Investing to Reduce Economic and Racial Disparities
“…Physical and economic health are inextricably linked. Prosperity is like a Jenga tower: Take one piece out and the whole thing can fall. And since well-being is the sum of a host of intertwined factors, finding a path to economic mobility and success means addressing them all.”
Since the publication of Investing in What Works for America’s Communities, where leaders serving low-income communities voiced a clear call to work across sectors, the SF Fed and the community development field as a whole have embraced this idea that addressing the intertwined challenges that contribute to poverty requires an equally comprehensive approach. John Williams, President of the Federal Reserve Bank of San Francisco, affirmed this idea by stating that economic mobility and well-being requires working together across multiple disciplines in his recent speech to community development practitioners and investors at the National Interagency Community Reinvestment Conference. Risa Lavizzo-Mourey, President of the Robert Wood Johnson Foundation, followed President Williams and told the audience that bankers are some of the most important health workers in the country. To address the disparities of health, where life expectancies can be as large as 25 years depending on where one lives, bankers can more intentionally invest in the social determinants of health through opportunities such as affordable housing closer to public transit, day-care centers, and access to fresh foods, to name just a few examples.
Rooted in this theme of bettering lives through improvements in all contributing factors, the Strong Prosperous and Resilient Communities Challenge (SPARCC) is a response to accelerate how cities can work together to tackle health, environmental, and racial disparities to improve economic opportunities for all people. With billions being invested annually by banks and other financial institutions in low-income communities through the Community Reinvestment Act (CRA), ensuring that these investments make differential impact is even more critical as income inequality grows. With the $90 million from SPARCC that will be available for the winning sites, the SF Fed, in partnership with Enterprise Community Partners, the Low Income Investment Fund, and the Natural Resources Defense Council, aspire to support new models of how cities and regions can work to understand the underlying causes of economic and racial disparities and empower people and leaders to invest in more effective ways.
With generous support from the Ford, Kresge, and Robert Wood Johnson Foundations, SPARCC will work with the ten invited regions—Atlanta, Chicago, Denver, the San Francisco Bay Area, Los Angeles, Memphis, New Orleans, Philadelphia, Pittsburgh, and Seattle/King County—through the end of the year to ultimately select six winning sites. SPARCC supports the Federal Reserve’s mission of strengthening the economy by ensuring that all communities can reach their economic potential.
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