Below is a basic explanation of community benefits. To familiarize yourself with the details of how they work, please also refer to these resources:
- Delivering Community Benefits Through Economic Development: A Guide for Elected & Appointed Officials
- A Framework for Success (online planning tool)
- Definitions, Values & Legal Enforcement
- Making Development Projects Accountable
- Building America While Building Our Middle Class
What is a Community Benefits Agreement?
A Community Benefits Agreement or "CBA" is a contract signed by community groups and a real estate developer that requires the developer to provide specific amenities and/or mitigations to the local community or neighborhood. Site-specific community benefits agreements (CBAs) ensure that particular projects create opportunities for local workers and communities. Often, however, these projects change the city's development paradigm; when decision makers realize what well-considered projects with specific benefits attached can bring to the community, the city enacts community benefits policies that set the stage for lifting thousands of people out of poverty.
Why the Community Benefits Model Works
- Community benefits tools maximize returns on local government investment in development.
- Community benefits programs can transform regions through stronger, more equitable economies.
- Community benefits help generate public support for economic development projects.
- Delivering community benefits is smart business.
- CBAs hold developers accountable for their promises to local governments and residents.
- Public input results in better projects that benefit the whole community and attract local customers.
- Community benefits are part of a smart growth agenda.
- Time is money, and projects with CBAs often enjoy a faster, smoother entitlement process.
What Is a CBA?
A Community Benefits Agreement (CBA) is a project-specific agreement between a developer and a broad community coalition that details the project’s contributions to the community and ensures community support for the project. Addressing a range of community issues, properly structured CBAs are legally binding and directly enforceable by the signatories.
In some cases, the community benefits terms from a CBA may be incorporated into an agreement between the local government and the developer, such as a development agreement or lease. That arrangement gives the local government the power to enforce the community benefits terms.
CBAs allow a win-win approach to development: meaningful, up-front communication between the developer and a broad community coalition decreases developers’ risk while maximizing the positive impact of development on local residents and economies. The developer benefits from active community support of the project, and community members gain when the project responds to their needs.
CBAs offer two important advantages over the traditional land use approval process. First, the process of negotiating a CBA allows for a more constructive and collaborative conversation about meeting community needs than the often adversarial and highly structured hearings that are part of a local government’s project approval process. Second, a private agreement is free from certain critical legal constraints that apply to government conditions on development projects, so the community and the developer may negotiate over a wide variety of deal points and come up with creative approaches.
Community benefits coalitions are long-term, broad-based groups with deep roots in the community. Coalitions typically represent a broad array of stakeholders, such as local residents across the income spectrum, people of all colors, representatives from labor, environmental and faith groups, and affordable housing advocates.
Community benefits coalitions recognize that high-quality new development is critical for expanding prosperity. Coalitions seek a role in shaping that development, and know that no one wins if the project fails.
What Is a Community Benefits Policy?
A community benefits policy is any policy adopted by a local government that requires community benefits on projects undertaken by the government or by a private developer. Common examples include living wage, local hiring, and affordable housing requirements for subsidized development.
Cities sometimes chose to adopt community benefits policies after successful projects with CBAs change the city's development paradigm. When decision makers realize what well-considered projects with specific benefits attached can bring to the community, the City enacts community benefits policies that set the stage for lifting thousands of people out of poverty.
Some local officials seeking to advance the use of CBAs in their cities have considered policies that require developers to negotiate CBAs. The Community Benefits Law Center generally advises against this approach for two reasons: (1) it is not clear who will negotiate on behalf of the “community” in such circumstances, and the process could be coopted by more well-connected and well-resourced interests; and (2) in the case of projects not receiving subsidy (or otherwise the subject of a government agreement), the CBA may be subject to the same set of legal constraints that govern conditions of project approval, limiting the kinds of community benefits that can be included.
Multi-Parcel Development Standards
Local governments can proactively guide future growth by applying community benefits principles to large parcels of land slated for development. If the land is government-owned or developed under an agreement with the local government, officials can incorporate community benefits into requests for proposals.
Community Benefits Standards
Community benefits policies attach standards to subsidized development and other economic activity with which a city has a relationship like public works or projects on city-leased land. Living wage ordinances, targeted hiring requirements, and mixed-income housing requirements are examples of community benefits standards. These policies make the development process more predictable by making the community's expectations clear to all stakeholders and reducing the need to articulate community benefits on a per-project basis. More information is available from the Community Benefits Law Center.