Universities in the United States employ over 4 million people, spend over $43 billion annually on goods and services, and hold around $535 billion in endowments.

Two years ago, Buffalo State College, University of Missouri–St. Louis, Rutgers University–Newark, Cleveland State University, Drexel University, and Virginia Commonwealth University each made a commitment to investing, hiring and purchasing locally. Now, a new report from the Democracy Collaborative by Emily Sladek illustrates how they take seriously their role as “anchor institutions” when it comes to economic impact on their local economies.

Buffalo State College’s Small Business Development Center has been supporting and incubating small local businesses owned by minorities and women. The office has nurtured entrepreneurs such as an organic goat farm owner and an artisan who was able to build up her business into providing costuming for singer Katy Perry’s tour.

A Rutgers faculty member, Kevin Lyons, led an effort to map out local procurement needs for hospitals and universities in the area. He found hospital socks were shipped in from out of state; now a local business provides them instead.

Virginia Commonwealth University worked with a grassroots coalition to create a jobs training program in construction for formerly incarcerated residents. It places graduates in state-funded construction projects at a living wage.

As a group, the six universities also hashed out a shared dashboard and data collection process to track the local economy impact of all existing and new initiatives. According to the report, internal conversations about the local economic impact of universities are becoming more “sophisticated” and “in some cases enthusiastically embraced.”

The report outlines five big indicators for success, starting with leadership from the top. Jennifer Jettner, assistant director of community-engaged research at Virginia Commonwealth University, told Democracy Collaborative, “A champion in a leadership position to drive the ship — specifically, clearly communicate the vision, gain buy-in, empower others to act on the anchor mission, and garner resources to fund the effort.”

The anchor institution’s efforts in this sphere must also be part of a broader strategic plan. Another success factor was the establishing of anchor committees — an unexpected development that came about after the group of six came together. Five formed anchor committees, which meet at varying frequencies, from once a quarter to biweekly. Some campuses have a leadership team made up of high-level administrators (e.g., chief of staff, provost, deans, chief information officer, chief financial officer) as well as working groups with other staff. Committees include, on average, six to eight members.

Implementing data collection protocols was another indicator for success. The report includes sample surveys and metrics used among the group to track data in a transparent way that allows universities to compare performance between themselves. One key question: How do universities define “local”? Each university in the cohort selected at least two geographies to collect data on. Most selected three: the university, the city and a specific low-income neighborhood. The locations were selected for various reasons including preexisting university impact objectives and programming, and a desire to reach historically underserved communities.

The fifth success indicator was relationship building with external partners. While important, it’s also something that needs more clarity in some cases.

Alan Delmerico, a Buffalo State behavioral scientist, told the Democracy Collaborative: “This is one of the challenges that our committee has encountered. Our committee does not have a standard definition for what a partnership is but rather labels an organization as a partner if we do any service work with them. The quality to which we define a partnership is the bigger issue.”

Oscar is Next City's senior economic justice correspondent. He previously served as Next City’s editor from 2018-2019, and was a Next City Equitable Cities Fellow from 2015-2016. Since 2011, Oscar has covered community development finance, community banking, impact investing, economic development, housing and more for media outlets such as Shelterforce, B Magazine, Impact Alpha and Fast Company.

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