Closing the Racial Wealth Gap in Seattle: Workshop Shares Strategies and Successes

Shiho Fuyuki of People’s Economy Lab speaks to workshop participants. Photo credit: Original Studios and People's Economy Lab.

Pearl has worked in real estate for a long time. But even so, when he recently purchased his first home, “it was hard.” He felt priced out of Seattle and ended up buying in Tacoma. It’s one of the reasons he’s excited about working on a unique new home ownership program called U-LEX @ Othello Square in Seattle. This is a pilot of a model that’s new in the Northwest but “big on the East Coast.” Pearl, who works in real estate development for HomeSight Washington, said he was drawn to this project because he wanted to be “an advocate for others and an advocate for myself.”

Pearl was one of many people sharing their stories about community wealth building at “Unlocking Community Wealth: A Workshop with The Democracy Collaborative and People's Economy Lab,” Tuesday, March 12, at Centilia Cultural Center in Seattle. About 100 people attended the workshop, which was intended as a space to create a shared language and frame about community wealth building, share local examples, and build connections while bringing together diverse stakeholders.

Pearl Nelson describes his work on U-LEX @ Othello Square. Photo credit: Original Studios and People's Economy Lab

The COO Learning Community co-sponsored the workshop, along with the City of Seattle’s Department of Neighborhoods and Office of Economic Development, Sonen Capital, LNW, and Humanize Wealth.  People’s Economy Lab has previously been a funded partner of ours because their work aligns with our results areas.

Why we need community wealth building

Owning your home or the building where you do business is a major source of generating wealth for people in the United States. But not everyone has been able to build wealth this way. Across the United States and in our region, racist policies about housing and home ownership enabled widespread discrimination and a racial wealth divide. These policies include redlining and racially restrictive deeds and covenants, which barred communities of color and Jewish people from owning homes in large swaths of our region.

A 2023 study for King County, by ECONorthwest, estimated that the lost wealth for the average Black household ranges from $105,000 to $306,000, the Seattle Times reported. Not only did Black households lose wealth, the gap in the rate of home ownership among Black and white households has widened over the past 50 years.

“Community wealth building is an economic development model that transforms local economies by giving communities direct ownership and control of their productive assets.”
— The Democracy Collaborative

Government played a part in those wealth gaps, and now government is trying to undo some of those gaps. The City of Seattle partnered with People’s Economy Lab and Headwater People in 2022 to understand how the City could address the racial wealth gap. The Generational Wealth Initiative work “was sparked by the 2020 protests that followed the murder of George Floyd and is deeply rooted in the movement for racial justice.” Investments in generational wealth, the City says, “grow assets that people are able to transfer between generations.”

As part of the initiative, the Department of Neighborhoods convened a BIPOC Generational Wealth Initiative Community Roundtable to help guide the work. Two of our COO Governance Group members, Bilan Aden and Yordanos Teferi, served on that roundtable of 15 community leaders. The group concluded that “a generational wealth building framework wasn’t sufficient. Instead, the project, and ultimately the City of Seattle, should use a community wealth building framework.”

The Generational Wealth Initiative's 2024 Equitable Economy and Community Wealth Building Report describes how the City is taking action, through participatory research, direct investments, internal systems change, and more.

A person with dark hair wearing a white jacket holds a microphone at a podium. Behind is a slide on a screen that says Unlocking Community Wealth: A Workshop with The Democracy Collaborative and People's Economy Lab

Shiho Fuyuki from People’s Economy Lab introduces the day’s events. Photo credit: Original Studios and People’s Economy Lab.

A person at a podium holding a mike looks toward a screen with a slide. The slide is titled "The Vision" and has an illustration that says "Washington State Just Transition Strategy Summit, People's Economy Lab, 2021, Front and Centered."

Njuguna Gishuru from People’s Economy Lab describes the background of their work in Seattle. Photo credit: Original Studios and People’s Economy Lab.

During the Community Wealth Building workshop, we heard about examples of initiatives from the City and around the world. People’s Economy Lab staff Shiho Fuyuki and Njuguna Gishuru described the background of this work locally; Democracy Collaborative’s Sarah McKinley talked about the movement globally; and representatives of other projects pointed to regional examples of community wealth building. They include collective ownership models like broad-based worker ownership, access to affordable capital and community-controlled capital, community ownership of real estate, progressive procurement, equitable small business ecosystems, and wealth retention and asset-building programs.

connecting concepts to action

A person with dark hair and glasses, wearing a purple top and a name badge that says Tammy, holds a mike at a podium.

Seattle City Councilmember Tammy Morales greets participants. Photo credit: Original Studios and People’s Economy Lab.

Seattle City Councilmember Tammy Morales, who represents District 3, greeted participants. She talked about what she described as her office’s three principles – to repair harm, democratize power, and plan for the seventh generation. In her first term (2019-2023), Councilmember Morales worked with the People’s Economy Lab team to help develop the community wealth building project.

She invited everyone to participate in finalizing the City’s draft Comprehensive Plan, also called the One Seattle plan. This is a once-a-decade vision for how the city will change and grow. People can give their input by attending open houses around the city and using the online Engagement Hub.

Morales noted that the El Centro de la Raza development where the workshop met is “a perfect example of mixed-use development.” It includes affordable housing, childcare, a credit union, community meeting space, restaurants and more, all on one site right next to the Beacon Hill light rail station.

A person in a blue headwrap and black-and-white garment is standing to make a comment, in a room of people who are seated at tables.

Ubax Gardheere of Cultural Space Agency shares insights. Photo credit: Original Studios and People’s Economy Lab.

The City of Seattle has been working with People’s Economy Lab on nine pilot community wealth building projects, investing $1.3 million over two years. Their just-released new report describes the partnership and the projects.

