Your Community Is a Portfolio of Unique Assets — It's Time to Manage It Like One

A new ISD framework argues that disaster management and community development belong inside the same system — and that treating them as separate is costing communities their futures.

There is a question that almost no American community can answer: Is our community better off than it was five years ago?

Not richer or poorer in the narrow fiscal sense. Not whether this year's budget came in on target or whether the new development project broke ground on schedule. But better off across the full range of things that actually determine whether a place is worth living in — the strength of its social fabric, the health of its natural environment, the quality of its civic institutions, the vitality of its local economy, the distinctiveness of its identity and culture.

Communities cannot answer this question because they are not organized to ask it. They have budgets, not balance sheets. They track expenses, not assets. They measure outputs — dollars spent, projects completed, grants closed — rather than the condition of the underlying capital stock that all of those outputs are supposed to improve.

ISD's new policy paper, Development Support Functions for Asset Protection and Growth, argues that this is not a measurement problem. It is a structural one. And it points a way out.

The Integration Paradox

Here is something worth sitting with: when a hurricane hits, communities suddenly become very good at integration. The Emergency Support Function framework — fifteen coordinated functions covering everything from transportation to public health to search and rescue — snaps into place. Agencies that never meet become a unified command. Information flows. Decisions get made.

Then the disaster ends. And the silos come back.

The same communities that demonstrate, under crisis conditions, that integrated coordination is entirely possible return immediately to the fragmented, departmentally siloed normal that defines their normal operations. The public health department stops talking to the economic development office. Infrastructure capital planning loses its connection to the workforce development agenda. And the managed transition between the two modes — the hand-off from the integrated emergency frame to the fragmented normal frame — does not exist. One simply ends and the other resumes when the recovery money dries up.

This is the integration paradox: communities already know how to integrate. They just don't do it except in emergencies. And the cost of that choice compounds quietly, in deferred maintenance and deferred investment and deferred attention to the vulnerabilities that the next shock will crystallize.

Four Failures, One System

The paper names four structural failures in how American communities currently manage development and disaster. They are worth listing not as independent grievances but as a causal chain:

Siloed. Departments, budgets, and policies designed in isolation. The hand-off between emergency and normal operating mode is unmanaged.

Reactive. Because communities lack a shared account of what they are building, they have no basis for prioritizing investment before things go wrong. Plans are written; they are rarely practiced.

Income-statement mentality. Public budgeting treats community investment as expenditure. A school is a line-item cost. A park is a maintenance burden. A water system is an infrastructure expense. This framing shapes what gets funded, what gets deferred, and what eventually fails.

Short-sighted. Recovery almost universally aims at restoration of the status quo before the disaster which systematically recreates the pre-disaster vulnerability. Federal programs reimburse documented losses. They do not, by default, fund strategic repositioning.

These failures do not sit side by side. They generate each other. Because communities are siloed, they cannot anticipate cross-departmental problems — which means they are reactive. Because they are reactive, crisis spending dominates — which drives the income-statement mentality that treats proactive investment as unaffordable. Because investment is deferred, communities return after each disaster to whatever trajectory they were on before it — which erodes the political will for the long-term capital investment that would break the silo in the first place.

The loop closes. And it is a system design failure, not a failure of the individuals working within it. Many practitioners understand these constraints acutely. The problem is upstream of their efforts.

Communities Are Portfolios

The paper's central reframe is this: a community is a portfolio of capital assets, and the relevant question is not what it is spending but what it is building or depleting.

ISD's Community Assets Framework identifies nine forms of capital that constitute the community balance sheet:

• Economic capital — jobs, income, businesses, innovation, financial health

• Property capital — housing, land, buildings, neighborhoods

• Physical capital — infrastructure, transportation, utilities

• Human capital — health, education, skills, well-being

• Social capital — trust, civic networks, volunteerism, community connections

• Political capital — effective institutions, leadership, accountability

• Intellectual capital — knowledge, data, research, diagnostic capacity

• Natural capital — clean air and water, healthy ecosystems, biodiversity

• Legacy capital — history, culture, identity, distinctive places and traditions

These are not independent categories. They interact — and the interactions are where the diagnostic power of the framework lies. Weak political capital leads to deferred physical infrastructure maintenance. Deteriorating water and roads impose direct health costs on human capital. Businesses relocate, eroding the economic capital. The tax base contracts.

An old street preacher in Anacostia used to give talks about his neighborhood that even reached the ears of the Whtie House, and one of his aphorisms became a key litmus test for HUD during a certain era: "A community is only as good as its weakest link." In other words, because communities have become so inter-connected, a failure in one system, say policing or education, can have economic, social, environmental, and other ripple effects.

The cascade can run from one depleted type across the entire balance sheet.

New Orleans after Katrina is the clearest illustration: by conventional metrics, the city recovered. The French Quarter is thriving. Tourism is back. But the working-class neighborhoods that bore the brunt of the flooding have not recovered in any meaningful sense — because the disaster economy, the surge of reconstruction spending and federal assistance, produced visible results that obscured a continuing deterioration in the underlying community capital for many of the people most harmed.

