Community Development: Comprehensive Approaches Address Multiple Needs
but Are Challenging to Implement (Chapter Report, 02/08/95,
GAO/RCED/HEHS-95-69).

The aspirations of people in distressed neighborhoods are familiar--to
have a home and a job, to live in a safe area, and to have hope for
their children's future.  Isolated by poverty, residents of distressed
neighborhoods may never realize their dreams.  Some community-based
nonprofit groups are using a multifaceted, or comprehensive, approach to
community development that relies on residents' participation to address
housing, economic, and social service needs in distressed neighborhoods.
This report examines (1) why community development experts and
practitioners advocate this approach, (2) what challenges they see to
its implementation, and (3) how the federal government might support
comprehensive approaches.  GAO reviewed four groups, located in Boston;
Detroit; Pasadena; and Washington, D.C., that have used comprehensive
approaches in their communities.

--------------------------- Indexing Terms -----------------------------

 REPORTNUM:  RCED/HEHS-95-69
     TITLE:  Community Development: Comprehensive Approaches Address 
             Multiple Needs but Are Challenging to Implement
      DATE:  02/08/95
   SUBJECT:  Interagency relations
             Disadvantaged persons
             Federal aid to localities
             State/local relations
             Urban planning
             Model cities
             Community development
             Community development programs
             Declining neighborhoods
             Federal aid for housing
IDENTIFIER:  Boston (MA)
             Detroit (MI)
             Pasadena (CA)
             District of Columbia
             Community Action Program
             Model Cities Program
             Community Services Block Grant
             Community Development Block Grant
             Empowerment Zones and Enterprise Communities Program
             Social Services Block Grant
             HUD Home Investment Partnership Program
             HUD Homeownership Opportunities for People Everywhere 
             Program
             Ford Foundation Neighborhood and Family Initiative
             Annie E. Casey Foundation Rebuilding Communities Initiative
             National Performance Review
             Emergency Shelter Grant
             HUD Housing Opportunities for Persons with AIDS Program
             Dudley Street Neighborhood Initiative (Boston, MA)
             
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Cover
================================================================ COVER


Report to the Subcommittee on Human Resources and Intergovernmental
Relations, Committee on Government Reform and Oversight, House of
Representatives

February 1995

COMMUNITY DEVELOPMENT -
COMPREHENSIVE APPROACHES ADDRESS
MULTIPLE NEEDS BUT ARE CHALLENGING
TO IMPLEMENT

GAO/RCED/HEHS-95-69

GAO/RCED-95-69

GAO/RCED/HEHS-95-69 Comprehensive Approaches to Community Development


Abbreviations
=============================================================== ABBREV

  AFDC - Aid to Families with Dependent Children
  CAA - Community Action Agency
  CAP - Community Action Program
  CCN - Core City Neighborhoods
  CDBG - Community Development Block Grant
  CDC - Community Development Corporation
  CSBG - Community Services Block Grant
  DSNI - Dudley Street Neighborhood Initiative
  EZ/EC - Empowerment Zones and Enterprise Communities
  HHS - Department of Health and Human Services
  HOME - Home Investment Partnership
  HOPE - Housing Opportunities for People Everywhere
  HUD - Department of Housing and Urban Development
  LISC - Local Initiatives Support Corporation
  MHCDO - Marshall Heights Community Development Organization
  NAPA - National Academy of Public Administration
  NHS - Neighborhood Housing Services
  NPR - National Performance Review
  NRC - Neighborhood Reinvestment Corporation
  OMB - Office of Management and Budget
  PNHS - Pasadena Neighborhood Housing Services
  SSBG - Social Services Block Grant

Letter
=============================================================== LETTER



B-259639

February 8, 1995

The Honorable Christopher Shays
Chairman
The Honorable Edolphus Towns
Ranking Minority Member
Subcommittee on Human Resources
 and Intergovernmental Relations
Committee on Government Reform
 and Oversight
House of Representatives

This report responds to your request that we examine multifaceted--or
comprehensive--approaches that community-based nonprofit
organizations have taken to improve conditions in distressed urban
neighborhoods.  We reviewed four organizations--located in Boston,
Massachusetts; Detroit, Michigan; Pasadena, California; and
Washington, D.C.--whose approaches rely on residents' participation
to address the housing, economic, and social service needs of the
communities.  This report is based on the experiences of a wide
variety of experts in each location, as well as on the findings of
government, foundation, and community development researchers. 

