America’s largest bank has announced it will invest $100 million over the next five years on improving Detroit’s infrastructure and training the blighted city’s workforce.
The New York Times reports JPMorgan Chase said it will invest the money on housing repairs, blight remediation, economic development and job training programs in the debt-plagued city. The investment will be a combination of loans and grants.
“The city’s challenges remain significant– unprecedented, in some regards– but JPMorgan Chase believes that Detroit has the ingredients and intrinsic strengths to reshape and rebuild a dynamic modern economy and make the city a great place to live, work and invest,” the company said in a statement. “We are committed to helping make that future a reality.”
Half of JPMorgan’s investment will be directed toward community projects that would otherwise have great difficulty securing capital. Groups including the Detroit Land Bank Authority and the Detroit Blight Removal Task Force, which are dedicated to removing the estimated 78,000 vacant structures in a city whose population has plunged from nearly 1.9 million in 1950 to just over 700,000 today, will receive $25 million.
An additional $12.5 million will be spent on job training, $7 million will fund small business assistance and $5.5 million has been earmarked for economic growth projects like a new streetcar system, the Times reports.
Detroit is broke. Last July, it became the largest US city to ever file for Chapter 9 bankruptcy protection. The city, once the world’s leading industrial metropolis, suffered enormously from the decline of American manufacturing and the subsequent flight of more than 60 percent of its population. It is now mired in $18.5 billion in debt.
JPMorgan Chase isn’t the only major corporation that has pledged significant investment in Detroit. Last November, Lloyd Blankfein, CEO of the multinational investment banking giant Goldman Sachs, and billionaire investor Warren Buffet, unveiled a $20 million partnership to boost small business in Detroit.
Both JPMorgan Chase and Goldman Sachs have been implicated in criminal wrongdoing in connection with the recent financial meltdown. While no charges have been filed against Goldman Sachs, JPMorgan Chase recently agreed to pay $1.7 billion to settle criminal charges in the Bernie Madoff case, as well as $13 billion for lying about the value of mortgages it sold to investors.