Blog
Seed Fund Grantee Highlight: Sustainable Economies Law Center
February 25, 2014
by Alex Haber
Building the next economy will take work in many sectors. RSF focuses on work with investors, donors, and entrepreneurs to build the direct, transparent relationships necessary to make economic renewal a reality. But as all these groups move their money and conduct their business with deep values, ossified legal structures will have to adapt and become more flexible to meet the needs of new economic relationships.
RSF Seed Fund grantee, Sustainable Economies Law Center (SELC), works precisely at this intersection. SELC provides essential legal tools – education, research, advice, and advocacy – to support a transition to local, resilient economies. It focuses in many areas, including cooperatives, community-owned enterprises, co-housing, urban agriculture, barter, and local currencies.
Last year, SELC received a grant from the Seed Fund to support a new project that helps farmers interested in sustaining and growing their businesses through community-based or crowd-sourced financing methods. These methods allow local, small-scale investors to become financial stakeholders in an enterprise, and allow enterprises to seek capital from friends, family, and community members instead of high net-worth individuals or banks. With RSF’s funding, SELC was able to run an outreach campaign and application process for this new service to assess interest among farmers, and the response was very strong.
One of the most promising candidates was the South Central Farmers’ Cooperative (SCF), a worker-owned farm in California’s Central Valley. The coop grew around South Central Farm, a former fourteen-acre urban farm in South Central Los Angeles. After ten years of cultivating the land and building the community around it, the farmers were evicted in 2004 when the plot was slated for development. This eviction led to significant protests and civil disobedience, as well as an Academy Award nominated documentary, The Garden.
Since then, the South Central Farmers have been cultivating land in the Central Valley, and are currently looking to expand and help start other worker-owned farms. In order to do this, and to avoid the threat of eviction, SCF is looking to form a non-profit organization that could purchase land it could lease to worker-owned agricultural cooperatives, and to finance these land purchases through a public offering, so small investors, potentially from all over the state, could invest in these farms.
SELC and SCF hope to continue working together on this project as it evolves, and SELC is looking for funding to continue the work and develop a how-to guide for other farms interested in community-based and crowd-sourced funding.
Click here to learn more about how you can get involved with the Seed Fund to support great organizations like Sustainable Economies Law Center.
Alex Haber is Program Manager of Philanthropic Services
Community Foundations: What It Takes to Become Dynamic Hubs of Local Capital
February 24, 2014
by Don Shaffer
Community foundations—with their deep local ties, significant assets, and community benefit missions—are ideally positioned to play a leading role in solving our communities’ most profound and difficult challenges. Yet many are stuck in a pattern of disbursing only a small percentage of their assets in grants and investing the rest in traditional portfolios that don’t advance (and may even undermine) their mission.
What is preventing these anchor institutions from realizing their potential? What exactly is that potential, and how can community foundations shift to an impact investment strategy that really makes a difference to community success and resilience?
RSF is taking a hard look at these questions. We recently brought together senior executives from 24 of the most innovative community foundations in the U.S. and Canada, along with RSF advisors and other impact investment experts, for “A Field-building Collaborative: Changing the Game through Local Impact Investing,” a conference looking at barriers to place-based investing and how to overcome them, lessons learned, and drivers of change.
The imperative of impact investing
We were pleased that the Jan. 29–31 event, co-hosted with the Arizona Community Foundation in Phoenix, attracted so many community foundation leaders from across the country, representing rural as well as urban communities and holding assets totaling more than $5.5 billion. But we weren’t surprised: a powerful combination of generational change and aspiration is motivating community foundations to explore local impact investment strategies. Foundation leaders are searching for ways to stay relevant to the next generation of donors, who tend to take a hands-on approach and often are entrepreneurs who made their money by thinking big and taking risks. These leaders also aspire to make their institutions drivers of local economic health. They see the opportunity to become dynamic hubs of community capital, deploying a full range of low-interest loans, loan guarantees, convertible notes, and other forms of investment funding to social enterprises.
Kelly Ryan is on her way to doing that in central Wisconsin as CEO of the Incourage Community Foundation. She told the story of how her community lost 40 percent of its jobs overnight when their major employer moved overseas. The foundation rallied, changing its focus to creating jobs and supporting local businesses, essentially saying, “We’re going to be the institution that brings everyone out of the ashes.”
All community foundations have that opportunity right now. The questions we started exploring with “Changing the Game” are, is it possible to make that happen before reaching the tipping point of a massive crisis? And if so, how?
Identifying roadblocks
The motivations and opportunities to invest for local impact are powerful—but so are the countervailing forces. Foundation leaders who take steps toward changing their institution’s investment practices confront a thicket of challenges. Two sets of issues stood out in the presentations and discussions.
Culture. The cultural assumptions of boards, investment committees, investment advisors and even staffs can present significant roadblocks. RSF advisor John Fullerton captured the problem: the people serving on investment committees often have spent their careers living and breathing current models of portfolio theory and investment management. They’re focused on fiduciary responsibility, and in their minds that means making sure the money makes more money—not ensuring that investment has a positive impact on the community. It’s hard to convince a board member who spent their career on Wall Street that financial return is not the number one goal.
