What does Hispanic Heritage Month mean to you?
(Video Translation) This month it’s important that, as Latinos, we understand that we were here even before the United States existed. It’s important to understand that we were part of the creation of this beautiful country, it's part of our history and will be going forward, whether we be Puerto Rican, Cuban, Mexican. At the end of the day, in the eyes of God, we are one great family.
This month, for me, represents the pride of being part the United States as a Mexican American—with my culture, with my family, with my language and, more important, with my cuisine.
How did Raza Development Fund and LISC come to work together?
Raza Development Fund (RDF) is a CDFI, and its mission is to serve Latino and poor families across the country. When I first got the organization put together, the mission for me was to try to emulate what LISC had done over the years.
About five or six years ago, I got a call from [former LISC CEO] Michael Rubinger saying, ‘Look, the market has crashed. Maybe we ought to work together to create a fund that would be focused on helping the Phoenix market.’ So I said ‘You put up $10 million and we’ll put up $10 million and we’ll work together. You do your underwriting and we’ll do ours, but we’ll focus our energy on light rail developments across the Phoenix, Tempe and Mesa areas.’
That first major partnership has had great results, like health care centers in Mesa, and affordable housing projects in Phoenix, Mesa and Tempe.
More recently, LISC and Raza got together to finance a number affordable housing projects in rural Arizona. Rural parts of the whole United States are difficult to finance. It was a great opportunity for us to leverage our capital and our underwriting capacity.
From your perspective, how has LISC’s work supported Latino communities?
Through its offices across the United States, LISC has the ability to target markets where we have affiliates with Unidos US, our parent corporation. We have a major investment, for instance, through Asociación Puertorriqueños en Marcha, a Puerto Rican organization in Philadelphia. We’ve been involved in many of their building projects and other things, and LISC has been a part of that, too.
LISC has offices in L.A., in San Antonio, and in a variety of markets that are predominantly Latino. As far as we’re concerned, it’s important to have capital coming into our communities, regardless of who provides it. What LISC does is come in with a very clear agenda of serving a poor community, and that’s really our mission also.
So LISC is important not just to the general market, but certainly important to the Latino community across the country.
What are the principle challenges confronting the communities you work with today?
A really striking issue is the Dreamers, the immigrant population. These are very well-educated Latinos, predominantly Mexicans, many who came here when they were two or three years old. We have a number of organizations that provide employment [to Dreamers] in nonprofit groups—around charter schools, healthcare facilities and so on. For Latino families dealing with these immigration issues right now, it’s a very difficult situation.
Education is a key issue for us, too. Latinos and other ethnic groups are falling behind educationally all across the country. But because Latinos make up such a large part of the population, they need to be well-educated. Sixty percent of our portfolio is in charter schools right now. It behooves organizations like LISC and Raza Development Fund to concentrate our capital in bringing quality education into the community.
A third issue is small business. Over the last decade, Latina women have been the entrepreneurs that have been really committed to the marketplace. When you consolidate the GDP of Latinos across the country, we could be one of the seven largest countries in the world. Which should be a wake-up call to politicians, and also to the business community: this is a market you want to be a part of.
What do you hope to see in Raza’s future?
Raza Development Fund’s goal is to expand its operation of providing equity capital. Those dollars are very hard to come by, but what we’re finding is that many of the organizations we provide services to and debt for are lacking what’s called “the equity piece”—equity that they can use in a transaction.
My vision is to create an equity capital fund over the next five years. That means raising equity from the private sector. That’s the only way you can do this. The transactions would be geared towards employment and for-profit corporations in the Latino community. It’s key for us to be able to build wealth inside the Latino community.
Another key for us is developing young Latino business leaders, especially in the nonprofit space.
How can LISC help?
Recently, LISC has gotten into the private capital market and raised bond capital to the tune of a hundred million dollars. It’s going to take that kind of capital to go into the small business investing space. I believe that LISC and Raza Development Fund can partner to really have a national impact on the marketplace for Latino entrepreneurs.
LISC has also historically been a great provider of staff for various CDFIs. They benefit from your staff who want to move to on to other organizations. LISC should strive to bring in young individuals, especially Latinos, who are interested in community development. I also think LISC and Raza Development Fund need to start looking at the possibility of creating an entrepreneurial leadership development fund. It could be a joint effort, through universities in one or two areas of the country, that zeroes in on preparing young Latinos to work in community development.
And after the horrible experiences that we’ve had in Houston, TX, in Florida, in Puerto Rico [in the aftermath of the hurricanes], I would say that over the next couple of decades, community development will be a key element in helping those communities come back together and especially for our families that are of low income. It becomes important for us to fill that void, where the banks and other institutions cannot work, because it’s difficult to underwrite those communities.