We are sending copies of this report to the Secretary of Health and
Human Services, the Secretary of Housing and Urban Development, and
other interested parties.  We will make copies available to others
upon request. 

Please contact us--Judy A.  England-Joseph at (202) 512-7631 and Jane
L.  Ross at (202) 512-7215--if you or your staff have any questions. 
Major contributors to this report are listed in appendix VIII. 

Judy A.  England-Joseph
Director, Housing and Community
 Development Issues

Jane L.  Ross
Director, Income
 Security Issues


EXECUTIVE SUMMARY
============================================================ Chapter 0


   PURPOSE
---------------------------------------------------------- Chapter 0:1

The values and dreams of people in distressed neighborhoods are
familiar--to have a home and a job, to live in a safe area, and to
have hope for their children's future.  Isolated by poverty,
residents of distressed neighborhoods may never realize their dreams. 
Some community-based nonprofit groups are using a multifaceted--or
comprehensive--approach to community development that relies on
residents' participation to address housing, economic, and social
service needs in distressed neighborhoods. 

To advise the Congress on the use of multifaceted approaches to
improving conditions in distressed neighborhoods, the Subcommittee on
Human Resources and Intergovernmental Relations, House Committee on
Government Reform and Oversight, asked GAO to examine (1) why
community development experts and practitioners advocate this
approach, (2) what challenges they see to its implementation, and (3)
how the federal government might support comprehensive approaches. 
This study incorporates information obtained during GAO's review of
four organizations--located in Boston, Massachusetts; Detroit,
Michigan; Pasadena, California; and Washington, D.C.--that are
applying a comprehensive approach in their respective communities. 


   BACKGROUND
---------------------------------------------------------- Chapter 0:2

Despite overall economic growth in the United States during the
1980s, the economic and social health of many cities declined.  For
example, the number of citizens living in poverty increased from 29
million in 1980 to 39 million in 1993.  Over the same period,
intergovernmental aid to cities declined by 19.4 percent in constant
dollars.  The out-migration of many middle-income residents and
businesses has caused city tax bases to shrink while the demand for
services has grown.  To help meet the needs of residents, community
organizations have initiated comprehensive efforts such as the four
GAO examined.  These efforts rely on technical support and funding
from local and national nonprofit organizations and private groups as
well as federal, state, and local governments.  The federal funding
generally flows through state and local governments in the form of
block grants or goes directly to the organizations in the form of
categorical, or program-specific, funding. 


   RESULTS IN BRIEF
---------------------------------------------------------- Chapter 0:3

Community development experts--researchers, government officials, and
practitioners--advocate a comprehensive approach to address the
problems of distressed neighborhoods because such complex,
interrelated problems are better addressed in tandem than
individually.  Practitioners in the four locations GAO examined and
other experts GAO consulted said that the comprehensive approach has
benefited the communities and holds promise for long-term results
because it provides for multiple services and makes them more
accessible to community residents.  Researchers said that such an
approach is feasible because community organizations and networks to
support them have evolved over the last several decades.  However,
the experts cautioned that conditions in distressed neighborhoods
cannot be quickly reversed and that the outcome of much of the work
these groups do--community outreach, counseling, and referral
services--is hard to quantify, making evaluation of the results
difficult. 

Many challenges confronted the four organizations GAO studied as they
attempted to improve conditions in their neighborhoods.  Because of
community skepticism, a substantial challenge to each was ensuring
residents' participation.  In addition, the organizations had to
piece together a complex web of funding from several private and
public sources--often with conditions and/or restrictions on use--to
cover both program and administrative costs.  The organizations also
faced the onerous task of managing a diverse set of concurrent
housing, economic development, and social service programs.  Leaders
of these organizations said that to sustain their efforts they have
concentrated on building residents' support, gaining access to
multiple funding sources, and developing a cadre of experienced
staff. 

