Jim Harding

Last December, 2007, I meet up with Martin Garber-Conrad in the McCauley – Boyle neighborhood where he lives, and we spent a few hours chatting over coffees at the La Dolce Vita Café, an institution in Edmonton’s Little Italy.

Martin Garber-Conrad is the CEO of the Edmonton Community Foundation. He and I are working together on a large SSHRC research project examining the social economy in British Columbia and Alberta (BALTA). I thought I might take the opportunity to learn more from a long-time practitioner in the field. I asked Martin about his work with the Edmonton Community Foundation, and the brand new Edmonton Social Enterprise Fund .

Martin set out the evolution of these projects by telling me about one of his first ‘social enterprises’ and along the way we explored some other significant collaborations he led to save Heritage Buildings in Edmonton and repurpose them to shelter social economy organizations¹.

[Editor: Social Development Canada (2005) defines the social economy as “a grass-roots entrepreneurial, not-for-profit sector, based on democratic values, that seeks to enhance the social, economic, and environmental conditions of communities, often with a focus on their disadvantaged members.” Western Economic Diversification Canada (2005) defines the social economy as “an entrepreneurial, not for profit sector that seeks to enhance the social, economic and environmental conditions of communities.” Similarly, Economic Development Canada (2005) defines the sector as one that “produces goods and services within the context of the market economy, but whose aim is to redistribute surplus in support of social and community objectives.”

For British theorist John Pearce the social economy is the “third system” of the economy. The first system represents the private sector and is primarily profit driven. The second system is the domain of the public sector and is focused on redistribution and planning. The third system is about “citizens taking action to meet and satisfy needs themselves and working together in some collaborative say to do this” (Pearce 2003). John Restakis (2005) head of the BC Cooperatives Association provides the following definition from an organizational perspective: “Social economy organizations are those organizations whose members are animated by the principle of reciprocity for the pursuit of mutual economic or social goals, often through the control of social capital.” Restakis’ definition includes all co-operatives, credit union, non-profits and volunteer organizations, charities and foundations, service associations, community enterprises and social enterprises that use (in part or in whole) market mechanisms to pursue explicit social objectives. For profit enterprises are included only if surpluses are mutually shared by members in a collectively owned structure such as in co-operatives or collectives. In all these approaches, the social economy is defined as all that part of the third system which is on the trading side or that sells goods and services in the market place for social purpose(s).]

Aurora: I know you have been doing this kind of work for over twenty years Martin, so why don’t you just take me on that journey. Tell me about yourself, and how you went from practical work with kids on the street, to another level of the practical – the financing role that you have now within the Edmonton Community Foundation and the social economy sector.

Garber-Conrad: I think my interest in the social economy probably started before I even knew what it was called. Certainly, before I had heard the term ‘social enterprise.’

In the early 90’s, we had been working with street kids, particularly with young women involved in prostitution and we had some success getting them off the street. But, it was very difficult to help them make the next step. We could get them in a group home in support of our transitional housing. Most of them had already done life skills programs, which were really about the only thing available for high-need, really messed up kids.

We started thinking about how we could help them make the transition from social services into real life. And at some point, before I even heard of the concept of social enterprise, I heard about an outfit in Vancouver called the Picasso Café. It was a small restaurant and catering business and they hired high-risk, high-need youth. I started thinking that if we could help these kids get into gainful legal employment that would be a way for them to begin to make the next step.

A Social Enterprise Café in Edmonton’ City Hall – “Kids in the Hall Bistro”

Garber-Conrad: We knew from the employment training programs already going on with youth in our city that most of those government funded programs would not, or could not, afford to take the risk on these high need kids because they would fail. And that would screw up their outcome numbers. Their funding was dependant on having ‘x’ percentage of outcomes, so they simply targeted themselves at a group of youth who are more functional, less damaged, than the ones we were working with.

We wanted to try to work with kids who were at the deep end of drugs, child welfare, and the criminal justice and mental health systems, whatever. Give them lots of second chances, and give them concrete practical work experience. That (work experience) could be best had in a real restaurant, rather than in a program. There was certainly a programming element of it as well, but we wanted there to be the real concrete work experience.

Shortly before this, Edmonton’s New City Hall had been completed and there was an empty space that had been allocated for a restaurant. They had done two proposal calls seeking a commercial restaurant to move in there and there were no takers, because it wasn’t a good location for a restaurant. There was no parking on the surface close by; City Hall itself was largely a public show space. It was not a high rise where you had fifteen hundred employees captive in the office building. There were only a couple of hundred resident workers, so it was not ideal for a restaurant.

But we felt that we could make a go of it anyway. It’s now been eleven years. I’ve been gone two and half or three years. The restaurant is doing better then ever. The funding for the employment training is perhaps not stable and generous, but adequate to keep it going. The restaurant itself is making more money then ever. Excess revenue is of course contributed to the program but, there is no scenario under which that would ever replace the government funding for employment training programs. It’s very expensive to work with high-need damaged children.