Capacity constraints. Most community foundations don’t have the staff expertise to evaluate and manage direct investment in local enterprises, or to develop a cohesive local investment strategy. Even hiring appropriate consultants can be a challenge. Impact investing is relatively new, so the pool of experts is not yet deep. Another challenge is tension between programming and investment—the program staff may feel that impact investments are invading their turf. In addition, the lack of history with direct investment means the opportunities may not be obvious to foundation staff.
Creating space for impact investing to grow
Discussions at the event revealed a big gap between the desire many have to pursue impact investing (“Why wouldn’t we want to do this?” was a commonly expressed sentiment) and the knowledge they need to actually do it. RSF advisors and foundation leaders who’ve started down the path shared suggestions for moving forward.
Work with the board to change investment culture. Private foundations are often created with one large gift that’s expected to last; they are risk-averse and focused on returns because they want to ensure perpetuity. Community foundations, however, are public institutions whose growth and success rest on the number of donors they can continue to attract over time; they should be free to focus on demonstrating their relevance to the community and attracting the next generation of donors. There’s no structural reason for them to be risk-averse and returns-focused—the fact that many are is often a result of board culture.
Brian Byrnes of Santa Fe Community Foundation encountered tremendous board resistance to a shift in investment strategy; to counter that he took the board through an analysis that revealed their level of investment in areas contrary to their mission. Byrnes said the exercise was a powerful force in opening minds. Kelly Ryan reconstituted her board at Incourage so that they could implement a community investment strategy as a central feature of their mission.
Redirect investment expenses. One of the most eye-opening moments for many participants was RSF advisor Leslie Christian’s “do the math” challenge. “How many of you are experiencing a roadblock in that your boards think impact investing is too expensive?” she asked. Hands shot up all over the room. She then did the math: a $100 million foundation paying a typical 0.8 percent fee to its investment advisor is spending $800,000 a year to maintain its portfolio. What if the foundation fired the investment manager and instead put all that money into a Vanguard index fund, which historically has long-term returns as good as or better than investment managers? With a typical mutual fund fee of 0.08 percent, they’d free up $720,000 they could use to hire impact investment experts.
Restructure your organization. Dana Pancrazi of the FB Heron Foundation put forward a structural solution to internal turf battles and mission conflicts: the foundation dissolved its grantmaking and investment teams, replacing them with an operations team that provides administration and support, and a capital deployment team that handles grants and investments—and treats both as 100 percent mission driven.
Pioneers wanted
A few foundations have already made great progress on local impact investing, but it hasn’t been easy—and it won’t be for the next wave of pioneers, either. In addition to inspiring stories, we also heard “it’s not all rainbows and unicorns.” At RSF, we know how hard this is, having spent the last 30 years building up the expertise and insight to invest for impact effectively. There will be failed investments and difficult expectation setting. But as entrepreneurs know, failures teach the lessons that lead to ultimate success. Why not give the non-profit sector the same opportunity to use investments to try out innovative solutions to our communities’ most pressing problems?
We’re hoping to spark this change by inviting the most committed community foundation leaders to join a community of practice that will go deeper into what it takes in terms of personal leadership to shift to impact investing. The group will provide peer support and share everything from in-progress case studies to best practices to credit memos.
We believe the opportunity for change is profound. If a relative handful of community foundations reinvented themselves right now, they could truly change the game for communities across the country.
Don Shaffer is President & CEO at RSF Social Finance
Community foundations conference attendees.
RSF Makes a New Loan to Eureka Recycling
February 19, 2014
RSF Social Finance (RSF) is pleased to announce a new loan to Eureka Recycling, a non-profit recycler specializing in zero-waste. RSF financing will be used to purchase new recycling equipment which will help the company transform its operations, reducing operating costs and improving service to its clients.
Based in Minneapolis, Minnesota, Eureka Recycling provides curbside recycling services to the Twin Cities of Saint Paul/Minneapolis and the metro area. Eureka Recycling is one of the largest non-profit recyclers in the United States and is a leader in demonstrating the best waste reduction and recycling practices not only for the Twin Cities metro area, but for the nation.
Eureka Recycling puts into practice a model of resource management rather than waste management, a model that assumes waste is preventable, not inevitable. As a mission-driven non-profit organization, Eureka Recycling looks beyond the bottom line to provide the best practices for recycling and consider the optimum balance of cost, personal convenience, and environmental benefit.
“We are not like many traditional non-profit environmental organizations because we have a large operation in which we manifest our mission each day,” says Tim Brownell, CEO of Eureka Recycling. “We believe that it is most powerful to advocate from a place in which we have rolled-up our sleeves to do the work and know that what we are of others is doable and will get the job done.”
All of Eureka Recycling’s efforts are designed to help individuals, organizations, and communities understand the significance of zero-waste and to achieve their own zero-waste goals. This includes activities beyond recycling such as encouraging reuse through the Twin Cities Free Market, a web-based program that connects community members to share durable goods that might otherwise end up in the landfill; composting services for restaurants, grocery stores, and other food businesses; and education and advocacy programs to promote community responsibility for waste-reduction.
“Eureka is much more than a recycling company,” says Mike Gabriel, lending manager at RSF. “This organization has deep roots in the community. And, with the breadth of services they provide, they’re really helping to build a vibrant and resilient local economy in the St. Paul area.”
