Communities at Work: Addressing the Urban Challenge National Excellence Awards for the City Summit U.S. Department of Housing and Urban Development HUD User P.O. Box 6091 Rockville, MD 20849 ------------------------------ The National Preparatory Committee To oversee America's preparations for the City Summit (Habitat II), U.S. Department of Housing and Urban Development (HUD) Secretary Henry G. Cisneros has named a National Preparatory Committee (NPC). Those serving on the NPC are: Henry G. Cisneros, Chair Secretary, HUD Michael Stegman, Alternate Chair Assistant Secretary, HUD James Johnson, Vice Chair Fannie Mae Vince Lane, Vice Chair American Community Housing Association Moises Loza, Vice Chair Housing Assistance Council Aurie A. Pennick, Vice Chair Leadership Council for Metropolitan Open Communities Camille Cates Barnett Center for International Development Research Triangle Institute Harvey Bernstein Civil Engineering Research Foundation Don Borut National League of Cities Joan Baggett Calambokidis International Masonry Institute Joan Brown Campbell National Council of Churches Gale Cincotta National Training and Information Center Stephen Coyle AFL-CIO Housing Investment Trust Juanita Crabb Sister Cities International Cushing Dolbeare National Low-Income Housing Coalition Michael E. Doyle Cooperative Housing Foundation Terrance Duvernay Legg-Mason Wood Walter Incorporated Mencer Donahue Edwards U.S. Network for Habitat II Pablo Eisenberg Center for Community Change Jane Fortson The Progress and Freedom Foundation Maria Foscarinis National Law Center on Homelessness and Poverty Ester Fuchs Columbia University Millard Fuller Habitat for Humanity International Rose Garcia Tierra Del Sol Housing Corporation The National Rural Housing Coalition Christopher T. Gates National Civic League Robert Geddes, FAIA New York University Bertha Gilkey Urban Women Incorporated Arthur Godi National Association of Realtors William Gorham The Urban Institute Eugene Grigsby University of California/Los Angeles Paul Grogan Local Initiatives Support Corporation David Hales US Agency for International Development William Hansell International City/County Management Association F. Barton Harvey, III The Enterprise Foundation Glenda Hood Mayor of Orlando, FL John Kasarda University of North Carolina Kenan Institute of Private Enterprises George Knight Neighborhood Reinvestment Corporation Carole Lankford Confederate Salish & Kootenai Tribe Gregory S. Lashutka Mayor of Columbus, OH Warren Lasko Mortgage Bankers Association of America George Latimer National Equity Fund David Mammen Institute of Public Administration Gary D. McCaleb Mayor of Abilene, TX William McDonough University of Virginia Robert McNulty Partners for Livable Communities Richard Nelson, Jr. National Association of Housing and Redevelopment Officials Michael O'Brien GMAC Mortgage Corporation Molly Harriss Olson President's Council on Sustainable Development Ting C. Pei The Pei Group Neal R. Peirce Syndicated Columnist Janice Perlman Mega-Cities Project Incorporated Tessa Martinez Pollack Glendale Community College William Reilly Stanford University Norman Rice Mayor of Seattle, WA Yolanda Rivera Banana Kelly Community Improvement Association Nan Roman National Alliance to End Homelessness David Rusk Urban Policy Consultant Kurt L. Schmoke Mayor of Baltimore, MD Randall Smith National Association of Home Builders Marta Sotomayor National Hispanic Council on Aging William C. Steere Pfizer Corporation Franklin Thomas The Ford Foundation Tanya Tull Beyond Shelter Chester A. Widom, FAIA American Institute of Architects Eddie Williams Joint Center for Political and Economic Studies ------------------------------ U.S. Department of Housing and Urban Development The Secretary Washington, D.C. 20410-0001 I am honored to present Communities at Work: Addressing the Urban Challenge--a profile of 25 examples of excellence in building healthy communities from across the Nation. As part of the U.S. preparations for Habitat II: The Second Global Conference on Human Settlements, the Department of Housing and Urban Development sponsored the National Excellence Awards for The City Summit to identify and share the best of the American community-building experience. With the help of experts and practitioners from the public, private, and nonprofit sectors, the competition identified 25 of the most innovative and successful efforts to promote affordable housing, economic development, education and job training, public safety, and environmental protection in cities and towns across the country. By demonstrating how local initiatives can help link residents of distressed communities to the larger economic and social mainstream, these success stories are both instructive and inspirational. While such examples are rarely replicable, they are often adaptable to reflect the particular circumstances of a community. By offering lessons about the organizational, financial, and management elements critical to success, these examples will benefit others who engage in the community-building process. As a former mayor, I recognize the importance of local initiatives in developing lasting solutions to the challenges facing our communities. This publication is just one element of the Department's continuing effort to work in partnership with local governments, private firms, and the growing network of community- based organizations to build healthy cities and a strong Nation. Henry G. Cisneros ------------------------------ Communities at Work: Addressing the Urban Challenge June 1996 U.S. Department of Housing and Urban Development Office of Policy Development and Research ------------------------------ Dedication The U.S. Department of Housing and Urban Development joins the winners of the National Excellence Awards in dedicating this book to Mr. I. Donald Terner, President and Chief Executive Officer of the San Francisco-based BRIDGE Housing Corporation. On April 3, 1996, Don Terner, along with 32 Americans on a trade mission to Bosnia and Croatia, perished in a plane crash near Dubrovnik. An architect, planner, and housing developer, Don Terner is an inspiration to us all. His passion and strong will led to thousands of affordable homes for working men and women. Since joining BRIDGE in 1982, he has helped develop more than 6,000 units of affordable housing and 250,000 square feet of community-oriented commercial space throughout California. His visionary approach to mobilizing private investment for affordable housing is reflected in the World/BRIDGE initiative, highlighted in this book. ------------------------------ Acknowledgments This report was prepared by Aspen Systems Corporation and the Mega- Cities Project, Inc., through funding provided by the U.S. Department of Housing and Urban Development. Our thanks to the 175 organizations that submitted programs for consideration by the selection panel and to the experts who reviewed them. This report would not have been possible without the dedicated reviewers from the following organizations: AFL-CIO Housing Investment Trust American Institute of Architects The Barnard-Columbia Center for Urban Policy Center for Economic Priorities Center for Sustainable Cities Program City College of New York Architectural Center Columbia University, Graduate School of Architecture Community Trust Council for Economic Priorities CUNY Graduate Center, Department of Sociology The Enterprise Foundation GMAC Mortgage Corporation Hunter College, Department of Urban Planning Institute of Public Administration International City Managers Association Joint Center for Political and Economic Studies Leadership Council for Metropolitan Open Communities Mellon Foundation National Association of Housing and Redevelopment Officials National Association of Realtors National Council of Churches National League of Cities National Low-Income Housing Coalition Pfizer, Inc. Picardi and Company Project for Public Spaces Rutgers Department of Urban Planning Sister Cities International Social Policy U.S. Agency for International Development University of Washington, Center for Sustainable Communities Village of Rye Brook Administration Wellington Sanders Associates World Environment Center ------------------------------ Table of Contents Introduction National Excellence Awards Winners The Almena Idea Impact Seven, Inc. Almena, Wisconsin Bricklayers and Laborers Nonprofit Housing Bricklayers and Laborers Nonprofit Housing Corporation Boston, Massachusetts Campus Circle Comprehensive Neighborhood Revitalization Initiative Marquette University Milwaukee, Wisconsin Center in the Square Roanoke, Virginia Community Lending Through Community Home Buyer's Program Federal National Mortgage Association Washington, D.C. A Continuum of Program-Enriched Housing Northeast Denver Housing Center, Inc. Denver, Colorado; Greenpoint Manufacturing and Design Center Greenpoint Manufacturing and Design Center LDC Brooklyn, New York Habitat for Humanity Habitat for Humanity International Americus, Georgia Homeless Families Program Beyond Shelter Los Angeles, California Housing Assistance Council Washington, D.C. Housing Scholarship Program City of Fremont Fremont, California The Loading Dock Baltimore, Maryland McAuley Village The McAuley Corporation Providence, Rhode Island Minneapolis Neighborhood Revitalization Program Minneapolis, Minnesota NeighborWorks Full-Cycle Lending Neighborhood Reinvestment Corporation Washington, D.C. New Community Pathmark Supermarket New Community Corporation Newark, New Jersey Police Homeowner Loan Program Columbia, South Carolina Resident and Community Services Omaha Housing Authority Omaha, Nebraska South Bronx Churches Nehemiah Homes South Bronx Churches Sponsoring Committee, Inc. Bronx, New York Take Back The Park Citizens Committee for New York City, Inc. New York, New York Tent City Tent City Corporation Boston, Massachusetts Transforming Neighborhoods Together Center for Neighborhood Development Knoxville, Tennessee The Winds of Change: Meeting the Needs of Rural Resort Latinos Asistencia para Latinos Glenwood Springs, Colorado The World/BRIDGE Initiative BRIDGE Housing Corporation San Francisco, California Yard Waste Recycling Project City of Lindsborg Lindsborg, Kansas National Excellence Awards Finalists ------------------------------ Introduction This is an extraordinary time in America's cities. Communities are tackling old and new problems in innovative ways. They are engaging new partners, working entrepreneurially, using resources in unaccustomed ways, and breaking down barriers in service delivery to revitalize cities and meet complex human needs. These activities and innovations are clearly evident in the winners and finalists in the National Excellence Awards for The City Summit (Habitat II) whose work is highlighted in this volume. Selected from among 175 nominations, these model projects give testimony to the ingenuity and successful enterprise evident in cities all across America. In the United States, two major changes have occurred in housing and community development since the United Nations convened the first Habitat conference two decades ago: o In recent years, there has been an upswelling of community- building activity at the local level, not just within government, but also among private and grassroots organizations. Because people at the local level are often better able to recognize their needs, order their priorities, and craft solutions that are consistent with local traditions and resources, even the most disadvantaged communities are taking the initiative to address the range of issues with which Habitat II is concerned. o The nature of community-building efforts has evolved dramatically. Increasingly, our consciousness has moved away from simple bricks and mortar to viewing housing and community development in the context of integrated service delivery. While adequate shelter is an important element for many low-income families on the road to economic self-sufficiency, health services, education and job training, child care, and public safety are also important. Local Partnerships Creating change from the bottom up requires partnerships that bring together the energy and determination of a community with outside resources. Many kinds of resources may enter into these partnerships: money, expertise, volunteer labor, donations of land or buildings, or special credit terms. They typically involve a blend of private and public sources from the local, State, and Federal levels. These partnerships build the sort of citywide and regional ties that will be necessary for disadvantaged communities to participate in regional economies over the long haul. Partnerships such as these have fueled virtually every one of the winners of the National Excellence Awards. Several of the projects highlighted here exemplify the state of the art in carrying out community goal setting and planning at the neighborhood level. The Minneapolis Neighborhood Revitalization Program currently involves 65 of the city's 81 neighborhoods in planning, and has earmarked $20 million annually for the next 20 years to carry out their plans. This program, in effect, asks urban residents who might be tempted to relocate to the suburbs: "What do you need to stay?" Another neighborhood planning program, the Knoxville, Tennessee-based Transforming Neighborhoods Together, a project of the Center for Neighborhood Development, specifically targets low-income areas. The Knoxville program helps leaders of low-income neighborhoods create visions of the future and then develop the skills, networks, and strategies that enable them to work together to implement the vision. In Wisconsin, The Almena Idea illustrates how outside expertise can help revitalize rural towns facing hard economic times. Working with Impact Seven, a community development corporation serving Northern Wisconsin, the small town of Almena witnessed an entrepreneurial renaissance that attracted new businesses, created jobs, and spurred new investment. From the Bottom Up Also consider Boston's Tent City, which grew out of a demonstration on April 28, 1968, following the assassination of Dr. Martin Luther King, Jr. A group of community activists amassed a "tent city" as a way to protest the demolition of older housing carried out under urban renewal policies and to demand mixed-income, integrated housing in line with King's dream. Following almost two decades of struggle against a city government opposed to this dream, Tent City eventually forged a partnership in the mid 1980's with the Boston Redevelopment Authority. Through State and local regulatory mechanisms and grants, and with the support from local political leaders, Tent City was able to create 269 units of mixed-income housing, 5 stores, a day care center, and an after school program. The organizations acting as linchpin to these partnerships for neighborhood betterment are diverse and often surprising. The Boston Bricklayers Union and the Laborers Union came together to form the Bricklayers and Laborers Nonprofit Housing Corporation, which has built more than 279 houses. The homes have sold for $67,500 to $149,000 in an area where the median housing cost is $170,000. Through its Campus Circle Neighborhood Revitalization Initiative in Milwaukee, Wisconsin, Marquette University is turning around the urban neighborhood in which it resides. In addition to its $9 million investment, Marquette called together a "Neighborhood Circle" of representatives from local businesses, churches, community groups, and residents to help with the planning process. This inspired friends of the university to invest in the project and provide an additional $9 million in equity. South Bronx Churches Nehemiah Homes, which has produced more than 500 new