Strategic Economic Development for Latino and Hispanic Small Business

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Newburgh – Two new reports by Pattern for Progress address the needs of the growing Hispanic and Latino business community in urban areas in the mid-Hudson Valley. Released in partnership with Community Capital of New York (CCNY), the reports identify obstacles to success for Hispanic and Latino business owners and entrepreneurs, and recommend strategies for individuals seeking to start or grow a business.

Between October 2016 and November 2017, Pattern and CCNY staff jointly conducted extensive community outreach in these cities and villages–meeting with business owners, hosting public forums and discussion sessions, and speaking with leaders in the Hispanic and Latino community. Following the community outreach, Pattern conducted research and analysis, while CCNY provided technical assistance to potential new business in the study communities and coordinated workshops on topics such as becoming a certified Minority or Woman Owned Business (M/WBE) and methods to access capital from both traditional and nontraditional lenders.

Through its ongoing Urban Action Agenda initiative, Pattern has made it a priority to bring resources to urban areas in the Hudson Valley, and Pattern strongly believes that understanding the impact and needs of the rapidly growing Hispanic and Latino population will play a crucial role in shaping the future success of urban communities in the Hudson Valley.

“We hope these studies will provide a framework to further assist the Hispanic and Latino business community to grow and thrive,” said Joe Czajka, Pattern’s Senior Vice President for Research, Development, and Community Planning.

Congressman Sean Patrick Maloney helped to secure funding from the U.S. Department of Commerce’s Economic Development Administration (EDA) for the first of the reports, which focuses on six cities with growing Hispanic populations: Beacon, Kingston, Middletown, Newburgh, Poughkeepsie, and Port Jervis. The second report, funded by New York State Electric & Gas (NYSEG) through their economic development initiative, aimed to assist four villages with large Hispanic populations: Brewster, Liberty, Monticello, and Walden.

“Community Capital is very grateful for the support we received from NYSEG and the EDA to explore these issues,” said Kim Jacobs, the Executive Director of CCNY. “We learned so much from the business owners who generously shared their time and experiences with us, and we look forward to taking steps to meet the needs that have been identified. Toward that end, we have been scheduling workshops in Spanish on a number of small business topics like access to capital and getting ready for a loan and hope to do more in the future,” she added.

Czajka credited Emily Hamilton, a former Senior Research Planner at Pattern, for her hard work leading the community engagement and research aspects of the project. “Her passion to assist the residents and business owners in these communities was unparalleled,” he said.

The studies identify several challenges and obstacles that impact the Hispanic and Latino population. These obstacles hinder the success of existing Hispanic and Latino owned businesses and serve as barriers to entry for prospective Hispanic and Latino entrepreneurs. The primary obstacles identified by this study include:

  • Language barriers that limit potential customer bases and renders certain professional services unavailable to Hispanic and Latino business owners.
  • Limited technical assistance opportunities for certain business improvement topics and a lack of awareness of existing technical assistance opportunities that are already available.
  • Limited access to capital as a result of a number of factors including credit history, unfamiliarity with traditional lending institutions, and limited knowledge of nontraditional lending opportunities.
  • Rent increases as a result of gentrification.
  • Perception of crime and safety.

“The banking community has already expressed a willingness to work to address some of the concerns mentioned in the report.” said Jonathan Drapkin, CEO and President of Pattern.

These community outreach findings were used to inform the development of a strategic economic development action plan with a series of recommended strategies and action steps. The action plan also includes examples related to each recommendation that can be used as models for success. The six key recommendations of the action plan were:

  1. Establish consistent networking opportunities for Hispanic and Latino business owners to support each other and advocate for their needs.
  2. Provide Hispanic and Latino business owners with information and training on how to expand their customer base by marketing their products to non-Hispanic and Latino customers
  3. Provide Hispanic and Latino entrepreneurs and business owners with training and assistance on legal and regulatory procedures related to business.
  4. Provide Hispanic and Latino business owners with information and training on how to access capital through traditional and nontraditional lenders.
  5. Start a “Lending Circle” for unauthorized immigrant business owners who lack access to traditional lending institutions.
  6. Implement measures to mitigate the displacement of Hispanic and Latino business owners in communities where rents and property values are rising.