Several New Haven-area organizations have launched a program that will give grants of $20,000 to individuals in the Newhallville and Dixwell neighborhoods as a way to combat generational poverty.
The Wealth Accelerator is led by ConnCORP, the organization that’s building a major mixed-use development at the former Dixwell Plaza site, and its sister nonprofit ConnCAT.
It has investments totaling $1.15 million from partners that include the Connecticut Project, the William Caspar Graustein Memorial Fund, Edward Jones and M&T Charitable Foundation. The Community Foundation of Greater New Haven is also on board as a community partner.
“The evolution of it was really about how do we find ways to address the long history of poverty that quite frankly is undergirded by racism and racist systems,” said Erik Clemons, CEO of ConnCORP, who himself grew up in poverty.
ConnCORP describes the accelerator as a research project that will investigate the efficacy of large-scale cash-injection programs.
The program will work with a cohort young adults, ages 18 to 30, who are graduates of ConnCAT’s workforce development programs in phlebotomy, medical billing, culinary arts or construction.
Some 82 participants will be eligible for a payment of $2,000 intended for the relief of immediate debts. Of those 82 participants, 20 will be randomly selected to receive a cash injection of $20,000.
They can use the money to fund retirement savings, start a business, support a downpayment for homeownership or any purpose related to wealth creation. The participants will also take financial literacy classes.
“The issue is, quite frankly, the access to capital,” Clemons said. “There’s a myth that folks who are poor, it’s their fault. And it is not. Folks work hard, yet there are systems that are entrenched in this country that have not allowed for their hard work to bear fruit.”
M&T Bank provided a $150,000 grant to the program via its M&T Foundation Amplify Fund. Regional Manager Karen Galbo said the program was a good fit with many questions the foundation is also trying to answer.
“How do we work together to close opportunity gaps, particularly the wealth gap, and how do we come together to help individuals and families build generational wealth?” she said. “It certainly aligns with our priorities in terms of our goals and what we’re trying to do in terms of our community.”
The project will hire an outside organization to monitor and evaluate the program, researching how young adults perceive wealth and make financial decisions, what priorities they have for the capital, and how the money impacts other aspects of economic wellbeing such as employment decisions, debt mitigation or the ability to save.
The aim is to provide the state of Connecticut’s Baby Bonds program and other cash-injections projects with best practices based on the research.