Garber-Conrad: The program has expanded from six months to nine months in addition to programming and workshops outside. The main part of it remains the work experience in the restaurant and then at the end the kids are sent out for work experience in other settings depending on their interest. As a social enterprise, it is certainly contributing. That is, the business is contributing to the social purpose. But it is not of sufficient magnitude to replace the other funding. And, it’s a viable business. It’s well loved, it’s well patronized downtown. They are developing a much more vigorous catering operation, which in the future, I think, has potential for returning even more revenue to the operation; again, probably not of the magnitude sufficient to replace government funding for the training. Nevertheless, it’s better and stronger training for having the discipline of a real restaurant.

Aurora: Restaurants are notoriously high risk ventures. Why a restaurant and not some other type of business?

Garber-Conrad: There were a number of reasons why we picked this particular line of business to get into with these kids, even though we know that the restaurant business is challenging at best and with very few expectations is not a gold mine but, we felt that the experience of working with the public was particularly important.

Especially, because many of the kids are aboriginal and the context in which they are socialized into does not equip them very well for mainstream, middle-class white society. So learning to deal with the public and communicate in a more mainstream way, we felt would be very useful in addition to the work skills and just the general discipline of a work environment in terms of having to get up in the morning and actually show up.

We learned a number of things through it, including that despite our best hopes we could not in fact take the most severely damaged kids. Kids who were homeless no matter how much desire (they show), cannot hold a job. Rather than reject homeless kids and tell them to go away, we would say, “Lets try to get your housing stabilized then you can come into the program.” Likewise, kids that are actively using, it just isn’t going to work. “Get yourself off drugs. We’ll try to get you in a program and when you are clean, and then you can start.” So, so we learnt some things. Overall the success rate - as it has been from the very beginning – is around 80% in terms of kids having a job or going back to school. We track them for at least a year, and that holds up.

Garber-Conrad: That has varied over the years, but probably between 50 to 100 kids would be involved in the program within the course of the year, and we’ve tried various things in terms of doing intakes in groups. I believe the current practice is more continuous intake. They generally spend 4 or 5 weeks in workshops before they come over to the restaurant. Originally the program was limited to six months but the kids can stay for as long as nine months now. Again, reacting to what we have learned and how damaged the kids are, and how long it takes for them to get back into any kind of real life. I am delighted to see that this dream has succeeded.

Garber-Conrad: I was Executive Director of Edmonton City Centre Church Corporation or E4C that had a dozen similar magnitude of programs. I spent at least half my time on this one program for the first three years, trying to get it built, get it approved, getting it going and then keep it running.

Garber-Conrad: Edmonton City Center Church Corporation was formed in 1970 by five of the large downtown mainstream churches. Whatever the original vision was what emerged and what the organization could do very well was to essentially behave as a community based social service organization. It never did very much of a religious nature and under my 18 years it did even less.

But, it became an umbrella under which a variety of social programs could be done particularly in the area of women and children. Our very first programs were nutritious snack in the morning for inner city elementary school children and running the homeless women’s shelter.

Garber-Conrad: Yes. Kids in the Hall Bistro, it’s in the west wing of Edmonton City Hall. We even contacted the group “Kids in the Hall” many, many years ago and got a sign-off from their lawyers on using the name. We had to promise we wouldn’t use it in promoting concerts and we had to promise to send them any bistro t-shirts that we had printed up, send them a sample of any menus etc.

I invested a lot of my time and energy in this in the early years. Nothing delights me more, now that I have been gone, than to see that it’s still going strong and it’s been at least eleven years now. The dates kinda fade as my memory ages, but we must have started it in probably around 1994 or 1995. To see it not only still going but, thriving and indeed, doing more business than … when I was there, so much so in fact, that it’s sometimes even challenging for me to get a table without reservations!

Another thing that really delights me is walking down Jasper Avenue carrying on my normal business and seeing one of the kids and waving and they say, “Hi” and I say, “Where are you going?” with a reply, “Well I am on my way to my job at so and so.”

Garber-Conrad: These were kids who had been on the street, who had been involved in all sorts of messed up bits of life and now they are walking down the street, like everybody else, on their way to work. They may have their kids with them, but they are getting on with their life and that’s still a kick after all these years…quite neat.

Aurora: Did these on the ground experiences influence your thinking about what works best in service provision to marginalized groups.

Garber-Conrad: It’s interesting, after doing this for a while and studying - certainly not in the academic sense of study but reviewing a number of Canadian examples and many more American examples of this particular kind of social enterprise. It’s very exciting. It’s got huge potential but, boy this is not a cheap and easy alternative to traditional social programming. And, it’s certainly not an easy way for charities to make money. In fact, one of the things that I wrote on my sabbatical was a little essay that I intended only slightly tongue in cheek to be a warning to budding social entrepreneurs about how carefully they needed to consider this kind of thing. It is so easy to lose your shirt. I outlined in my essay that perhaps an even greater danger was success and then you lose your soul. In others words, you begin thinking with a mind towards business and you begin compromising your social goals for better business outcomes.

I used to tell people quite up front, that we could improve the financials of the restaurant quite significantly with every kid that we didn’t take! And when we finally got down to no kids, and no expensive training staff, and just had a cook in a dirty t-shirt and a waitress with tattoos, the place would probably make good money. But the social purpose would be lost.

Aurora: As you know Martin, one criticism of the social economy and social entrepreneurship is that it plays into the hands of those proposing a more neo-liberal model of reducing the role of the state in society and privatizing social services. The argument by neo-cons is that a business model is the solution to efficient social service provision, that is, the market is better than state programming at reducing social inequality etc.

