CDAC Spotlight:
Collaboration: The Key to Champion Community Investments' Success

A friend of mine from Murphysboro, Ill., is fond of the old saying, “If you want to go fast, go alone. If you want to go far, go with others.” After my initial dismissiveness of yet another motivational adage, I could see the passion for “going far” in his eyes and knew he meant business. Since I first heard him say it, I’ve repeated the maxim a hundred times to others and to myself. More importantly, I’ve taken it to heart.

Champion Community Investments—The Beginning

With the assistance of some great folks in Rural Development at the U.S. Department of Agriculture (USDA), we launched Southern Illinois Coal Belt Champion Community Inc. (doing business as Champion Community Investments, or CCI) in 2002. Originally, we were an applicant for federal Empowerment Zone status, but we lost out in the final round. In the process, though, those of us on the planning committee—who hailed from three rural counties and several small towns—found that we liked and respected each other immensely and that perhaps we shouldn’t let this defeat stand in our way.

With that shared commitment, we formed as a nonprofit 501(c)(3) corporation with missions of economic and community development. CCI originally served three counties—Perry, Franklin and Williamson. In 2010, Jackson and Jefferson counties were added. One of our lending programs also includes White, Hamilton, Gallatin, Saline, Pope, Hardin and Randolph counties.

In the beginning, there were times when we met more as a social opportunity while searching for tangible work. By 2005, we had launched Connect SI, an initiative that would become a 20-county project built around collaboration and broadband connectivity. Today, because of the collaboration between the telecommunications industry and units of local, state and federal governments, the region is wired for global success. The city of Carbondale—home of Southern Illinois University Carbondale—is a “gigabit city.” Fiber-to-the-home projects extend even into the Shawnee National Forest.

From Business Loans to CDFI Status

In 2006, CCI made its first business loan after USDA fueled our interest with a $94,500 grant to start a revolving loan program. We quickly lent out that fund and landed our first Intermediary Relending Program (IRP) loan of $300,000. That first IRP has been followed by three more million-dollar IRPs and two rounds of Rural Microentrepreneur Assistance Program (RMAP) loans of $500,000 each.

In 2013, CCI was recognized by the U.S. Treasury Department as a community development financial institution (CDFI), the only nonprofit CDFI south of Springfield. The organization also received a $600,000 Small and Emerging CDFI Assistance grant to further our lending and investment abilities. The grant has offered CCI the ability to leverage additional lending resources as well as to consider business funding alternatives—including equity investing—that couldn’t have been offered previously. Furthermore, the CDFI designation has put CCI on the radar of larger regional and national commercial banks.

Since that first loan in 2006, CCI has closed on 85 loans with an aggregate principal value of $4.8 million, $8.4 million in private-sector injection and over $13 million in total project value. We have worked extensively with area banks to provide gap financing to help complete worthy projects. CCI has also worked with other area 501(c)(3)s to further economic regional development.

This cooperative structure works well for our funding resources, who prefer to fund collaborative organizations with regional footprints. Several towns and counties in the organization’s service area now defer business lending to CCI. Handing that task off to a regional entity also removes the politics that sometimes play into local lending decisions. As competition increases for government resources, CCI has earned and maintained the respect of federal partners who seek reliable intermediaries.

What Makes CCI Work?

What makes this all click is that the CCI directors work so well together. They aren’t bankers or financial types. They are mostly economic and community development professionals who find creative ways to overcome bureaucratic and political friction. They recognize and take smart risks that have kept the organization’s losses and bad debt ratio very low. They disagree respectfully and don’t push buttons. They delight in the success of the businesses we help, whether they are located in their respective counties or not. In the process, all feel more at home as citizens of southern Illinois.

CCI is pretty short-staffed. I am a part-time executive director. Our treasurer—also a member of the board of directors—serves as our loan officer. Our directors are our best faces in their communities. We have at least two directors from each of our five core counties. In many ways, they are the most effective marketing arm of CCI. The directors have taken an active role in promoting the corporation as well as advocating for loan applicants from their constituent areas. In considering loan applications, they ask tough, challenging questions. Other times they encourage us to take risks that conventional lenders might disdain. They have learned how to be discerning lenders who effectively balance our nonprofit mission with common sense.

During CCI’s life, we have seen other collaborative efforts rise and fall. The ones that work seem to feature strong, inclusive, servant leadership. Collaborative leaders must be able to communicate a vision, work with and through others to champion that vision, and be there for both the successes and the inevitable bumps in the road. They have to be willing to roll up their sleeves and be seen as team members who are willing to get their hands dirty on occasion. Collaborative leadership isn’t for wallflowers.

When others look at CCI, they are quick to attribute our success to numbers—millions lent and millions more in projects leveraged, or the infinitesimal bad debt ratio, or the incredibly small number of write-offs. I know better. Our success is driven by directors from Franklin County who support projects in Williamson County. CCI is successful because a director from Mount Vernon advocates for a project in Carbondale, 50 miles away. CCI succeeds because its board is composed of smart people who see themselves as citizens of a larger community that needs our help.

To the CCI Board of Directors, on behalf of grateful businesses throughout the region and well over 150 working southern Illinoisans, I extend my sincere appreciation. Thank you for your vision and willingness to work, think and succeed together. Because of your teamwork, CCI is going far.

CDAC Spotlight: Rex Duncan

Rex Duncan serves as executive director for Champion Community Investments (CCI), a 501(c)(3) nonprofit community development financial institution (CDFI) that provides economic and community development support in five southern Illinois counties. He served as president of the Board of Directors of CCI starting in 2004 and became the organization’s first executive director in November 2015. Duncan retired from Southern Illinois University Carbondale in 2014, having worked as the director of Community Development and Outreach in the Office of Economic and Regional Development. He holds a bachelor’s degree in business from Eastern Illinois University and a master’s in workforce education from Southern Illinois University Carbondale. He is a member of the Community Development Advisory Council (CDAC) for the Federal Reserve Bank of St. Louis and is a former mayor of his hometown of Du Quoin, Ill.

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CDAC members are experts in community and economic development and financial education. They complement the information developed through outreach by the Eighth District's Community Development staff and suggest ways that the St. Louis Fed might support local efforts. A list of current members is available at www.stlouisfed.org/community-development/about-us/community-development-advisory-council.