The support and financing from RSF will also allow Eureka Recycling to launch their ‘Zero-Waste Lab,’ an education tool, feedback loop, and measurement device for governments, corporations, and communities. “Now that zero-waste efforts are becoming more mainstream, there are many claims regarding policies, collection and processing designs, and packaging changes that are supposed to reduce or eliminate the growing waste stream,” explains Bryan Ukena, Business Development Director at Eureka Recycling. “Eureka’s Zero Waste Lab will actually help to distinguish those that are just talk from those that show true results.”
About Eureka Recycling
Based in Saint Paul, Eureka Recycling is one of the largest non-profit recyclers in the United States and the only organization in Minnesota that specializes in zero-waste. Eureka Recycling provides curbside recycling services to Saint Paul’s homes and apartments with a mission to demonstrate that waste is preventable, not inevitable. In addition, Eureka Recycling is a leader in waste reduction education, programs, and advocacy
www.eurekarecycling.org
Thin Margins, Deep Trust – Part II
February 14, 2014
by John Bloom
We received valuable feedback, by blog post comment, phone calls and a few emails, on the recent pricing change. Most clients and readers appreciated our transparency and insight into the price-setting process and how we shared the information with our community. With that transparency, some challenging issues surfaced. At RSF, we believe in the value of asking hard questions. Reflection is a critical tool of inquiry and thus an important part of our organizational learning. We hope that by publicly discussing some of the tougher questions, we continue to create a strong community for all of our stakeholders to share and learn from each other. This is what we mean by community. We also wanted to share some further thinking in response. We do not expect everyone to agree, yet engagement is essential. What follows are a few of the comments that were shared in the public arena, along with a sense of other comments and thoughts that came in response to the pricing change:
“It does not look like the margins of the senior staff are too thin. The CEO got $350,000 in 2011 according the Form 990 filed with the IRS.”
This is true. All of our executive compensation is public record, and can be found on our 990 tax forms. Our board evaluates executive compensation to keep it in line with industry standards and to maintain our compensation ratio of 8:1, meaning that compensation of our highest paid employee will never exceed eight times that of our lowest paid employee. Given that we are seeking to retain top talent in the Bay Area (one of the most expensive regions of the country), and that our CEO is responsible for leading a $160M organization and a $6M budget, we believe that this level of compensation is appropriate.
Compensation isn’t the sole indicator of the thin margins, which we are in fact operating on. In recent months we have thoughtfully reduced our budget expenditures, which required makings some difficult changes. All employee salaries are under review, but in our effort to maintain a competitive standard for top talent we made the decision not to compromise our investment in people.
“Are interest rates not going to be rising this year? Will borrowers continue to say that they can get loans cheaper elsewhere or that they can’t afford a small increase?”
Perhaps, all of the above could happen. The purpose of the quarterly pricing meetings is to be responsive to a changing environment.
Changing the borrower rate will certainly be part of the discussion this year and as that takes place we’ll be looking at key factors such as: if, given enough notice, will borrowers be able to pay an increased rate; and, what is going on in the market? The reality is that right now we are in a low interest environment and we have to keep our rates low in order to stay competitive. As the market changes, so may we. One big challenge is that big banks have extremely low cost of funds (near 0%) and therefore more latitude in how they price their loan products and also gain from the margins.
“I was wondering why during the course of my investment with RSF, the return has gone from one percent to 0.25 percent?”
Good question, and it is very much linked to the previous one regarding borrower rates and the subsidized advantage that big banks have. Investor rates have decreased as a direct result of the competitive environment for borrower business and what is going on in comparable investments. Having said that, we are currently on par with comparable short-term opportunities. However, we do recognize that our investors shouldn’t have to bear the full burden of this. And this point will be up for consideration throughout 2014.
That we had such responses is an indicator that our clients care about not only their own piece in the Social Investment Fund community, but about all the participants, and further understand the complexity of such transformational work. We thank you for your engagement.
Click here for Thin Margins, Deep Trust Part I
John Bloom is Senior Director of Organizational Culture at RSF Social Finance
More than Murals
February 10, 2014
This article was originally published in the Winter 2014 RSF Quarterly.
by Megan Mendenhall
A decade and a half ago, four graduate students from the University of Texas started with a small idea: to use the arts to support youth development. From this inspiration, they created the Theater Action Project, an interactive violence prevention program that offered drama-based activities to help youth deal with social issues. In 2003, with the addition of now-Executive Director Karen LaShelle, a new team developed dozens of additional programs that incorporated more art forms and creative means—puppetry, parades, filmmaking, drumming, mural arts—and the organization was eventually reborn as Creative Action. Today, Creative Action is Central Texas’ largest provider of afterschool programming, arts enrichment, and character education, serving 18,500 youth annually.
Since its founding, Creative Action has ignited and supported the academic, social, and emotional development of over 100,000 young people in Central Texas. By providing youth with hands-on programs that utilize art making, team building, and creative problem solving, Creative Action offers a fun and engaging way to equip children and teens with important life skills.
“In the wake of rising incidents of school violence and bullying in the late 1990’s, Creative Action was formed to help give young people opportunities to develop stronger social and emotional skills,” says LaShelle. “In order to succeed and thrive, students need an opportunity to develop what I call twenty-first century skills: empathy, creativity, appreciation of diversity, critical thinking, leadership, and job training.”