Garber-Conrad: Well, as I said with this kind model (and admittedly it’s only one type of social enterprise), it would be unrealistic to ever expect to make the kind of money that would replace the social program. It’s very much supplemental. It’s another revenue stream to go with, in this case, a very intensive training program for high-needs people, it can only be supplemental. But the experience of doing it in an enterprise setting instead of a class room or a counseling setting is still superior. And, in order to do that, you need to put the effort into at least getting a viable business going even if it’s not a gold mine.

Sheltering the Social Economy in Alberta Heritage Buildings

Aurora: You moved from Kids in the Hall and are now working in similar but new directions? One of those directions is the purchase of real estate, buildings and land, and its role in the social economy.

Garber-Conrad: Well I left Edmonton City Center Church Corporation about three years ago, and I have been running Edmonton Community Foundation since then. But let me share one or two other things that I think could be interpreted under the social enterprise framework that I did while still at for E4C. This will get us into the real estate area.

Aurora: Good, because controlling land and property in the hands of the social economy sector is what I want to discuss with you in some depth.

Garber-Conrad: The project I want to discuss wasn’t our very first housing project but it was our first substantial one - the largest single capital project that I have even been involved in. Our organization ran the homeless women’s shelter and had done so since the early 70’s. It was located first in a government building, and then leased space. We were at capacity for the building that was available and so, I had spent a couple years in the early 90’s trying to get a commitment from the government for funding to build a new facility for the women’s shelter. We had, I believe, a commitment of dollars for that purpose; we had an architect; we had a site in mind; and we had preliminary drawings done of a brand new facility that would have met all our needs.

At about that time the Mayor called a meeting of interested people in the community concerning a particular heritage building in Edmonton, known as the Flat Iron building, more properly called the Gibson Block. A triangular shaped building. One of few left in Alberta and indeed in North America for reasons that we eventually found out! It was quite an attractive building. It had been built in Edmonton’s first boom in about 1912 or 1913, and although quite beautiful, was reasonably modest in terms of finishes even at the time.

It had been built as an office building, but soon after it was completed, Edmonton’s first boom was followed by Edmonton’s first bust. And it was quickly converted from offices to a rooming house. It remained a rooming house until probably 10 years before this meeting, well into the 1980’s. Indeed, one of the owners, an elderly woman of interesting character, still lived in a steel reinforced suite on the end of the main floor. She basically ran this thing personally herself, from onsite for about 40 years.

Garber-Conrad: Yes, it’s on the edge of the downtown. It was at the end of Edmonton’s first commercial block and now, very much just over the edge between downtown and inner city in Edmonton. It had become an increasingly disreputable rooming house over the years as no money was invested in keeping it up. So the clientele, you know, were down scaled as well. Nevertheless it had an interesting history and one of Edmonton’s last remaining Turkish baths in the basement - which also started out quite socially acceptable in the 30’s, 40’s and 50’s, but gradually became somewhat more questionable over the years as bathing tastes changed.

This building had been abandoned for approximately 10 years and was improperly boarded up and provided temporary housing for many people, many of whom kept warm by starting fires inside. When we first saw it, it had fairly extensive fire damage and a whole lot of debris that people had used to make nests.

Aurora: Edmonton is a city where -40 Celsius is common in the winter, so the fires make sense.

Garber-Conrad: And in the basement, with enough old mattresses and carpets and a small fire you could keep warm. The roof hatch also had deteriorated and so for at least a few years there was rain coming down through the core of the building. Nevertheless, we have so few architecturally interesting or historically significant buildings left in Edmonton that there was some interest in preserving it. Soon after this meeting with the Mayor, I got the bright idea that perhaps we could do two things at once. Perhaps we could put this building to a social use and preserve its historical significance.

Garber-Conrad: The Mayor was Jan Reimer, our most left-wing mayor in recent times, and when I floated this idea to her, she was supportive. That certainly helped, although having support at that level is only half of it. There is still the Planning Department that one has to continue to contend with throughout a project like this. The justification I saw for compromising the social purpose with a historical or heritage purpose was that I thought it would be very exciting to get the community of people that supports arts, heritage, cultural and historical stuff also interested in homeless women, and if possible to draw resources for the project not only from the traditional housing sources, but also from the historical and cultural sources. I think we demonstrated that it’s possible to do, but it certainly wasn’t easy.

What we basically did was take all the funding that had been allocated for a brand new purpose built building and put it towards trying to salvage and convert this old, wreck of a building to make it into something that would be functional for what we wanted to do with it.

Now one advantage was that it has always been a rooming house, so the notion of housing in this building was not completely foreign. It was an old rooming house, but as we learned more about the architecture of flat-iron shape buildings, one learns the price that is paid for what was basically a solution for using an odd-shaped lot. At certain points in cities, there are places where the street no longer intercepts perpendicular and you have one going off on an angle and depending on the number of degrees of that angle, you often have a triangular shaped lot in that corner that can’t be reasonably be used for a square building. So the bright idea at the turn of the century was to put a triangular shaped building on it.

