JPMorgan Chase To Pump $100 Million Into Detroit
DETROIT (WWJ/AP) - Financial giant JPMorgan Chase will invest $100 million over five years into bankrupt Detroit.
JPMorgan Chase Chief Executive Jamie Dimon got a standing ovation as he officially announced the investment Wednesday.
The money will be divvied up in loans and grants and will include funding for home mortgage loans, job training for Detroit residents and blight removal.
"We believe in Detroit's future, and we want to see the city recover its economic strength," Dimon said.
"We are putting our resources and expertise to work to help this iconic American city chart the course back to economic prosperity. We have been in Detroit for a very long time - and we're going to be here for the long term," he said.
Dimon says this is no charity case.
"We are, just to make it clear, a for-profit institution and we are making an investment in Detroit."
Here's how the Chase investment breaks down:
$50 million -- Community Development
This investment, in partnership with Invest Detroit and Capital Impact Partners, will create two new funds to help finance vital projects that often lack access to traditional sources of capital.
$25 million -- Tackling Blight
This investment will help accelerate the city's ambitious efforts to end blight, restore properties to productive use and stabilize and revitalize neighborhoods. Approximately $5 million of the investment will be used to seed a Rehab Loan Pilot Program that will make loans to families purchasing their own home through the city's Neighbors Wanted property auction.
$12.5 million -- Strengthening Workforce Readiness
Helping workers obtain valuable job skills expands access to opportunity. This initiative will strengthen partnerships between employers and local workforce programs and give residents access to training in the skills employers are seeking. Part of the funds will also go toward expanding employment experiences for young people through the Detroit Youth Employment Consortium.
$7 million -- Growing Small Businesses
In a partnership with other local organizations -- such as Bizdom, TechTown and Eastern Market -- this investment will help Detroit's vibrant small businesses and entrepreneurs access the resources and expertise they need to get their companies off the ground and catalyze broader growth and employment throughout the city.
$5.5 million -- Seeding Future Economic Growth
This investment supports strategic initiatives that are important to Detroit's recovery and long-term future economic growth, mainly the new M-1 rail line and bringing the Global Cities Initiative to Detroit. Beyond the core focus areas, this investment will also support other local organizations working to revitalize the city.
"When you're in a town, you try to be a great citizen there and we happen to be a big player in Detroit," Dimon said, adding that Chase has more than 2,500 employees in southeast Michigan.
Chase's investment will help in Detroit's revitalization, Downtown Detroit Partnership president Dave Blaszkiewicz told the Free Press. The group is a partnership of corporate, civic and philanthropic leaders that supports downtown improvement programs and initiatives.
"You couldn't ask for a better time to bring these dollars in," Blaszkiewicz said.
Detroit Mayor Mike Duggan said the city will have the money soon.
"They're moving the money to the CDFIs and to the local banks very quickly, and I expect it to be accessible within a matter of weeks," the mayor said.
Said Detroit City Councilwoman Brenda Jones, "(This is) fantastic! I think it's a great day for the city of Detroit..."
Detroit filed for bankruptcy last July, becoming the largest U.S. city to do so, citing $18 billion in unmanageable long-term liabilities.
Ballots have been mailed to thousands of Detroit creditors for their votes on the city's bankruptcy restructuring plan. State-appointed emergency manager Kevyn Orr expects the city to exit bankruptcy later this year.
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