Mark your calendars for this year’s “Big Green Conference” on November 10th. The conference in Bloomington, MN will feature industry experts from both private and public sectors with expertise in public policy, corporate sustainability, and urban development. University of St. Thomas real estate professor Dr. Tom Musil will present a session entitled “Community Benefits Agreements Shaping the Future of Real Estate and Economic Development.” This is an important topic for anyone in the development business to be familiar with, as CBA’s are becoming more common in both large and small scale development.
What are Community Benefits Agreements? Dr. Musil explains CBA’s and his research.
Community Benefit Agreements (CBAs) are one of the most powerful tools that community groups have to shape real estate and economic development projects. CBAs have been used in large, highly subsidized urban real estate and economic development projects including Los Angeles International (LAX) Airport, the Staples Center, and Yankee Stadium, and the use of CBAs will likely expand to smaller-scale development projects in the future. This paper presents a comprehensive review of CBA advocacy groups, enforcement, and land use regulatory issues and a survey on the nature and composition of community stakeholders negotiating CBAs with real estate developers in the U.S. It presents the first survey research investigating CBAs.
The development of CBAs has slowly occurred over the last thirteen years with the support of foundations, labor unions, and CBA coalition advocacy groups. CBAs establish a process for developers to include community objectives as part of a development. They are legally binding contracts between developers and CBA coalitions. Once the CBAs are negotiated, developers then approach the issues of regulatory applications, reviews, and approvals. The CBA process is generally simple. A developer enters into a private contract, usually with a coalition of community, faith-based, or special interest groups in exchange for their support, cooperation, or forbearance regarding the proposed development. CBAs are generally negotiated with the assistance of a national or regional advocacy group(s) knowledgeable about real estate development, law, organizing, community needs, and the CBA process. In some cases, CBAs are incorporated into development agreements between the local units of government and the developers. CBAs can require any of several developer actions, from the use of local contractors to the monitoring of long-term community objectives outlined in the CBAs.
With a CBA in place, the developer can usually accelerate the entitlement process and obtain public subsidies, zoning changes, and use variances.