These skills help define what Creative Action calls “4C” students: creative artists, courageous allies, critical thinkers, and confident leaders. These transformative qualities are what drive the development of the organization’s programming as Creative Action continuously seeks ways to fully engage young people. Patrick Torres, Middle School and High School Program Director at Creative Action, explains, “For us, art is a pathway for personal development, and our mission to empower young people to become 4C students is what informs Color Squad’s impact on both individuals and communities.”
Creative Action sets itself apart by creating programs with a dual mission: to inspire youth to become 4C students while also transforming the world around them. This past summer, the organization initiated Color Squad, a project that provides aspiring young artists with opportunities to work with professional artists to install murals that renew public spaces. Youth, ages 14-20, deeply engage with the city and its history, and build important social and emotional skills as they remake neglected spaces into places of beauty, reflection, and inspiration.
“Color Squad is unique because of the way it uses the arts as a tool for both youth development and civic engagement,” notes Torres. “Not only does the program transform participants into 4C students, but it also transforms neighborhoods and communities. It shows how art can impact people and place.”
Creative Action’s teaching artists guide and mentor a team of 25 teens over the course of a semester to install murals that elevate and illuminate historically underserved neighborhoods. At the beginning of the project, teens conduct extensive research to identify neglected spaces that could benefit from beautification and place-making. Through interviews with key players in the community, as well as library and online research, the team investigates the space with an emphasis on history, community aspirations, and current challenges.
“For Color Squad, painting a mural isn’t just about creating a picture; it’s about community engagement, creating a shared space, discovering oneself and one’s city,” Torres explains. “We see in-depth research and connecting with the community as vital to the artistic process.”
Once the team has fully explored and understood the community, they design and construct a mural and a related public arts project. The project culminates with a public reception to celebrate the artwork, artists, and local community.
In May 2013, RSF Social Finance (RSF) gave a Seed Fund grant to Color Squad to provide 25 youth stipends for its first full year in operation. The intention of the Seed Fund is to support new initiatives with small, but catalytic grants. RSF received 160 applications for the 2013 cycle and Creative Action was one of eight organizations chosen to receive grant funding.
“Creative Action’s Color Squad stood out amongst other Education & the Arts applicants because of the community involvement component,” explains Ellie Lanphier, Program Associate of Philanthropic Services at RSF. “This project includes co-creation and celebration with the local neighborhood, which showed a high level of dedication and willingness to dig deeper into the true needs of their community.”
This past summer, Color Squad implemented their pilot program: creating signage for an East Austin food truck, Tony’s Jamaican Food. The Color Squad team partnered with neon artist and professional sign-maker Todd Sanders of Austin’s Roadhouse Relics. Sanders shared his professional expertise and taught the teens how to design and create their own signs. “The highly visible work has already been grabbing attention in the community,” says Torres, “and other business owners have been asking about our services.”
After the success of the pilot, Color Squad plans to implement two projects a year, engaging 30 youth each semester and providing guest lectures with 15 local artists, designers, and architects throughout the year. In the fall of 2013, they revitalized and restored the beloved “Greetings From Austin” postcard mural, an iconic landmark of South Austin. Color Squad again teamed up with Sanders, as well as the Bouldin Creek Community, to help return the mural to its original splendor.
Color Squad partnered with local artist Todd Sanders to restore the iconic ‘Greetings From Austin’ mural. Photo by Todd Sanders
Next summer, Creative Action will get to work close to home. The non-profit will be relocating their headquarters to the Chestnut neighborhood of East Austin where an innovative redevelopment project is revitalizing this underserved region. This project is a collaborative partnership between a variety of organizations from both the for-profit and non-profit sector that have united to create a place rich with opportunities and resources.
To kick off their work in the neighborhood, Color Squad will be installing a community mural on Creative Action’s new building once complete. The mural will face the Metro rail so that it can be seen and enjoyed by commuters and visitors to the Chestnut neighborhood each day. Creative Action hopes to become a solid foundation for the community’s growth as a cohesive, innovative entity that welcomes and unites people of all ages and from all walks of life.
It’s clear that Creative Action’s Color Squad is making a mark on Austin’s art culture and local community. Their strategy of using the arts as a means for youth development and community engagement and revitalization offers a unique and innovative model for others.
“What is exciting about Color Squad is how the projects allow youth to create truly impactful art that actually changes public spaces,” voices Torres. “Through this process, we hope participating youth will be empowered as they discover how visual art can be bigger than just themselves, that their ideas and their work speaks to the whole community, and that they develop a greater sense of connection and purpose in their city.”
Megan Mendenhall is Communications Assistant at RSF Social Finance
Expressive Arts Therapy: Responding to Traumatic and Emotional Experiences
February 4, 2014
This essay was originally published in the Winter 2014 RSF Quarterly.
by Denise Boston
As a society, we have come a long way in the field of mental health over the past few decades. Improving the treatment and quality of life for individuals who live with serious mental illnesses as well as people who struggle with traumatic life events such as hunger and food insecurity, violence, cultural stigmatization, and social trauma, has been at the forefront of the work of many healing practitioners and therapists all over the world. The expressive arts therapy field specifically, has given increased attention to creative and liberatory approaches to health, wellness, and trauma intervention.
