Community benefits agreements

What is it?

Before a major development project breaks ground in an urban setting, local stakeholders have an interest in shaping the project's impacts and opportunities. People living in low-income urban neighborhoods are often subject to the negative impacts of large urban development projects but have only limited access to the new economic opportunities that such projects provide. This dynamic occurs in part because community representatives don't have a meaningful seat at the table during the key stages of project development.  A community benefits agreement (CBA) is an economic empowerment mechanism by which stakeholder organizations can negotiate directly with developers for the benefits most important to them – shaping urban development projects to improve lives for local residents, most frequently communities of color.

A CBA is a legally enforceable contract between a coalition of community-based organizations and the developer of a proposed project. In exchange for the coalition's public support of the project in the approval process, the developer agrees to contribute benefits to the local community if the project moves forward.  In this way, the coalition has a hand in shaping the project, while the developer builds community support and strengthens local partnerships. The result is a smoother approvals process for the developer and a better project for the community.

Community benefits set forth in a CBA can cover a range of issues prioritized by the community coalition, such as affordable housing, local and targeted hiring, living wage requirements, open space, and so forth. CBA terms are enforceable by coalition organizations directly against the developers, providing these organizations with a level of certainty that traditional planning processes cannot provide.  When CBAs work well, this inclusive process – and reliable legal mechanism – can help deliver concrete economic and social benefits to affected communities.

Who implements it?
  • Coalitions of community-based organizations and other stakeholders build sufficient political leverage to shape terms of development in their communities; they then negotiate a CBA directly with project developers, providing public support to projects that will deliver a strong slate of community benefits.
     
  • Developers directly negotiate a CBA with community coalitions, gaining support for their project and building local partnerships that will benefit the project over time.
     
  • Elected officials and city staff keep lines of communication open to ensure consistency with the city's policy goals. 
Key considerations

Strong Coalitions.  The CBAs that deliver the strongest slate of community benefits are negotiated by a credible, unified coalition of grassroots community organizations that can leverage a sophisticated campaign, including organizing capacity, media engagement, policy research, and legal capacity.  Community/labor coalitions have been particularly effective. 

Role of Government.CBAs supplement the existing processes by which a public entity shapes a large urban development project.  City staff and elected officials can show inclusive leadership by (i) ensuring transparency around project development, (ii) indicating to developers the importance of broad community support during the project approval phase, and (iii) allowing space for CBA negotiations, without trying to control them. 

Resistance to concept.  City staff and elected officials may be resistant to CBAs, because they are either unaware of how CBAs operate, or are threatened by what they perceive to be a release of control over project development.

Misuse of CBAs.  Developers, and city staff that are in strong support of a proposed project, may misuse the CBA concept:

  • They may characterize the Development Agreement or a portion of it as a CBA – even though it is not negotiated by, and will not be enforceable by, community representatives.
  • They may arrange for and release to the public a "CBA" between the developer and a friendly local body, such as the local chamber of commerce, that will not actually press the developer for changes to the project.

Each of these methods is an attempt to occupy space that might otherwise be filled by a robust, community-driven CBA effort.

Importance of sufficient community leverage.  Without demonstrable public pressure and legal leverage, sufficient to shape dynamics of project approvals, developers may lack incentive to negotiate. 

No CBA can involve all stakeholders.  Certain segments of a community may be unable or unwilling to participate in a CBA negotiation process; no one should take a CBA effort as channeling or capturing every community opinion or priority.

Enforcement.  Projects can take a decade or more to come to fruition.  Community coalitions may lack long-term capacity to monitor CBAs and enforce CBA terms against successors to the developer. 

Where is it working?

CBAs function best for large development projects in urban areas, where there is a broad-based community coalition, and the developer desires community support to obtain public subsidies and/or approval of a proposed project.  Community representatives are in a stronger position to negotiate if the city shares the community coalition's policy goals and encourages the creation of a CBA. 

  • Staples/L.A. Live CBA, Los Angeles, CA.  In 2001, the Los Angeles Staples Center CBA set the precedent for what is considered a successful CBA, with community benefits commitments conservatively valued at $150 million – about double the amount of the promised city subsidy for the project.  The community coalition that negotiated the CBA consisted of more than 20 organizations.  The CBA contains commitments relating to a broad range of issues, including affordable housing, parks and open space, local hiring, and living wages. 
     
  • Nashville MLS Soccer, Nashville, TN.  In 2018, Nashville-based community coalition Stand Up Nashville negotiated a CBA to accompany a proposed soccer stadium.  The CBA contained requirements for living wage jobs, first-source hiring, affordable housing, a child-care center, and other community benefits.  Nashville Mayor David Briley penned an open letter to the city expressing his support of the project in large part because it would have a CBA attached.  Then, Stand Up Nashville joined the developer in a letter to Metro Council urging approval of controversial rezoning legislation necessary for the project to proceed. 
     
  • Facebook, East Palo Alto, CA: In 2016, Facebook entered into a CBA with a community coalition with regard to a major office expansion. The CBA requires Facebook to provide nearly $20 million toward a fund to be used for affordable housing in the region. This fund was soon leveraged to include approximately $60 million of additional funds, to be expended on the same terms.  The CBA also provides funding support for other issues of community concern, including legal support for tenants and policy advocacy campaigns. 

 

In addition to PolicyLink resources listed on the right, see below for the text of CBAs currently in effect as well as additional materials.

Text of CBAs Currently in Effect:

 

Additional Materials:

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