Clicks for cash: Cities and towns turn to crowdfunding for public projects
In Detroit, an artists collective was trying to renovate a community kitchen in an area two miles from a grocery store.
The solution: Using online donations to cover what taxpayer dollars may not.
The idea of soliciting small amounts of money from large numbers of people is nothing new. But crowdfunding websites like Kickstarter and GoFundMe have blossomed over the last decade, leading local governments to replicate the model.
In East Lansing, pickleball players are using a government program to turn clicks into cash.
They want to build new courts using a grant of up to $50,000 from the state’s economic development agency. The money’s available for publicly accessible projects ranging from murals to picnic shelters.
But here’s the catch: Municipalities and nonprofits have to raise at least half the funding themselves from donors using the crowdfunding platform Patronicity.
East Lansing’s pickleball fans plan to supplement crowdfunded dollarswith corporate sponsorships, a state natural resources grant and income tax revenue pledged by the city.
Still, Wendy Wilmers Longpre, the city’s director of parks, recreation and arts, says residents like knowing they helped pay directly for something they want. They don’t always make that link to paying taxes.
“When you pay your property taxes or income taxes, those go to a broad range of services,” she said. “And sometimes people really enjoy the opportunity to give money to a specific resource where they know exactly where their funds are going to go.”
Martin Mayer teaches political science at the University of North Carolina at Pembroke. He’s researched civic crowdfundingwith a focus on where it’s most likely to succeed.
“It's generally not the largest cities, but it's smaller, fairly affluent, well educated places for the most part,” Mayer said. “The success is often linked to the group itself, how well the group markets these projects, the influence of the people pushing these projects, the networks that these individuals have."
The process can raise issues of equity. Residents with more money and ample free time for planning gain an advantage.
Since Michigan launched its initiative six years ago, more than 50,000 donors have funded 300 projects, state officials say.
Melissa Milton-Pung worked on the program through the Michigan Municipal League and calls it an innovative way for local governments to plug budget gaps.
“You're usually trying to make sure that you are keeping the lights on and that you're meeting your basic needs,” Milton-Pung said. “To get further down the list of the wants, versus the must-haves, you almost always have to have some form of outside catalyst."
In cities and towns across the country, crowdfunding has become that catalyst. It's a grassroots approach to improving public spaces, said Michelle Parkkonen, who works for Michigan's development agency.
“Even if you do not have that disposable income, you can still be a patron by either getting the word out and assisting with those fundraising efforts or helping to build that local community support,” she said.
“It allows development to happen with communities versus development happening to communities."