The down side is - if you think of it as a right triangle and take the height and the base and make it a rectangle, you would have x number of square feet. But by cutting it off and making a triangle you have half the number of square feet. However, you have considerably more than half of the perimeter, and therefore the walls and therefore the surface area to lose heat. So it’s very inefficient as a building envelope - even though it fits a triangular shape lot very well.

Aurora: Tell me a bit more about the built heritage aspects of the building itself.

Garber-Conrad: The building was done with beautiful red bricks. It had interesting sorts of modest Chicago School kind of design elements. There was very little of historical interest inside because the inside was pretty well completely wrecked. As it turned out we had to not only demolish the rooms, but we had to demolish the floors and one of my favorite photographs of the building was an aerial shot from a surveying blimp showing these three walls supported by numerous supports with absolutely nothing in there. We couldn’t even save the floor joists. Everything was gone, from top to bottom, so there was just this open triangular shell and within that we basically built the building back to the way it was a four story building.

We put the kitchen and dining room and what eventually became a health clinic on the main floor. We put the offices and laundry and programming area on the second floor and the top two floors were double rooms, each with a bath for the women. It was built to house 50 women and has since been upgraded to cram about 75 in, as homelessness has gotten worse.

We had dreams originally of doing a more traditional social enterprise on the main floor. We thought we would have a little coffee shop, but the way it was configured, there just wasn’t room to have a kitchen and actually have a coffee shop. An opportunity came with the local community heath center to develop a nursing station there for the women. It’s gone through several incarnations as a site for an HIV research project and then just daily or weekly nursing care for the women who lived there…a very challenging project.

What was interesting about that building was the outside. We preserved it faithfully, even down to finding the last glass factory in North America that could make the little 6 inch square glass panels that had then been set in lead and made into a cornice of some kind above the main windows on the main floors. There was this row of little glass bricks. We paid, I don’t know, 70 grand to get these moulds made and then an outrageous amount for this factory to crank out. We were able to salvage about a third of the original glass. We found somebody in town to make the stain glass panels and re-pointed the brick with just the exact color of red mortar that really highlights the color of the brick beyond what would be the case if you used just normal grey mortar, and a sheet metal class (at NAIT) made these round medallion things that went around the top. We took the last rusty one down and had them make perfect matches of that.

It’s still in a rough neighborhood, and every time they talk about redeveloping that end of downtown everybody thinks, we got to get the women’s shelter out of there. Let’s turn this cute building into condos or something. Nobody thinks of tearing it down now. But they are eager to, and maybe someday, it will be cost effective to let somebody buy it out and turn it into some other use.

Garber-Conrad: The City Center Church Corporation. It has a ( Alberta) provincial heritage designation. It’s a ( Edmonton) city heritage thing. We got all the plaques and we got some money from both the province and the city that was just enough to put together with all the money I had to build a brand new building, and it was just enough to save this old building. But, it’s there and it’s attractive and considering how heavily it’s been used - indeed beyond capacity since at least the last 10 years, it’s holding up very well.

The other really interesting thing- the first week when we moved the women in - for people who don’t know Edmonton, this is right on Jasper Avenue just one block east of Canada Place, two blocks east of the central business district of Edmonton. It’s across the street from the river bank, it’s on the north side of Jasper Avenue, but it does overlook the river valley.

Garber-Conrad: Yea, yea. When we moved the women in a couple of them went up to their rooms and said “This is our palace on the river bank.” “We never thought anybody would think we were good enough to deserve a place like this.” And we are talking about, you know, a 100 square foot room with two beds and some MDF cabinets and half a bathroom.

Garber-Conrad: But this is their “palace on the river bank.” The location of the building said to them, you know, we are no longer shit; to everybody. Somebody cares enough to give us a decent place to live. That made it worth it.

Heritage Building Preservation and the Social Economy

Garber-Conrad: We did a couple of other heritage projects and I’ll mention the others more quickly, because they are not as interesting. Then I‘ll tell you why I think even this fits in with the social entrepreneur component.

The next one we did was a little Chinese restaurant in a frame construction building on 96th Street. This old couple had run the Chinese restaurant for; I don’t know 30 or 40 years. They owned the building. They lived upstairs, they put all there kids through university on this little, really grubby rusty spoon Chinese restaurant. The building was marginal at best; it probably dated from the 1930’s. It was not at all historically significant, other than that there are very few buildings even that old, still functioning in Edmonton, and the zoning was commercial so, the thought of converting this to social housing was a stretch. It was not easy but we did it. It’s basically a two story building. We wanted to build five suites on the main floor, five suites on the top floor, and we did it. We had to gut the whole building and it was more rotten then we thought - lots more expensive.

There was this little lean-too portion in the back, that was just one floor, and it had a little office in it that hadn’t been rented in decades. But it was a commercial space and all we had to do was not tear that down and (we could) say to the zoning people, well there’s still some commercial space on the main floor. Can you allow us to do this (ten units of housing) in this (commercial) zoning? And that’s what allowed it to happen.

