As the pursuit of racial justice gains momentum worldwide, the need is It has become more urgent to ensure that funding goes to organizations with these ambitious goals.
Enter REAPP, which stands for a proactive and practical assessment of racial equality. This new tool from BlueHub Capital, a Boston-based CDFI, will assess the potential of credit to support racial justice in various community projects.
REAPP is still in the pilot phase and, according to Catherine Dun Rappaport, who develops BlueHub's metering projects, it aims to support direct loans to developers and borrowers focused on creating affordable housing. The tool is "a more nuanced way of looking at racial justice credit," she says.
REAPP is launched to better support BlueHub Capital's newly announced $ 15 million COVID-19 Housing, Opportunity, and Wellness (C19-HOW) fund. The fund aims to support the construction of affordable housing for communities disproportionately affected by COVID-19 and whose residents are low-income and mainly black, indigenous and / or colored (BIPOC). The C19-HOW funds up to $ 2 million in pre-development loans; up to $ 2 million in acquisition loans and up to $ 4 million in construction, period, equity, or bridging loans.
While the creator, Dun Rappaport, is white, she says she built REAPP over nine months "in intensive consultation on impact investing and with my colleagues and people of color".
REAPP measures five different dimensions, including the project, its leadership and goods, and its impact – all with the intent of ensuring that the project builds prosperity in a BIPOC community, supports BIPOC staff and providers, and avoids becoming a BIPOC Harming community, e.g. gentrification or increased economic segregation. REAPP is designed as a 20-minute survey on mostly closed questions. Given that social impact can be outside of a borrower's core business, REAPP asks them "just how racial justice fits into their framework and intent," said Autumn McLaughlin, communications manager at BlueHub.
"At the moment, some of the specific questions are focused on residential construction, which is where we come in," says Dun Rappaport. In fact, REAPP is used in the first initiative funded by the C19-HOW Fund – the Salem South River Revitalization Project, which will provide affordable housing and more to the El Punto neighborhood of Salem, MA.
Finally, BlueHub Capital hopes to make REAPP available to the wider CDFI community. So far, a number of leaders in the CDFI community have expressed interest, including Molly Melloh, Senior Director of K-12 Education at the Philadelphia-based Reinvestment Fund, who is working to develop a framework for racial justice that goes beyond its lending Charter schools.
"While quantitative data, be it about a business's demographics or the population served, can be relatively easy to collect, qualitative measurements and assessing whether racial justice is at the center of a potential borrower's decision-making process can be difficult." said Melloh in a statement.
Annie Donovan, chief operating officer of the New York-based Local Initiatives Support Corporation, agrees that more data can help assess the impact.
"Racial justice has always been important to CDFIs," says Donovan. "We need to be able to measure the results so that we know if we are going deep enough; when we move the needle. "
This story is part of our CDFI Futures series, which explores the community development finance industry through the perspective of equity, public policy, and inclusive community development. The series is generously endorsed by Partners for the Common Good. Register for the CapNexus newsletter from PCG at capnexus.org.
Frances McMorris is a Tampa-based writer who worked as a court and legal reporter for the Wall Street Journal, New York Daily News, and Newsday. She specializes in legal and business issues.
source https://seapointrealtors.com/2021/08/10/new-tool-puts-racial-equity-at-the-center-of-community-funding/
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