One thing we have noticed in our community engagement work in neighbourhoods is how incredibly committed and passionate residents and local business owners are about the neighbourhoods in which they live, work, and play. People want to see development in their area of town that aligns with their collective aspirations and needs, and it is clear to us that they want to have a significant say and role in such development, not just be consulted about what developers want to do.
Development of any kind costs a lot of money and there are a growing number of residents who believe their ability to co-create development will be enhanced if they can raise money they can use to leverage funding and financing from institutions. Grants can help but some development initiatives do not qualify for government capital grants.
An ODC can invest in the capital development of commercial space, housing, place-making initiatives, as well as the purchase and/or development of a business. It really depends on what community members want to do and invest in.
The Edmonton CDC has been working with a group of neighbourhood residents in McCauley in interested in investing in the future of their neighbourhood. One of the ways to do that is through an Opportunity Development Co-operative (ODC), a legal entity which is recognized by the CRA as carrying vehicle for self-directed RRSP and TFSA investments which would pay a modest dividend. Non-registered monies can also be invested.
The ODC members raises investment money from other community people based on an Offering Memorandum that clearly identifies the goal of the raise and the purpose for which the money will be allocated. Investors become members in the Cooperative and each member has a vote in terms of the work and operations going forward.
There are of course rules and regulations governing ODCs and processes that are required by the government to ensure appropriate management of investment dollars. The Edmonton CDC has been working with the Alberta Community and Cooperative Association and with legal counsel to ensure due diligence is being addressed for the creation and operation of the ODC in McCauley.
One of the reasons the Edmonton Community Development Company exists is to support neighbourhood residents and stakeholders in their efforts to influence their community’s future. An ODC is a means to that end. When mainstream developers may pass on developing in a neighbourhood like McCauley, an ODC offers a lever that can be used to transform that community.
While an ODC builds financial capital, another benefit is that it can also grow social capital. For example, governance is through the member/owners of the co-operative and therefore, decision making is in the hands of the community. Development decisions are more likely to consider the context, culture and capacity of a community. This understanding, along with the financial and emotional investment of local residents, can result in developments that are more likely to benefit and be supported by the community.
Our work in McCauley has had a steep learning curve. Our goal is to be an expert in creating ODCs and in helping neighbourhood residents raise capital for projects they want, want to own or co-own, and become more influential with the City and other levels of government about what their neighbourhood should look like in the future.
In the new year, it is our intention to connect with other neighbourhoods that may be interested in forming their own ODC.