Community Investments Vol 23, Issue 1
According to the National Bureau of Economic Research, the nation’s economy began to grow again in June of 2009, ending an 18-month recession that was the longest on record since the Great Depression. Yet low-income communities across the 12th District remain in economic crisis, struggling with the compounding effects of unemployment, foreclosures, and neighborhood disinvestment.
Reversing these trends will be far from easy, and most predict that the road to recovery will be long and bumpy. If history is any indication, however, we can be sure that the crisis will prompt the community development field to emerge stronger than ever. After all, previous periods of crisis led to the rise of Community Development Corporations, the Low Income Housing Tax Credit, and the Community Reinvestment Act, all of which prompted new investments and innovations in community development. As Nancy Andrews has written, “[This history] speaks to the creativity and drive of the professionals working in the community development field, professionals motivated by a social vision, not by profit maximization. Economic reversals spur creativity.”
The articles in this issue of Community Investments speak to that creativity, and the constant work of both practitioners and researchers to identify best practices and programs that can help lower-income households and communities. We profile two new efforts to improve consumers’ financial decisions. The first is an innovative program that engages low-income youth in financial education and asset building through a lottery-based savings account. The second is a nonprofit check cashing outlet – the first of its kind – which seeks to curb the asset stripping effects of alternative financial services. We also highlight new research released by the Urban Institute on shared equity homeownership strategies, which shows that shared equity programs deliver on three important goals: 1) long-term housing affordability for low-income households, 2) wealth building, and 3) sustainability of tenure. The article by PolicyLink reviews promising local strategies for responding to the trend of investor purchases of distressed properties. And we look at how the Neighborhood Stabilization Program is strategically targeting public dollars for the acquisition and rehabilitation of foreclosed properties to maximize the program’s impact on the ground.
Of course, these strategies merely scratch the surface of the interventions that will be needed in the coming years. But we hope these articles and ideas will spark innovative ideas or programs in your community. Let us know if there’s something else brewing in your backyard that can contribute to a more inclusive economic recovery – we always welcome your thoughts and feedback.