Community Benefits Agreements Ordinance Introduced, Other Council Meeting Highlights (3/6/23)

Mar 06, 2023

Cleveland (March 6, 2023) - Council introduced two pieces of legislation that will change how developers and builders operate in Cleveland.

Community Benefits Agreements: The ordinance would establish a floor for what benefits developers provide for Cleveland – apprenticeship, internship and mentor-protégé programs, community meetings, neighborhood improvements, minority business enterprise, female business enterprise, Cleveland area small business, and resident hiring goals - when they seek city financial assistance through:

• Loans or grants
• Land transfers at below market value
• Development-associated capital infrastructure improvements
• Residential multi-family tax abatements and tax increment financing (TIF)

Establishing a “legally enforceable agreement” is important for several reasons. First, providing financial support from the city for development projects should elicit tangible benefits to Cleveland residents’ and neighborhoods. Second, front-loading negotiations with developers on community benefits, and including neighborhood residents early in the process, builds community support and strengthens local partnerships.

CBA’s will start when the city’s assistance is at least $250,000. Starting at this level all projects will be required to establish a plan to meet minority business enterprise, female business enterprise and Cleveland area small business goals, as well as resident and low-income resident employment goals.

For large development projects over $20 million, developers will work from a “menu” of additional community benefits they can provide or establish, as well as provide other benefits based on community input. “What’s enough” will be determined by the department director in consultation with the developer by using a scorecard evaluation, and Cleveland Citywide Development Corporation recommendations informed by the community and departments.

This ordinance will improve workforce and community benefits data reporting and transparency by directing the Office of Equal Opportunity (OEO) to develop a public-facing data dashboard. OEO will also send quarterly reports to Council and copies of CBAs to include in the legislative file. Council will holding several committee hearings on the legislation, bringing in developers, corporate and business leaders, labor officials and others to discuss the ordinance. Ord. No. 297-2023

Construction Reform Charter Change: Community Benefit Agreement legislation will be coupled with Council legislation asking voters to approve a construction reform charter change to give developers more tools and project delivery method options when doing public improvement work in Cleveland. The vote on the charter change is expected to be held this fall. Ord. No. 298-2023.

These two ordinances are packaged with $10 million in American Rescue Plan Act funding for workforce development, ARPA funding for bonding relief for minority and small contractors, and professional services to develop a scorecard evaluation process for determining community benefits. Council recently passed legislation regarding this funding support.

Together these initiatives and legislation will maximize benefits to Cleveland neighborhoods and residents, and also build capacity and meaningful opportunities for MBE,FBE, and CSB contractors in development projects.

Other Council Highlights:

Kia and Hyundai Thefts Surging: Council unanimously passed a resolution, first sponsored by Councilman Kris Harsh, calling upon the Bibb administration to follow the lead of Columbus and other cities and file suit against Kia and Hyundai to recover costs incurred by the City associated with the rash of thefts of stolen vehicles. The number of insured Kias and Hyundais stolen in Cuyahoga County jumped more than 233% from October to December, 2022, when 656 cars were stolen in the county. Cleveland alone saw 459 thefts of the two makes of cars in the December, 2022.

Kia and Hyundai failed to equip their vehicles manufactured between 2015- 2021 with industry-standard security features, including engine immobilizers and other anti-theft systems, which could have helped prevent the thefts. The rise in the thefts of Kias and Hyundais has caused the City to expend more resources to investigate the thefts, respond to criminal activity related to the thefts, and assess associated property destruction, all at the increased expense of taxpayers. Res. No. 257-2023.

Highland Park Golf Course Changes: Council approved new management for the city-owned Highland Park Golf Course. The legislation was amended to a 20-year contract with the Highland Park Golf Foundation, with two extensions. Council made other changes including requiring the Director of Public Works to provide bi-annual reports for the first seven years of this new management arrangement to Council members concerning the status of the arrangement.  

The newly established Highland Park Golf Foundation is contracting with Troon, the world’s largest professional golf club management company. The City will provide an annual management fee of $250,000 to the Foundation for operations and management, that is expected to be offset by increased revenue within five years. The legislation was also changed to add the right to terminate this agreement with the Contractor under certain conditions. Ord. No. 117-2023