Expressive Arts Therapy (EXA) integrates a range of arts modalities in the service of mental health and self-actualization. EXA therapy practitioners have a wealth of aesthetic options to draw upon—music, visual arts, dance/movement, photography, creative writing, singing, storytelling, drama, poetry, and indigenous rituals. Through the creative process, clients and/or participants have the opportunity to explore and potentially transform emotional, social, and relational issues; identify patterns of personal success; and experience new and innovative insights.
Expressive arts therapists grounded in culturally sensitive and liberation psychological approaches—ones that aim to actively understand the psychology and social structures of oppressed communities—use the arts as a means of understanding and collaborating with children, youth, families, couples, and individuals dealing with varying degrees of threats that hinder self-actualization and a path to wholeness. Expressive arts processes in counseling and group therapy have been used in a variety of settings including, but not limited to, hospice, youth residential facilities, and homeless shelters.
One particular health challenge that therapists and counselors worldwide are currently being exposed to is emotional and psychological trauma. Environmental-contextual conditions such as chronic violence, bullying, human trafficking, abject poverty, war, and post-traumatic stress disorder, have necessitated an authentic and empathic therapeutic presence and practice with victimized populations and trauma survivors. An expressive arts-based approach has been effective in the treatment and intervention of trauma recovery, because an imaginative and creative process is a doorway into self-reflective inner work and self-empowerment. The body, mind, and in some cases, spiritual experience allow participants to articulate their feelings aesthetically when words are inaccessible and inadequate. Arts approaches used in the therapeutic setting are a powerful, sacred, and evocative tool for healing. The work of the therapist in this context is to increase hope and motivation, and create enough safety that the participants can become aware of their own agency and strengths.
In my work as an EXA educator and registered drama therapist, I have facilitated workshops and training sessions in collaboration with community-based service providers on the concept of arts, healing, and social consciousness. For more than a decade, my programmatic and research interests have been in the area of African American community mental health. African Americans are often at a socioeconomic disadvantage in terms of accessing mental health care and culturally sensitive counseling. Much of my work has been conducted collaboratively with community organizations and schools, and is aimed at promoting positive youth development by increasing cultural values and presenting an expressive arts caring approach for traumatized children and adolescents of African descent. The cultural-based research in the African American community has incorporated the use of drama, storytelling, dance, spoken word, and drumming to redress the disparities defined by historical trauma and the systematic loss of culture and self-identity. The data gathered through these projects have provided an important glimpse into the vulnerable and alienated voices of young people and the outcomes has indicated the positive and healing effects of expressing one’s truth.
A memorable moment, which demonstrates the power of arts-based intervention, is an experience I had with an 18-year-old African American man by the name of Kevin (not his real name), who had been trapped in the criminal justice system most of his life. He participated in an expressive arts workshop that I facilitated for males living in a residential group home in Arlington, VA. As they entered the arts room, the young men were welcomed to the setting with the music of Tupac Shakur, a famous rap artist at that time, as well large pieces of paper and an assortment of colorful art materials. I instructed the group to allow the lyrics and the rhythm of the music to inspire them to create a collage that represented their stories, thoughts, and dreams. At first, Kevin was reticent and skeptical of this unfamiliar situation and stood with his arms folded, disconnected from the group. I did not intercede, but kept an eye on him as I moved around the room checking on the progress of the other teens. He stood for a while listening to the music, and then something moved him. He picked up the large oil pastels and immersed himself in the creative process. Once he completed one collage he approached me and asked if he could do another. In the two and a half hour session, he had the opportunity to channel his anger, trauma, and loss into two powerful, provocative works that represented his story. At the conclusion of the session, Kevin rolled up his work and left the room a different person than who he was when he walked in. I stopped Kevin on his way out and shared with him how moved I was by his work. I wanted him to know “I see you”. We both shared a special transitional moment—never to see each other again. It is moments such as this that demonstrates the transformative and healing potential of the arts.
As a little girl growing up in Baltimore, MD, I loved using dance, music, reading, and dramatic play to express myself. At the age of twelve, I was diagnosed with juvenile rheumatoid arthritis. Bedridden with my knees filled with fluid, swollen, and painful to touch, I spent months in the hospital unable to be the energetic and vibrant child I was known to be. What I owe my recovery to was a supportive family and community, and my creative resources. I used movement and dance as my physical therapy to strengthen my inflamed limbs; and music to heal the sad places deep inside. It was from this traumatic childhood experience that I found my calling and a path to the creative exploratory process. I uncovered something profound within my spirit and my quest for optimal health and wellness, strengthened my love and compassion for others dealing with various aspects of pain and suffering.
I am appreciative of my arts-based practice and journey and will continue to use the arts with people who live within intersectional situations; race, gender, class and sexuality. This year, I have been invited to go back to my birthplace and to Washington, DC to promote the healing arts and provide training to mental health professionals working with children and families in traumatized environments. It is inspiring to connect with local people and plant the seeds of the arts in their promising communities and to imagine a thriving untraumatized world together.
