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Community Benefits Agreements: Basics and Benefits

Updated: Jun 12

Community Benefits Agreements

What is a Community Benefits Agreement?

A Community Benefits Agreement (CBA) is a legally binding contract between a coalition of stakeholders (residents and or community groups) and the project developer. Often, for large infrastructure or real estate projects, a CBA secures benefits for communities affected by the proposed project. A signed CBA outlines and commits benefits that the developer will provide to the community. 

CBAs differ depending on the type of project (e.g., transit development, energy projects, campus expansions) and the geography, demographics, needs, and capacity of the impacted community. They must take into account the unique context and needs of the community. Successful CBAs commit to addressing community needs and fostering mutually beneficial relationships.

How are Community Benefits Agreements (CBAs) Formed and Implemented?

In a CBA, multiple stakeholders are involved: a community coalition, a project developer, elected officials, and government agencies. The community coalition and developer are often the most active stakeholders in a CBA process. Negotiating community priorities shapes CBA commitments, empowering communities by directly addressing their needs, fostering participation, enhancing overall quality of life, and preserving cultural identity.The benefits provided by CBAs can vary widely, for example, dedicated funding for schools, targeted hiring and workforce programs, environmental protection and remediation programs, infrastructure upgrades and investments, community space set-asides, and daycare facilities.

CBA stakeholders closely coordinate to develop mutually agreed-upon commitments for the project developer to deliver impact to communities, and in turn, communities often support projects. Residents, nonprofit organizations, local committees, religious groups, and representatives from educational/cultural institutions make up the community coalition. Their role is to build consensus and identify priorities for benefits. Developers serve as infrastructure project leads and are responsible for implementing agreed-upon community benefits throughout the project. They are a partner in the negotiation and implementation of the CBAs. While CBA formation and negotiation happens outside government processes, legislation in some areas may require CBAs. However, the government plays a small part in the drafting, implementing, or monitoring of a CBA. Finally, elected officials, like government agencies, are not directly involved in CBA development. Elected's play an important role in advocacy and serve as links between goals and policy priorities. 

How do CBAs Drive Community Benefits and Economic Impact?

One example of a CBA in action is the 2018 Union Square Tech Training Center agreement between the real estate developer, nonprofits, the local community board, and residents. Through this CBA, the developer committed to free access for local nonprofits to use event and meeting space in the facility, priority hiring for local candidates, and priority access to food hall space for local XBE vendors. This CBA secured considerable developer support for the Union Square community through meaningful community engagement and stakeholder involvement. 

Another instance of a CBA in action is the 2008 agreement between the Yankees, the Bronx Borough President, and the Bronx delegation of the New York City Council. In this CBA, the developer committed 15,000 free tickets annually to residents and nonprofits, $800,000 per year for 40 years to Bronx nonprofits, and $100,000 in sports equipment for Bronx schools and organizations. This agreement secured significant support for the Bronx community amidst the construction of Yankee Stadium. 

How Do CBAs Contribute to Offshore Wind Initiatives and the Just Transition?

For decades, CBAs have been a valuable tool for building community power and community-driven economic development. The clean energy transition is ushering in a new era for community benefits packages. Communities can secure large-scale investments through CBAs, state-mandated developer commitments, host community agreements, and innovative partnership models (e.g., developer partnerships with local schools to fund research and job training). 

A case in point of the role of CBAs in clean energy projects is Vineyard Wind 1, the first federally recognized OSW CBA in the United States. This 2015 agreement in Martha’s Vineyard secured local jobs and required continuous engagement with the coalition and community stakeholders through a Host Community Agreement. It also mandated additional monetary donations to host communities of infrastructure sites. 

Looking to leverage CBAs for your project's success? Our experts at Karp Strategies are here to help. Schedule a meeting with us to learn more about maximizing the benefits of community-driven economic development and sustainable growth. Reach out to us today!


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