plans to invest $40 million in Chicago's historically underserved South and West sides in an effort to tackle the city's poverty and violence through economic growth.
The three-year initiative by the nation's largest bank is its second-biggest commitment to a single city, following an infusion of $150 million into Detroit. It amounts to a 50 percent increase in JPMorgan Chase's philanthropic contributions in Chicago. The bank typically has invested $8 million to $9 million annually.
The challenge: turning that $40 million into meaningful changes in neighborhoods that have seen decades of decline and uncertain outcomes from previous philanthropic efforts.
Grants from Chase to community groups will fund job training, small businesses expansion, neighborhood revitalization and personal financial health programs through a variety of community partners already working in Chicago. To ensure the money is having an impact, it is funding third-party evaluations and has a local team of Chase experts monitoring the investments along the way to change course if necessary. Opening bank branches in the target communities is not part of the plan.
Chase is following the model it used in Detroit, where promising early results prompted the bank to add $50 million to its initial $100 million commitment. As in Detroit, the bank believes its funding initiative will succeed in Chicago because of the collaboration it sees between the public, private and nonprofit sectors.
"We're not arrogant enough to think that we're going to come in and solve a problem," said Peter Scher, head of the bank's global corporate responsibility initiatives. "But we do think that when you have that kind of collaboration on the ground, there are things that we can bring in terms of our resources and expertise that can help accelerate and catalyze a lot of that growth and opportunity."
Most of the $40 million has yet to be allocated. The local Chase team plans to host a roundtable Thursday in the Little Village neighborhood with local business, nonprofit and community leaders to start to identify programs and specific neighborhoods to receive funding.
So far Chase has allocated $3.7 million, and those beneficiaries offer a sense of the work it may continue to promote.
The largest grant, $2 million, has gone to a new initiative from Heartland Alliance that with the help of community groups will identify individuals at highest risk of gun violence and pay them to work in 18-month transitional jobs, mostly in work crews doing tasks like neighborhood cleanup, paired with cognitive behavioral therapy and other support. The goal is to connect 400 people with transitional jobs in the first year.
The University of Chicago Crime Lab will measure whether the intervention is working by tracking if participants are involved in fewer shooting and homicides than a control group, as well as labor market outcomes. There's no certainty the model will work on such a high-risk population, and "one of the reasons we have enjoyed partnering with (Chase) is that they're in, they think this is really worth trying," said Heartland Alliance President Evelyn Diaz.
Another $500,000 is going to the Brazier Foundation to help expand BSD Industries, a robotics technology training program designed to prepare Chicagoans for jobs in advanced manufacturing. BSD, which stands for Building Self Determination, launched a pilot in 2015 with money from Chase and this week started its second class of nearly 50 students.
A pillar of the 13-month program is a paid apprenticeship at BSD's new plastics manufacturing facility in the Calumet Heights neighborhood on the South Side, which officially opens next month and already has clients lined up to buy its compostable plastic cutlery.
"I will be super excited when we get people working and we get people's lives transformed and we really and truly get people empowered by this manufacturing opportunity," said Trista Bonds, vice president of manufacturing operations and training for BSD.
Chase said 95 percent of the $40 million will be awarded in the form of grants, with a small slice set aside to fund programs like sending Chase employees to consult with nonprofits. Even when grants provide funding for partner organizations to provide loans, Chase doesn't profit.
Still, Scher says there's a business case to be made. "If the economy is growing for everyone, that's a good long-term bet for our shareholders," he said.
Chase's Chicago and Detroit investments reflect a shift in the bank's approach to philanthropic giving after a review five years ago revealed that writing big checks wasn't having a proportionally big impact, Scher said....Read more