Denise Boston, PhD, is an Associate Professor in the Expressive Arts Therapy Program at the California Institute of Integral Studies (CIIS). Dr. Boston was an actor and served as a director and drama teacher prior to her career as a psychology educator. Her arts-based teaching experience spans working with children, youth, families, and individuals in marginalized communities as well as at cultural centers such as the Kennedy Center, Baltimore School for the Arts, and Arena Stage-Living Stage Theatre Company. Dr. Boston received her BFA in Drama from the University of North Carolina School of the Arts, a MA in Counseling and Psychology from Goddard College, and a PhD in Counseling Psychology from Walden University. CIIS is an RSF borrower.
Creatively Financing the Arts
January 30, 2014
This essay was originally published in the Winter 2014 RSF Quarterly.
By Reed Mayfield
Can you recall a moment when a song, a painting, a dance, or a theatrical performance moved you deeply? If you can, perhaps the experience caused you to gain a new or different emotional awareness. The arts have a unique ability to transcend age, socio-economic status, geographic location, and ranges of personal experience. The arts can simultaneously facilitate an artist to produce their work and a patron to enjoy the experience, piece, or production; the arts can also create economic value. Art promotes creativity, expression, identity, innovation, and aesthetics. These things are what we typically associate with the arts. What is less understood, however, is the multidisciplinary impact the arts have on social development, learning, and the economy. These three aspects are at the heart of what RSF focuses on through its lending activity to arts organizations, and they are the indicators of RSF’s values—the arts can serve the highest intentions of the human spirit.
Art takes many forms, and there are many types of organizations that foster the arts through their programs and services. RSF is committed to supporting arts organizations that promote creativity, spiritual awareness, and provide community to people of all backgrounds. Specifically, we fund organizations that contract directly with schools or community-based organizations; provide support systems for artists, or arts organizations; and facilitate the economic prosperity of the arts.
Non-profit arts organizations face several challenges to reaching financial sustainability. In particular, these organizations have historically relied heavily on foundation and individual giving. According to a 2012 report from The Stanford Center on Poverty and Inequality, the recent recession contributed to a 10.9 percent drop in individual giving between 2007 and 2010. Another financial issue art organizations face is the reimbursable grant format: an organization must incur the expenses related to the programming before a grant is awarded. This form of grantmaking can cause strain on the cash flow of an organization, and make it hard to meet overhead responsibilities, let alone budget for program growth. Arts organizations also tend to have untraditional assets such as contracts, incoming grants, or pledges, which may limit access to credit for growth or operations.
With a strong history of supporting the arts and an understanding of how non-profits work, RSF is uniquely poised to address these financial challenges. In particular, RSF is able to provide critical financing for working capital, facilities renovations, construction projects, or acquisition of space—financing that arts organizations often could not receive from conventional lending institutions. RSF is able to do so by employing innovative financing structures. For example, for working capital needs, RSF is able to offer a Grants Receivable Line of Credit. This entails looking at a forward rolling year of confirmed grants and making funds available based on this total. This gives an organization access to capital when their cash flow may otherwise be strained by inconsistent funding and reimbursable grants. In other cases, some financing needs are addressed by Pledge or Guarantee Loans where the organization’s community participates by providing the assets necessary to secure a loan. This creates a strong financial relationship that involves organizational leadership, beneficiaries or customers, and donors.
As of late, RSF has reinvigorated its historical focus on the arts. Given the state of our culture, the arts and access to them are more important than ever. At RSF, we believe the social value created through the growth of the arts has deep, long-term positive impact in the world. We invite you to join the conversation and share your insights into the arts and how we can create the systems necessary to support their financial and creative sustainability.
Reed Mayfield is Senior Lending Associate at RSF Social Finance
Heart’s Guidance: An Economic Imagination, Part II
January 21, 2014
Click here for Part I
by John Bloom
As an organ, the human heart plays leading role in maintaining human life forces. And, it works in a fully integrated system. It is an arbiter between the intense circulatory exchange in the fine capillaries at the extremities and need for constant vortical movement as the blood moves through the heart’s chambers. Blood, exhausted after delivering its nutrients along the way to the periphery, returns to the heart-lung center to be revitalized—a systolic, diastolic rhythm of constant exchange. There is no part of the human organism that is not permeated through circulation, and just about any stoppage in that circulation has significant health consequences. I am certainly not the first to use the circulation of blood as simile for the circulation of money. This is an illuminating but partial picture. Circulation is meaningless without the management capacities of the heart, its sensitivity to our inner and outer-facing nerve-sense system, and the forces of our metabolic system. Simply put, the heart embodies interdependence, serves as guide and guardian, harmonizer for human life, and thus supports our capacities to think and act. This complete and unalterable interdependence has much to tell us about economic life.
How the heart models service is in stark contrast to dominance of self-interest, a concept intractably nestled in the modern evolution of economic thinking. Self-interest as currently fostered and practiced has become debased from the moral, and I would say religious, framework that says that it is in your self-interest to be interested in and help others. As economic experience has become ever-more embedded in the materialism and consumerism of the marketplace, interest in the other has converted into competitive fear of the other. Money is the measure of man; thus, I am better the more I can extract from the system for myself. This is a powerfully destructive thought.
