
Substantial Noncompliance 0 0 0
POINTS COMPOSITE ASSIGNED RATING
20 or over Outstanding
11-19 Satisfactory
5-10 Needs to Improve
0-4 Substantial Noncompliance
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INTRODUCTION
BUFFALO, NEW YORK IN BUFFALO REINVESTMENT ACT23
3. t h e re s p o n s i v e n e s s o f q u a l i f i e d Business Investment Companies and
investments to credit and community specialized SBICs;
development needs; and
• to support or develop facilities that
4. the degree to which the qualified promote community development in
investments are not routinely provided low- and moderate-income areas for
by private investors. low- and moderate-income individuals,
such as daycare facilities;
Under the CRA, a “qualified investment” is
a lawful investment, deposit, membership • in projects eligible for low-income
share, or grant that has as its primary purpose housing tax credits;
community development (see below).
Examples of qualified investments include • in state and municipal obligations that
but are not limited to investments, grants, specifically support affordable housing
deposits, or shares: or other community development;
• in or to financial intermediaries † that • to not-for-profit organizations serving
primarily lend or facilitate lending in low- and moderate-income housing or
low- and moderate-income areas, or to other community development needs,
low- and moderate-income individuals, such as home-ownership counseling,
in order to promote community home maintenance counseling, credit
development, such as a CDFI that counseling, and other financial services
promotes economic development on an education; and
Indian reservation;
• in or to organizations supporting
• in support of organizations engaged in activities essential to the capacity of low-
affordable housing rehabilitation and and moderate-income individuals or
construction, including multi-family geographies to utilize credit or to sustain
rental housing; economic development.
• in support of organizations promoting Under the CRA, four things qualify as
economic development by financing “community development”:
small businesses, including Small 1. A f f o r d a b l e h o u s i n g ( i n c l u d i n g
multifamily rental housing) for low- or
† Intermediaries include, but are not limited moderate-income individuals;
to, CDFIs, CDCs, minority- and women-
owned financial institutions, and low-income or 2. Community services targeted to low- or
community development credit unions. moderate-income individuals;
GREEN JOBS FOR BUFFALO:
A POLICY PROPOSAL CONCLUSION APPENDICES
A QUALIFIED INVESTMENTBuilding a Sustainable City: Green Jobs for Buffalo
3. Activities that promote economic geographies designated by the Board
development by financing businesses of Governors of the Federal Reserve
or farms that meet the size eligibility System, FDIC, and Office of the
standards of the Small Business Comptroller of the Currency, based
Administration’s Development on:
Company or Small Business Investment
Company programs (13 CFR 121.301) or a. Rates of poverty, unemployment,
have gross annual revenues of $1 million and population loss; or
or less; or
b. Population size, density, and
4. Activities that revitalize or stabilize: dispersion. Activities revitalize
and stabilize geographies
i. L o w - o r m o d e r a t e - i n c o m e designated based on population
geographies; size, density, and dispersion
if they help to meet essential
ii. Designated disaster areas; or community needs, including
needs of low- and moderate-
iii. D i s t r e s s e d o r u n d e r s e r v e d
income individuals.
nonmetropolitan middle-income
READY FOR RECOVERY: COMMUNITY EFFORTS THE COMMUNITY
INTRODUCTION
BUFFALO, NEW YORK IN BUFFALO REINVESTMENT ACTGreen Jobs for Buffalo: 25
A Qualified Investment
U
nder current CRA rules, an investment in combination with the work already
in Green Jobs Buffalo should count as underway in the Green Development
a qualified investment. Three of the Zone, it will address the need for
examples of qualified investments in CRA high-quality housing and “greener,”
regulations apply to Green Jobs Buffalo. healthier neighborhoods through green
rehabilitation and retrofitting of affordable
1. “Organizations engaged in affordable housing, regional food systems, and
housing rehabilitation” environmental stewardship.