homes, is an example of a type of partnership that has become increasingly common: a church or coalition of churches initiating community development. The funds to develop Nehemiah Homes in the South Bronx were raised with the support of South Bronx Churches member congregations, their judicatories, and denominational leaders. Two Episcopalian churches each agreed to loan $1 million, and the Evangelical Lutheran Church of America gave $500,000 to the construction. East Brooklyn congregations, composed of Catholic and Jewish individuals as well as Catholic religious orders, made up the rest of the trust that reached a total of $3.5 million. This decentralized approach to community development nurtures local initiatives that are both highly creative and well positioned to take advantage of previously underutilized resources in their communities. The Greenpoint Manufacturing and Design Center in Brooklyn, New York, for example, is an industrial cooperative that houses small businesses while these tenants work to restore the rambling 19th century industrial property. The revitalized Greenpoint is also helping to stabilize its urban neighborhood. The Loading Dock in Baltimore is a grassroots organization that enlists contractors and volunteers to recycle building materials, which would otherwise be thrown away, for use by low-income households. Intermediary Organizations Local initiatives and low-income individuals are also often helped by intermediary organizations, which bring in training and technical experience in specialized areas to allow local efforts to take advantage of lessons learned in other places. One such intermediary is San Francisco's nonprofit BRIDGE Housing Corporation, which teamed up with the World Savings and Loan Association, a private sector financial institution, to create the World/BRIDGE Initiative. The initiative, having attracted the participation of other financial organizations, has become a pioneer in enabling nonprofit housing corporations to access public pension funds to construct affordable housing. Another intermediary group, the Housing Assistance Council, works with fledgling, isolated, often rural nonprofit housing developers to begin their development programs. A third, the Neighborhood Reinvestment Corporation, uses its NeighborWorks Full-Cycle Lending program to work with lenders and affiliate organizations to open up mortgage loans to low-income people. Integrating a Range of Services Aside from a new emphasis on decentralization and partnerships, a second fundamental change in this area during the past decade is that increasingly, housing and community development initiatives do not address housing or the creation of neighborhood facilities in isolation. Instead they conceive of the task of community revitalization as involving a whole complex of needs, including low education levels, lack of employable skills, unstable living patterns, poor coping skills, and troublesome health conditions (including possibly substance abuse), which require integrated service delivery to tackle all components of the problem. Three winning programs, Los Angeles' Homeless Families Program (a project of Beyond Shelter), Denver's Continuum of Program-Enriched Housing, and Providence's McAuley Village, provide housing as a core service while addressing other acute needs to stabilize homeless individuals and families. The Omaha Housing Authority also uses an integrated services approach to help its low-income public housing residents become self-supporting. In Glenwood Springs, Colorado, Asistencia para Latinos, a local community-based organization, is working to bring together a broad range of social services and advocacy activities to improve the situation of Hispanic residents in the Roaring Fork Valley. Two programs highlighted in this volume use housing as a means of leveraging other desirable social outcomes. The Police Homeowner Loan Program of Columbia, South Carolina, offers police officers excellent terms on the purchase and rehabilitation of inner-city houses, which gives individual police officers a stake in distressed communities and makes neighbors feel safer. The Housing Scholarship Program in Fremont, California, provides housing assistance as an incentive to encourage heads of households to remain in job training to improve their earning potential. Working at All Levels The winning projects of the National Excellence Awards show a great variation in scope, attacking problems at all geographic levels. One New York City program, Take Back The Park, works at the neighborhood level, training young people to reclaim crime-ridden parks for community uses. The Yard Waste Recycling Project in the small town of Lindsborg, Kansas, applies the power of community volunteerism to create a valuable resource--mulch--out of common yard waste. In Newark, New Jersey, the New Community Pathmark Supermarket--a joint venture between a local community development corporation and Pathmark Supermarkets--anchors a new shopping center that reinvests its profits back into the community and is helping to revitalize a distressed and previously underserved neighborhood. By creating a home for three museums, a planetarium, a professional theater, and an arts council in a restored warehouse, Center in the Square, in Roanoke, Virginia, was the catalyst in the revitalization of the heart of the city and serves as an excellent example of a public-private partnership. Through its national Community Lending Through Community Home Buyer's Program, the Federal National Mortgage Association (Fannie Mae), has funded $20 billion in mortgages and assisted 258,000 families around the country in the half-decade of the program's existence. In addition, the nonprofit self-help housing program, Habitat for Humanity, has built or renovated more than 40,000 houses around the world in its two decades of operation, providing nearly 250,000 people with safe, decent, affordable shelter. Models for Change In their various ways, the winners of the National Excellence Awards demonstrate how local initiative can help link residents of distressed communities to America's economic and social mainstream. In doing so, programs such as these make strategic investments in the human and physical capital of our Nation, and strengthen our society's ability to compete in the global economy of the future. ------------------------------ About the National Excellence Awards The National Excellence Awards are a key component of U.S. preparations for Habitat II: The City Summit, a global conference convened by the United Nations (U.N.). The conference, being held in Istanbul in June 1996, focuses on the critical urban situation and the initiative needed for worldwide action to improve shelter and living arrangements. At this important world summit, government representatives, political and social leaders, experts in housing and construction, and community development organizations from the U.N.'s 180 member nations have an unprecedented opportunity to explore new approaches to the management, financing, design, and guidance of housing and urban growth. U.S. Department of Housing and Urban Development (HUD) Secretary Henry G. Cisneros named a U.S. National Preparatory Committee (NPC) for Habitat II from among private sector, nonprofit, and government leaders to guide U.S. conference preparations, including the National Excellence Awards process. Conference organizers asked participating nations to share information on "best practices"--examples of outstanding work being done in housing and community development. The United States responded by initiating the National Excellence Awards for The City Summit in support of Habitat II. This was also an exercise to determine, highlight, and promote effective programs within the U.S.--it focused attention on the inherent strengths in our Nation's communities and resulted in a meaningful exchange of ideas among those with a stake in the country's urban future. NPC, supported by HUD, announced a Call for Submissions for the National Excellence Awards in September 1995. Application Process The NPC designed an open, objective, and highly structured submission and evaluation process for the National Excellence Awards. The competition was open to all government, nonprofit, and private organizations. Programs had to have been in operation for at least 2 years prior to the submission deadline of October 16, 1995. They had to address one or more of several issue areas: poverty alleviation; economic development; social infrastructure and services; environmental regeneration; physical infrastructure and services; natural hazard management/mitigation; housing, land use, and urban planning; urban governance; or social and cultural viability. Programs also had to demonstrate a practical course of action. Nominated programs could range in scale from the neighborhood to an entire metropolitan area. And, because rural areas are often an important factor in the urbanizing world, NPC encouraged nominations from rural communities. Importance of innovation The review criteria gave weight to such elements as local partnerships, participatory planning, demonstrated programmatic impact, and potential for replicability in other communities and countries. The criteria emphasized innovation--projects needed to demonstrate alternative solutions with the potential to change the logic of the way problems are approached, to create new incentive systems, or to bring new players to the table. The competition encouraged projects addressing a broad range of issues to apply: social (experimenting with new forms of social architecture of group behavior at the family, neighborhood, city, or societal level); cultural (shifting an entrenched cultural belief or norm); economic and financial (testing new ways of mobilizing and allocating resources); political (creating new means of empowerment and participation in democratic decisionmaking); administrative and managerial (developing improved mechanisms for sharing responsibilities, monitoring processes, or ensuring quality); technological (taking the form of a new technical device, mechanical design, or scientific system); and spatial and physical (reorganizing the use of physical space at the building, neighborhood, city, or regional level). Criteria. In announcing the competition, NPC spelled out in detail the selection criteria: Impact o Significance: the program addresses a fundamental urban/community problem. o Creativity: the new program or process reflects a change from "business as usual." o Benefit: the net impact on those affected (regardless of how many) is clear and profound. o Scope: there is clear potential for broad impact. o Proven merit: there is empirical evidence that the innovation is workable and can serve as a "tried and tested" model of success. o Long-term viability: there is evidence of lasting institutional change in legislation, by-laws, standards, social policies, strategies, management practices, governance, revenue utilization, resource allocation, or the logic of problem solving. Operation o Cost effective: the approach or project is operationally cost effective. o Practical: the innovation does not require inaccessible technology, unattainable skills, or excessive capital to implement. o Collaborative: the innovation involves partnerships among at least two of these sectors: government, nongovernmental organizations, community-based organizations, the private sector, academia, and the media. o Sustainable: the creative approach has the potential to be ongoing. Objectives Socially equitable: the program or policy promotes social and economic self-sufficiency among those in need. o Economically viable: the costs are low enough for the innovation to become viable on a wide scale. o Politically participatory: the decisionmaking process is democratic and includes the people whose lives are most directly affected. o Ecologically sustainable: the initiative protects or regenerates the urban environment. o Culturally adaptable: the innovation is culturally sensitive and flexible enough to be applicable in other countries. National and Global Impact o NPC emphasized that special consideration would be given to projects demonstrating the potential to make a difference on a national or even an international scale. Selection Process Once the deadline for applications had passed, the selection process began. The review process--administered by the Mega-Cities Project, Inc., and Aspen Systems Corporation on behalf of HUD and NPC--was designed to be thorough and fair. The selection process consisted of four phases: review for eligibility, identification of finalists, site visits, and selection of the winners. First, Aspen Systems Corporation reviewed all applications to ensure that minimum eligibility requirements were met. A 20-member panel-- representing academia, community organizations, government, and foundations--then reviewed the applications and identified 53 finalists. In the third phase, independent, external reviewers who are experts in their fields made site visits to each of the finalists and submitted extensive written reports, standardized in format to facilitate comparisons among the diverse projects. Each finalist's application and site visit report was then independently rated and ranked by three members of the NPC Selection Committee. The Selection Committee then met, made their decision, and designated the 25 National Excellence Award winners. ----------------------------- The organizations acting as linchpin to these partnerships for neighborhood betterment are diverse and often surprising. ------------------------------ World/Bridge has become a pioneer in enabling nonprofit housing corporations to access public pension funds to construct affordable housing. ------------------------------ Housing and community development initiatives do not address housing or the creation of neighborhood facilities in isolation. Instead they conceive of the task of community revitalization as involving a whole complex of needs. ------------------------------ The Almena Idea Impact Seven, Inc. Almena, Wisconsin The Almena Idea is an approach to economic development that brought together a regional community development corporation (CDC) and a rural town in an unconventional partnership that allowed an economically hard-pressed, conservative rural community to develop a new risk-taking, proactive stance to promote growth. In Almena, Wisconsin, the initiative has been a success. It has attracted new businesses, created and retained jobs, spurred zoning reform, inspired investment while minimizing risk, and encouraged revitalization. This rethinking of attitudes allowed a community that once believed decline was inevitable to turn things around and stage a rebirth. Background During times of fiscal hardship, pursuing "business as usual" may not be the best way to spur investment and stimulate a sagging economy. At the same time, a community wrestling with the effects of decline may feel intense pressure to dig in its heels, ride out the bad times, and resist untested ideas or investment plans. Rural communities, many of them hit hard by economic recession, may be particularly susceptible to this attitude of inflexibility. Many small, rural communities like Almena, Wisconsin, face high rates of poverty due to high unemployment and declining economic conditions. In the early 1990's, Almena, a town of 650 people, had recently lost the only employer of any significant size. Its unemployment rate was 19.4 percent--almost three times higher than the national rate. Almena invited Impact Seven, Inc., a community development corporation serving rural, northern Wisconsin, to challenge the village to combat its sense of inevitable decline and develop feasible, if