Counting dollars spent and projects completed is measuring the disaster economy. Measuring recovery means tracking whether the community's capital position has been restored — and whether the trajectory has been redirected toward growth.

What Are Development Support Functions?

The federal government has fifteen Emergency Support Functions and six Recovery Support Functions. It has zero Development Support Functions.

That asymmetry is the gap the paper is designed to name. ESFs and RSFs are frameworks for crisis — organized around the moment of disruption rather than the ongoing work of building community capital. They are extraordinarily sophisticated at crisis response and largely silent about the capital conditions that make communities more or less vulnerable to crisis in the first place.

The paper proposes nine Development Support Functions as the steady-state analogue:

Each DSF designates the public, private, and civic actors who share responsibility for building that capital type — not just the government agencies, but the businesses, lenders, anchor institutions, and community organizations that are often the fastest and most flexible sources of investment and coordination capacity. This is a whole-of-society framework, because the evidence shows that whole-of-society coordination is what actually works.

Recovery Is a Bridge, Not a Destination

The lifecycle framework in the paper traces six phases: steady state/normal operating conditions, shock event, emergency response, stabilization, long-term recovery, and return to development. The paper argues that the stabilization phase — the weeks and months after the acute emergency but before federal recovery dollars arrive — is consistently underfunded and undertheorized. This is the valley of death in disaster recovery: the period when businesses fail, residents leave, and assets are permanently lost while communities wait.

But the deeper argument is about the final phase. Recovery ends not when the last federal grant is closed out, but when the community is back on its development trajectory — building capital again, investing in resilience, pursuing its growth agenda. A community that has "recovered" by returning to its pre-disaster condition but not its pre-disaster trajectory has not succeeded. It has returned to whatever slow decline or stagnation was in place before the event.

This changes the strategic question at the beginning of every recovery effort. The question to ask is not: what did this community have before the disaster? It is: what does this community need to be on a better trajectory after it?

Recovery is perhaps the only significant opportunity a community will have to make strategic investments in the capital types that were already weak before the storm. Missing that opportunity by focusing only on restoration is one of the most common and most costly failures in American disaster policy.

Three Tracks, Not One Size

A major disaster does not change the track a community is on. It accelerates the trajectory that was already in place.

The paper uses a three-track framework to account for the variation in community capital positions that makes the same intervention produce radically different results in different places:

Innovation economy communities generally have strong economic and intellectual capital. Their challenge is managing the social costs of that strength — displacement, affordability, the erosion of the legacy capital that made the place worth caring about.

Mature economy communities have an established base that is neither thriving nor failing. Their window for intervention is real but not permanent — a manufacturing town that loses its anchor employer has years, not decades, to diversify before fiscal decline becomes self-reinforcing.

Opportunity economy communities — rural counties hollowed out by consolidation, urban neighborhoods abandoned by capital, small cities that have missed the last several economic transitions — are the hardest cases and the ones where the gap between conventional development tools and actual need is widest. Standard incentive-driven recruitment doesn't work here because the prerequisites aren't present. What works, slowly, is inside-out development: building from existing community assets, strengthening social networks, preserving legacy capital, restoring basic infrastructure.

The track a community is on before a disaster is the most important predictor of its recovery trajectory. Building capital in the steady state is not just a development goal. It is disaster preparedness.

What This Means for Practitioners

The paper's policy implications are direct:

Require multi-capital assessment before strategy. Communities need an honest accounting of where the capital stock is strong, where it is depleted, and how the depleted types are constraining the strong ones. This should be the first deliverable in any serious development or recovery planning process — not a budget analysis, not a project pipeline.

Deploy recovery resources toward trajectory, not restoration. A community with a significant natural capital deficit before a disaster should use recovery resources to address that deficit. A community with weak social capital should invest in civic infrastructure. Recovery is the opportunity — sometimes the only one — to change tracks.

Design programs for capital conditions. A grant program built around the needs of mature economy communities will underperform in opportunity economy communities because the prerequisites aren't present. Program design that accounts for capital conditions and measures success by capital outcomes — not just spending rates — is what the evidence supports.

An Invitation

This paper is Version 1.0. ISD will be hosting a webinar to discuss the framework and we expect it will generate responses — from emergency managers, from federal program officers, from community development practitioners, from local officials. We want those responses. The framework is designed to be useful in the field, and field experience is how it will improve.

The communities this framework is ultimately about are not the ones that make the covers of economic development magazines. They are the ones that have been working hard with insufficient tools — the rural counties told for a generation that their trajectory is beyond their control, the disaster-affected neighborhoods that received recovery resources and still didn't recover, the small cities where decline is slow enough to feel natural but fast enough to be devastating.

These communities do not lack will. They lack a diagnostic framework that accurately names what is constraining them and what it would take to change it.

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Stephen Jordan is the Executive Director of the Institute for Sustainable Development. ISD is a nonpartisan 501(c)(3) practitioner-led think tank based in Alexandria, Virginia, working at the intersection of disaster recovery, community resilience, and economic development. Learn more at isdus.org.

Tags: disaster recovery, community development, Development Support Functions, community resilience, CDBG-DR, policy