To establish shared language and frame for the day, Sarah McKinley from The Democracy Collaborative grounded participants in the basics of community wealth building. She called it a way to transform local economies, where communities have direct ownership and control. It challenges failing approaches that have been widely accepted for too long, she said.

She described the rich history of this approach. Although the term is fairly new, it has roots in community organizing, the civil rights movement, labor rights, and other movements. “Community Wealth Building is action oriented to deliver,” she said.

Noting the vast disparities in wealth in a country where three men own as much as 49% of the entire population, Sarah described the racial wealth gap as even worse. Community wealth building is intended to help close that gap, and drive a wedge into the traditional model of an extractive economy. She walked us through five key concepts:

  1. Economics of place – commercial, social (nonprofits, care work, labor between us), and public (government). While the commercial economy commercial gets most of the attention, she said the public economy is half of our activity. “We need a robust social economy of place for other sectors to thrive,” she said. “They all need to be in balance.”

  2. Money flows – How the economy flows gets rooted in place instead of trickling. We need to undo this.

  3. Multipliers, or the impact of funding, where it goes, and to whom. For example, when you buy from a small local business, you’re contributing to the local economy and the people working in it, instead of spending money on products from large corporations and “buying a CEO a vacation home.”

  4. Assets and wealth ownership. There’s been a massive drop since 1970 in income as a source of wealth, McKinley said. Wealth now is land, financial, and capital, and we need to re-define it.

  5. Pre- and re-distribution. It’s not enough to tax the wealthy, Sarah said; we need to make sure that huge wealth inequities don’t happen in the first place.

A person with dark hair and glasses, wearing a red jacket over a black dress, gestures toward a screen.

Sarah McKinley describes community wealth building fundamentals. Photo credit: Original Studios and People’s Economy Lab.

At midday, even the lunch break exemplified community wealth building in action. José Manuel Vasquez introduced the three caterers connected to this work. José is piloting the small business incubator program through his new company, Growing Contigo, in partnership with Villa Comunitaria. It’s part of the Generational Wealth Initiative. The three businesses are:

  • CheBogz, a Beacon Hill restaurant that is part of the City of Seattle’s tenant improvement fund work;

  • El Mixtecos, whose staff member Noemi Tungüi is a graduate of José’s small business incubator;

  • Healthy Creations + Plant-based Food Share, whose chef, Ariel Bangs, is an inaugural member of People's Economy Lab New Economy WA Fellowship program. This fellowship was a partnership with Front and Centered and funded by Communities of Opportunity.

In the afternoon session, Sarah expanded into the five Community Wealth Building pillars of direct intervention into local economies:

  • Inclusive and democratic enterprise. Cities should have multiple forms of worker and consumer cooperatives, social enterprises, public ownership, municipal enterprise, and more, based on the recognition that the ownership of productive capital is at the heart of where power lies in any political-economic system.

  • Locally rooted finance. Cities and local institutions should redirect money in service of the real economy through public and community banks, credit unions, targeted public pension investments.

  • Fair work. Every worker must receive a living wage and real power in and control of their workplace for decent work and conditions, and advancing trade union rights.

  • Just use of land and property. Cities should mobilize land and property assets to build real wealth in communities, bring local land and real estate development back under community control, and combat speculation and displacement.

  • Progressive procurement. Local governments and place-based “anchor institutions” should lead with procurement practices that re-localize economic activity, build local multipliers and end leakage and financial extraction.

Local case studies demonstrate community wealth building

Jackie Mena and Heidi Hall of the City of Seattle introduce local case studies. Photo credit: Original Studios and People’s Economy Lab.

Speakers from the City of Seattle and community organizations talked about some of the community wealth building initiatives in Seattle.

  • Ubax Gardheere shared the success of Cultural Space Agency, a cultural real estate development company chartered by the City of Seattle that develops long-term affordable cultural commercial space. Ubax, their director of fund development, is also a formerly a leader of Seattle’s Equitable Development Initiative and was a member of the COO governance group from 2017-2020.

  • Heidi Hall, City’s Office of Economic Development, and Jackie Mena, Department of Neighborhoods, introduced other Seattle examples.

  • A panel featured Agraj Dangal, from Seattle’s Office of Economic Development; Pearl Nelson, from HomeSight Washington; and Gavin Ramos, from Central Area Collaborative. As mentioned, Pearl is working on the U-LEX @ Othello Square development, an affordable co-op home ownership project that is a new concept for the Northwest. Gavin’s organization helps small businesses get financing and build credit. Agraj, at the City, consults with small businesses to help them understand how to get access to capital, and supports a cohort where members learn from each other.

     

Two people sit on chairs on a stage. One wears a cap that says "Avole," a denim jacket and dark pants. The other holds a mike and wears a flap cap and glasses, with a checked shirt and dark sweater with khaki pants.

Gavin Ramos and Agraj Dangal talk about how their programs help small businesses. Photo credit: Original Studios and People’s Economy Lab.

Sarah closed the discussion with some national/global examples that Democracy Collaborative has played a key role in.

  • Cleveland’s Evergreen Cooperatives, which works to develop employee-owned businesses. One success story is an organization that won a long-term contract to provide laundry services to large institutions, interrupting the tradition of these institutions contracting with large corporations who sent the work out of state.

  • City of Chicago’s Wealth Building pilot, which used $15 million from the American Rescue Plan to initiate its project.

  • Scotland’s national approach to community wealthy building. The government has adopted CWB policies to build wealth and prosperity for everyone.

 

Taking Action on Community Wealth Building

If you’re intrigued by these possibilities, here are some next steps you can take.

 

Are you a funded partner of COO who would like to learn more about community wealth building? Contact us at info@coopartnerships.org.

All photos by Tawfik Abdulaziz at Original Studios.

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