possibly risky, solutions for turning the community around. Lacking capital, economic development experience, and a history of risk-taking, the community would have been unable to take steps to improve its situation alone. Approach The Almena Idea illustrates how outside expertise can help revitalize a community suffering from inertia and decline. Instead of spreading its resources thinly over a broad range of communities or projects, Impact Seven decided to concentrate resources in one community to demonstrate the value of focused knowledge and expertise. In a matter of years, The Almena Idea was able to reverse a long-term trend of decline. Impact Seven started by establishing a framework for change. Before a community can effectively control its future, a number of prerequisites need to be in place: a community vision, a process for implementation, cooperative community participation, and strong local leadership and organizations. For the small rural town of Almena, Impact Seven helped make this possible. Before working with Impact Seven, Almena also lacked a strong local development organization. With support and encouragement from Impact Seven, Almena developed the Almena Business Development Corporation (ABDC) to represent local interests and undertake proposed projects. To get ABDC off the ground, Impact Seven received a $20,000 State grant for marketing. Total startup costs were approximately $40,000. Impact Seven provided the staffing for facilitating the development of ABDC. Most of the work was done as in-kind assistance. Ongoing operating costs, estimated at $20,000 per year, are shared by Impact Seven, ABDC, and supplemented by many volunteer hours. Their activities, aimed at expanding business and making the town more attractive, stressed improving infrastructure and business facades, changing zoning, and developing new industrial parks. Although Impact Seven brought with them vital expertise in economic development and fundraising, they were, nevertheless, in a delicate, potentially threatening situation. They were invited into the community to shake up the accepted way of conducting business, to push leadership to become more organized, and to take risks. This was not a comfortable time for those in positions of authority in the community, even though they may have recognized that change was desirable. Impact Seven kept lines of communication open by working closely with the village council, an elected body, and through town meetings. In one of the deals arranged under The Almena Idea, Impact Seven sought financing from 13 State and local financial sources, assuming the risk itself. This allowed Almena a chance to explore new ways of doing business without taking on more risk than it felt able to handle. Impact Seven's commitment of its own money helped the community overcome their traditional distrust of outsiders. Impact Almena residents now see the town as a place where they can invest and develop their businesses. In 5 years, the project has more than doubled the number of employers in the community. It has added 2 industrial parks and brought in 5 employers that created 96 new jobs. In addition to direct economic development, new roads have been built and the downtown has been revitalized with a park and building improvements. Even housing is improving as exemplified by: o renovation of rundown downtown housing to provide convenient housing for Almena workers and their families, o an apartment development for low-income elderly, and o market rate duplexes. Most of those who secured jobs through these efforts had previously been unemployed and on government assistance. Almena's increased economic vitality has increased the tax base, lowered unemployment, and strengthened community pride. Scaling Up At the foundation of The Almena Idea is the belief that an outside agency can challenge the status quo and persuade a willing community to reorganize and save itself. In many ways, this project focuses in a concentrated fashion on many classic revitalization tools such as job creation, multiple sources of funding, establishment of ways of maintaining momentum, and increasing leadership and community ability to cooperate. A number of other communities in northern Wisconsin have started projects based on The Almena Idea. Contact: Ms. Mary Vinopal Impact Seven, Inc. 651 Garfield Street Almena, WI 54805 Phone: 715-357-3334 Fax: 715-357-6233 ------------------------------ In 5 years The Almena Idea has: o Created 96 jobs for low-income residents in a small town. o Doubled the number of local businesses to 31. o Increased the tax base by $1.7 million to $9 million. o Matched a $20,000 National Endowment for the Arts downtown revitalization grant with $50,000 locally. o Developed two industrial parks and added 70,000 square feet of manufacturing space. o Constructed new housing for its low-income elderly population. ------------------------------ "I am very impressed by The Almena Idea as a creative and innovative public-private partnership between Impact Seven and Almena. This proves that a community can take control of its future. The Almena Idea is an excellent model for international community development." Senator Herb Kohl ------------------------------ By upgrading infrastructure and business facades, changing zoning, and developing new industrial parks, the community has become more attractive to new and expanding businesses. ------------------------------ Almena invited Impact Seven, Inc. to challenge the village...[to] develop feasible, if possibly risky solutions for turning the community around. ------------------------------ Bricklayers and Laborers Nonprofit Housing Bricklayers and Laborers Nonprofit Housing Corporation Boston, Massachusetts In 1989 the Bricklayers and Laborers Nonprofit Housing Corporation built more than 200 attractive and affordable homes in the Mission Hill and Waterfront areas of Boston. This nonprofit housing corporation is changing popular misconceptions about affordable housing. Their work demonstrates that developers can build attractive and affordable housing and still pay union rates. With the creation of top-of-the-line housing units in prime locations in Boston, they leverage pension funds and diversify financing options to build houses and rebuild neighborhoods. The developments foster a sense of community in a downtown multiethnic neighborhood and maintain housing diversity in a rapidly gentrifying former industrial area. Background More than 10 years ago many did not view unions as an integral part of their community. But in Boston, where the median house price is out of reach to many low- and moderate-income families, the expertise and organization of unions can play an important role in building communities. When looking for a way to become more involved in the community, Boston Bricklayers Union Local 3 decided to focus on what it does best: construction. Although the union lacked seed money, it did have the ear of then-Mayor Ray Flynn. The union convinced the city to donate a parcel of land in South Boston where the first 18 units were built. The Bricklayers Union Local 3, in collaboration with a local chapter of the Laborers Union, formed the Bricklayers and Laborers Nonprofit Housing Corporation. The Union pays the salary of the president of the corporation--its only employee. Funds generated by the sale or rental of the completed houses pay an executive director's salary. The corporation's mission is to be a force of good in the community by building well-designed, high-quality affordable housing, using union labor. Approach This award-winning innovation consists mainly of two developments: The Back of the Hill, with 165 rowhouses in Mission Hill, and The Charleston Navy Yard, 50 townhouses near Boston's waterfront, both completed by 1989. Effective community organization, creative financing, and innovative design made these developments the success they are today. The union used its community organizing expertise to unite diverse and sometimes divergent interests, including community activists, neighborhood civic groups, architects, developers, city planners, and financiers. In Mission Hill, the local community development corporations played an important role from the outset by articulating neighborhood concerns on design and helping to design and implement the application and selection process for the completed houses. Charlestown neighborhood organizations were similarly involved in Charlestown Navy Yard Development. The housing corporation held down costs by leveraging a variety of resources and taking advantage of several financing options. The Back of the Hill development combined funding from the Community Development Block Grant (CDBG) and HOME (a Federal housing-specific block grant), city of Boston linkage grants, and union pension funds. To develop the Charleston Navy Yard site along the waterfront, a private developer donated the land and a grant for a copper roof, while the City donated funds from their linkage program. The design of these developments was also unique. Designed by a renowned architectural firm, the developments used local materials and styles to blend with the existing neighborhoods and support revitalization efforts. The result was a well-built complex without the usual stigma associated with affordable housing. To develop housing that promotes urban cohesiveness in the Mission Hill area, a neighborhood plagued by ethnic divisions, each of the three newly constructed streets in the Back of the Hill development features townhouses with one of three bayfront styles and brick patterns. The Charlestown development features a combination of a six-story elevator building and stacked townhouses; townhomes on the ground level have a private yard or, for those on the upper level, a private 150-square-foot deck. Impact The Bricklayers and Laborers Nonprofit Housing Corporation has developed 279 units of affordable housing in the 10 years since it began. The corporation sold the homes for $67,500 to $114,000 in neighborhoods where the median housing cost is $170,000. The group's attention to housing design and financing proves that low- cost housing can be both well built and attractive. These projects also integrated the housing into the existing area. In both cases, the design and location of the housing developments physically upgraded the neighborhoods and promoted community spirit. In Mission Hill, the site of the Back of the Hill project that was once 11 acres of vacant land, now links two ethnically diverse neighborhoods that have a history of racial and ethnic tension. The Charlestown Navy Yard reclaimed decaying industrial property on the edge of an urban harbor and supported ongoing revitalization efforts, while ensuring that the revitalization did not leave the poorer members of the community behind. Scaling Up Thomas McIntyre, president of the Bricklayers and Laborers Nonprofit Housing Corporation, is also the president and founder of the Bricklayers and Carpenters Charlestown Nonprofit Development Corporation, which was formed in June 1990 to develop affordable housing for the elderly. Bricklayers and Carpenters Charlestown Nonprofit Development Corporation formed a limited partnership to develop Building #104 in the Charlestown Navy Yard into 46 units of elderly housing using Low Income Housing Tax Credits. All of the units are affordable to households at 60 percent of median income or below. Building 104 consists of 46 one-bedroom rental units, half of which are rented to tenants at or below 50 percent of median income. Building 104 was completed in December 1994 with a total development cost of about $7.5 million. The Bricklayers and Laborers Nonprofit Housing Corporation is taking its show on the road. Because union pension funds are an important and underutilized source of housing development funding, the Bricklayers and Laborers are working in cooperation with the AFL-CIO Housing Investment Trust to develop similar affordable housing projects in El Paso, Texas. The International Masonry Institute is currently working with groups in New Mexico on a similar development. Contact: Mr. Thomas J. McIntyre, President Bricklayers and Laborers Nonprofit Housing Corporation 104 First Avenue Charlestown, MA 02129 Phone: 617-242-2231 Fax: 617-242-2430 ------------------------------ In the 10 years since the Bricklayers and Laborers Nonprofit Housing Corporation began, it has: o Built and sold 279 units to low- and moderate-income homebuyers. o Won awards from the American Institute of Architects (AIA), Time magazine, the New York Times, New England Regional AIA, Central New York Chapter AIA, and Boston Society of Architects. o Sold houses for $67,500 to $114,000 in an area where the median housing cost is $170,000. ------------------------------ "Union pension funds can be a strong force in rebuilding the cities of America." Thomas J. McIntyre, President, Bricklayers and Laborers Nonprofit Housing Corporation ------------------------------ "It is surprising nowadays when decent housing for the working class gets built. Boston's 50-unit Charleston Navy Yard rowhouses...are virtually miraculous: cheerful, dignified, altogether grand looking low-cost housing." Time Magazine January 1989 ------------------------------ Campus Circle Comprehensive Neighborhood Revitalization Initiative Marquette University Milwaukee, Wisconsin Marquette University's Campus Circle Initiative is a unique neighborhood revitalization approach that marshals the strengths of the various professional schools and departments and the institutional outreach of the University. Initially created to focus on housing and commercial needs, the project, in cooperation with its community partners and the city of Milwaukee, has expanded to encompass significant quality of life issues including job creation, education, homelessness, youth programs, crime, and public safety. Because of the Campus Circle Initiative, the near west side of Milwaukee has benefited from the creation of more than 200 units of affordable housing, and the neighborhood has experienced a decrease in drug trafficking and other criminal activity. The secret of Campus Circle's success lies in its partnerships and financial commitments. Marquette University allocated $9 million as part of an investment of more than $50 million, and it is collaborating with the city, the police department, local public schools, social service agencies, the YWCA, large local employers, university staff, and students. The initiative has started a movement: 25 institutions, most of them urban educational institutions, have visited the program, several are in the planning stages of replicating it, and some are already establishing partnerships. Background Marquette is the largest institution in the Avenues West neighborhood, which also contains the Sinai-Samaritan Hospital, a regional blood center, two insurance companies, and several churches and businesses. As recently as a decade ago it was a thriving area with eight hospitals. Much of the hospital staff lived in the surrounding neighborhood, but as the hospitals relocated, so did their staff. By 1990 only 4 percent of the housing stock was owner-occupied. Poverty rates doubled between 1980 and 1990. If Marquette was to survive as an institution, it would have to leave the area--as its law school did in the 1960's-- or create a neighborhood revitalization effort that linked the university and the neighborhood more closely than ever before. Local activists and residents were skeptical when they first heard of the revitalization plan. "It has not been in Marquette's history to work in the community," says Joyce Henry, a local social service provider. "Their community--yes. The rest of the community--no." To capitalize on community expertise