We built ten suites - self contained suites, we use them for people who are homeless, or have low level mental health problems, that are able to live independently. For years our maintenance man had his office there. He wasn’t a counselor, he wasn’t a therapist, but every morning when he came in, he put on the coffee pot. And some of the residents would come down for a chat and a coffee. They would tell him if so and so next door was winging out, or hasn’t been taking his meds, or they haven’t seen him in three days. Our maintenance guy could call the authorities and have it looked in to. So it was not a mental health program, really just low-end bachelor suites. But the set up could house people that otherwise would have needed a staffed group home - a much more intrusive program to be able to live independently.

Now, this building cost almost exactly what it would have cost to build new one at the time. However, because it was a ‘Reno’, we were able to get RRAP funding from CHMC that wouldn’t have been available for new construction.

Garber-Conrad: Residential, Rehabilitation Assistance Program. It’s a CHMC program for renovating residential properties.

And it gives you, you know at the time I think it was $30,000 a door or something. Anyway we were able to put that with provincial funding that was available for either new construction or through the homelessness funding. By putting those (two funding sources) together we were able to get enough to do this whereas, if we had to depend on only one funding source, it wouldn’t have been enough; because they simply weren’t paying enough to build anything especially small.

Aurora: This wasn’t a heritage building? It was more of repurposing an existing building?

Garber-Conrad: It was a 70 year old building, which now is an 80 year old building and soon it will 100 years old.

Aurora: Sure, sure. That’s all I wanted to get clear. I’m with you. It doesn’t all have to be these beautiful buildings like the Gibson Block.

Garber-Conrad: It’s a stick built store front that you used to see all over. Well you would have big windows on the main floor and probably residential or warehouse above and a single slope roof and a little cut out thing. I mean we kept all the architectural elements we could but, you know, there was nothing there. I mean it was a piece of shit. But we managed to salvage it and turn it into a good use.

Garber-Conrad: The next one was Alex Taylor School and that is a heritage building. Around about 2000, the School Board had abandoned it; it had been boarded up for three or four years. The population of children in the neighborhood was such that the school was surplus. Because of our connections at the School Board we began to talk about what if you let us have this school and what emerged …was as the new home for our organization - City Center Church Corporation.

We have been in rented high rises on Jasper Avenue in the heart of the business district for our entire life while all our work was east of the downtown in the inner city. And we began to think “what if we moved actually into the area we served?” “what if we took our experience with the Gibson Block and heritage buildings and used it on this heritage school to preserve what could be preserved, but repurpose it from a school into an office and community complex?”

So, with some modest renovation and a million dollar investment in the infrastructure, Alex Taylor School became the home for City Center Church Corporation, the Alberta Council of Women’s Shelters, for a unit of Big Brothers - Big Sisters. It became the training and workshop space for Kids in the Hall Bistro. It became the garage for the success by 6 cow buses. It became an early Head Start Program for 0-3 year olds and it became a conference and meeting space for a variety of community groups.

We treated it as a facility rental social enterprise but, really down played the revenue aspects. For both the tenants and the user groups we charged just enough to cover expenses. Repurposing this building, again, the primary interest in the building was the exterior. We messed very little with that. We spent a huge amount money replacing the boilers and completely redoing the electrical. We developed the offices on the classroom modules; we basically took the size of an existing class room which was quite substantial in those days with beautiful high ceilings and turned that into an office suite and so each of our programs got a classroom with a number of walls and various configurations of cubby holes built within an existing classroom. We even left the slate bulletin boards on the walls.

Garber-Conrad: Yes, yes, where they were slate. Not the cheap ones, the slate ones

. They were built into the brick and of course the school had been built in two phases. The original school was built in 1907 and then about another 50% was added on in 1912. Half the rooms had these huge masonry walls inside. We couldn’t just knock out the walls even if we wanted to, so we preserved the hallways, the stairways all that stuff even the finishing scheme, such as we could.

But it wasn’t wood panel wainscoting. It was burlap, painted burlap, with plaster above. We kept that and indeed replicated that in all the new areas but we did it with two colors of paint rather than actually stick burlap back on the walls.

Garber-Conrad: It was wonderful, a couple of tenants have changed over the years, either the programs have changed or people needed more space or happier space. But it has worked really well. Because of the extreme difficulty of actually selling a school, we settled for a 50 year lease. So, we don’t in fact own it. It’s not yet added to E4C’s real estate portfolio although that is in the works again. It’s been more than 10 years now - they have hopes of eventually taking ownership not only of the building but of the rest of the school site and then developing affordable housing, on the rarely used baseball and soccer field. That is very exciting. And that would fit in with [new plans being discussed] for redevelopment of that part of downtown [Edmonton].

Garber-Conrad: From the Flat Iron Building just keep going down Jasper Avenue - It’s about 93rd Street and Jasper Avenue.

Aurora: I have been thinking about sheltering the social economy as something more, analyzing the relationship of the actual facility and sense of place associated with each of these examples as fundamental to the identity of the services offered. The more I think about it, listening to your stories, there is even more going on here, a larger layer of history, of socio-cultural practices associated with each place, that links the heritage buildings (the past) to the (present) that the public can identify with, not just the clients and workers, but a public that recognizes its own investment in social democracy and social justice.

