Centralized market would help community bonds scale up: report

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TORONTO — A new report lays out how an innovative funding model for community groups could be scaled up.

The report by Tapestry Community Capital looks at the growing use of community bonds, which not-for-profits are using to raise money for everything from solar projects to social housing.

Community bonds pay out interest, and eventually return the initial capital, in the same way as more conventional bonds do, but the money is directed to social projects, and the not-for-profit entity that initiates one is responsible for the guarantee. The Tapestry report says the model could get a boost from a more centralized market so they’re easier to find, as well as better tax treatment and standardization around practices.

Suzanne Faiza, knowledge lead at Tapestry, says making community bonds more mainstream would make it easier for groups to raise money for important projects like affordable housing. She says the rising popularity of the model comes amid a real estate crisis affecting everything from the housing market to commercial space for community groups themselves to work.

 

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