Cleveland Foundation to Saddle Poor with Debt to Buy Depreciating Asset

Local philanthropies have been indispensable partners in the struggle for a more sustainable and equitable transportation system, with many foundations around the country doing wonders to bring their cities into the 21st century.

In Detroit, the Kresge Foundation is putting up a large portion of the money to bring light rail to Midtown. In Pittsburgh, philanthropic groups have stepped up to help the city with engineering for new bike lanes. All over the country, foundations large and small have supported regional smart growth efforts that improve environmental outcomes, public health, and quality of life.

But clearly, some foundations are more forward-thinking about these issues than others. As an example, we submit the transportation policies of America’s second-largest community foundation, the Cleveland Foundation. Citing “employment barriers”–namely sprawl and car dependence–this esteemed foundation is not supporting a transit advocacy group. Nope, the Cleveland Foundation is helping low-income adults buy brand-new cars!

Through a partnership between the Cleveland Foundation and a local car dealer, ten graduates of local adult job training programs will be offered assistance to purchase brand-new Nissan Sentras. Putting aside for the moment the question of whether it’s the best financial decision for lower-income workers to buy brand-new cars, it’s hard tosee how these participants are even getting that great a deal.

According to a Plain Dealer description of the program, dubbed “Drive to Succeed,” lucky participants will not be asked to make payments on the cars for the first three months. After that, they will have to pay $200 per month for the next nine months. At that point, they’ll be expected to purchase or finance the remaining $14,000 price tag. So rather than tackle those “employment barriers,” the Cleveland Foundation will encourage fledgling workers to strap themselves with at least $15,800 in debt, not to mention gas, maintenance, depreciation and insurance.

India Pierce Lee of the Cleveland Foundation told the Plain Dealer that “affordable transportation has been a barrier” for graduates and employees of the program, and nobody doubts that is so. But luring ten people to take on the massive ongoing expense of car ownership by helping them out with a few payments is not the best way to address that problem.

I don’t know what better evidence there is than this that many of Cleveland’s urban development leaders still do not “get it” with respect to the sea change in thinking about transportation and livability in our cities.

–A.S.

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