Garber-Conrad: This school has some of those dimensions because for almost 30 years before the school was abandoned, it had one principal, Steve Ramsankar in the 1970s. He was a character in his own right but he developed this school into a center for the community. And it was more important to that community than even an ordinary school. It became the Chinese senior’s center. It became the drop-in center for scared and abused children. It became an early school lunch program centre. So, at the philosophical or metaphoric level we were not in fact developing a new use for the building, we were in some ways returning it that non-school or extra school part of its life. And in addition to everything else we actually had children back in that school.

There are always compromises. Even brand new buildings are often not absolutely perfect for everybody and certainly we could have made it even better if we added even another couple of hundreds of thousands dollars. We could have replaced the windows, the original windows are still there and they are beautiful, but, you know they are eight feet tall by four feet wide. They are terribly inefficient from a heat perspective. They are almost impossible to open although we made sure in every classroom at least one window opened, but, you know it would have been hundreds of thousands of dollars - even with the cheapest windows, to do historical consistent windows, would have really been expensive. Although that’s the only way I would have done it. So as you know, you could always do more but, it’s functioning.

The organization is where it ought to be and it’s an interesting bridge because it’s on the edge of the downtown, but very much in this community that it serves and even though very little of the organization’s programming is done there it is still a better place. In the old place there was no way clients could come to the 18 th floor of the Royal Bank Building even if we wanted them too. Here it’s at least possible even though most of it is offices, not client services, except for the little early head start kids.

Let me tell you about the last historical one and then I will tell you how’s this ties in to social enterprise.

Two and half or three years ago I moved to Edmonton Community Foundation. We also rented space in the Royal Bank Building, a very corporate and stuffy high rise - the windows don’t open and five or ten years ago had been sold to some off shore interest who had no interest in maintaining the building.

Just before I left E4C I’d become aware of this house called Hilltop House, the former McDougall Mansion on 103 Street right downtown about a block and a half south of Jasper Avenue, located in such a away that you don’t see it unless you are looking. Many people are not aware that it is still there. It’s a 1912 brick house, built for the son of John A McDougall who as an early commercial success story in Edmonton and had a store and turned that into a real estate empire. McDougall and Secord have some legal existence now as they own some high rises and stuff.

The house was built for his son, a five thousand two hundred square foot brick, three-story house. And the widow lived in it until 1952 and we don’t know how but somehow the Province came to own it thereafter, whether it was for back taxes or what. In the 60’s and 70’s it acquired the name Hilltop House. It was a residence for women recovering from alcohol problems and when AADAC was finally formed, it became a program of AADAC and served that purpose till the late 80’s when it was shut down. At it’s height it had 20 women living in there. After that it became minor government offices. The Premier’s Commission on the Family was in there for a few years in the early 90’s and then the Children’s Advocate was in there until five years ago. Five or six years ago.

Garber-Conrad: Well hidden. Abandoned. Not boarded up, but, not used for about four years.

Garber-Conrad: Eventually the Province decided to sell it, put it on the market, no takers. I approached them when I was still at E4C about buying this. My thought was to turn it back into a group home. I made the government an offer, they said no. I got talking to my predecessor at the Edmonton Community Foundation - Doug McNally, a former police chief. He was kind of interested in it and he put in an offer. The government didn’t buy that either. We said well, “what if we put in an offer together and Doug you can take the house as your new office and I’ll take the land and I’ll build a little, you know, I’ll build a few suites of affordable housing there.”

So, we put in a joint proposal - the government said no. About a month later, we hear that Gene Dub who’s the big architect, who owns half the downtown, bought it for exactly the same price we had offered. But, he of course bought it out right; we said we needed 90 days or 180 days to get our funding and get our board approval and all that. Soon after Gene buys it, he finds out that we were interested and we (ECF) worked out a deal where we would lease it with an option to purchase, that was to allow us to figure out if we could actually own property. He agreed to do the initial renovations that we would need to be able to move in and add it to the mortgage, so we didn’t have to put out anything. He put a little less then a hundred grand into it and and we moved in two and half years ago. This year, I put in another hundred thousand. We got a new boiler, air conditioning, new windows. It’s probably another hundred grand that we will need in the next two years. I think we had five years to either purchase it - all our lease payments were going towards the purchase, or, to walk away.

We exercised that last May and the timing was absolutely perfect because the values of the property had doubled in that 14 months that we were leasing it. So, I looked like a real estate genius! What this swings us around to is the social economy piece. My world is Social Service Charities, but I think it also applies to arts and other kinds of (non-profit) groups. We are not only continually short of operating funding, what is needed on a day to day basis to run programs to serve needs, which keep growing generally faster than government funding available. Almost all real charities need money every year. And what charities and non-profits are also short of is assets. And, that puts us in a doubly difficult position.

Private businesses, whatever their revenue and expenditure and profits, often have assets. Now they don’t all have real estate. And there are pluses and minuses to owning real estate. But, particularly in an economic climate like we have now, organizations that don’t even have the possibility of owning real estate are at the mercy of the market and that’s particularly painful in a fast rising real estate market. They have no way to protect themselves against rising rental and lease rates, particularly if you need to be in a particular place. In other words, if geography is not irrelevant to you, and you don’t have the option of moving to a cheaper part of the city or the suburbs and if your program needs to be able to go downtown, then even in the inner city the actual value has not increased but the speculative value (of real estate) and has, and therefore the asking price.

