Raimondo, Boston Fed president announce economic growth initiative

GOV. GINA M. Raimondo, R.I. Commerce Secretary Stefan Pryor and the Federal Reserve Bank of Boston president announced Tuesday that the Boston Fed has selected Rhode Island as the next state in its Working Cities Challenge competition. / PBN FILE PHOTO/ MICHAEL SALERNO
GOV. GINA M. Raimondo, R.I. Commerce Secretary Stefan Pryor and the Federal Reserve Bank of Boston president announced Tuesday that the Boston Fed has selected Rhode Island as the next state in its Working Cities Challenge competition. / PBN FILE PHOTO/ MICHAEL SALERNO

(Updated 2:04 p.m.)
PROVIDENCE – The Federal Reserve Bank of Boston and Gov. Gina M. Raimondo on Tuesday announced a new economic growth initiative aimed at incentivizing municipalities to work collaboratively across sectors in order to address issues affecting low-income residents.
The initiative, dubbed “Working Cities Challenge,” started in 2013 in Massachusetts. The Boston Fed began discussions with the state earlier this year, and formerly announced its launch in Rhode Island at the 2015 Regional Convening at the Feinstein Providence campus of the University of Rhode Island.
Eligible medium- and small-sized Rhode Island municipalities at the beginning of next year will be given the opportunity to contend for funding and one-on-one coaching with the Boston Fed and state leaders in order to address local issues. The caveat, however, is that applicants will be judged based largely on their ability to show they’re committed to working together across public, private, nonprofit and philanthropic sectors.
Rhode Island is now the second state to participate in the challenge and Boston Fed President Eric Rosengren says it’s poised well for this type of work.
“There’s clearly a need [in Rhode Island],” Rosengren said. “You have a number of working cities and you have cities that are ripe for actually changing the story [here].”
Stefan Pryor, R.I. commerce secretary, says more details about the competition in Rhode Island should emerge in the next few months, adding that they estimate three municipalities could be selected as winners in the first round of the competition.
Funding for the project will come from three areas: public, private and philanthropic.
The state has already committed to providing $150,000 annually for the next three years, which will come through the R.I. Commerce Corp., the R.I. Department of Labor and Training and R.I. Housing, according to Raimondo’s office.
The Rhode Island Foundation, a local philanthropic leader, has also committed to providing funds, but hasn’t yet disclosed how much. Neil D. Steinberg, Rhode Island Foundation president and CEO, has been in talks with the Boston Fed about the project for several months now and says communities across the Ocean State will benefit from this project.
“It’s not just the winners who will benefit, it’s everybody who takes the time to put together a proposal,” he said.
There’s also a national philanthropic funding partner, according to Tamar Kotelchuck, director of Working Cities Challenge at the Boston Fed, who added there’s been no commitment yet from Rhode Island’s private sector.
No funding comes directly from The Boston Fed.
After its first year, the six winning Massachusetts cities have received $1.8 million in funding for projects that address issues impacting low-income communities. They have also received more than $2.6 million in direct follow-on investment from private funders as a result of winning the challenge, according to the Boston Fed.
Holyoke, Mass., has revamped its licensing system and created a venture fund and business accelerator for Latino entrepreneurs. Lawrence, Mass., is training parents and placing them in jobs with employers including New Balance Athletic Shoe Inc. and Solectria Renewables LLC. Chelsea, Mass., is piloting the first-in-the-U.S. model of data-driven collaborative crime prevention, to name a few.
The Boston Fed will now help the state establish a “Steering Committee,” comprising private, public and nonprofit leaders to design the framework for the competition. Eligibility criteria will be announced later this year.
“You made a good choice in picking Rhode Island,” Raimondo told Boston Fed representatives. “I know you’ve seen some things in Massachusetts, but you ain’t seen nothing yet.”

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