How the U.S. Government Can Better Promote “Anchor” Institutions

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New report proposes ways that the federal government can help encourage anchor institutions to revitalize communities.

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Factories are closing. Businesses are moving. Jobs are being sent overseas. In the wake of the Great Recession, claims like these have regularly appeared in the media. With fewer businesses firmly rooted in their communities, local government officials and community groups wonder how they can better foster economic development and civic engagement in their hometowns.

In a recent report issued by the Center for American Progress, Tracey Ross argues that another set of institutions—such as “colleges, universities, and hospitals”—can serve as social and economic hubs, or “anchors,” in the communities where they are located. In the report, entitled “Eds, Meds, and the Feds,” Ross claims that while these “anchor” institutions are no “silver bullet for addressing the socioeconomic challenges” facing communities, the federal government can better partner with these institutions to promote development from within communities themselves.

Anchor institutions are organizations that have a “large stake and an important presence” in their communities. Not only do they serve as resource centers and job generators, but they are also unlikely to relocate. Universities, hospitals, sports stadiums, airports, and a host of other institutions fit the description.

Examples abound of efforts to strengthen anchor institutions. The developer of the Kingsbridge Armory, a large mixed-use complex in the Bronx, signed a community benefits agreement and committed to a local hiring and living wage policy. The mayor of Baltimore, Stephanie Rawlings-Blake, recently announced a strategic action plan to engage the city’s anchor institutions. The Roosevelt Institute Campus Network, a student-run policy organization, launched an initiative that capitalizes on its student membership to examine the role universities can play in local communities.

Ross argues that as projects like these gain momentum, the federal government can help ensure their success. Her report outlines the various roles anchor institutions can play in a community, tools for weighing the extent of an anchor’s commitment, and metrics for measuring the impact of anchor-community partnerships. Additionally, she identifies a number of current federal initiatives that can better spur anchor-community partnerships.

Along these lines, Ross argues that the U.S. Department of Housing and Urban Development’s (HUD) Office for University Partnerships (OUP) should be rebuilt. The OUP was established in 1994 with the mission to “encourage and expand the growing number of partnerships formed between colleges and universities and their communities.” However, according to Ross, many of the OUP’s grant programs have “been unfunded for years.” Ross contends that the OUP can encourage university-community partnerships and play a critical role in developing tools to measure anchor performance.

One example of such a tool, Ross says, is the Democracy Collaborative’s Anchor Dashboard. The Anchor Dashboard provides a number of indicators that policymakers can use to assess anchor institution efforts and impacts in a community. For example, it can enable the OUP to evaluate how anchor institutions invest in community land trusts and what impact those investments have on poverty in the area. With that information, the OUP can help universities contribute to HUD’s housing goals by providing resources and assistance. Directing resources to anchor institutions is particularly important given that university real estate development can either help or hinder a community.

Ross also asserts that the U.S. Department of Education (DOE) should provide better guidance for colleges and universities that use federal work-study funds. Institutions “must use at least 7 percent” of their work-study funds “to support students working in community service jobs.” Yet some universities have a difficult time meeting this requirement despite high levels of community service among college students. DOE guidance, Ross claims, may help a college or university “better align the community service requirement with its overall mission,” such as by promoting service-learning programs and local nonprofit partnerships.

Higher education institutions can also help local small businesses by partnering with them for business and mentoring. Currently, universities planning on using federal funds on research must “maintain competitive bidding-purchasing systems to drive down the cost of goods and services.” However, Ross argues that these systems can discourage institutions from weighing the benefits of community impact. To counteract this incentive, Ross asserts that the U.S. Small Business Administration should provide grants to small-business intermediaries who can help connect small businesses with anchor-institution clients in order to encourage relationships between small businesses and anchors.

For hospitals, Ross contends that community health needs assessments required under the Affordable Care Act offer new opportunities for nonprofit hospitals to engage with community health issues. However, some hospitals conduct these assessments without collaborating with the local community. Currently, the Internal Revenue Service reviews these assessments to ensure hospitals’ tax-exempt, nonprofit status. Ross argues that the U.S. Department of Health and Human Services should also examine these reports “to ensure that a deeper understanding of the potential health effects is achieved,” thereby holding hospitals to higher standards in their communities.

The need to rethink government relationships with anchor institutions is vital, Ross claims, given the role these institutions can play in their communities. “As the federal government continues to be a major investor in the work of these institutions,” Ross concludes, “it is important for federal leaders…to ensure anchor institutions work with public, private, nonprofit, and philanthropic leaders to revitalize communities.”