By Stevan Allen

In the Central Valley, our community has faced significant challenges due to the housing crisis and stagnant business growth. While we’ve often turned to the government for solutions, our region hasn’t always received the support it needs. That’s why I’m fully backing the community benefits plan proposed by Capital One as part of its merger with Discover.

Capital One’s ambitious $265 billion Community Benefits Plan (CBP), set to roll out over the next five years, stands as a groundbreaking initiative for small businesses and those traditionally excluded from the financial sector. Once the merger with Discover is approved, this substantial plan promises to have a far-reaching impact on real estate and minority-owned businesses, particularly in California and nationwide.

In California, where affordable housing demand continually outstrips supply, Capital One’s CBP provides a critical response. With $44 billion earmarked for community development financing across the country, this plan has the potential to fuel the construction and renovation of much-needed affordable housing units in the state. By injecting significant capital into California’s real estate and infrastructure markets, Capital One is addressing not just the immediate housing crisis but also setting the stage for long-term community growth and sustainability.

A key element of the plan is the $600 million designated for Community Development Financial Institutions (CDFIs). These institutions have long been essential in supporting low- and moderate-income (LMI) communities, particularly those historically underserved by mainstream financial services. CDFIs, such as NeighborWorks America, have played a pivotal role in shaping this plan to ensure that it directly benefits local populations. By partnering with these organizations, Capital One guarantees that the resources from the CBP reach the communities that need them most, fostering equitable growth across the state.

Beyond real estate, Capital One’s CBP also delivers vital support to minority-owned businesses in California. With $15 billion set aside for small business lending in LMI communities and for businesses with annual revenues under $1 million, the plan aims to empower entrepreneurs who have historically struggled to secure capital. In a state like California, where nearly 2 million minority-owned businesses employ 2.5 million people, this commitment could transform the economic landscape. Furthermore, Capital One’s pledge to spend $5 billion with diverse suppliers ensures that minority-owned businesses directly benefit from the bank’s operations, spurring even more economic development.

Additionally, the plan directs a staggering $200 billion towards lending to LMI consumers, enhancing access to the financial system with simple and affordable products. This comprehensive approach is designed to dismantle the barriers that have historically prevented many Californians from achieving financial stability and security.

Collaboration with non-profit partners like NeighborWorks America underscores the importance of strategic partnerships in driving meaningful, lasting change. These organizations provide invaluable local insights, ensuring that Capital One’s CBP is both effective and responsive to the specific needs of California’s communities.

As this plan progresses, it is vital that regulators recognize the transformative potential of Capital One’s CBP. Approving the merger with Discover would unlock significant resources and opportunities for California’s real estate market and minority-owned businesses. Regulatory support at this pivotal moment could catalyze long-lasting, positive change, making affordable housing and economic empowerment a reality for millions of Californians.

In summary, Capital One’s CBP represents a historic and profound commitment to addressing the critical needs of real estate and minority businesses in California.

Stevan Allan is a seasoned communications and business consultant serving California’s agriculture, trade, and tourism industries. He served as a respected staff member of Governor Gray Davis’s Administration and the State Legislature.