Green Jobs for Buffalo would build 3. “Organizations supporting activities
on the work already being done in the essential to the capacity of low- and
Green Development Zone to sustainably moderate-income individuals or
rehabilitate and retrofit affordable housing geographies to sustain economic
for low- to moderate-income people. development”
2. “Not-for-profit organizations serving Job training, employment placement into
low- and moderate-income housing or high-quality jobs, and career pathways
other community development needs”
Green Jobs for Buffalo is a direct response
to community development needs. It
will address the need for pathways out of
poverty by providing on-the-job training,
certifications, and career pathways in
green sectors of the economy for people
with barriers to employment, including
those from low- to moderate-income
communities and communities of color. It
will address the need for jobs by placing
program participants in full-time jobs that
pay family-supporting wages and benefits
and allow for career advancement. And, Photo courtesy of PUSH Buffalo.
GREEN JOBS FOR BUFFALO:
A POLICY PROPOSAL CONCLUSION APPENDICES
A QUALIFIED INVESTMENTBuilding a Sustainable City: Green Jobs for Buffalo
— combined with energy-efficiency bottom-line returns in terms of equity,
retrofitting for low- to moderate-income environment, and economy.
households and complementary projects
It should be no surprise that Green Jobs Buffalo
that enhance environmental quality and
has so much in common with the examples in
health — will stabilize and revitalize
the CRA regulations. The program’s purpose
low- and moderate-income communities
is clearly “community development” as
in Buffalo. These activities will not
defined in those same regulations.
only sustain economic development;
they qualify as sustainable economic According to CRA regulations, community
development because they achieve triple- development includes activities that “stabilize
Photo courtesy of the Massachusetts Avenue Project.
READY FOR RECOVERY: COMMUNITY EFFORTS THE COMMUNITY
INTRODUCTION
BUFFALO, NEW YORK IN BUFFALO REINVESTMENT ACT27
or revitalize low- or moderate-income Under the NSP, HUD has provided funds to
areas.” According to Interagency Questions state and local governments and nonprofit
a n d A n s w e r s R e g a rd i n g C o m m u n i t y o rg a n i z a t i o n s f o r t h e p u rc h a s e a n d
Reinvestment, activities may stabilize or redevelopment of abandoned and foreclosed
revitalize low- or moderate-income areas by properties. PUSH Buffalo is a current recipient
“creating, retaining, or improving jobs for of NSP funds for the purchase of abandoned
low- or moderate-income persons.” Green and foreclosed properties.
Jobs for Buffalo will stabilize and revitalize
low- to moderate-income areas – in part by The agencies’ proposal would encourage
creating, retaining, and improving jobs for depository institutions to make loans and
low- to moderate-income persons. investments and provide services to support
NSP activities in areas with HUD-approved
Under the investment test, a bank’s investment plans. If approved, this regulatory change will
performance is evaluated pursuant to create an opportunity to leverage additional
four p er for man ce cr it e ri a, i ncl udi ng government funding targeted to areas with
“responsiveness of qualified investments to high foreclosure or vacancy rates –– areas like
credit and community development needs.” those in which PUSH Buffalo and its partners
Banks investing in Green Jobs for Buffalo are already working.
should score well, as the program is directly
responding to community development needs. Beyond Assessment Areas
Agencies consider all activities that benefit the
OTHER CONSIDERATIONS institution’s assessment area(s) or a broader
statewide or regional area that includes the
CRA Rule Proposal Re: Neighborhood assessment area(s). An institution’s activity
Stabilization Program is considered community development if it
supports an organization or activity that
The federal bank and thrift regulatory agencies covers an area that is larger than but includes
have proposed a change to CRA regulations the institution’s assessment area(s). The
to support the stabilization of communities institution’s assessment area(s) need not
affected by high foreclosure levels. The receive an immediate or direct benefit from
proposed change would encourage depository the institution’s specific participation in the
institutions to support the Neighborhood broader organization or activity, provided
Stabilization Program (NSP) administered by that the purpose, mandate, or function of
the U.S. Department of Housing and Urban the organization or activity includes serving
Development (HUD). geographies or individuals located within the
institution’s assessment area(s).
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A POLICY PROPOSAL CONCLUSION APPENDICES
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