This is the final in a six-part series spotlighting CDFIs in the Wells Fargo Works for Small Business®: Diverse Community Capital program network, funded with a $175 million commitment to help diverse small businesses grow.
When large-scale development and gentrification move into a neighborhood, disruption and rising rents often force small businesses to move out or close altogether.
Latino Economic Development Center (LEDC), a CDFI serving Latino-owned and underserved D.C. and Baltimore metro area small businesses, knows this pattern all too well. “Many of the areas in which we work are changing rapidly,” said Marla Bilonick, Executive Director and an OFN Board Member. “LEDC works to help small businesses in these neighborhoods survive and even thrive when outside forces disrupt them.”
Protecting “Mom and Pop”
One of these neighborhoods is the Wheaton shopping district in Montgomery County, Maryland. A few years ago, the county broke ground on a new government building, kicking of a multi-year, large scale construction project on Lot 13 in the center of a shopping destination that’s home to roughly 100 “mom and pop” restaurants and retail shops.
“The new building takes away a central, outdoor parking lot that was vital to Wheaton businesses and provided easy parking and customer access,” explained Richard Cisneros, Business Resilience Programs Manager at LEDC, who is embedded in the Wheaton community and works closely with its small businesses. “During and after construction, this project has the potential to hurt even well-established businesses.”
LEDC has led efforts to keep the businesses going, partnering with Montgomery County and the Greater Washington Hispanic Chamber of Congress to provide marketing, capital infusions, and no-cost technical assistance to owners identifying a need.
On the Ground, In the Community
Since it launched this effort in 2016, LEDC, which is a member of the Wells Fargo Diverse Community Capital network, has helped more than 62 Wheaton businesses directly impacted by construction. After conducting a thorough needs assessment for these businesses, it matched the majority of owners with LEDC consultants, who provided the businesses with everything from QuickBooks training to IT support, website development or improvement to social media strategies.
“We started reaching out to businesses even before construction started a few years ago,” said Richard of LEDC’s commitment to maintaining a regular presence in Wheaton. “Trust is a big consideration when outside circumstances threaten a business’ success, and we were fortunate to have an early grace period to build rapport with owners. We spent a lot of time listening, getting to know the businesses, and establishing ourselves as partners in their survival. It really helped that we were on their turf.”
In addition, LEDC assists businesses in completing and submitting Montgomery County Small Business Assistance Program applications for grants available to businesses adversely impacted by the project. To qualify, these businesses must consult with LEDC on technical assistance needs.
In 2017, LEDC started working in a similar way along Georgia Avenue in D.C. As the urban corridor experiences a revitalization, smaller businesses are being priced out. Applying its Wheaton strategy to Georgia Avenue, LEDC offers qualifying businesses the opportunity to apply for technical assistance. This approach gives owners the added advantage of learning about LEDC small business loans and allows LEDC to continue building its client base.
Learning from Disruption
The seeds of LEDC’s surviving gentrification solutions were planted during another type of disruption. “During the Baltimore uprisings in 2015, we launched a disaster loan program to assist businesses impacted by civil unrest,” explained Marla. “From this experience, we learned to tailor products and programs for situations out of the norm. The commonality among the Baltimore, Wheaton, and Georgia Avenue businesses is that an external force threatened businesses that were in place for a long time.”
Marla added that in its small business preservation work, LEDC is working not only for individual business owners but for their communities as well. “We are committed to preserving individual and family livelihoods, creating and maintaining community jobs, and protecting the integrity and uniqueness of business corridors, communities, and cities.”
About Wells Fargo Works for Small Business®: Diverse Community Capital program
The Wells Fargo Works for Small Business®: Diverse Community Capital program (DCC) will deliver $175 million in capital to Community Development Financial Institutions (CDFIs) that serve diverse small businesses. Since program launch, DCC has awarded $94.8 million in grants and capital to CDFIs to grow their lending and services to diverse small businesses.