For more than a decade, community development practitioners have argued that anchor institutions can be powerful economic and social forces in communities. This is because anchors are place-based institutions that are unlikely to relocate, require a large workforce, are predominantly nonprofits with a public mission (e.g. hospitals, universities), and have a vested interest in their surrounding neighborhoods. While the theory of anchors as change drivers has led to extensive discussion and convening over the last decade, it has resulted in too few institutions developing discrete strategies and achieving measurable impacts.
Living Cities believes that anchor-based strategies are a core part of a new civic infrastructure that can address complex social challenges and drive a regional economy and several of The Integration Initiative sites are incorporating anchor strategies into their efforts. We’re highlighting two—Cleveland and Detroit—below, each of whom has made significant progress to date.
The Greater University Circle Initiative (GUCI) was founded in 2005 as a collaboration between the Cleveland Clinic, University Hospitals, Case Western Reserve, Louis Stokes Cleveland VA Medical Center, the City of Cleveland and local philanthropy.
In recent years, GUCI has had a particular focus on developing innovate strategies for economic inclusion by way of anchor institution procurement. Some of the GUCI anchor institutions procure goods and services from the Evergreen Cooperatives, employee-owned, for-profit companies that seek to serve the anchors while creating upwardly mobile local jobs. One of the businesses, Ohio Solar Cooperative, has already installed panels at Case Western Reserve, University Hospitals and the Cleveland Clinic.
In addition, Cleveland’s anchors are pursuing creative approaches within their own institutions that could be replicated or scaled across the collaborative. For instance, University Hospitals (UH), has taken extensive steps to institutionalize procurement from local, minority-owned and women-owned businesses. For each project, UH establishes clear goals for sourcing. To support the achievement of these goals, the hospital system has developed a Contractor Assistance Program to prepare local businesses to work with them (and, in turn, on other capital projects across the region). In addition, when reviewing bids, UH awards additional points to firms that are locally-based or have local presence. To ensure that women-owned, minority-owned and local procurement firms are not just pass throughs, they employ an outside company to monitor contracts. UH also ensures accountability by tying the procurement staff’s compensation to these goals as well as reporting annually to the Board of Directors about this work.
The results of UH’s efforts are extraordinary. In 2005, the Hospitals set out to source 80% of its capital projects locally. They met that goal in 2010 and in doing so bucked the conventional wisdom that sourcing locally costs more. UH’s construction costs have come in $20 million dollars under budget and they note that the proximity of suppliers as well as being a supplier’s largest client is an advantage in the quality, speed and flexibility of service.
Detroit’s Woodward Corridor Initiative aims to“redensify” the urban core by improving safety, schools, employment, and small business opportunities. The Initiative seeks to align anchor institution hiring and procurement, land use planning, transit corridor development, and neighborhood revitalization to secure direct benefits for residents while attracting new investment.
At the core of the Initiative is the Midtown Anchor Strategy, which is leveraging the economic power of the Henry Ford Health Systems, Wayne State University and Detroit Medical Center to bring more residents, capital and business opportunity to the Corridor. A recent study found that the three institutions collectively employ nearly 30,000 people, enroll 32,000 undergraduate and graduate students annually, and control nearly 40% of the undeveloped real estate. The study also found that these anchors could potentially add up to 10,000 residents to the Midtown neighborhood, achieve 30 percent local procurement, and reach 35% local employment over the next 10 years.
Early success in working toward these goals is being achieved through Live Midtown, a residential living program designed to entice employees of the three anchors to live and invest in a Midtown neighborhood. The program offers incentives to attract new homeowners and renters, as well as to retain current homeowners and renters in the neighborhood. Launched in 2011, the program has already closed on 197 applications yielding 19 new homeowners, 100 lease renewals and 76 new renters.
Live Midtown’s success has inspired other Detroit-based employers to use the same platform to incentivize their employees to move to the City. On July 25, five downtown Detroit employers announced the launch of a $5 million program—which uses the same incentive structure as Live Midtown—to attract their employees to become residents of six targeted Detroit neighborhoods. The program, called Live Downtown will also be managed by Midtown Detroit, Inc. and will be open to the 16,000 employees of DTE Energy, Compuware, Quicken Loans, Blue Cross Blue Shield of Michigan and Strategic Staffing Solutions.
From the sites’ on-the-ground efforts, a new framework for anchor work is emerging. One part of the framework is that very few anchors have the power to make change happen on their own. Instead, to achieve significant impact in communities, anchor institutions must partner with each other and with other types of organizations. Second, anchors must move beyond projects to make strategies a core part of their business operations in areas like procurement, place-making and personnel. Third, anchor strategies must engage communities as full partners in developing and implementing change efforts. And fourth, anchor work is not only about the neighborhood in which an institution is located, but instead about the region, the market in which it operates.
There is no tried and true script for doing this work, and the associated metrics are tough to determine and measure. For anchors to achieve their unrealized potential as regional economic drivers, they have to develop new ways to work together and with other stakeholders to create and implement the solution together and achieve enduring impact for their communities.
Going forward, Living Cities will be supporting this work through The Integration Initiative, working with anchors and others to develop a clearer framework for turning ideas into practice, and anchors into regional economic drivers. We look forward to sharing what we’re learning along the way.