The Community Investment Corporation The Community Investment Corporation (CIC) is designed to serve as a for-profit land planner and private sector developer geared to rational innovation and change at the community level. It would plan land use and develop the land within designated urban and rural enterprise zone for industrial, commercial, agricultural, residential and public purposes. It would sell and lease the land and structures for public and private uses and impose charges for improvement and maintenance. It would not own other businesses.   The CIC would function just as the Rouse Corporation did in building Columbia, Maryland or the Reston Corporation did in building Reston, Virginia--but with a difference. It would turn community residents into its principal shareholders. Citizens would accumulate assets and share in the profits from development to supplement their incomes from wages, welfare and other sources.   The CIC strategy and its institutional structure for mobilizing citizen action are easily adaptable to areas of virtually any size, such as land surrounding nodes of a mass transit system, a downtown renewal area, or an inner-city neighborhood. The CIC can even be adopted for an entire city, metropolitan area or natural region of the country. The proposed enterprise zones, or "super empowerment" zones, are ideal test sites for CIC demonstrations.   The CIC would aim at creating an environment within demonstration "super empowerment" zones for stimulating private sector growth and new private sector jobs and entrepreneurial opportunities. However, the CIC's main accent is on widespread participation, particularly in the ownership of land, technology, buildings and infrastructure that must be fabricated upon the community's land for expanding the local economy.   Using advanced tools of the free enterprise system--especially innovative credit and financing tools--the CIC would create new owners of newly created assets, without taking existing property away from present owners. Workers would earn their shares and receive profits from the ESOP companies for which they work, and residents would "earn" their shares in the CIC through a Community Shareholders' Participation Plan developed and approved within each zone community.   Without the CIC and Zone ESOP approach low-wage workers within the zone can be easily exploited by outside investors and companies seeking to compete with low-wage companies in the developing world. This weakness can be converted into a strength and magnet for companies willing to allow their employees to link their future increases to increased productivity through frequent profit sharing, equity accumulations and dividend incomes. The low fixed labor costs in zone companies can increase job security and employee incomes, without increasing product costs. Zone companies can then be America's models for global competition.   One word of caution. The Community Investment Corporation is radically different from ownership schemes such as Community Development Corporations (CDCs), Community Foundations, and Community Land Trusts. These tools of development launched in the "War on Poverty" of the 1960s too often produced poorly-managed enterprises whose ownership and control frequently fell into the hands of the few who controlled the organizations and local jobs. These approaches failed to decentralize access to economic power and profits by widespread personal ownership of local enterprises. By centralizing ownership, CDCs empowered local leaders, not the people. The CIC is designed to empower the people. How Would the CIC Work? CICs and companies adopting Zone ESOPs would be financed primarily through conventional market-rate lenders, plus loans syndicated by local community banks (which themselves could be employee-owned through ESOPs) and other sources of subsidized credit. Such funds could then be used both for acquiring shares in the CIC and in companies operating in a zone to meet their financing needs. In turn, the CIC could use the funds for acquiring and developing land, and zone companies would have funds for adding new machinery and buildings, working capital, acquisition of shares from present owners, etc. The end result of channeling credit through CICs and Zone ESOPs is to keep as much as possible of future equity accumulations (i.e., "capital gains") and development profits in the hands of community citizens, rather than being drained out by speculators, wealthy outside investors, outside consultants or local exploiters of the community.   CIC shares would be acquired by residents and other eligible persons at the lowest cost and generally with little or no down payment. The CIC would guaranty repayment of stock acquisition loans, pledging CIC assets (i.e., land, structures, equipment and receivables) as collateral. Credit for purchasing CIC shares would be repaid wholly with future CIC profits earned primarily from land sales and leasing. Residents would put up no personal savings to purchase CIC shares, and would not be personally obligated in the event of default on the share acquisition loans. As the CIC loans are repaid, CIC shares would be allocated among accounts of community households according to the points they earn under the Community Shareholders Participation Plan. The CIC would also serve as a community-based "stock exchange" for repurchasing CIC shares from outside investors or residents who move outside the community.   The CIC would also provide attractive discounts in the sale or leasing of land for commercial or industrial purposes to corporations adopting ESOP financing techniques for their employees or residents of the community. Profit-making subsidiaries of the CIC would be financed generally by loans which, when retired, would produce new capital estates for their employees and community residents. The Center for Economic and Social Justice P.O. Box 40711, Washington, D.C. 20016 Phone: 703-243-5155, Fax: 703-243-5935   thirdway@cesj.org (e-mail)