Traditionally, coordination has been limited among the many federal
departments and agencies responsible for administering the programs
that can be used to assist distressed communities.  Agencies have
tended not to coordinate their efforts with one another because they
have separate missions and have been concerned about losing control
over their own resources.  However, several recent federal
initiatives, if fully implemented, could help the federal government
become more supportive of comprehensive efforts.  Examples include
(1) the measures being undertaken in response to the National
Performance Review's recommendations for consolidating and
streamlining programs and (2) the Department of Housing and Urban
Development's (HUD) recently announced plans to consolidate 60
programs into 3. 


   PRINCIPAL FINDINGS
---------------------------------------------------------- Chapter 0:4


      COMPLEX PROBLEMS CALL FOR
      COMPREHENSIVE APPROACHES
-------------------------------------------------------- Chapter 0:4.1

According to the experts GAO consulted, a comprehensive approach
enhances the chances of improving conditions in distressed
neighborhoods because the problems in these areas are complex and
interrelated.  Addressing these problems in tandem, the experts
believe, makes long-term results possible.  In addition, the experts
said that comprehensive approaches are more viable now than they were
in the past because community organizations have gained experience
and an infrastructure has evolved to provide funding and technical
assistance.  The comprehensive approach was endorsed by HUD in March
1994.  Several national foundations--frustrated with the results of
programs they previously funded--have begun funding organizations
taking a comprehensive approach. 

The four community organizations GAO examined have taken a
comprehensive approach.  Although these organizations are diverse,
they share certain characteristics.  Each (1) is community-based,
focusing on a specific geographic area and relying on residents'
input, (2) addresses both physical and social needs, and (3) was
initiated and is sustained by a combination of public and private
resources.  Each organization evolved as it matured to respond to the
community's needs. 

The organizations GAO reviewed believe that while the conditions in
these neighborhoods cannot be quickly reversed, comprehensive
approaches hold promise for long-term results because they provide
multiple, accessible services for community residents.  Other experts
GAO consulted--both in and out of government--agreed.  However,
community development researchers cautioned that they have not yet
fully evaluated these approaches because the diversity of the
organizations' structures and services and the difficulty in
quantifying some of the organizations' results have made evaluation
difficult. 


      COMPREHENSIVE APPROACHES ARE
      DIFFICULT TO IMPLEMENT
-------------------------------------------------------- Chapter 0:4.2

Multiple challenges confronted the four organizations GAO studied. 
All experienced substantial difficulty organizing residents, gaining
their trust, and maintaining their involvement.  All four groups said
that residents needed to see a tangible result--rehabilitated housing
or a cleaner neighborhood--before they wanted to participate. 
Obtaining financial support and managing a diverse set of concurrent
programs also presented significant challenges.  The four
organizations relied on a myriad of public and private funding
sources, such as federal block grant and program-specific funding,
foundation grants, and corporate donations.  Overall, the groups
relied on public funding--often with conditions and/or restrictions
on use--for 30 to 60 percent of their budgets.  After obtaining
funds, the groups faced the challenge of concurrently managing
multiple programs, each with several separate funding sources,
application requirements, and reporting expectations. 

The four organizations GAO studied responded to the challenges
confronting them in a variety of ways.  They obtained residents'
support by including residents in their planning and decision-making. 
They also established multiple funding sources and collaborations to
leverage resources that could then be applied over a wide range of
needs in the communities.  In addition, each organization had access
to some relatively flexible funding--either public block grants or
private foundation funds--that enabled it to set priorities
consistent with its community's needs.  Finally, the organizations
built a cadre of experienced staff to administer and manage the array
of programs. 


      FEDERAL INITIATIVES MAY
      REDUCE PROGRAM FRAGMENTATION
-------------------------------------------------------- Chapter 0:4.3

Historically, there has been little coordination among the many
federal departments and agencies that have responsibility for
administering the programs that can be used to assist distressed
communities.  Agencies have tended not to coordinate efforts with one
another because they have been protective of their own resources and
separate organizational missions.  In addition, efforts that have
been undertaken have generally been unsuccessful, leaving community
organizations--such as the ones we reviewed--to try to piece together
programs to serve their communities. 

