ShoreBank Blog

Social Media, Online Music, and Awareness for Nonprofit Organizations?

Tuesday, August 25th, 2009

Hi! I’m Scott Kenemore, and this is my first blog for ShoreBank Voices. I work in ShoreBank’s communications department but am also a musician in a local Chicago band. Although these two gigs at first might seem disconnected, music and social activism are greatly connected to ShoreBank’s work serving nonprofits and foundations.

Popular musicians have long been associated with social causes, but when people think of music and activism, I think most still picture the Tibetan Freedom Concerts of the 1990s or Sting’s efforts to stop logging in the Brazilian rainforest. If that’s the case for you,  I think you’ll be surprised (and, I hope, pleased) by the recent ways the internet and, in particular, social media, have allowed performers and socially oriented organizations to come together to raise awareness.

MySpace is a great example. MySpace.com is the web’s second most popular social networking site. Although originally created to allow bands to promote their music, individuals and institutions (including nonprofit organizations) also established their presences on the site. Because of the way MySpace works, artists are capable of displaying “favorite” or “top” friends, which can be organizations, on their pages. Therefore, an artist who wants to support a particular nonprofit or movement can feature the corresponding profile on his or her page, which will create increased (and, not unimportantly, free) visibility for that organization.

When a world-famous, platinum-selling artist features an institution on its social networking page, that organization’s impact and awareness can skyrocket overnight. For example, when U2 featured the (RED) campaign to fight AIDS in Africa in their top friends on MySpace, awareness of and membership in that organization increased exponentially. The American band Green Day went a step further, launching a joint MySpace page with the National Resources Defense Council (NRCD) where fans can peruse articles, blog entries, and photographs that tell the story of the band’s support for the NRDC. The site also lets visitors join the NRDC or make an electronic contribution.

Big-name acts aren’t the only ones supporting worthy causes. Plenty of local and regional bands feel just as strongly about supporting certain nonprofits, foundations, and organizations via their web presences. Local bands might have 4,000 MySpace or Facebook friends (as opposed to 400,000), but get 100 local bands supporting your organization, and the impact is the same as if one international band supported your organization.

For example, let us examine the areas in which ShoreBank has branches: Chicago, Detroit, and Cleveland. With a quick search of MySpace, I can find Chicago acts like WILCO, which features nonprofits Oxfam America and the Gulf Restoration Network; Detroit-area groups like Serenity Court, which supports a local street fair; and the Woodchuck Music Festival in Cleveland, which promotes multiple nonprofits ranging from World Wildlife Fund to Greenpeace.

If you work with an organization that promotes a social cause, explore creating “brand ambassadors” via social networking sites. If there is a musician in your area whose demographic fits with yours, contact him or her directly and ask if he or she would consider supporting what you do. You’ll be pleasantly surprised by the willingness of performers—both large and small—to use their visibility to help institutions that make a difference in their communities.

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Tags: community development, green banking, ShoreBank, social media, triple bottom line
Posted in Outreach | 2 Comments »

How to Guide to Sustainable Home Ownership

Tuesday, August 18th, 2009

Despite current economic conditions, low interest rates, upbeat economic reports, and government incentives are making this one of the best housing markets in decades. Whether you’re a first-time homeowner looking to take advantage of the available $8,000 tax credit before it expires at the end of Nov. 2009, or looking to downsize or to upgrade, now is a terrific time to buy a home.

One lesson many people have learned all too well lately is the importance of knowing how to buy a home responsibly to ensure successful, sustainable home ownership. To help you buy a new home and make the best use of your money, I am sharing with you some home buying information and advice.

Begin by having a plan.
Don’t act immediately. Think about what you want – the type of home and the neighborhood – and what you can manage at this point in your life. How will a mortgage figure into your retirement plans or payment for the children’s education? Think about how your cash flow may change in the future. Talk to a mortgage lending specialist very early in the process who is familiar with the community and who can help assess your needs, calculate costs and determine what you can afford.

Then choose a manageable “standard vanilla,” fixed-rate loan and payment schedule that fits your goals. And perhaps, most importantly, ask a lot of questions and be sure you fully understand the terms of your loan.

Be conservative.
Equity is the difference between the appraised value of the home and the debt or current loan balance on the home. It is important to have realistic expectations of what the appraised dollar amount is when you are pricing your home for sale. You may qualify for a large loan and find you can’t easily handle the payments because the actual sale price of your home was much less than its appraised value. As I like to say, “Hope for the best, but don’t count on the best,” and borrow only what you need and can afford to repay.

Make a difference.
Maybe the house you have your eye has been vacant and needs some work—the paint is peeling, the floors and cabinets are dull or cracked, or the kitchen needs new appliances. Renovations on any scale are an opportunity to get exactly what you want and increase your home’s value, which in turn strengthens the neighborhood.

But be sure to look at more than just the “carpet and the fixtures” because there are other parts of the home whose repairs can be very expensive. It’s important to ask yourself: Can I afford repairs that may be needed in the first year—the next year? Therefore, I remind you, don’t be afraid to ask questions about the condition of the home while shopping for a home. To avoid “costly surprises,” here are some questions to ask:

• Does the home have insulation in the walls, crawl space and attic? Losing heat and letting in the cold is inefficient;
• How old is the roof? Asphalt and wood lasts about 20 years, and clay is the most expensive to replace and repair;
• Has the heating, cooling, and hot water equipment been updated? Usually the older it is, the less efficient it is; look for the ENERGY STAR label for efficiency;
• And what type of material was used for the exterior siding? Was it properly maintained? Can I afford to maintain it because each material, albeit, wood, vinyl and brick, require different maintenance needs, such as cleaning, painting or mortar re-pointing?

