Clinic law students, who are second or third year students at the University of Iowa College of Law participating in the Community Empowerment Law Project (CELP) explored models for community-driven investment vehicles in two Iowa communities- Webster City and Manning.
Rural Iowa communities of all sizes face many, well-documented challenges: aging residents and infrastructure, population decline, lack of affordable housing, the loss of manufacturing jobs, and the decline of Main Street that frequently follows. The City of Manning and Webster City, located in Central-West Iowa, are working aggressively to leverage the strengths of their communities, increase economic development, and re-envision what life in small town Iowa could be.
Manning is a small, rural town in Carroll County, with approximately 1,500 residents. Webster City, the county seat of Hamilton County, is significantly larger with approximately 8,000 residents. Though they differ in size, both communities are predominantly White and the median household income is $46,000. The median age of residents is approximately 45 years old and 85-90% of residents have high school diplomas.
Manning and Webster City are both interested in innovative solutions to support community-driven economic growth, by harnessing the capital of small, local investors and supporting entrepreneurs. Manning was successful in securing $790,000 from local investors to build the city’s first and only hotel. Similarly, Webster City has had success creating and renovating a nonprofit movie theater using crowd-funding, and is in the nascent stages of establishing a cooperative brewery in the city. However, these impressive successes did not create a means to effectively channel local investment for future projects.
Both communities want to establish legal entities with set processes for aggregating and using local dollars to develop their communities and generate community wealth. This project engaged a range of issues from how to survey and analyze community needs to the role of local government and social media in fostering community economic development. Students gained familiarity with state and federal laws relating to entity formation and governance, cooperatives, tax, securities, preemption, impact investing, and social entrepreneurship, amongst others, and presented Webster City and Manning with a range of alternatives as well as a set of recommendations tailored to each community.