Social Service organizations have very little potential for assets, other than real estate, because they don’t have machinery, they don’t have any of the assets aside from cash that other businesses would have that they can use to borrow, that they could leverage, that they could sell and lease back. They are completely at the mercy of a cash economy. And they are always short of cash and they almost in principle have no or very limited possibility of developing surpluses, even if they could, because often times, surpluses are clawed back by the government funders, even if you run efficiently you probably can’t keep your surplus. All the non-profits that have clients with money that’s a different ball game, but with all the people working with poor people you know user fees are limited.

When I look back on what I was doing at E4C even though I did it imperfectly, we went from essentially no assets to several million dollars in assets. Now they’re not nearly as liquid as one would like because all the historical buildings are tied up for 30 years, the Gibson Block cost $3 million dollars, the city gave us about $200,000. We would have to pay that all back if we sold it before 30 years. They have the option of purchasing the entire building at our cost of 30 years ago - they have the option of buying the whole damn thing.

Garber-Conrad: Same as with all the social housing projects. It varies, 15 -20 years after that then they will become ours free and clear. As I said with Alex Taylor (School) it is a 50 year lease, rather than a purchase, although we could end up owning that.

Aurora: There is some vulnerability there, but the social pressure not to repossess exists as well.

Garber-Conrad: For sure. It’s not liquid in the sense that normal real estate would be for 15, 20 or 30 years. Still, at the end of it, even though we will probably have to put more money into it, it will still have residual value at the end of 15, 20 or 30 years, even if it’s not all profit. It will still have residual value to E4C, it all depends on real estate prices but - 10, 20, 30, and 40 million dollars in assets that I paid you know, probably a total of 5 million for. And before we started doing that, we had zippo.

Aurora: So it was an opportunity that you began to think of as strategic as time went on?

Garber-Conrad: I didn’t think of it on day one but, I thought we have to bust our ass to invest in this but, look at the possibilities down the road, for leveraging this and rolling it over.

When I came to EC4 it was about a half million dollar organization with 20 staff only some of them full-time, in 1987. When I left in 2005, we had 200 staff and a $10 million dollar budget. Our specialty was women and children that expanded into children and youth, that expanded beyond just feeding children into things like the employment training for street kids, the very deliberate outreach to prostitutes, through Crossroads and beyond feeding kids into the whole area of Head Start and other pre-school programs, and then through the women’s shelter an interest in other kinds of social housing particularly for women, particularly for people with mental illness. And so that’s how we started. From that little core of expertise and spread it out.

It also became an umbrella and a facilitator for other programs particularly for highly specialized programs that didn’t fit with any other agency, but often required several partners. They could exist under our umbrella and then if a more logical home emerged for them over the years or if they got big enough to become there own organization that could happen. For me, it was all about getting the job done. Not about building an empire, although the damn thing did grow a lot.

Aurora: Well you know the 2000% growth or whatever – from 500k to $10 million was over eighteen years. Part of it is timing. There was an urgent need for dealing with homelessness in Edmonton and the traditional Federal-Provincial programs that allowed most of the social housing in Edmonton to be built up until 1993 were cancelled. That was right about the time we started building social housing.

The huge social housing projects, the high rises and the big apartment complexes, there wasn’t the money for those anymore, but there was still the need for more specialized projects that would deal with particularly the hard to house, mental health clients, and the people who could not live in a mainstream project anyway. We developed some ability to do that. Not uniquely. There were several other community agencies building housing ten units at a time instead of two hundred at a time, and drawing from half a dozen different resource pots, including a lot of community funding.

In the course of doing that, it became clear to me that even when you knew you could get the government funding there was a step missing, because in order to get approval from the government housing people, you had to have the proper zoning. You had to have detailed construction estimates. You can’t do either of those until you buy the land. And you can’t get the money to buy the land until you have gone through all those other steps and sat around and wait for six months or a year to get approval.

So, how do especially smaller, more marginal inner city charities that want to do social housing and don’t have any assets, how do you even buy the land? Like, you can sweet talk an architect, get him do to some preliminary designs, promise that he’s got the job when we get the money. He trusts you because you’ve done other projects. You’ve shown you can get the money. But you still need to buy the bloody land.

What I was able to do was find a couple of donors who essentially gave me the investment capital and they said here’s a $100,000 or here’s $250,000. You go buy that land for your social housing project and if you can get that covered in the cost from the government funders, then you can also buy your next piece of land. If not, we’ll look at giving you more next year. Basically I had to go out and get that sort of seed capital for a donor and I could basically only do one project at a time cause I could never afford to buy more than one piece of land, and even if I though I could get that money back I wouldn’t get it back until the project was paid off or completed. In the mean time you can’t get two or three lots for $100,000 any more, you are lucky if you can get even one.

So, that is one of the pieces that went into the thinking about the (Edmonton) Social Enterprise Fund.

The Edmonton Social Enterprise Fund

Garber-Conrad: I was well aware of all the work that had been done on financing social enterprise and most of it was around business start ups but, because of my experience or the lack of it, I wanted to develop a model that could also provide financing for social housing.