It is fascinating to me to consider that the heart is naturally moral. It does not deny one part of the body over another unless it needs to allocate healing resources for an interim period. It does not judge, it simply recognizes need and responds. It seeks sufficiency, and its actions are all guided by the impulse to restore balance—all for the purposes of circulation and meeting the needs of the whole throughout a very diverse organic system. Many natural systems are like this. Nature is moral, but somehow we have allowed the anti-social power of money to corrupt this moral element in human nature. It doesn’t feel right. Just as self-interest gives the lie to how truly interdependent we are, money supports the illusion of independence and serves as a measure of fittest in the Darwinian notion of survival. If the money was won through competition, what was lost along the way? These are not propositions of the heart. They are propositions of the head; rationalizations for historical patterns, and cynically, justifications for essentially immoral behavior in the financial marketplace. The heart does not speculate, it anticipates and regulates, not as an exercise in control, but rather in service to the whole.
So what is capital, and how does it serve in the heart imagination? One could say that capital is the materialization of spirit, spirit brought into matter through economic activity. This may seem a stretch, but consider the following. Economic life evolves from the work it takes to transform natural resources into practical goods. Of course, the transformation is not magical, rather it is often hard won through trial and error, through the application of physical and mental creative powers. The invention and evolution of the plow, or any machine for that matter, demonstrates the additive, transformative power of applied consciousness across generations and geography. A second development is how these powers are harnessed and organized for efficiency and production through the further application of intelligence. This applied intelligence in combination with the production of goods and services is what gives rise to capital.* Capital is to the economic realm what intelligence is to the individual. Since intelligence is not material, that is, it has no physical substance, it is by its nature non-objective. Its value appears as practical activity in the world. Capital is spiritual, while its value, its measure, derives from its application at a specific time and place.
The role of capital in the heart economy is like that of oxygen to the human heart. Oxygen is carried through the blood even as that stream is also collecting the carbon dioxide waste, which it returns to the world through breath. This self-regenerative system is the key to the imagination of a heart-centered economy.
I offer this imagination as a starting point for changing how we think about and live our economic life through our daily transactions. Can we see that we are part of a great circulation? Can we see that we are part of both the destruction and regeneration of natural systems, and that in our economic world we are never separate from each other, from wealth or poverty of resources, even though we have been conditioned to think that way? If, in our own body system, we were to establish “political” boundaries and protect them as we do, we would die an instant death. Boundaries are important, just as cell membranes are important. They are permeable; they protect, and contain, but in the end it is the circulation that is the most vital. And it is the workings of human heart, the servant of the circulatory system that demonstrates the wisdom we need to transform money, the financial system, and economic life. Not only by, but also from the heart we can learn how the world can support our lives as we work consciously to support others’.
* This essay is inspired by Rudolf Steiner’s insights into economics. In his 1922 lecture cycle, now published under the title Rethinking Economics: Lectures and Seminars on World Economics, he goes into great depth on how these two essential capacities, labor and intelligence, create value.
John Bloom is Senior Director of Organizational Culture at RSF Social Finance.
Cultivating a Local Food System for Kansas City
January 17, 2014
by Meredith Storton
Kansas City, Kansas, like many urban areas in the United States, has its share of food deserts – low-income neighborhoods devoid of fresh, healthy foods; it also has its share of vacant land. Cultivate Kansas City, a local non-profit, is changing the landscape and engaging the entire community with a healthy, environmentally-sustainable venture: urban farming.
Founded in 2005, Cultivate Kansas City promotes urban farming as a way to build a healthy local food system. Along the way they have become advocates, educators, and activists supporting the production of organic, nutritious produce on the ground and in the policy space. One population that Cultivate is introducing to urban farming is the Kansas City refugee community. Responding to a demand for more community garden space for low-income refugee families, Cultivate partnered with Catholic Charities of Northeast Kansas and three refugee organizations to begin the Juniper Gardens Training Farm and the New Roots for Refugees program. Since the program began in 2010, two gardens have been established: the Bhutanese Community Garden and the Somali Bantu Foundation garden. A third will be established in 2014.
For each of these gardens, Cultivate provides the gardeners with training, basic seeds, and supplies. The gardeners receive their training at the Juniper Gardens Training Farm, an eight-acre plot of land adjacent to a public housing site where many of the refugee families live, making the location both accessible and convenient. Once these gardens are fully developed, they will help up to 600 individuals living in poverty grow food for themselves and for sale at farmer’s markets. Further, these gardens allow refugees from Bhutan, Somalia, Burma, and elsewhere to grow vegetables from their home countries, like blue Burmese pumpkins, African corn, bitter melon, Hmong red cucumber, and more.
RSF was able to provide Cultivate Kansas City with a $3,000 grant through the Seed Fund to support their work establishing the second of these gardens for the Somali Bantu community. The Somali Bantu live in northeastern Kansas City where one grocery store serves a six-mile radius and one-third of the families earn less than $10,000 annually (ISED Solutions, Apr. 2010). In Somalia, the main occupation for Bantu people is farming, so urban farming seems to be an ideal way to help them assimilate into their new home while providing them with access to fresh, healthy produce.
