If the provision of subsidy in various parts of the budget is not oriented toward cost efficiency and high impact, then the subsidies won’t be smart.

To effectively address the challenges that America’s cities are facing and improve the lives of low-income people, municipal governments need to modernize their operations, refashion their use of capital, and deepen their engagement in collaboration to achieve collective impact. In the realm of more innovative uses of capital, local governments need to create sustainable models for utilizing public resources – including redirecting resources to their most effective uses – and also use public sector resources to more effectively leverage private-sector and philanthropic resources.

This paper is a practitioner’s reflection on subsidy, particularly as it relates to place-based real estate development and financing. It aims to open a conversation about subsidy as a way to improve community development practice. This is particularly important, argues Jeremy Nowak of J Nowak & Associates, during a period of budget cutbacks at the local and federal levels.