BEST PRACTICES > FINANCIAL CAPITAL  
 

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Community Engagement

Financial Capital

Keeping it Local

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Learning from Experience

Financial Capital

What is Financial Capital?

Millionaires don?t grow on trees in rural areas. But financial capital is essential in launching and sustaining new initiatives, allowing one a vision to become a reality. Traditional lending institutions tend to focus on the bottom line and your community likely cannot afford to fund every genuine initiative on its own.

For community economic development to succeed, communities must work and trust in themselves, take advantage of financial partnership opportunities and leverage local capital with provincial and federal dollars whenever possible.

Why Financial Capital?

Financial capital can...

  • Increase the capacity and scope of the undertaking
  • Open up new partnerships and benefits
  • Leverage funds and save money for other initiatives

How Do We Secure Funds?

The applicability of each of these strategies will vary depending on the size of community and the size of the project or program.

  • Research all possible funding sources when planning new initiatives
  • Explore additional funding sources for existing initiatives, as there may be opportunities to strengthen and enhance the initiative
  • Look for opportunities to leverage with community supported funds
  • Start a fundraising campaign to bridge funding gaps, perhaps by using a community foundation with donations from current or former residents
  • Gauge your capacity to administer new funds and ensure that you can meet all reporting requirements
  • Be realistic in your funding goals
  • Consider hiring staff to assist your organization with grant writing
  • Talk to the people in charge of administering the funding and others who have received it in the past to make sure that it is right for you

Please see page 42 for a list of sources of Financial Capital.

Sharing the Benefits of Community Wind

With the passing of the Green Energy and Green Economy Act, 2009, and the creation of a Provincial Feed-in Tariff Program that allows community organizations to sell power back to the grid, rural communities can profit from local wind resources. The Chippewas of Georgina Island First Nation located on Lake Simcoe, in partnership with the Windfall Ecology Centre, an environmental non-profit, have partnered in the development of a 54 MW wind park on Georgina Island.

The project was financed by equity raised through the Pukwis energy co-op (enabled by the Green Energy Act) and by traditional commercial loans backed by the power purchase agreement with the Ontario Authority. The wind park will be 51% owned by the Chippewas and 49% owned by the Pukwis energy Co-op, whose members will receive financial benefits from their initial investment into the project. Anyone in Ontario above the age of 16 may become a member in the cooperative.

Social Enterprise: Profiting through Community Service

The Community Opportunity and Innovation Network (COIN) is a not-for-profit organization which operates in Central Ontario. It runs social enterprises, which are businesses that turn a profit while meeting the social and environmental goals of the community. One of the social enterprises run by COIN is The Learning Source, which offers a variety of courses for affordable, lifelong learning, both in-person and online. Other enterprises run by COIN include:

  • A catering service, World 2 Go and Natural Blends Cafe
  • ReBoot Peterborough, a computer re-use and recycling company
  • TEKDesk, which offers online technical assistance, training and e-learning
  • COIN recently hired a Triple Bottom Line coordinator to create an accounting framework for social enterprises.
Downtown Community Improvement Plans

When the City of Sault Ste. Marie completed its Downtown Community Improvement Plan in 2007, the $95,000 allocated to implement the Plan each year over a three year period assisted in the Municipality securing an additional $570,000 from the Ministry of Agriculture, Food and Rural Affairs (OMAFRA) and approximately $45,000 from FedNor?s Northern Ontario Program to assist in downtown service improvements.

The $1.14 million contributed by the City, Province and Federal Government has leveraged approximately $7.4 million in private sector investment, a public/private ratio of approximately 6.5 to 1.

Visit www.city.sault-ste-marie.on.ca

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