This week, the Greater Washington Partnership announced a $4.7 billion investment over the next five years to support equitable business growth in the region from Richmond to Baltimore. The massive pledge leaves a lot of room for discretion on the part of the 25 entities who pledged to contribute.
All told, the investment includes $2.6 billion that those entities will put toward procurement spending with diverse suppliers and Minority Business Enterprises in the region, as well as $1.5 billion for “wealth building opportunities in underrepresented communities,” such as affordable housing. The remaining $619 million consists of financial investments to Community Development Financial Institutions and Minority Depository Institutions, which provide loans and financing to underrepresented populations.
An undisclosed portion of the $4.7 billion is already actively invested, Greater Washington Partnership Vice President Francesca Ioffreda told the Washington Business Journal. Rounding up the investments was a year-long process; during that time, the organization wanted to be “holistic in [measuring] that because we wanted to capture the full scope of investments that our companies are making and to also send a signal to others to lean in, to commit,” Ioffreda said.
She declined to share a breakdown but said “a significant portion does represent new commitments.” Depending on the organization, the investment represents a baseline year of either 2020 or 2021, Ioffreda said, in particular when it comes to procurement spending with diverse suppliers, a category that makes up over half of the multibillion-dollar investment. Decisions about which business and programs to target are being left mostly with the 25 partner organizations.
Ioffreda, JPMorgan Chase & Co. Vice Chairman Peter Scher and Howard University President Dr. Wayne Frederick formally announced the investment Wednesday during an event at Howard University's Cramton Auditorium. Vice President Kamala Harris, U.S. Secretary of Commerce Gina Raimondo, and U.S. Small Business Administration Administrator Isabella Guzman also spoke at the event, commenting on the importance of public-private partnerships and community investment.
Harris also touted the just-announced extension and improvements to the SBA’s Community Advantage pilot program, which helps entrepreneurs and small business owners access loans. “Since its founding, the Community Advantage Program has helped launch businesses, create jobs and drive innovation for our nation,” Harris said. The SBA program was set to expire in September and now will continue through September 2024.
That lending program is accomplished in part through CDFIs — organizations like Arlington’s Capital Impact Partners and the Washington Area Community Investment Fund (WACIF), both of which will receive a portion of the $619 million GWP has earmarked for CDFIs and MDIs.
“To create more opportunities for more people, new approaches are required,” Ellis Carr, president and CEO of local CDFI Capital Impact Partners, said during the event. The Latino Economic Development Center and Industrial Bank will also receive investments. All are places where the financial institutions involved in GWP are “investing heavily,” Ioffreda said.
Bank of America Corp. (NYSE: BAC), JPMorgan Chase (NYSE: JPM) and Capital One Financial Corp. (NYSE: COF) are among the financial institutions in the group.
In a statement, a Bank of America spokesperson said the corporation has invested more than $125 million over the past year to support the partnership and its "mission to foster unity and inclusivity across the Capital Region," and another $350 million in grants and capital investments to support small businesses, affordable housing projects and workforce development programs.
The Greater Washington Partnership was founded in 2016 as an alliance of major area employers and entrepreneurs. Its stated aim is to make the region from Baltimore to Richmond more equitable and its economy more inclusive. Its Capital CoLAB program, which aims to connect the area’s students — particularly people of color and women – with tech jobs recently announced it had provided training or met with 12,000 prospective workers thus far.