and win trust, Marquette created the "Neighborhood Circle" with representatives from local businesses, churches, community groups, and residents to help with the planning process and keep other residents informed. Marquette eventually hosted some 150 neighborhood meetings; refreshments were provided to encourage attendance and to convince the neighborhood of the firmness of the university's commitment to the entire 90- block neighborhood--not just the 20 blocks where the university resides. Approach Winning over the residents was only part of the battle. Other institutions--potential partners and funding sources that would benefit from the revitalization--were reluctant to participate, doubtful that an initiative of this scope could be successful. The university raised only $2 million from these sources, less than anticipated, and had to reorganize its fundraising. The Marquette donors were more enthusiastic, matching the university's $9.2 million pledge. This $20 million of equity in the form of capital and soft debt was leveraged with about $36 million in debt that included double tax-exempt bonds, Tax Incremental Financing proceeds, low-interest loans, and targeted loans from the banking community. From the start, safety and crime reduction formed a central focus of this project. The university partnered with the Milwaukee police to create the city's first community policing program where neighborhood residents, landlords, and institutions cooperate to increase public safety. Campus Circle provided the police with a highly visible site for their community-oriented substation. In addition, the university formed alliances with landlords who helped to identify problem properties and close down drug houses. The university hired an alumnus with a development and entrepreneurial background who, with the Campus Circle Board, formed two nonprofit corporations--one for residential properties and one for commercial real estate. Housing was one of the first areas tackled. Much of the local housing had deteriorated; 75 percent of landlords were absentee. Many units, built for single persons, did not meet the needs of families living in them. Homeownership rates were very low. Now Campus Circle manages more than 1,000 housing units and rehabilitated nearly 200 of these, converting a portion into family units. The initiative has emphasized keeping residents in place, improving quality, but not raising rents. Insufficient funding has kept some buildings empty, but these are boarded up and no longer available to drug dealers or other criminals. Campus Circle also began to renovate the business district near campus. It purchased 9 of the 15 bars and closed all but 3 of those. Although the area is still not financially stable enough to attract the supermarket that residents desire, the new development, called Campus Town, is a step in the right direction. This mixed- use project features 152 apartments, a sports bar, and 89,000 square feet of new commercial space. Economic development activities have attracted 13 new businesses and encouraged existing businesses to stay and reinvest. The university is investing its academic resources in the community as well. The Marquette Dental Clinic and Nursing School Parish Nurse Outreach Program help address area health needs. PACE brings the Marquette Department of Mathematics together with the Grand Avenue Middle School for an innovative math education program. The Marquette School of Education and community partners offer parent education, teacher training, and intensive literacy tutoring for children. The Service Learning Project brings 500 students into 50 citywide agencies to link classroom learning to for-credit volunteer service. Impact The neighborhood's appearance has improved as Campus Circle has purchased and rehabilitated housing and commercial structures. The community policing effort has made physical changes more than skin deep, with police records showing a 34-percent drop in crime in 2- 1/2 years. Improvements to community cohesion and pride of place may be less visible, but they are no less important. They are fostered by the numerous university-community partnerships, by tenant councils, and by resident-student cooperation in various social service activities. The example of Marquette's commitment to the Avenues West neighborhood has challenged its institutional partners to reevaluate their own role in the community and the effect of the community's stability on their own success. Scaling Up The Campus Circle approach is adaptable and, indeed, other universities throughout the country are in the process of forming creative partnerships with neighborhood businesses, activists, associations, and residents to create comprehensive change. More than 25 universities or city representatives have visited Campus Circle. But it is also an expensive approach, requiring a tremendous amount of funds. Because it could accumulate extensive equity, the institution was able to leverage the additional funds necessary. While the project's immediate future is secure, long-term prospects are less clear. Originally the university thought that program operating costs would be covered by real estate investments, but this has not been the case; Marquette is covering the losses. Campus Circle is currently developing a plan for disposing of some of its undeveloped properties to break even. On a smaller scale, the city of Milwaukee is using the Marquette neighborhood anchor approach in a variety of settings. The city has convinced several major employers to act as neighborhood anchors, serving as the focal point for a multifaceted approach. Employers such as Master Lock and Harley-Davidson recognize that their ability to attract and retain employees is influenced by conditions in the surrounding neighborhoods. Consequently, they are developing partnerships with the city and with community-based organizations to address neighborhood problems in a coordinated, systematic fashion. Contact: Ms. Sandy Hintz Campus Circle Comprehensive Neighborhood Revitalization Initiative Marquette University Holthusen Hall, 419 P.O. Box 1881 1324 West Wisconsin Avenue Milwaukee, WI 53201-1881 Phone: 414-288-1987 Fax: 414-288-6199 ------------------------------ Marquette University's Campus Circle Comprehensive Neighborhood Revitalization Initiative has: o Bought and managed more than 1,000 units of housing (with a mix of students and other residents). o Rehabilitated 188 units without raising rents. o Developed tenant councils to foster resident empowerment. o Established a community-oriented policing project that helped decrease crime by 34 percent in 2 1/2 years. o Constructed 84,000 square feet of rental commercial space. o Attracted 13 new retail businesses to the area. o Formed more than 20 partnerships with area landlords, the police department, businesses, social service agencies, homeless care providers, and residents. o Surpassed its goal of using minority-owned, woman-owned, and disadvantaged businesses in 25 percent of its construction and professional services. o Constructed 153 units of off-campus student housing. o Contributed more than 65,000 hours of faculty, staff, and student volunteer time in 1995. ------------------------------ "We could wall ourselves in or we could weave ourselves in." Rev. Albert DiUio, Marquette University President ------------------------------ "Employers recognize that their ability to attract and retain employees is influenced by conditions in the surrounding neighborhoods." Michael Morgan, Department of City Development Commissioner ------------------------------ Campus Circle, Marquette University's neighborhood revitalization initiative, is a pioneer program to build neighborhoods and community. ------------------------------ Center in the Square Roanoke, Virginia Center in the Square, Virginia's largest cultural complex, opened in 1983 to support art, history, science, and theater in southwest Virginia. Located in downtown Roanoke, the facility houses five arts, history, science, and cultural organizations. It attracts hundreds of thousands of visitors yearly, including local residents, school groups, and tourists. The business community enthusiastically supports the Center, which has been a catalyst for revitalizing Roanoke's decaying downtown area. Background In 1976, Roanoke's downtown area resembled deteriorating downtowns throughout the Nation, and suffered from drugs, prostitution, abandoned buildings, and out-migration of businesses to the suburbs. At the same time, a number of arts groups were scattered throughout the region in substandard conditions or poor locations, and a number of these groups faced closure due to high operating costs. At the time, one local business association questioned whether the area was salvageable; the answer was not clear. Any decision to invest in Roanoke required reexamining the decaying downtown in light of its potential. Despite its problems, it was an area rich with resources not available in rural or suburban areas: historic buildings and facades, a pedestrian-oriented infrastructure, business sites coupled with residential neighborhoods, multiple transportation choices, and less expensive sites. Resolved to keep Roanoke's downtown viable, a business association raised $60,000 to form the Central Roanoke Development Foundation, which was charged with creating a revitalization and development plan. This plan, called Design 79, was developed in a storefront window on Roanoke's busiest downtown street where citizens were encouraged to observe and to offer suggestions. After 4 months of call-in television broadcasts coupled with the participation of a 100-person citizen panel, the public wish list grew to include 3,600 recommendations. Some 1,200 items were eventually integrated into the project. Approach Interest focused on a proposed arts complex known as Center in the Square, which would be located in a dilapidated farm implement showroom and warehouse dating back to 1914. But the project immediately encountered obstacles. Some critics believed that the market district--the proposed site of the arts complex--was already lost, kept alive only by farmers selling produce at stalls. Others were concerned that the project would be too complicated to carry out and that visitors would perceive the neighborhood as too threatening. Despite enthusiasm among city officials, local public funding could not be obtained in time for this project. An array of public, private, and nonprofit organizations did come together to make this vision a reality. In a demonstration of the project's appeal, project organizers, primarily private-sector business leaders, raised $5.5 million in private contributions in 8 weeks. State and local funds covered the $7.5 million cost of startup, which included the cost of land, buildings, construction, and architectural fees. The Commonwealth of Virginia provided $2.6 million, and the remaining amount was made possible by local contributions through a trust indenture arrangement with First National Exchange Bank. Although the town of Roanoke was not able to provide a significant amount of direct funding, it did fund the construction of a parking garage adjacent to the Center. The Center, which opened in 1983, provides rent-free space and administrative and marketing services to the Art Museum of Western Virginia, Mill Mountain Theater, Roanoke Valley History Museum, Science Museum of Western Virginia, Hopkins Planetarium, and the Arts Council of the Blue Ridge. The operational and programming decisions of its affiliated organizations are independent of Center in the Square. Each has its own Board of Directors and budget, and is therefore autonomous. Center in the Square's annual operating budget is about $1.1 million. The State, local government, and private sector contributions each fund approximately one-third of these costs. Because funding for the arts, particularly at the State level, is less predictable, program organizers are especially pleased with the high level of private support. Funding from local companies, representing 42 percent of total funding, includes both cash and in-kind services. Although the city of Roanoke is the largest local government contributor, the program's success has inspired the city of Salem, and the counties of Roanoke, Botetourt, and Franklin to provide funds as well. Impact With Center in the Square, Roanoke improved the economy and quality of its downtown. As further proof of the business community's support, private businesses have invested more than $250 million in construction projects and capital investments in the downtown area since 1983. Nearly 165 new businesses have located in the immediately adjacent downtown area. The direct and indirect impact of Center in the Square--including consumer spending in the Center and the downtown, Center organizations' budgets, parking garage profits, and use of the Center by other groups--is conservatively estimated at $25 million annually. Center in the Square offers residents, school groups, and tourists an accessible location to experience a variety of the region's cultural and educational resources. During the 1994-1995 fiscal year, 425,954 people, including 113,542 school children, participated in programs offered at Center in the Square. Many activities are designed specifically for children; the Center reaches one-third of the school systems in the State with its onsite and outreach programs. Former Mayor Noel Taylor described it as a ". . . center for all people and its programs . . . are intended to embrace individuals of various cultures, interests, and backgrounds." One educational program last year, Local Colors, emphasized the ethnic diversity of the Roanoke region, and the Center plans to include more international elements in its educational program in upcoming years. Nonprofit arts and educational programs typically spend a great deal of energy on fundraising to keep their heads above water. The organizations housed in Center in the Square all had financial problems or unsatisfactory locations. With free rent and services in a centralized location, these five organizations enjoy increased visibility, decreased operating costs, and a more stable future. To enhance support for cultural programs in Virginia and protect the Center from economic fluctuations, the Center is developing a $12 million endowment fund, which will alleviate competition among Roanoke's cultural organizations for scarce operating funds. Scaling Up Expanding its scope, the Center has joined Total Action Against Poverty, a nonprofit organization dedicated to alleviating poverty, to provide job training for potential office assistants and custodial, HVAC maintenance, and building maintenance workers. Since Center in the Square's inception, many other cities have undertaken similar projects. These cities have tended to have a narrower focus and seek support primarily from the government. The Center has provided pro bono consulting services to these projects and continues to assist them in their development. Areas with projects under way include Albuquerque, New Mexico Charleston, West Virginia; Erie County, New York; and Harrisburg, Pennsylvania. In addition, more than 27 other communities have contacted Center in the Square for information regarding its operations and policies. Contact: Dr. James C. Sears/Ms. Carolyn Nolan Center in the Square One Market Square Roanoke, VA 24011 Phone: 540-342-5701 Fax: 540-224-1238 ------------------------------ Since its opening in 1983, Center in the Square has: o Served more than 4 million persons from all 50 States and 20 nations. o Attracted $250 million in capital investments in the downtown area. o Brought more than 165 businesses to the area. o Helped create an estimated $25 million direct and indirect annual economic benefits. ------------------------------ Center in the Square has become a center of education, entertainment, and excitement for all ages and all interests. Center's success has truly recreated the heart of the city. ------------------------------ This [revitalization] plan, called Design 79, was developed in a storefront window on Roanoke's busiest downtown street. Citizens were encouraged to observe and offer suggestions. ------------------------------ [Roanoke's downtown] is an area rich with resources not available in rural or suburban areas: historic buildings and facades, a pedestrian-oriented infrastructure, business sites coupled with residential neighborhoods, multiple transportation choices, and less expensive sites. ------------------------------ Community Lending Through Community Home Buyer's Program Federal National Mortgage Association Washington, D.C. The Community Home Buyer's ProgramSM (CHBP) of the Federal National Mortgage Association (known as Fannie Mae) makes mortgages more available to families of modest means throughout the country. Beginning as a pilot program in 1989, CHBP delivered $20 billion in mortgages by the end of 1995 and assisted 258,000 American families to achieve their dream of homeownership. The program is designed to make the housing finance system work for cities, urban neighborhoods, and low- and moderate-income families by reducing the discriminatory and suburban bias of much lending. Fannie Mae blazed a trail for others in the mortgage industry who use the CHBP template. Background Even if they are financially able to own a home, millions of families nationwide continue to face significant barriers to homeownership, such as excessive costs, lack of information, and discrimination. Rigid conventional mortgage loan guidelines have tended to exclude many low- and moderate-income families, minorities, and new immigrants who lack long-term employment histories or conventional credit histories. Fannie Mae, established by the Federal Government in 1938, is a stockholder-owned corporation that provides financial products and services that increase the affordability of housing for low-, moderate-, and middle-income families. The agency does not make mortgages directly to consumers, but purchases mortgages in bulk from primary lenders, thereby decreasing investor risk. Fannie Mae became a private corporation in 1968. Because much of Fannie Mae's work is behind the scenes, it was clear that the key to successful community lending was not only to work with its lender partners, but to also work closely with grassroots community groups and municipalities. One community group, the National Training and Information Center, approached Fannie Mae and the General Electric Mortgage Insurance Corporation in 1989 to discuss a community lending pilot program in five midwestern cities. Fannie Mae's Office of Low- and Moderate-Income Housing, which designs lending products and other activities on behalf of underserved populations and communities, developed guidelines for what became the Community Home Buyer's Program. The $40 million pilot program had purchased mortgages for 545 families by 1990, when it was made a nationwide program. It was expanded again in 1991 into a $10 billion initiative with the goal of bringing affordable lending into the industry mainstream. Fannie Mae's CHBP was the catalyst that fueled 66 percent--nearly $7 billion--of that seminal initiative. Today CHBP is offered by 862 Fannie Mae-approved lenders in all 50 States and all 320 metropolitan statistical areas (MSA's). Approach CHBP is designed to make the housing finance system work for cities, urban neighborhoods, and low- and moderate-income consumers by reducing discriminatory bias and the suburban orientation of such lending. The program targets funds to families whose income is below-average or average for their area--a group traditionally left out of the home finance mainstream. Focusing on increasing homeownership rates in central cities, CHBP works to improve the quality of life in urban neighborhoods and stem out-migration from distressed communities. Working with Fannie Mae, grassroots groups educate and prepare low- and moderate-income families to take on a mortgage. Fannie Mae has developed several high-technology services and tools to help them create concrete paths to homeownership and successfully negotiate each step of the homebuying process. Desktop Home Counselor, for instance, a finalist for a 1995 Smithsonian Award for Technology, provides personal and financial information for borrowers, such as credit and affordability analyses. Accessible on a personal computer, it can be used to construct financial scenarios that a borrower might use to purchase a home. To increase lender flexibility, Fannie Mae established alternative qualification guidelines so that families or individuals with less conventional financial histories might obtain a loan. Innovative features built into the mortgage offered under CHBP include: o Less income to qualify. Standard guidelines require that borrowers' monthly housing expense payment not exceed 28 percent of their gross monthly income, with a total monthly debt burden not exceeding 33 percent of their gross monthly income. With CHBP, borrowers can qualify with monthly housing expense payments of up to 33 percent of their gross income and total debt expenses of up to 38 percent of their gross income. o Less cash at closing. Typically home buyers are required to have a cash reserve equal to two mortgage payments at closing. CHBP does not have this requirement. o Nontraditional credit history. CHBP enables borrowers to demonstrate good credit through nontraditional methods such as evidence of stable, continuous payments to utility companies and previous landlords. o Home buyer education. Home buyer education ensures that borrowers are knowledgeable about the process of buying a home and obtaining a mortgage and are better prepared to meet the ongoing responsibilities of homeownership. CHBP generally requires borrowers to go through home buyer education. CHBP is committed to eliminating the "no" in the mortgage application process. All applicants are placed on a path of review and education that--once the flexible CHBP requirements are met-- will lead to loan approval. When a mortgage request is denied, the applicant receives information explaining why and recommendations on improving their application. To decrease lender risk, Fannie Mae guarantees purchase of mortgages in this initiative. This process--which creates the Secondary Mortgage Market--frees up additional lender capital for new mortgages. The education provided to potential low-income homeowners on their responsibilities and rights decreases the likelihood of mortgage defaults. In 1994 Fannie Mae extended and increased its commitment. The Showing America a New Way Home(R) initiative pledged $1 trillion in targeted housing finance by the year 2000 to help 10 million American families obtain mortgages. To increase central-city investment, Fannie Mae committed to extend outreach and form long- term partnerships with cities by opening at least 25 new "Partnership Offices." In 1994 Baltimore became the site of the first Partnership Office; 21 more local offices have since opened. Impact The 1989 pilot program included 6 lenders, who helped 545 low- and moderate-income families achieve homeownership. Fannie Mae's Community Lending product--Lease-Purchase--offered through Neighborhood Housing Services in Chicago, Illinois, helped Brenessa Stiff's family purchase a home. At the end of 1995, CHBP assisted 258,000 families with $20 billion in mortgages. Ninety-one percent of the homeowners helped were located in metropolitan areas. More than 39 percent of these new homeowners were minorities: 15.2 percent were African American and 17.9 percent were Hispanic. In sharp contrast, only 5.7 percent of standard business mortgages in 1995 were to African Americans and 8.4 percent were to Hispanic applicants. More than 67.5 percent of CHBP homeowners earn the median income for their area or below. Almost half of borrowers are first-time home buyers. Scaling Up The success of the pilot program led Fannie Mae to develop nine other products with specialized guidelines that fit under the CHBP umbrella. These share many of the same flexible affordability features, but they also have unique features that address the special needs of some home buyers. FannieNeighbors, for instance, was created to increase homeownership and revitalization in minority, low-, and moderate-income communities and central cities. The upper limit on income is waived if a home buyer purchases a home located in one of these eligible areas. Grassroots groups such as the National Council of La Raza and ACORN (Association of Community Organizations for Reform Now) have worked with Fannie Mae to structure special mortgage guidelines to address the needs of their targeted communities. Contact: Ms. Julia A. Gould Vice President for Community Lending Community Lending Through Community Home Buyer's Program Fannie Mae 3900 Wisconsin Avenue, NW. Washington, DC 20016-2806 Phone: 202-752-6576 Fax: 202-752-2829 ------------------------------ Fannie Mae's Community Lending Through Community Home Buyer's Program: o Through February 1996, has helped 250,000 families achieve homeownership. o Served more than twice as many African American and Hispanic home buyers than were served with standard loans. o Made almost 40 percent of its loans to minority households. o Made 91 percent of loans to residents of metropolitan areas. ------------------------------ Fannie Mae's Community Lending product--Lease-Purchase offered through Neighborhood Housing Services in Chicago, Illinois, helped Brenessa Stiff's family purchase a home. ------------------------------ The program targets funds to families whose income is average or below that of others in their area. ------------------------------ A Continuum of Program-Enriched Housing Northeast Denver Housing Center, Inc. Denver, Colorado "From homelessness to homeownership"--these words sum up the Continuum of Program-Enriched Housing, a set of programs operated by the Northeast Denver Housing Center (NDHC). The program helps participants deal with a wide range of issues: homelessness, transitional and rental housing, homeownership, and economic survival and stability. By tailoring its services to the specific needs of its clients--homeless families and individuals, teen parents, persons with HIV/AIDS, the mentally and physically challenged, and low- to moderate-income renters and home buyers-- NDHC has created an innovative incentive system that promotes self- sufficiency and fosters social change. Background In Denver, as in most communities, a portion of the population struggles with the basic issues of decent housing and economic survival. This is especially true in the northeast part of the city, a historically African-American area that has been isolated from the opportunities of the metropolitan region. Northeast Denver, like many other distressed urban communities throughout the United States, faces the hard challenges of economic blight, extreme poverty, a deteriorating housing stock, and lack of affordable housing, especially for people with special needs. Fourteen years ago, a group of community based organizations founded NDHC under the leadership of executive director Getabecha Mekonnen. NDHC has since served more than 4,000 individuals throughout the Denver area, primarily in northeast Denver and neighboring areas of Aurora, the second largest city in the metropolitan area. With a board of directors composed of members of the community and former clients, Northeast Denver Housing Center maintains a strong commitment to the community and a direct understanding of its needs. Approach Although its primary role is to address housing needs, NDHC does not look at this area of concern in isolation. Instead, the program helps clients achieve stability through an approach that takes into account all factors that influence their ability to succeed. While housing is the key ingredient, services to clients also include child care, education, training, transportation, and job placement and retention programs through collaborative agreements and partnerships with other organizations. Moreover, NDHC makes the most of existing opportunities--from taking advantage of the inherent value in available but neglected and deteriorated housing stock in urban areas, to putting "social riders" on its leases that require tenants to help themselves by obtaining education and skills for better jobs. The continuum of program-enriched services helps families who might otherwise be unable to become homeowners. Its lease-purchase "homeownership incubation program" lets families move into the homes they intend to buy. Families may remain in the homes as long as they meet the requirements of their performance contract, which spells out their periodic achievements in savings, debt management, and credit improvements. NDHC holds the beneficiaries of its programs accountable by requiring them to fulfill certain mutually agreed upon self-development goals that are monitored through case management services. To carry out its broad range of activities, NDHC works in partnership with other nonprofit organizations and social agencies. For example, the program works with Warren Village, a transitional housing program for teen parents. Graduates of Warren Village become candidates for permanent housing through NDHC's affordable rental housing units. As renters, they are encouraged, challenged, and educated about the next step in housing: homeownership. NDHC operates on an annual budget of about $500,000. The organization has a diverse revenue stream. About 40 percent of annual revenues come from rental income from NDHC's stock of rental housing, which it rents at a cost equivalent to 30 percent of a family's income. An additional 40 percent of the program's budget comes from Federal, State, and local governments. Another 10 percent comes from grants and donations from the private sector, including philanthropic grants, financial institutions, and the community, while the rest comes from earned income and other sources. Impact The Continuum of Program-Enriched Housing provided by the Northeast Denver Housing Center has had a considerable impact in the Denver area during the past 13 years. NDHC has served more than 4,000 people in northeast Denver, acting as a catalyst for community stability and social mobility. Each year, the organization provides: o comprehensive housing counseling to 455 people; o transitional housing with supportive services and case management to more than 65 homeless people; o affordable rental units to more than 40 households; o homeownership opportunities to 25 families; and o education and training in property management for owners and managers of low-income housing. Every year, the Continuum of Program-Enriched Housing helps 15 homeless families get off welfare and into stable home environments, producing a net yearly savings in public funds of about $50,000. Scaling Up NDHC's style of operating has been adopted by other community development corporations in Denver. At its heart, the Center's approach is recognition of potential of deteriorated urban housing stock, along with the ability to design and package housing opportunities for specific needs. It has demonstrated the ability to apply social resources in a systematic manner to help low-income and at-risk people take charge of their own lives and more fully realize their potential. Communities across the United States and in other countries could learn much from the Northeast Denver Housing Center. Contact: Mr. Getabecha Mekonnen, Executive Director Northeast Denver Housing Center, Inc. 1735 Gaylord Street Denver, CO 80206 Phone: 303-377-3334 Fax: 303-377-3327 ------------------------------ The Continuum of Program-Enriched Housing Program has: o Served more than 4,000 people during the past 14 years. o Provided comprehensive housing counseling to 455 people per year. o Provided affordable rentals to 60 homeless people, 14 teen parents and their children, and 5 people with HIV/AIDS in 1 year. o Provided 20 homeownership opportunities to first-time homebuyers. o Helped 15 homeless families get off welfare and into stable home environments in 1 recent year. o Renovated the historic Austin Building into 18 units of affordable housing and 9,000 square feet of retail space. ------------------------------ The development needs of urban inner cities and the challenges lower-income families face need solutions that provide residents with opportunities. ------------------------------ Diversity in income and race, type of housing program, and the will to try new, innovative and environmentally sound practices are the call of the future in community-city planning and development. ------------------------------ Greenpoint Manufacturing and Design Center Greenpoint Manufacturing and Design Center LDC Brooklyn, New York In Brooklyn, New York, a group of small crafts businesses and their public and private partners are reversing the decay of abandoned industrial sites by rehabilitating a former jute mill and leasing it to small businesses. These businesses are tenants at the Greenpoint Manufacturing and Design Center (GMDC), an adaptive re- use project that has preserved a significant piece of historic neighborhood architecture in a way that also produces new jobs and promotes neighborhood reinvestment. By creating an environment that is conducive to the formation and growth of small business, the facility addresses the area's economic problems and is the centerpiece of larger neighborhood revitalization activities. Background One highly visible problem of older urban areas is the decay and chronic under-utilization of abandoned industrial properties. Old factories--often monumental, architecturally unique structures that employed generations of residents in past decades--now lie unused. Private market forces are inadequate to support their revitalization, and government funds are too scarce to absorb the heavy costs of development. GMDC originated as the Chelsea Fiber Mills, constructed in the late 1800's at the tip of Manhattan Avenue in Greenpoint, Brooklyn. The eight-building brick mill served as a major industrial anchor in Brooklyn throughout the first half of the 20th century and employed thousands of residents. Then, like other similar facilities across the country, the 400,000-square-foot complex was abandoned in the 1970's. By the end of the 1980's, the abandoned buildings had fallen into severe disrepair. The city of New York, which had acquired the facility in a tax foreclosure action, was considering either sale or demolition of the ailing structures. Approach GMDC is a dual innovation: a successful adaptive re-use of a 19th century industrial property and a well-functioning industrial (zero-equity) cooperative that nurtures and sustains its members. The adaptive re-use entails a partnership among public, private, and nonprofit organizations, created and led by the building's tenants. It was made possible by the sweat equity and cooperative spirit of the tenants. The industrial cooperative emerged out of the individual and shared needs of each business and is supported by a local development corporation financed through rents and cooperative-related income. In 1988 a group of 21 small woodworking and cabinet-making firms, which had moved into the buildings on short-term leases, formed the Woodworking Center Equity Corporation and began to work together on rehabilitation. These tenants worked out an interim lease and development scheme and began rebuilding the structure to create a sort of greenhouse for small businesses. The facility began to attract dozens of other small enterprises from around the city, and what began in the mid-1980's as a small trickle of commercial activity has become a robust concentration of investment and employment. In the early 1990's when the city decided to dispose of the property, the tenant group banded together with other neighborhood groups and business leaders to create the GMDC Local Development Corporation (LDC). The goal of this new corporation was to redevelop the entire complex into an arts and industry center. Shortly after taking over management of the building in 1993, GMDC negotiated a special purchase arrangement with the city of New York. In lieu of bringing the building up to code prior to sale (which would have cost an estimated $10-$14 million), the city agreed to a sale price of $1 and provided $1 million for renovation on the condition that GMDC meet code requirements within 5 years. Once the sale went through, GMDC developed a plan to finance the extensive cleanup and renovations. The group resolved the building's bad debts and evicted tenants who were not paying their bills. GMDC currently has a waiting list for space. GMDC established a board of directors with four seats for finance and real estate professionals and four seats for the building's tenants. This board makes policy decisions, including establishing rental rates. GMDC's staff of 10 manages the building, schedules and undertakes repairs, obtains grants to provide technical workshops and marketing for the businesses, and has established a line of credit for use in major renovations and for purchasing machinery to be shared on a fee basis. Because of the terms under which GMDC purchased the building from the city, the corporation has no mortgage bill. Its major costs are ongoing renovation work and the purchase of specialized equipment. The city loan finances renovation work, while equipment purchases are financed through a line of credit and operating surpluses. The project is now mostly self-financing. Small grants and loans are used for special projects (for example, workshops in accounting procedures and a marketing brochure for the building), but GMDC is designed to function within its operating budget. The rents, falling between $3.75 to $4.50 per square foot, are competitive with neighboring industrial space. GMDC is currently approaching a positive cashflow and further expansion should make it financially sustainable. Building construction is pursued in a creative manner. Lacking adequate operating income to support external debt, GMDC relies on a slow, steady, monthly investment strategy and inhouse construction crew. This strategy, born of necessity, has proven highly economical. The management structure of GMDC is also uncommon. Each tenant is a member of the cooperative and controls votes in the organization equal to the portion of the building they occupy. This format fosters incentives for tenants to invest in their own space and in the project overall. It also bolsters their sense of control, heightening their overall commitment to the project. Impact As an architectural preservation project, GMDC saved a large industrial complex from demolition and is bringing the building up to code. It has already renovated and leased almost 85 percent of the facility. GMDC has also expanded the number of businesses in the building from 21 in 1988 to about 60 today. It has tripled the number of jobs in the building to about 350. GMDC has helped to stabilize and revitalize a section of Greenpoint at the end of a major street, Manhattan Avenue. There is some redevelopment activity nearby--a three-story brick townhouse--as well as a new deli and a restaurant. GMDC also gives back to its Brooklyn community. It employs Greenpoint residents and partners with the North Brooklyn Development Corporation to identify workers. It also initiated an English as a second language (ESL) program for neighborhood residents. GMDC also operates the Wood Center, a retail outlet that recycles scrap materials by selling to hobbyists and renovators and provides free wood for school projects. Since the cooperative was put in place, no GMDC business has failed, many have expanded, and only two have left. The GMDC has continued to rehabilitate vacant portions of the building, upgrade existing building systems, and gain new design and production tenants. Scaling Up There is much to be learned from the Greenpoint model: how an old industrial building can be made functional, how the tenant mix can contribute to cooperation, how to provide shared services, and how business development and neighborhood job development can be linked. This innovative approach could work in other neighborhoods in New York City and other cities across the country--anywhere where industrial spaces have been abandoned and small businesses need to be nurtured. Contact: Executive Director Greenpoint Manufacturing and Design Center LDC 1155 Manhattan Avenue Brooklyn, NY 11222 Phone: 718-383-3935 Fax: 718-383-6339 ------------------------------ The Greenpoint Manufacturing and Design Center has: o Saved a large industrial complex from demolition and renovated and leased almost 85 percent of the facility. o Expanded the number of businesses in the building from 21 to about 60. o Tripled the number of jobs in the building to about 350 and employed local residents. o Established a recycling outlet that provides free wood for school projects. o Helped stabilize the neighborhood. ------------------------------ The Greenpoint Manufacturing and Design Center was made possible by the "sweat equity" and cooperative spirit of the tenants. ------------------------------ Through its efforts, Greenpoint has preserved a significant piece of historic neighborhood architecture in a way that also produces new jobs and promotes neighborhood reinvestment. ------------------------------ Habitat for Humanity Habitat for Humanity International Americus, Georgia Habitat for Humanity, marveled one observer, is "a crazy idea that works." As a nonprofit, ecumenical Christian housing ministry, Habitat for Humanity works in partnership with people in need to build and renovate decent, affordable housing. The program builds and sells housing at no profit, finances houses with no-interest mortgages, and markets them to people who often cannot even afford decent rental housing. Partner families work many hours of volunteer labor as part of the program, whose goal is to eliminate inadequate housing worldwide and to inspire others to take action to do the same. Background Habitat traces its roots to 1965 when millionaire entrepreneur Millard Fuller and his wife Linda were struggling with a crisis of personal values. Resolving to end their materialistic lifestyle and rededicate themselves to a life of serving God, the Fullers sold their assets and donated the money to the poor. In 1968 they began an extended stay at Kiononia Farm, a Christian community in rural southwest Georgia. While there they helped launch Partnership Housing--a nonprofit, no-interest house building program in partnership with many poor families in the area, who often lived in tarpaper shacks without electricity or plumbing. In 1973 the Fullers took the Partnership Housing concept to the African country of Zaire, where they started 114 houses in 3 years and where Habitat's work continues today. Upon returning to the United States, the Fullers gathered friends and supporters together to explore forming a new housing ministry, incorporating Habitat for Humanity International in 1976. Key obstacles to Habitat's work were funding, human resources and, more importantly, skepticism. Many asked, "How can they build and sell houses at no profit, financed with no-interest mortgages?" But as Habitat's work spread, slowly at first and later at nearly an exponential pace, it became clear that Habitat for Humanity's program does indeed work. As families are lifted from poverty and as Habitat affiliates transform housing and entire neighborhoods, skeptics become believers. Approach Through volunteer labor and tax-deductible donations of money and materials, Habitat builds and rehabilitates simple, decent houses with the help of the homeowner families. Habitat houses are sold to these low-income families at cost, financed with affordable, no- interest loans. The homeowner's monthly mortgage payments are placed in a revolving Fund for Humanity that is used to construct more houses. Unlike many housing assistance programs that involve the ongoing receipt of housing vouchers, subsidized rentals, or semi-permanent placements, Habitat is a program of full homeownership. Habitat does not use government funds to finance construction. Government funds may be used, however, to acquire streets, utilities, land, old houses that need renovation, or for administrative expenses. Government entities also provide support in the form of donated land or buildings, waiver of permit fees, and infrastructure development. Corporate support for Habitat and its affiliates has grown considerably in recent years, especially from firms associated with the construction industry. Habitat is not a give-away program. In addition to a down payment and the monthly mortgage payment, families invest hundreds of hours of their own labor into the building of their homes and the homes of other participants. At each local Habitat affiliate, a Family Selection Committee chooses aspiring homeowners based on the family's need for decent shelter, their willingness to become partners in the program, and their ability to repay the no-interest loan. Neither race nor religion is a factor in selection, but willingness to work is. To participate, families and individuals must be willing to "partner" with Habitat--that is, to perform between 300-500 hours of voluntary labor. Habitat calls this homeowner labor "sweat equity," and it must be completed before the family can move into their new home. Habitat's ecumenical, international board of directors determines overall policy and monitors operations in conjunction with a board of volunteer advisors. With a budget of $53.6 million in 1994, $40.8 million going to program services in the United States and abroad, Habitat headquarters operates with an administrative staff that is assisted by a core group of clerical and support employees and supplemented by short-term and long-term volunteers. Each affiliate of Habitat for Humanity is managed by a local volunteer board and many have no paid staff. Habitat's affiliates are independent, nonprofit, tax-exempt, community-based organizations that are empowered to set their own policies within the guidelines adopted by the Habitat board. Committees of volunteers make decisions and carry out the local work. The affiliates are supported by contributions of cash and materials from individuals, churches, businesses, charitable foundations, and other organizations. Affiliates also forge diverse local partnerships to extend and facilitate the work. Habitat headquarters may channel funds and donated materials to its U.S. affiliates for special projects. Habitat's method of grassroots organization and local ownership are especially important. Too often the poor see "renewal programs" sweep into their neighborhoods from the outside with no invitation for or participation by local citizens. Habitat's approach offers residents the opportunity for homeownership through ownership of the program itself. They identify local leaders and invite them to participate in the Habitat process. Through town meetings and other assessments, local Habitat affiliates learn more about neighborhoods and their people. Committees made up of local volunteers who actively participate in decisionmaking