Utilization of a Community Development Corporation


By Marlon Webb, Veridus Group 

Published: May 10, 2019 by The Veridus Group 


The painful process of buying a home in a seller’s market is something most of us can relate to. We see our dream home on the way to work, but on the way home, the front lawn sign reads “SOLD.” So, we scour for the most qualified real-estate agent in hopes that they can better manage the search for and purchase of a home. Such pain is something that not only affects individuals, but municipalities as well. 


Municipalities have to abide by laws that dictate how they must secure property for redevelopment or other public use purposes. So, what happens when a municipality cannot secure property in time? It ultimately must wait or alter the plan it had for that property, which could alter community redevelopment plans. While eminent domain could be utilized, it is often controversial and hardly considered. Just like individuals, municipalities can call in knowledgeable sources to mitigate tricky processes. However, community development corporations serve as a way for municipalities to quickly respond to a plethora of opportunities, including real estate.


By definition, a community development corporation (CDC) is a nonprofit organization that provides programs and services to promote and support a municipality’s economic development initiatives. These services are most commonly used to bolster underserved areas that have experienced significant disinvestment. Common CDC services include providing affordable housing, undertaking economic development projects, providing social services, community organizing, and neighborhood branding etc.

Although these initiatives are typically seen in neighborhood CDCs, municipalities can utilize a CDC to promote efforts aimed at improving the economic vitality of their respective communities. CDCs focus on revitalizing the area in which they are located, which can greatly benefit municipalities.


Several communities across the Indianapolis region have utilized CDCs for a variety of reasons.  We tend to see more of these municipalities utilizing a CDC in order to make their redevelopment and economic development dreams a reality.  Some argue that transparency can be an issue as the CDC is a private, nonprofit entity.  However, it is important that municipalities clearly dictate the CDC’s use to implement redevelopment and economic development plans that should have already received public response and support. This can help ensure the public’s trust and avoid any potential set backs to implementing a shared community vision with municipal staff and the public.


A municipality in need of a community liaison with a statutorily set purpose should do its due diligence in researching and understanding the role of a CDC, and when the time comes, properly organize the CDC to ensure the greatest benefit is reaped.   Municipalities are investing more time and thought into community development efforts, and utilizing a CDC can increase efficiency and productivity by serving as the vehicle by which municipalities conduct business. As with any program there can be drawbacks to utilizing a CDC; however, capitalizing on an “alternative model to government administration of comprehensive community programs” may be the most advantageous tool municipalities have in relation to community based economic development. 

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