Recently, however, the federal government has initiated efforts that,
if fully implemented, could support comprehensive efforts.  For
example, measures being undertaken within departments to consolidate
and streamline programs in response to recommendations of the
National Performance Review could decrease the number of separate
federal programs and make application and reporting requirements less
burdensome for community organizations.  Indeed, HUD has announced
plans, pending congressional approval, to consolidate 60 programs
into 3. 


   RECOMMENDATIONS
---------------------------------------------------------- Chapter 0:5

This report does not contain recommendations; however, it does
discuss the potential for ongoing federal efforts, if fully
implemented, to make federal programs more accessible to community
organizations. 


   AGENCY COMMENTS
---------------------------------------------------------- Chapter 0:6

We discussed the findings in this report with the Director, Office of
Affordable Housing, Community Planning and Development Division,
Department of Housing and Urban Development, and the Director, Office
of Community Services, Administration for Children and Families,
Department of Health and Human Services.  These officials generally
agreed with the information presented in the report. 


INTRODUCTION
============================================================ Chapter 1

Despite overall economic growth in the United States during the
1980s, the economic and social health of many cities declined.  While
crime, poverty, and the physical and social deterioration of urban
neighborhoods increased, intergovernmental aid to cities declined
between 1980 and 1993 by about 19.4 percent in constant dollars. 
Meanwhile, the out-migration of many middle-income residents and
businesses has caused city tax bases to shrink, hampering the ability
of local governments to assist economically and socially distressed
areas suffering from a mix of interrelated problems. 

Over the past several decades, the public and private sectors have
tried different strategies to assist people living in distressed
communities.  Some of these efforts have focused on improving the
chances for individuals in these areas to obtain the education,
social services, and other support they need to leave their
neighborhoods.  Others have focused on improving the neighborhood's
physical environment through affordable housing or economic
development.  Still others have combined aspects of both approaches
by addressing the needs of residents and their environment.  These
latter efforts are referred to as comprehensive by community
development experts because they consider the housing, social
service, and economic development needs of the community.  They are
considered community-based because they focus on a specific
geographic area and involve the residents in planning and
implementing the effort.  Comprehensive community-based efforts have
often begun within a community in response to neighborhood
conditions--rather than in response to a federal program--and are
operated by local nonprofit organizations.  While the structures of
these organizations and the programs they provide vary, figure 1.1
illustrates a likely design for a comprehensive community-based
development effort. 

   Figure 1.1:  Diagram of a
   Comprehensive Community-Based
   Development Effort

   (See figure in printed
   edition.)


   MAJOR COMMUNITY DEVELOPMENT
   INITIATIVES
---------------------------------------------------------- Chapter 1:1

During the 1960s, as a part of its overall strategy to better serve
the needs of the poor, the federal government supported broad
comprehensive initiatives, such as the Community Action Program (CAP)
and Model Cities.  CAP established community action agencies (CAA) at
the local level to combine and redirect a wide range of federal,
state, local, and private resources to make a comprehensive attack on
poverty.  Participation by beneficiaries and decentralization of
decision-making were also major elements of the program.  As we
reported in 1992,\1 the program lacked sufficient authority and
political support at the federal and local levels to influence
agencies' practices and improve service delivery.\2

Model Cities\3 sought to rebuild deteriorated neighborhoods in
selected cities by coordinating the array of resources from
assistance programs at all levels of government, particularly in
housing, education, health, and transportation.  Like CAP, Model
Cities attempted to unify these efforts into an interrelated system. 
The program was administered by city demonstration agencies that were
an integral part of city administrations.  In retrospect, according
to our 1992 report, the results of the Model Cities program were
mixed because the program lacked incentives to promote cooperation
and consensus on priorities.  The Model Cities program was terminated
as of January 1975 by the Housing and Community Development Act of
1974.  The act consolidated seven community development categorical
grant programs into the Community Development Block Grant (CDBG)
program.  Federal support and sponsorship for comprehensive efforts
slowed after this, and funding for many community development
programs declined in the 1980s. 

Meanwhile, the private sector, which had started its own
comprehensive effort to revitalize distressed communities, continued
to shape the comprehensive approach.  The Ford Foundation, early in
the 1960s, developed the Gray Areas Project in New Haven,
Connecticut.  Its purpose was to address the multiple needs of a
distressed inner city neighborhood by rehabilitating existing
housing, providing new affordable housing, and addressing residents'
social and economic needs. 

