GroundBreak, a coalition of over 40 corporate, civic, and philanthropic organisations in the US fighting for racial equity and climate based justice, has announced $926.75 million in financial commitments to expand wealth building opportunities for the most disadvantaged and marginalised groups in Minnesota.
Over the next decade, GroundBreak says it aims to expand access to capital to close racial wealth gaps in the region, with a focus on building Black wealth in the Minneapolis-St Paul region. Through what is calls “deep collaboration across philanthropic, private, and public institutions” in its October progress report, GroundBreak says it seeks to reach 11,000 new homeowners, 5,000 entrepreneurs creating 8,000 jobs, 60 neighbourhood commercial developments, and 23,500 units of affordable housing.
Minneapolis-St Paul residents face some of the region’s widest disparities in wealth and opportunity. Minneapolis is where protests over the killing of George Floyd by US police first started in 2020, inspiring a global Black Lives Matter movement.
According to the Census Bureau and state government statistics, African-Americans experience poverty four times greater than their white counterparts in Minnesota and are over three times more likely to be unemployed.
The racial equity and climate focused coalition says a new financial system for regional institutions could “enable a large amount of capital to intentionally flow toward financial tools and products for aspiring homeowners, entrepreneurs, and commercial developers.”
This includes a combination of grants and guarantees on low-cost loans, alongside a willingness from financial and banking institutions to unlock “flexible capital”.
Flexible Capital refers to financial resources typically provided at a lower interest rate and more favourable terms and conditions, often offered by philanthropic institutions.
Shafi Musaddique is a news editor at Alliance magazine.
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