The role of arts and culture in the discourses and practices of 'sustainable development' can be a local, grounded phenomenon in communities around the world using holistic 'hand-shake' cultural policies. The idea of 'hand-shake' policy is derived from a comparative analysis of the Western (Anglo-Saxon) arm's length policy model of project-based funding, which focuses more on quality (aesthetics and outcomes) products than on ongoing art programs, with policy models developed in Bulgaria and Brazil that privilege the regularity and sustainability of social interactions/processes, where nationally distributed basic institutional support for community cultural centres secures the base infrastructure for systems of creative social exchanges. When planning sustainable cities is based on an integrated system of social relations and cultural codes, a community cultural centre in every neighbourhood (potentially the focal point of localized cultural policies) can serve as the community nucleus where anyone can discover and develop creative potential. Such centres, working within national networks of community cultural centres, should be understood as just as essential and socially useful as the community school and the community health centre. Combinations of three main factors that determine the grounding of cultural policies and NGO projects – looseness, lapse of time, and locality – underlie this transition and the long-term qualitative measurement of participatory processes rather than project outcomes. The dilemmas involved in quantifying intangible project outcomes like emotional, psychological, and social transformations resulting from community arts participation inform the need for alternative and/or complementary indicators of outcomes, that support strategies for sustainable socio-cultural development.