There are a wide-array of loans in the marketplace designed to help rehab and purchase a new home. Look for loans, like the ShoreBank Home Energy Conservation Loan, that offer a free energy audits.

The energy saving improvements can reduce your monthly utility bill by 25 to 45 percent while increasing the home’s appraised resale value, sometimes in the neighborhood of 15 percent. In addition, they reduce the amount of greenhouse gas emissions that harm the environment. In fact, our nation’s homes contribute one-third of all green house gas emissions, or roughly the same amount emitted by autos and commercial buildings.

My next blog will share with you some suggested low-cost, eco-friendly home improvements that will add value and comfort to any home. In the meantime, if you have any questions about responsibly buying a home and obtaining a quality, affordable mortgage, please send me an email.

Tags: community development, environmental sustainability, green banking, home affordability and stability plan, home ownership, ShoreBank, triple bottom line
Posted in Mortgage Lending | No Comments »

The Rules of the Game

Tuesday, August 11th, 2009

All games have rules. In fact, you could say that games are their rules. Rules are arbitrary, but as long as they are applied equally and consistently to all players and teams, their arbitrariness is irrelevant.

Real economic life is supposed to be too serious to be a game. Humans have practiced commerce and trading for millennia with few, if any, rules. But as economies and the businesses within them have grown more sophisticated and complex, so have the rules used to regulate and to measure them. This is especially true of accounting rules, known as Generally Accepted Accounting Principles (GAAP).

In recent years, a major controversy has erupted about one of these rules known as “mark to market.” Assume a bank makes a $100,000 loan on January 1, 2009, that a borrower agrees to repay with interest in five years. GAAP has traditionally held that the bank’s $100,000 loan asset should be valued at $100,000 until maturity, as long as it is considered collectible. But, at any given time before maturity, the loan’s value on the market may be 102 cents on the dollar, or 97 cents on the dollar, or whatever investors are willing to pay. In that case, should GAAP still maintain the value of the loan to the bank at $100,000? Or should it be $102,000 or $97,000? In technical terms, should the loan be marked to market or not? This is important because, if the loan were marked to market based on our example, the bank would record temporary income of $2,000 or a temporary loss of $3,000.

GAAP is supposed to make the financial statements of all companies as transparent and comparable as possible. This is a worthwhile goal, but nothing in this life is free. Accounting rules, like baseball rules, are inherently arbitrary. Changing them changes how businesses operate, but there is a key difference between games and real life. After a certain amount of time or number of innings, games end. A new rule can be implemented when no games are being played, allowing everyone to start with the same clean slate. But business never stops. All changes to GAAP or similar rules are implemented while business is in progress. Businesses have no alternative but to adjust their decisions and strategies according to these new rules. There is not a clean slate. The result is that businesses, like games, start to become the rules. To ask if this is “good” or “bad” may be a virtually meaningless question. But it does make business seem a lot more like a game.

Posted in Banking Industry | No Comments »

Can Environmental Justice Create Eco-Injustice?

Tuesday, August 4th, 2009

Like the differing reactions to the recent arrest of Henry Louis Gates, environmental justice has always presented a challenge for the environmental community because of its potential to divide activists along racial lines. Thus, it was with some trepidation that I accepted an invitation to speak at a recent event on the topic.

The discussion, sponsored by the Justice in Journalism program in affiliation with the prestigious Annenberg School at USC, brings journalists who are undertaking in-depth explorations of race and poverty at a local level together from all over the country.

The focus of my session was the future directions of environmental justice. The discussion centered on what could be a fundamental shift in eco-justice. In the past, eco-justice largely examined the adverse environmental consequences to the poor and to minorities caused by economic patterns and activities. A paradigmatic example is the respiratory problems and elevated cancer rates experienced in minority communities that live adjacent to large industrial plants or transportation hubs.

Going forward, I believe environmental justice will center on the adverse economic consequences that environmental policies create for the poor and for minorities. While these policies are undoubtedly necessary for a number of reasons, including confronting global climate change and limiting respiratory ailments, many of these policies are likely to hit poor communities hard economically.

Indeed, one of the journalists at the event described just such an instance. In this case, he was researching the implications that the new environmental rules instituted by the Long Beach ports, which ban entry to older trucks, had on Latino truckers. For these independent and, sometimes cash-strapped, truckers, the rules present a significant economic challenge–either spend the capital required to upgrade to newer trucks or lose business at the port. The financial burden these rules pose on Latino truckers’ livelihood is another “toll” on an already vulnerable segment of the population.

I believe changes in environmental regulations should be arrived at without any additional expense and hardship to underserved communities. By staying focused on the triple bottom line, organizations, agencies and individuals can work together to ensure that sustainability and economic development are integrated and create benefits for all. It may take more than a “beer summit” to close the potential divide, but engaging in dialogue is an important first-step towards ensuring long-term environmental and economic justice.

Tags: community development, environmental justice, green banking, ShoreBank, triple bottom line
Posted in Green Collar | No Comments »