carry out the affiliate's work. Impact Habitat and its affiliates have built, renovated, or repaired more than 40,000 houses around the world. Some 250,000 men, women, and children are living in Habitat houses worldwide. The more than 1,200 active U.S. affiliates of Habitat produced about 2,770 affordable homes in 1994. Beyond the bricks and mortar, the program strengthens the social fabric of the community where it operates through its volunteer orientation and provides a heartening example of the potential impact of a humanitarian impulse. Every Habitat affiliate is making an impact on its community. One example, Sandtown Habitat, is situated in the deteriorated Sandtown-Winchester neighborhood of Baltimore, Maryland. This affiliate grew from a bold community partnership. In 1986, overcoming numerous obstacles, the Rev. Mark Gornick and his close friends the Tibbels, a family of four including 30-year-old Allan Tibbels, a quadriplegic, relocated to the Sandtown neighborhood. The group moved into deteriorated rowhouses in this neglected neighborhood and began rebuilding the structures while forging relationships with their new neighbors. Together with those neighbors they founded the New Song Community Church which, in 1989, started the Sandtown Habitat for Humanity affiliate. Sandtown Habitat initiated a project in 1992 to build 100 homes in the midst of a neighborhood filled with more than 600 vacant rowhouses. Working in partnership with groups such as the Enterprise Foundation; the city of Baltimore; and Baltimore area churches, corporations, and foundations, Sandtown Habitat has completed more than 35 homes. The Habitat approach produces affordable houses. Most families pay far less each month to own their Habitat home than they would pay to rent much less desirable housing. For example, in Atlanta, where the Habitat affiliate has built or renovated 265 houses, the total cost of a Habitat home is between $38,000 and $42,000 and the monthly payment is about $275 per month including loan, taxes, and insurance. Scaling Up Without decent, affordable places to live, people cannot develop their potential and families often cannot overcome the circumstances that so often lead to personal dysfunction and social disintegration.Habitat's grassroots, self-help homeownership model has been adapted and successfully replicated throughout the United States and around the world. There is almost no place in the world where Habitat's model could not be successful. Even the poorest communities in the poorest countries can benefit if citizens pool their resources and work together to address local housing problems. The program that began as a personal, religious initiative in a small town in Georgia is, almost two decades later, a widely adopted model. Habitat for Humanity is solving the problem of finding affordable housing for many people, providing others with a practical means of serving others, and seizing the imagination of countless more. Habitat's method knows no jurisdictional boundaries or limitations because it is locally based. With proper resource development, on a larger scale than single affiliates can maintain alone, Habitat building programs could be launched or expanded wherever both substandard housing and the local will to eliminate it exists. Contact: Mr. Michael Willard Habitat Affiliates Worldwide - U.S. Habitat for Humanity International 121 Habitat Street Americus, GA 31709 Phone: 912-924-6935 Fax: 912-928-4087 ------------------------------ Results of Habitat include: o Habitat and its affiliates have built, renovated, or repaired more than 40,000 houses around the world. o Nearly 250,000 men, women, and children are living in Habitat houses worldwide. o Habitat for Humanity has more than 1,200 active affiliates in the United States that produced about 3,200 affordable homes in 1995. o One Habitat affiliate in Atlanta has built or renovated 265 houses. o A Habitat affiliate in the Sandtown neighborhood of Baltimore initiated a renovation program in 1992 in the midst of a deteriorated neighborhood and has completed 35 houses to date. ------------------------------ "Habitat for Humanity, according to one observer, is a crazy idea that works." ------------------------------ "We believe in Habitat for Humanity's integrity, effectiveness, and tremendous vision. With Habitat, we build more than houses. We build families, communities, and hope." Former U.S. President Jimmy Carter, on the Carters' long-standing partnership with Habitat for Humanity. ----------------------------- Homeless Families Program Beyond Shelter Los Angeles, California The "Homeless Families Program" run by Beyond Shelter of Los Angeles is a dramatic new response to the problem of family homelessness that stresses immediate return of families to independent living. Beyond Shelter deals with the interrelated problems that homeless families face: poverty, economic development and access to credit and job training, social infrastructure, and housing. The services are provided in an integrative manner to place families, especially female-headed families, not only back into housing, but back into communities. It involves women in economic and social services after they are stabilized in permanent housing and are no longer traumatized by the experience of homelessness. In the 7 years of its existence, Beyond Shelter has placed 750 homeless families in permanent rental housing in residential neighborhoods. Many program graduates enroll in school or vocational training, obtain employment, and become financially self-sufficient. Background Homelessness is our Nation's most serious housing problem. While estimates vary, the number of homeless people in America is greater today than at any time since the Great Depression. Most troubling is the fact that families--often single mothers with children--are a growing proportion of the homeless population and account for approximately 35 percent of the general homeless population in the United States. Constrained by limited resources, providers are often forced to move participants out of their program when they have only begun to stabilize. While some families are able to move into affordable housing and remain there, others who move into housing lack stable living patterns or adequate coping skills and are rendered homeless again when another crisis occurs. Other families are forced to leave emergency shelters or transitional housing without any followup plan at all and become chronically homeless or experience recurring episodes of homelessness over a long period of time. As a result, homeless families often move from shelter to shelter and from agency to agency in a process that is capital intensive for providers and disenfranchising for clients. In fact, this system can actually impede the process of helping homeless individuals and families achieve a stable and permanent home in mainstream society. Approach Beyond Shelter began in 1988 as an alternative to traditional practices that emphasize emergency shelters and transitional housing. An innovation in social architecture, Beyond Shelter's Homeless Families Program places homeless families directly into permanent housing while providing them with individualized case management support for up to 1 full year. This approach shifts cultural, political, and administrative policies and practices in a new and important way. By situating homeless individuals within the larger community, the program fosters dignity and human connection. The program makes financial and management innovations by coordinating existing services in the community through individualized and proactive case management. More than 25 agencies across the city of Los Angeles including shelters, transitional housing programs, drug treatment programs, social service agencies, and churches, refer homeless families to Beyond Shelter for the "next step," after they have provided initial emergency or interim services. Families meet with intake workers at the Beyond Shelter offices for screening and enrollment. During that time, the family works with agency staff to develop an individualized Family Transition Plan. This plan identifies the family's housing and social service needs and the steps necessary to achieve independence and self-sufficiency. Then, families receive assistance in negotiating leases, financing the move, accessing subsidies, and overcoming the barriers of poor credit history, prior evictions, and discrimination based on ethnicity, family size, and unemployment. To access affordable housing for families, Beyond Shelter builds and maintains close working relationships with private sector building managers, nonprofit affordable housing providers, and local, State, and Federal housing assistance programs. The fact that there exists a support system for their tenants motivates many private landlords to rent to homeless families referred by Beyond Shelter. Each family enrolled in the Homeless Families Program is assigned a case manager, who provides individualized support for up to 1 full year as the family carries out its Family Transition Plan. Once in their new housing, the formerly homeless family is introduced to their new neighborhood--its shopping, transportation, and community agencies. Families are supported as they improve their coping skills and reorient to normal living patterns and are provided assistance with homemaking, nutrition and parenting skills, and budget planning and money management. Each family receives their own copies of the Family Survival Guide and Successful Household Money Management, two Beyond Shelter publications that help program participants learn self-sufficiency skills. Case managers work in partnership with the family on issues such as education and literacy, career development, health, family dynamics, and recreation. Progress is evaluated every quarter until the participant is no longer considered at risk of becoming homeless again. Funded by a major private donor the first year, Beyond Shelter has since been financed largely through government grants from a variety of agencies, including the U.S. Department of Health and Human Services (HHS); the U.S. Department of Housing and Urban Development (HUD); the State of California Department of Housing and Community Development; the City of Los Angeles Community Development Department; the Housing Authority, city of Los Angeles; and the U.S. Emergency Food and Shelter Program. A variety of foundation and corporate grants support Beyond Shelter, including the California Community Foundation, the James Irvine Foundation, the Times Mirror Foundation, the Ahmanson Foundation, the Soref Foundation, the Seaver Institute, and the Better Homes Fund. An anonymous donor made a $1 million endowment gift in 1991 that made possible the creation of the Beyond Shelter Fund at the California Community Foundation to help support Beyond Shelter's operating expenses. Two additional anonymous donors provide substantial support each year. Impact Since 1989, Beyond Shelter's many programs have had an important impact on homeless families in Los Angeles. For example: o Beyond Shelter has helped more than an 750 high-risk, homeless families stabilize in permanent housing. o In the most recent statistical year, approximately 40 percent of graduates have enrolled in school or vocational training, and 25 percent have obtained employment. o About one-third of graduates increase their incomes. o Program graduates demonstrated increased self-determination, participating not only in developing their Family Transition Plans but also in the ongoing evaluations of service provision and activities leading toward self-sufficiency. o Program graduates improve their money management skills by creating and following monthly family budgets. o Approximately 90 percent of graduates experience no recurrence of homelessness. Scaling Up Beyond Shelter actively disseminated its Homeless Families Program model, which has attracted considerable attention from policymakers. In 1990 Beyond Shelter designed a 3-year demonstration project funded by HHS to help develop the Los Angeles Early Intervention Demonstration Project for Recently Homeless and At-Risk Families. In 1992, Beyond Shelter implemented a second 3- year project for HHS, the Homeless Families Support Services Demonstration Project. That same year Beyond Shelter published the Beyond Shelter Methodology Manual, a 158-page, step-by-step guide and began presenting the methodology in a series of technical assistance workshops in various U.S. cities. Beyond Shelter's Technical Assistance Department provides training, consultation, workshops, and publications for agencies throughout the country on the Homeless Families Pro-gram and also on the provision of services and tenant management in permanent, multifamily housing projects. Nationally, both public and private agencies have learned from Beyond Shelter's individualized approach that maximizes the use of existing services and resources in communities. Developed in an era of shrinking resources, the Beyond Shelter methodology is based on collaboration between public and private sectors to create permanent change in the lives of homeless families by helping them build a personal support system within a residential neighborhood. This approach has been incorporated into HUD's "continuum of care" strategies being adopted by communities across the country. Contact: Dr. Tanya Tull, Executive Director Beyond Shelter 4032 Wilshire Boulevard, Suite 501 Los Angeles, CA 90010 Phone: 213-252-0772 Fax: 213-480-0846 ------------------------------ Since 1989, through the Homeless Families Program: o 750 high-risk homeless families have stabilized in permanent housing. o 40 percent of the program's graduates enrolled in school or vocational training. o 25 percent of graduates obtained employment. o 30 percent of program graduates increased their incomes after participating in the program. ------------------------------ Since 1989 Beyond Shelter has helped more than 750 high-risk, homeless families stabilize in permanent housing. ------------------------------ "It is an axiom of our field that the longer a family or individual remains homeless, the more dysfunctional they tend to become." Tanya Tull, Executive Director, Beyond Shelter ------------------------------ Housing Assistance Council Washington, D.C. The Housing Assistance Council (HAC) uses a three-pronged approach to identify and nurture local nonprofit housing development groups by providing them with training, technical assistance, and seed capital to begin their development programs. Particularly for fledgling, isolated, nonprofit housing developers, the combination of technical assistance and loans is crucial to their ongoing success, even existence. HAC works with all low-income rural people, but emphasizes minorities, women, children, elderly, homeless, farmworkers, and the disabled. In 25 years of operation, HAC has made more than 860 loan commitments totaling more than $50 million, created 26,000 housing units, and established 220,000 water and sewer connections throughout the United States. Background Although the number of substandard rural homes has declined over the past 20 to 30 years as a proportion of all rural housing, the problem persists. Many rural homes are of poor quality and still lack water and sewer facilities, particularly in Appalachia, Indian country, the Mississippi Delta, the Ozarks, the Southeast, and the colonias on the Mexican border. Minority groups in rural areas suffer an even higher incidence of housing problems; in 1991, for example, almost 32 percent of African Americans in rural areas lived in units with severe or moderate structural problems, compared to 17 percent of their urban counterparts. The nature of the problem