Knowing that the magnitude of building social housing was so huge that we wouldn’t be able to reasonably do that with the small fund, (we decided that) the piece we could do would be to loan organizations money for that initial land purchase. Not only would it be smaller (the loan), but if they were successful in getting the project funded they could pay that back sooner, better to make a small loan. Let them buy a piece of land, pay it back in six months to a year, then we can loan it out again. We’ll do some longer term financing of course on business start ups, on expansion, on all the traditional social enterprise stuff. We may even give a mortgage or more likely partial financing for a building purchase. But what I think we can contribute best to social housing is that interim or bridge financing.

Aurora: And you built that into the Edmonton Social Enterprise Fund? Amazing.

Can you tell me a bit more about the links between the Edmonton Community Foundation and this new Edmonton City Social Enterprise Fund?

Garber-Conrad: The Edmonton Community Foundation is part of the community foundation movement across Canada and indeed started in the States. It’s been going on for close to 100 years. The first community foundation was in Cleveland Ohio, and north of the great lakes, Winnipeg was the first community foundation in Canada. That was very logical in the first quarter of the 20 th century. Cleveland, Chicago and across the lake – Winnipeg, that was where the action was. So Winnipeg had a community foundation before Toronto, or anybody else. Anyway, it s been going on here for awhile but its very small here compared to the states.

There are about 150 community Foundations in Canada but, there are only 12 substantial community foundations. Our main purpose as a community foundation is to build and look after endowments. So we get donors to give us money, we invest that money, in perpetuity. It is the growth or interest on that money that is given out in grants to reregistered charities every year. The capital stays intact and indeed continues to grow. We have about 250 million dollars in assets. We are the fourth largest community foundation in Canada. We are behind Vancouver, Winnipeg and Calgary. We are growing quite well. Normally we don’t do programming ourselves; we give money to charities to do stuff. We just handle the money.

However, there are certain things, as I found at E4C, sometimes there isn’t an obvious other organization appropriately equipped to do X. And, if X needs really to be done then one either does it or laments its absence. For about eight years, a small obscure unit at the City of Edmonton in the community services department has been very interested in social enterprise and particularly in the financing of social enterprises. In some form or another they have had this vision of a social enterprise fund but, knew that they could not implement it themselves and did not see anyway of doing that until I came to the Foundation. And my particular take on what we could do at the Foundation, plus my history of working with the City, plus my experience with actually running a social enterprise and my interest in the wider issue of financing both for the non-profit sector in general and for social enterprises in particular, it occurred to them that they might want to talk to me. Over a period of six months we came to share a vision for a social enterprise fund much as we think this one will be. And we came to share the opinion that our organization, even though not a traditional operative program, was in fact the right place to run this programs initially with potential that it would grow beyond.

We envision a $10 million dollar fund and we anticipate doing somewhere between dozens and hundreds of loans primarily to registered charities but, perhaps also to non-profits, in order to finance the start up or expansion of social enterprises or finance buildings related to social enterprise and/or other charitable activities, particularly to provide interim financing for affordable housing.

If we are able to live up to all our projections, in the first five years, we would see our fund reach $10 million dollars at the end of five years. We will nevertheless be able to do more than $20 million dollars of business in the first five years, with funding going from $1-10 million. And it’s all about that leveraging and getting the money back and using it yet again. We also intend to develop relationships with one or more mainstream financial institutions. We had the most interest from Van City, one of the largest credit unions in Vancouver. And we hope to get interest from Alberta Treasury Branch here in Edmonton, but, nothing is set yet. We think one way they might be able to participate is by co-financing particularly some of the real estate stuff.

So most of our work in the foundation is around helping donors meet that particular portion of their philanthropic dreams and goals that can be done by setting up an endowment. And endowing that money and giving it out. But this one little bit is going to be supervising the social enterprise fund.

End Notes

1. What is the Social Economy?

For many, the social economy is the “third system” of the economy, that includes all co-operatives, credit unions, non-profits and volunteer organizations, charities and foundations, service associations, community enterprises and social enterprises that use (in part or in whole) market mechanisms to pursue explicit social objectives. This contrasts with the private sector (which many consider the first system of the economy and is primarily profit driven) and the state and public sectors (which are described as the second system focused on regulating the market, taxes, redistribution and planning).

For profit enterprises are included in the social economy only if surpluses are mutually shared by members in a collectively owned structure such as in co-operatives or collectives. What is not included are state institutions or programs and conventional capitalist firms such as sole proprietorships, partnerships and investor-owned or publicly traded companies (Restakis, 2005). Western Economic Diversification Canada (2005) defines the social economy as “An entrepreneurial, not for profit sector that seeks to enhance the social, economic and environmental conditions of communities.” Similarly, Economic Development Canada (2005) defines the sector as one that “produces goods and services within the context of the market economy, but whose aim is to redistribute surplus in support of social and community objectives.” Finally, I prefer the nuance in this definition from John Restakis of the BC Coop Association (2005) which captures the humanity of the sector:

“Social economy organizations are those organizations whose members are animated by the principle of reciprocity for the pursuit of mutual economic or social goals, often through the control of social capital.”

A Social Enterprise Café in Edmonton’ City Hall – “Kids in the Hall Bistro”

Sheltering the Social Economy in Alberta Heritage Buildings

Heritage Building Preservation and the Social Economy

The Edmonton Social Enterprise Fund

End Notes

Related Links