Three Ways Local Leaders Can Center Racial Equity and Inclusion in Economic Recovery
The pandemic-induced recession has disproportionately affected people of color because of historic and ongoing structural racism—the policies and practices that have caused deep racial disparities in access to wealth-building opportunities and upward mobility. That’s why centering equity and inclusion is critical to economic recovery. But as local leaders make policy and programmatic decisions to advance economic recovery, how can they also dismantle these long-standing inequities?
In 2018, Urban Institute scholars sought to learn from communities that harnessed economic recovery to advance inclusion following the 2008 recession. They defined an inclusive recovery as one in which “a place overcomes economic distress in a way that provides the opportunity for all residents—especially historically excluded populations—to benefit from and contribute to economic prosperity” and ranked US cities on economic and inclusion measures. Since then, efforts have built upon this body of work to help local leaders understand trends and make decisions that advance inclusive recovery.
Our new brief expands on that definition of inclusion, adding a focus on outcomes in addition to processes. It also incorporates equity, focusing on how policies can promote fair treatment and equal access across a range of identities, with an emphasis on racial equity, given the significant role of structural racism as a driver of poverty and economic instability in the United States.
To promote equitable policies and programs for an inclusive economic recovery, local leaders can take the following approaches to guide their decisionmaking.
1. Address policies and programs with harmful impacts
Centering equity doesn’t always require creating new policies or programs. Local leaders can start with assessing and modifying existing policies that have disproportionately affected people of color and communities with low incomes and limited wealth. Typically, leaders created these policies without an explicit equity lens.
For example, San Francisco has reconsidered the impacts of public fines and fees on its residents. Fines and fees can act as a regressive tax that disproportionately burdens people with low incomes and people of color. Since 2017, San Francisco’s Financial Justice Project has worked with community groups, government departments, and the courts to eliminate or adjust fines and fees.
In response to financial burdens created by the COVID-19 pandemic, the city also enacted several policy changes to temporarily alleviate the burdens of fines and fees, including
- halting collections in a range of domains
- temporarily suspending the collection of certain debt owed to public hospitals and transit agencies
- offering property tax waivers
- deferring some taxes and license fees for small businesses
- waiving parking, towing, and other fines and fees
- suspending late fees and shutoffs for public utilities
- suspending collections in the Superior Court for people on payment plans
- removing the sheriff department’s commission on items sold in jails and accelerating the implementation of free jail phones
2. Target supports and opportunities to historically excluded communities
To address long-standing structural inequities, leaders can prioritize historically excluded populations when targeting new pandemic relief resources, including stimulus dollars, or when determining target populations for policies and programs. Though these practices alone may not eliminate structural barriers, they can ensure that new resources do not exacerbate existing inequities.
For example, Florida’s Broward College has seized the opportunity to support historically excluded students facing structural challenges, such as economic insecurity and limited access to technology. Broward College’s Unlimited Potential program employs a two-generation approach to target residents in six zip codes with high unemployment rates, low educational attainment, and low household incomes.
The college has relied on partnerships with community-based organizations, local government, and regional employers to improve access by offering classes within six identified geographic communities and providing free training and wraparound services, such as case management and broadband access.
3. Explore policies that can eliminate structural barriers
Although reforming current policies can make some progress in reducing structural barriers, local leaders could also consider policies designed to fully eliminate those barriers and improve economic stability for all residents. Much of this work would benefit from parallel state and federal action, but local leaders have control over policies that could move the needle on racial equity.
For example, although income supports and jobs programs can help stabilize households’ current economic conditions, narrowing the racial wealth gap—not just the income gap—requires addressing asset disparities. In July 2021, the District of Columbia City Council passed a budget proposal that includes legislation that would establish a baby bonds program for children in families with low incomes. The DC City Council unanimously approved the legislation in October 2021.
The program will cost the city $32 million over four years and will provide up to $1,000 annually in a trust fund for children born in families enrolled in Medicaid whose income does not exceed 300 percent of the federal poverty level, or about $79,500 for a family of four. The accounts will be held in public trust to be used to pursue education, purchase a home, invest in a business, or save for retirement. This program could help address long-standing wealth gaps and open up more opportunities for future generations.
The Urban Institute has the evidence to show what it will take to create a society where everyone has a fair shot at achieving their vision of success.