Capitol One’s $265 Billion Community Benefits Plan Could Be Game Changer

File photo by Jack Fennimore.

It goes without saying that I and many others are witnessing our city’s low and middle-income communities struggle with rising rents, entrepreneurs unable to access capital, and entire neighborhoods caught in cycles of disinvestment or facing gentrification efforts. That’s why I’m optimistic about Capital One’s recently announced $265 billion Community Benefits Plan.

This sweeping commitment, linked to Capital One’s proposed acquisition of Discover, could be transformative for communities like ours in Milwaukee. At its core, this plan recognizes what I’ve long argued: that uplifting our low and middle-income neighborhoods requires a comprehensive approach.

Let’s start with housing. Milwaukee’s affordable housing crisis has reached a breaking point with nearly half of our renters considered cost-burdened, which means someone spends more than 30% of their income on rent, mortgage, and other housing needs. Capital One’s pledge of over $35 billion for affordable housing nationwide could be a game-changer. This investment could help finance thousands of new affordable units in our city, providing stable homes for families teetering on the edge of homelessness.

But affordable housing alone isn’t enough. There needs to be investments of community development that strengthens our neighborhoods and workforce. That’s why I’m encouraged by the plan’s $44 billion for broader community development. In Milwaukee, where we’ve seen the devastating effects of deindustrialization, this could mean new life for abandoned industrial sites, funding for much-needed community centers, or support for local healthcare facilities. These investments don’t just improve neighborhoods – they create jobs and economic opportunities for residents.

In addition to the workforce efforts, there is $15 billion earmarked for small business lending in low-income areas, we could see a revival of commercial corridors in neighborhoods like Sherman Park or the North Side. Small businesses are crucial in building sustaining communities and this investment means more local jobs, increased economic activity, and a chance for entrepreneurs from our communities to build generational wealth.

I’m particularly intrigued by Capital One’s commitment to Community Development Financial Institutions (CDFIs). These organizations have been lifelines for many in Milwaukee, providing loans to small businesses and homebuyers when traditional banks wouldn’t. The additional $500 million for CDFIs could amplify their impact, reaching even more aspiring entrepreneurs and homeowners in our underserved communities.

The involvement of nonprofit partners like NeighborWorks America in shaping this plan gives me hope that these commitments will translate into real, on-the-ground impact. Their expertise, along with that of organizations like the National Association for Latino Community Asset Builders and 800 additional nonprofits, suggests that these investments will be tailored to community needs, including those of Milwaukee’s diverse population.

Of course, we must remember that this plan is contingent on regulatory approval of Capital One’s acquisition of Discover. I believe any major banking merger deserves scrutiny and must be thoroughly vetted, yet the potential benefits for low and middle-income communities make a compelling case for approval.

As regulators review this proposed merger, I urge them to consider the potential impact on cities like Milwaukee. The commitments made by Capital One, shaped by respected nonprofit partners, offer a rare opportunity to drive significant resources toward our most vulnerable communities.

Milwaukee, like many urban centers, faces complex challenges that require multifaceted solutions. Ambitious private sector commitments like this, give us the best chance to create lasting positive change in our low and middle-income neighborhoods. As someone who has dedicated their career to fighting for Milwaukee’s underserved communities, I believe this plan deserves our support. Let’s seize this opportunity to build a more equitable and prosperous Milwaukee for all our residents.

Assembly Representative and State Senator-Elect Dora Drake has served in the Wisconsin Legislature since 2021.