Community Benefits Agreements

A Community Benefits Agreement (CBA) is a negotiated contract between a prospective developer and community groups, setting forth the benefits the developer will provide to the community in exchange for community support. This support is very helpful for developers looking for government subsidies and permit approvals. i Therefore, a CBA is negotiated before the development agreement is finalized between a developer and the government, and can be initiated by the developer, a community coalition, or even encouraged by city officials. Overall, a CBA is a way to work towards the objectives of both the community and the developer, and a way of enforcing both sides’ promises.

CBA’s can provide a wide range of community benefits. The community groups involved in CBA negotiations often include labor, neighborhood-based, environmental, and religious organizations, but many other community-based groups can be involved as well. ii Each CBA will be dependent on the needs of the particular community, the size and type of the proposed development, and the power the community has organized (the community’s relative bargaining power and likelihood to win a CBA is directly related to the extent the community has been organized, which gives it political strength). iii An example of a CBA begun recently in Chicago was in association with the Chicago 2016 developers and an advisory body known as the community outreach committee. The CBA was to ensure affordable housing and jobs would be set-aside for folks living near the planned site of the Olympic Village and Olympic Stadium. iv However, the CBA did not go through after Chicago lost the bid. Benefits included in past CBA’s are: a living wage requirement for workers employed in the development, space for a neighborhood-serving childcare center, environmentally-beneficial changes in major airport operations, construction of parks and recreational facilities, and construction of affordable housing. v

CBA’s also help to increase transparency by having all the benefits set forth in one place. This allows everyone involved (the public, community groups, and public officials) to understand the commitments made by the developer, compare offers by competing developers, and eventually monitor outcomes. vi

To make a CBA enforceable, legal counsel must be involved in the process at some point. They can either be brought in after an agreement is reached, simply to document the agreement in a legally enforceable way, or they can be part of the negotiation process. If the developer negotiates through an attorney, the community groups should negotiate through one as well. vii It is preferable for community groups to hire an experienced attorney, but community groups who don’t have enough money to do so, can seek help from a legal assistance clinic, a local law school clinic, or a referral from the National Lawyers Guild (go to www.nlg.org for a directory of chapters). viii It is also important that the CBA includes monitoring and enforcement provisions that require coalitions to engage in future activities related to the CBA, which may be difficult for coalitions that formed for the sole purpose of a CBA. A well established neighborhood association or community-based advocacy group can be excellent organizations to lead continued monitoring and enforcement of a CBA. This is another reason why it is important for community groups involved in CBA negotiations to be well-organized and well-unified. ix

Finally, the following is a checklist of issues community groups and developers should consider as CBA’s are negotiated: x

Parties
• Developer obligations
• Community coalition obligation
• Individual agency obligations
• Is the municipality a party to the agreement?
• Who has the authority to speak for or sign for each party?

Benefits
• What are the benefits to all involved parties?
• Is a needs assessment or study required (relevant to environmental benefits)?
• What is the scope of the developer’s responsibility or financial obligation?
• When does it begin and how long does it last for?
• Does the obligation transfer to subsequent project owners, or other third parties such as sub-contractors or on-site vendors?
• What is the implementation process?
• What is the implementation timeline?
• Will an individual agency or a committee be responsible for the oversight?
• How will the process be monitored?
• How often will reports be made?
• Is there a process to amend the terms of the benefit or program?

Remedies
• What constitutes a breach on the part of the developer?
• What constitutes a breach on the part of the community?
• What are the remedies in the event of a breach?
• Are the remedies specific to each benefit?
• What type of notice is required before relief is sought?
• Will the right to request specific performance be included?
• Is equitable relief permitted in the event of an irreparable injury?
• Who is responsible for attorney’s fees in the event of a court action?
• Will the other clauses of a CBA remain in effect in the event of a breach?
• Are there any intended third-party beneficiaries?
• Should a mediation process be pursued in the case of a breach (before taking legal action)?