Home ownership not only establishes a sense of place, community, and stability but multiple studies show it has been the most effective intergenerational wealth building strategy Americans have known.

Yet 2023 research published by the California Housing Finance Authority, suggests that discriminatory housing practices such as redlining, racial covenants, and predatory lending has disproportionately kept Black families from owning homes at the same rate as their white peers.

In Minnesota, 77.5 percent of whites own their own home, compared to just 30.5 percent of Blacks; the 5th worst homeownership gap in the United States. Not surprisingly, that gap corresponds to an equally abysmal wealth gap among Black and White Minnesotans.

One need only look to St. Paul for a relevant example of legally sanctioned government actions that resulted in disproportionate harm to Black residents.

From 1956 to 1968, local and state leaders seized by eminent domain, land upon which hundreds of Black-owned homes, and businesses in St. Paul’s Rondo neighborhood sat, in order to construct a new interstate corridor. At the time nearly 80 percent of St. Paul’s Black residents lived in the Rondo neighborhood.

Björgvin Sævarsson, founder and CEO of the Yorth Group, reports that “over 700 homes were lost to I-94. Along the way, the ecosystem for the previously thriving local [Black] economy was destroyed with many businesses closing as a result.”

Sævarsson determined that the intentional routing of I-94 through the heart of Rondo resulted in a loss of at least $157 million by 2018 in intergenerational wealth being passed down from homeowners to their children and grandchildren.

Rondo is just one local example of legally sanctioned, post-slavery actions taken across the United States that have left a legacy of Black exclusion educationally, socially and economically.

Efforts to repay Black Americans for their decades of loss have rarely gained traction. But on January 4, 2023, the Saint Paul City Council voted to establish the Saint Paul Recovery Act Community Reparations Commission. 

The ordinance, which takes effect on February 13, 2023, establishes a commission that will recommend ways for the city to make reparations to Black residents whose ancestors were enslaved.

The vote came two years after the City apologized, for its role in “systemic discrimination […] perpetrated through redlining and racial covenants, access to housing, environmental injustice and the removal of St. Paul’s Rondo neighborhood (Gray, 2023).”

These efforts also follow the adoption of the 2021 Ramsey County Inclusive Economic Competitiveness & Inclusion Plan, which endorsed significant local and county housing investments and acknowledged the historic policies that extracted wealth from Black families, necessitating courageous policies to catalyze systemic equity building.

The Center commends the actions of policymakers to address the wealth, unity, and community taken from the residents of the Rondo community. The multi-generational effects of the United States highway system on Black communities can truly never be measured, but our actions to repair the harms must begin now.

Learn more about the Center for Economic Inclusion’s work with Ramsey County, the City of Saint Paul and others to disrupt and dismantle systemic racism and bias to construct and sustain an inclusive, equitable and growing regional economy for all here
Learn more about the Saint Paul Recovery Act Community Reparations Commission here.

By Tawanna Black, Founder & CEO

When the 2023 Minnesota Legislature was called to order on January 3, lawmakers and advocates throughout the state turned their attention to top priorities, including allocation of the unprecedented $17.6 billion budget surplus and drafting a two-year budget.

Both the surplus and budget represent historic opportunities to drive economic growth through job creation and increased GDP by making substantive, structural, and equitable investments in Black, Indigenous, Latino, and Asian individuals and communities across our state.

At the Center for Economic Inclusion, we’re committed to closing racial employment, income, and wealth gaps, and building racially inclusive and equitable regional economies. The Center equips public- and private-sector employers and policy makers to dismantle systemic racism and institutionalize anti-racist policies in shared accountability and solidarity with Black, Indigenous, Latino, and Asian communities.

History proves that when racial equity and economic inclusion are not prioritized in policymaking, the result is often inequitable policies, loss in economic growth, and harmful impacts to Black, Indigenous, Latino, and Asian communities that can ripple for generations.

We are headed in the right direction. Over the last decade, Minnesota’s Legislature has increased the number of data-informed policies and investments focused on closing stagnant racial employment, income, and wealth gaps. The state Legislature is also more racially diverse now than at any point in its 174-year history. These policymakers are positioning Minnesota to win by leveraging their diverse lived experiences, perspectives, and that of their constituents as they legislate.

The future of Minnesota’s economic growth and competitiveness relies upon the willingness of policymakers to enact and invest in anti-racist policies and solutions. To support policy makers in building an equitable, just, and prosperous economy, this legislative session we are advocating for the following policies.

Policy: Racial Equity Impact Notes (Read More)

The Center and a coalition of partners will continue advocating for Racial Equity Impact Notes, a tool similar to a budget or environmental impact note, that empowers policy makers to assess the impacts of a proposed policy or investment on closing or widening racial disparities. In 2022, the Center conducted research on the results of similar impact notes in other states and partnered with leaders across the state to develop strategies we will recommend to Minnesota’s Legislature to actively engage Minnesotan’s in more data-informed, transparent, and consistent analysis of policies aimed at building the most inclusive, competitive, and prosperous state in the country.

Policy: $10M Direct Appropriation for Job Creation (Read More)

The Center is uniquely positioned and dedicated to create inclusive regional economies for Minnesotans of color. We have demonstrated our capacity and commitment to develop groundbreaking and actionable research, data-informed tools, and frameworks, including our Racial Equity Dividends Index, Vanguard Accelerator, Indicators for and Inclusive Regional Economy, Vanguard Research, Racial Equity Impact Notes Research and equity consulting services. With a track record of success, we are uniquely positioned to continue helping Minnesota employers take actions to build anti-racist and equitable workplaces, and helping state policymakers facilitate cross-sector, community-driven development.

After just five years, we’ve helped many Black-owned businesses create and grow jobs statewide and have created almost 30 jobs at the Center itself. An investment in the Center for Economic Inclusion’s job creation strategies will pay multi-generational dividends for all Minnesotans.

Policy: Increase State of Minnesota Procurement Preference and Equity Select Cap

We advocate for increasing the percentage when contracting with the State of Minnesota from 6% to 12% and raising the limit for non-competitive contracting from $25,000 to $100,000. The State of Minnesota currently allows the Commissioner of the Department of Administration to award a 6% preference to businesses owned by women, minorities, economically disadvantaged, and persons with substantial disabilities. These groups are also eligible for the Equity Select program which allows the state to directly contract with businesses up to $25,000.

While these goals have allowed for increased contracting with the groups identified, research shows there is more capacity to contract with these businesses. This is why we support the Department of Administration’s proposed policy to increase the preference to 12% and direct contracting amount to $100,000.

The legislative session is short. Minnesota’s problems are historic and systemic. We have to make the time count. We invite you to join us in partnership and collective action.

Let’s keep building!

For more information, read about our policy priorities.

Center Applauds City of Saint Paul Actions to Address Historic Legacy of Wealth Extraction

2023 Legislature: Breakthrough Year for Racial Equity and Inclusion in Minnesota?