has changed over time. Historically, quality was the primary housing issue in rural areas. But by 1991, almost 70 percent of poverty-level households in rural areas had to pay more than 30 percent of their income--the Congressionally defined threshold of affordability--for housing. Approach Established with a Federal antipoverty grant in 1991, HAC is the Nation's oldest full-service intermediary for housing and community development. Through training, technical assistance, and seed capital, HAC seeks to build capacity and strengthen the network of community-based organizations working to meet rural housing and local development needs. HAC provides much-needed seed money to spur housing and community development in rural areas. This up-front, pre-development, high- risk money enables isolated, cash-strapped, and often fledgling nonprofit development groups to initiate potential housing projects. HAC funds typically pay for optioning the land, resolving site design or environmental issues, or working through community processes such as rezoning approvals. As a full-service provider, HAC is unique in integrating loans with project-specific technical assistance, training, and other services. For example, technical assistance accompanies most loans, and training events use HAC publications. After delivering a loan or workshop, HAC continues to provide assistance for as long as it is needed. HAC also produces many how-to and policy publications for its clients and people interested in rural housing issues, including an 1,800-page technical training manual on housing development and nonprofit management. The HAC approach builds on the strengths of private financial institutions, local government jurisdictions, nonprofit groups, State and Federal agencies, and the homeowner families themselves. HAC provides funds to acquire and develop sites, including a public improvements completion guarantee bond. Government agencies provide financing and handle complex site development questions. Local nonprofit groups may identify the families, provide necessary credit and homeownership counseling, and construct the project. The families themselves provide a critical mass of voluntary labor. Impact In almost 25 years of operation, the organization has made more than 860 loan commitments totaling more than $50 million for almost 26,000 housing units and 220,000 water/sewer connections in 48 States, the Virgin Islands, and Puerto Rico. These loans have directly helped almost 250,000 rural households. In the past 5 years alone, HAC lending has leveraged more than $177 million in permanent financing. HAC also has conducted more than 90 intensive training workshops and published more than 250 guides, reports, manuals, and information briefs. Scaling Up HAC was one of the earliest intermediary organizations. To some extent later organizations, such as the Local Initiative Support Corporation and The Enterprise Foundation, have borrowed from its model. In the past few years, HAC has begun to broaden its services. HAC has increased loan assets, made their uses more flexible, developed lending partnerships with other entities, allied with other community lenders, and reduced borrower charges. In recent years HAC also has become a source of support for community-based housing groups by passing through administrative funds from sources such as the U.S. Department of Housing and Urban Development and private foundations. This complements HAC loans, technical assistance, and other services. Contact: Mr. Moises Loza, Executive Director Housing Assistance Council 1025 Vermont Avenue NW., Suite 606 Washington, DC 20005 Phone: 202-842-8600 Fax: 202-347-3441 ------------------------------ During the past 20 years: o HAC has made more than 860 loan commitments totaling more than $50 million for almost 26,000 housing units and 220,000 water/sewer connections. o HAC has assisted rural housing groups in 48 States, the Virgin Islands, and Puerto Rico. o HAC has directly helped almost 250,000 rural households. In the past 5 years: o HAC lending has leveraged more than $177 million in permanent financing. o HAC has conducted more than 90 intensive training workshops. o HAC has published more than 250 guides, reports, manuals, and information briefs. ------------------------------ The Housing Assistance Council operates the oldest active, continuously operating, and successful loan fund for affordable housing. ------------------------------ The Housing Assistance Council identifies local nonprofit housing development groups and nurtures them by providing training, technical assistance, and seed capital to carry out their development programs. ------------------------------ Housing Scholarship Program City of Fremont Fremont, California By offering housing as an incentive to encourage heads of households to stay in job training to improve their professional skills and earning potential, the city of Fremont, California, has taken a creative step to alleviate poverty. Fremont's Housing Scholarship Program combines affordable housing, job training, child care, and other supportive services to enable participating low-income families to obtain full-time employment and achieve economic self-sufficiency. The program provides housing units at below-market rents to participants and recent graduates of eligible job training programs. Background In the city of Fremont, economic self-sufficiency has been an unattainable goal for many low-income families. Nearly 1,400 renter households, most of which are headed by women, spend more than half of their income for housing while earning 30 percent or less of the area median income. Without adequate child care and other supportive services, these families cannot escape their low-paying jobs and remain trapped in a cycle of poverty and welfare. When Carol Lamont, Housing Director for the city, introduced the idea of housing scholarships to landlords in 1987, she faced widespread skepticism. Not giving up, she convinced the director of a local job facility, the Mission Valley Regional Occupation Program (ROP), to speak to the landlords' association. By describing individual cases, the director was able to show the plight and motivation of individuals in her program. During the meeting, one landlord raised his hand and said that he would like to sponsor one individual in his building. From then on, more landlords volunteered units to help family providers while they completed training and secured employment. They agreed to provide rent discounts of up to 50 percent for up to 1 year. Once housing scholarship graduates acquire jobs, rents gradually increase to market price. ROP provides job placement and case management services, and the city provides policy direction and coordinates the program under the leadership of a Housing Scholarship Board composed of representatives of the city council, the apartment owners association, the board of realtors, a program graduate, and many other community groups. Approach "It is particularly difficult for cities to be innovative because of the risks involved," comments Gus Morrison, Mayor of Fremont. "But, Fremont took the step to establish the partnerships needed to create this program. We have shown that it can be done--and that it should be done." The Housing Scholarship Program is not just another housing subsidy program; rather, it inspires and enables heads of households to achieve. It provides families with the case management, job search services, and affordable child-care services that are an essential component in the quest for economic self-sufficiency. Through intensive focused community support, this important project is helping families who have demonstrated their commitment to improving their skills and employability to achieve their goals. The city and private landlords, both for-profit and nonprofit, have collaborated to provide a safety net for families moving toward economic self-sufficiency. As part of the Housing Scholarship Program, the city initiated a rigorous screening, monitoring, and followup process. Applicants are recommended by designated representatives from job training and educational programs. An advisory board meets monthly to review new applications according to special criteria and rank candidates. When units become available, one of the two top applicants is selected by a landlord. The applicant signs a program agreement detailing his or her responsibilities for job training, job search, and employment in exchange for a rent reduction. Participants are terminated from the program if they fail to meet their obligations. Public-private partnerships help keep expenses manageable. Donations from landlords, rather than public subsidies, cover rent discounts. As the program grows, nonprofit and for-profit developers create more housing scholarship units. In its recent renovation of Century Village apartments, the Mid-Peninsula Housing Corporation set aside several units for the Housing Scholarship Program, which were financed through development funds and redevelopment fees. The Fremont Housing Department covers operating costs by providing five full-time staff, and public funds cover the costs of the Tri-Cities Children's Center, a child care center that has been established at ROP. This center now serves 50 preschool children on a sliding-fee schedule. Impact "There's so much talk about getting families off welfare," says Carol Lamont, "this program really did it." To date, this relatively new and growing program has empowered 91 families to achieve self-sufficiency--a 90-percent success rate. The benefit to the community is reflected in the pride that the people of Fremont feel in their multiagency effort to successfully address a problem that many cities believe is unsolvable. Landlords and employers are active, positive agents of change, and community service agencies not only alleviate immediate suffering but also move recipients toward independent, financially secure living. Aided by life skills classes, scholarship graduates are taking on new leadership roles. One graduate has become an Advisory Board member of the program, while another has moved from extreme poverty and welfare to a $40,000 annual income that allows her to send her bright daughter to Montessori school. Scaling Up The Housing Scholarship Program has successfully helped families climb the ladder to self-sufficiency. The program is so highly popular that there are 10 to 20 applicants for every housing unit available. To meet this need, the city is working to convince nonprofit housing developers to set aside units in developments financed by the city. In 1995 its success prompted the Fremont City Council to agree to use vacant city-owned houses for housing scholarships. Communities throughout the Nation, such as Temple, Texas, are now considering establishing a housing scholarship program based on the Fremont model. The scholarship program has received much recognition. It was showcased in September 1995 at an International City Managers Association Meeting in Denver and, in May 1995, the Center for Housing Policy in New York showcased the program as 1 of 12 national case studies in its "Linking Jobs and Housing: The Key for Self-Sufficiency for Low-Income Residents and Communities" workshop. The program has won several awards, such as the "California Cities Helen Putman Award for Excellence" in November 1995. Contact: Ms. Carol Lamont, Director Office of Housing Services City of Fremont 39550 Liberty Street P.O. Box 5006 Fremont, CA 94537-5006 Phone: 510-494-4500 Fax: 510-494-4636 ------------------------------ The City of Fremont Housing Scholarship Program has achieved the following accomplishments: o More than 90 percent of the housing scholarship recipients have successfully completed job training, secured gainful employment, and have become economically dependent. o Housing Scholarship Program graduates are developing leadership skills and becoming assets to the program and the community. o It has received growing recognition, including the 1995 California Cities Helen Putman Award for Excellence, the Association for Local Housing Finance Agencies Meritorious Achievement Award, and the State Department of Education Career Vocational Division Award. The program is also a semifinalist in the Ford Foundation and Harvard University "1996 Innovations in American Government Awards Program." ------------------------------ Because there are insufficient resources to provide affordable housing for all low-income families in need, we must help to build the earning capacity of families while targeting housing assistance for those with the most critical needs. ------------------------------ There is so much talk about getting families with children off welfare--this program really helps families do it while improving their quality of life. ------------------------------ "It is a partnership--no one part could accomplish such dramatic results on its own." Carol Lamont, Housing Director for the City of Fremont ------------------------------ The Loading Dock Baltimore, Maryland The Loading Dock (TLD), a grassroots organization that provides resources for low-income housing rehabilitation and development, was the first successful self-sufficient nonprofit recycler of reusable building materials in the Nation. Through its recycling efforts, the program increases the supply of decent affordable housing available to low-income families by helping them acquire building supplies to renovate their homes. At the same time, TLD helps save the environment by educating the public and private businesses about how to donate and reuse building material rather than dumping it into our rapidly filling landfills. Background Like many older cities in the United States, much of Baltimore's housing stock is more than 100 years old and in need of repairs. Ten percent of Baltimore's housing is considered substandard, and all but 1 percent is considered suitable for rehabilitation. Low- income homeowners are particularly hard-hit; they are more likely to live in older housing but least likely to have extra income for repairs and maintenance. To help rectify this situation, a group of housing professionals with an interest in the environment saw the possibility of matching needs: low-income homeowners need low-cost building materials to renovate and maintain their homes, and the building industry has a large supply of excess building materials that go to waste. In 1984, through a $25,000 grant from the Morris Goldseker Foundation, TLD opened for operation in a 7,000-square-foot warehouse where it stores building materials. In 1988 the effort expanded to add a 21,000-square-foot warehouse. Approach Recent visitors to The Loading Dock warehouse in Baltimore, Maryland, found lumber, windows, solar panels, a maple gymnasium floor, toilets, tubs, kitchen sinks, and even a gargoyle water fountain. In the past, these materials, left over from commercial construction projects, would likely have been considered waste and dumped in a landfill. Today, however, these usable materials are made available to low-income homeowners and nonprofit organizations for home repairs and rehabilitation. Although TLD receives donations from several States, the warehouse serves lower income neighborhoods in the greater Baltimore area. Grassroots groups refer people to join TLD. Once they are certified as low income, applicants pay a $5 annual fee to become members. TLD members can shop in the warehouse for building supplies, which cost about one-third to three-fourths less than retail, and may also attend monthly home improvement workshops hosted by trades-and craftspeople. Realizing that issues of waste management are regional in scope, TLD works with donor partners from throughout the Mid-Atlantic region, enc