The nearly one-acre plot of land that will be used for this garden was donated by the Somali Bantu Foundation of Kansas, an organization dedicated to the resettlement and integration of Somali Bantu refugees. Upon first glance, the land did not appear ideal for farming; it was heavily sloped and filled with weeds and construction debris. Urban farmers make do with what’s available, though, and Cultivate Kansas City and Somali Bantu Foundation volunteers cleared the land, formed terraces, composted the soil, and planted cover crops. As a result of their efforts, a little over a half-acre is now ready for planting.
Juniper Gardens Training Farm
Before the growing season begins, Cultivate Kansas City will help install two cisterns for the garden which will help them plan for water costs ahead of time (instead of connecting to the city water system directly). The plan is to plant the first vegetables in the spring, and the first harvest will be ready for enjoyment and sale at local farmers markets in the summer. To get their new gardeners ready, Cultivate Kansas City will offer workshops covering basic gardening, soil management, and planting for the region and season. They will also work with the gardeners to order seeds and supplies. The garden’s benefits will reach beyond the gardeners to their neighbors and families who will have access to fresh, healthy, culturally-appropriate, and affordable produce.
Cultivate Kansas City is doing some ground-breaking work –they’ve helped start more than 40 farms and have provided thousands of hours of technical assistance to hundreds each year. But there’s still more to be done. As their Executive Director Katherine Kelly said, “there is food to be grown and money to be made and empty lots to be turned into assets rather than blight!” Cultivate Kansas City wants to grow a movement of people who know that they can reclaim the food system and their communities, and who know there is joy and power in the process. It seems they are off to a great start.
We’re now accepting applications for 2014 Seed Fund grantees! Learn more here
Meredith Storton is Client Development Associate at RSF Social Finance
Heart’s Guidance: An Economic Imagination, Part I
January 16, 2014
by John Bloom
The mind thinks it loves; the heart loves before the thought.
In our current stage of materialist economy, we are entranced with capital and disconnected from our hearts. This discord is a result of the inherent nature of capital, so centered as it is in the head, as the origin of the word indicates. In the visible world discord looks like a widening gap between wealth and poverty, and in the inner world like a disintegration of beliefs, values, and behavioral decisions. Make no mistake, we need capital in one form or another, and we need those who work with capital to be in the world in a way that values each human being and supports the regeneration of nature. This inner integrity might then begin to heal social and ecological wounds.
So, how might the imagination of economic life change from where we currently are— dependence on growth that is heading toward the demise of nature and increased suffering—to one that is instead life affirming and regenerative? The purpose of this essay is to focus on a guiding framework for systemic change. Real change never happens without a guiding imagination.
Let’s start with the basics. As I remember, the things that I needed to know or commit to memory, I learned by heart—a poem, a lifeline phone number, a lover’s birthday. I suspect this is true for others as well, though ever-present reference technology has helped us grow lazy about such matters. Long before textbooks, encyclopedias, and wikipedias, the heart is what we had by way of stored knowledge, even while it was the head’s task to process that knowledge. Thus, consciousness has been as much if not more a product of the heart than of the head, though modern industrial culture has come to prize intellect over character. We have learned how to perceive and transform nature, while also learning from each other in order to survive as individuals and in communities.
As we evolved, our relationships were practical as well as spiritual; that is to say that trust catalyzed community action, whether the trust was a result of blood connection or common cause. Each individual discovers and develops her or his own capacities or gifts. And, it is when those capacities begin to serve both self and others that the glimmerings of economic life emerge. Fast forward and you get the industrialized version of economic efficiencies in the division of labor. When I am contributing my capacities and in return receiving what I need back from the community, I feel engaged, recognized, and valued—supported both materially and through a sense of fulfillment. While this is a somewhat simplistic framing, I believe this feeling is one desired not only by me, but also by a significant number of individuals open to reflecting on the nature of vocation and economic life.
What I am describing is a heart-centered economy, one motivated by continuous circulation, connection, caring, and cognizant of each person’s dignity and destiny. And most important, an economy in which the rediscovery of trust becomes the vital element supporting the circulation and regeneration of resources as common, co-produced wealth, including but certainly not limited to money. After all, money emerged primarily as an economic convenience, as a portable way to store value. By agreement its value was established through the exchange of goods and services. It was a means. But, as money has become more a valued commodity in and of itself, it has been disconnected from its purpose of accounting for economic flow, disconnected from real needs and human activity. In this sense, the more money is valued as an accumulated object attached to an individual, the more anti-social it becomes. In contrast, economics is deeply social as we are fully dependent upon one another’s capacities to meet our material needs.
Click here for Part II
John Bloom is Senior Director of Organizational Culture at RSF Social Finance.
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RSF Seed Fund grantee, Sustainable Economies Law Center (SELC), works precisely at this intersection. SELC provides essential legal tools – education, research, advice, and advocacy – to support a transition to local, resilient economies. It focuses in many areas, including cooperatives, community-owned enterprises, co-housing, urban agriculture, barter, and local currencies.
One of the most promising candidates was the South Central Farmers’ Cooperative (SCF), a worker-owned farm in California’s Central Valley. The coop grew around South Central Farm, a former fourteen-acre urban farm in South Central Los Angeles. After ten years of cultivating the land and building the community around it, the farmers were evicted in 2004 when the plot was slated for development. This eviction led to significant protests and civil disobedience, as well as an Academy Award nominated documentary, The Garden.