Experiences from the private and the federal efforts of the 1960s led
to the concept of the Community Development Corporation (CDC).  CDCs
are private nonprofit organizations that focus their efforts on
specific distressed geographic areas.  As originally envisioned,
these groups emphasized economic and physical development as well as
social service delivery.  Their boards of directors were composed of
residents from the area and representatives of concerned businesses
and institutions.  CDCs typically entered into partnerships with
local governments and corporate entities and relied on both public
and private funding.  Since the early 1970s, the number of
Community-Based Development Organizations--also known as CDCs--has
more than tripled, according to a Fannie Mae Foundation study. 
Studies by the National Congress for Community Economic Development
indicate that there are currently at least 2,500 CDCs around the
country.  However, many of these CDCs do not offer comprehensive
services but focus primarily on housing production or economic
development. 

As federal involvement in community development declined and private
participation grew, entities known as intermediaries evolved to
provide CDCs with financial and technical assistance.  In 1979, the
Ford Foundation created the Local Initiatives Support Corporation
(LISC), a national intermediary set up to provide grants, loans, and
technical assistance to nonprofit community development
organizations.  Another prominent national intermediary--the
Enterprise Foundation--has focused on strengthening nonprofit housing
development groups, forging local housing partnerships, and helping
local groups link needed services into housing, as well as on
demonstrating creative approaches to community development. 

The federal government also supported the use of national
intermediaries.  In 1978, the Congress chartered the Neighborhood
Reinvestment Corporation (NRC) (42 U.S.C.  8101 et.  seq.), a public
nonprofit corporation.  NRC's mission included the revitalization of
declining lower-income neighborhoods and the provision of affordable
housing.  NRC works with local organizations that are known
collectively as NeighborWorks.  There are several different types of
NeighborWorks organizations, including Neighborhood Housing Services
(NHS).  NHSs are partnerships of local business leaders, local
government officials, and neighborhood residents that function as
NRC's main vehicle for revitalizing distressed neighborhoods. 

A major new federal initiative to assist urban and rural communities
in their revitalization efforts--the Empowerment Zones and Enterprise
Communities (EZ/EC) program--was adopted in 1993 under the Omnibus
Budget Reconciliation Act.  This program promotes the comprehensive
revitalization of distressed communities by funding broad,
community-based strategic plans.  The bulk of the benefits under the
program go to nine areas--six urban and three rural--designated as
empowerment zones.  Considerably fewer benefits are available to the
95 areas--65 urban and 30 rural--designated as enterprise
communities. 

Although the Department of Housing and Urban Development (HUD) and
the Department of Agriculture were responsible for designating the
areas, the President also established the Community Enterprise
Board--a federal, Cabinet-level entity--to assist in implementing the
EZ/EC program.  The Board is composed of the Vice President, who
serves as its Chair; the President's assistants for domestic policy
and economic policy, who each serve as vice chairs; the secretaries
of 10 Cabinet departments; and the heads of several other agencies.\4
In addition, the Board is tasked with advising the President on how
federal programs can be better coordinated across agencies to respond
to the needs of distressed communities. 


--------------------
\1 Integrating Human Services:  Linking At-Risk Families With
Services More Successful Than System Reform Efforts (GAO/HRD-92-108,
Sept.  24, 1992). 

\2 Although CAP and the Office of Economic Opportunity--the office
that administered CAP--were eventually disbanded, local CAAs continue
to operate and are eligible for Community Services Block Grant
funding. 

\3 Model Cities is the popular name for the Demonstration Cities and
Metropolitan Development Act (42 U.S.C.  3301). 

\4 The Secretaries of the Departments of Agriculture, Commerce,
Education, Health and Human Services, Housing and Urban Development,
the Interior, Labor, Transportation, and the Treasury; the Attorney
General; and the Directors of the Environmental Protection Agency,
the Small Business Administration, and the Office of Management and
Budget; and other presidential advisers are represented on the Board. 


   SOURCES OF FUNDING AND
   TECHNICAL SUPPORT FOR COMMUNITY
   DEVELOPMENT EFFORTS
---------------------------------------------------------- Chapter 1:2

Community development initiatives typically rely on a patchwork of
different funding and technical support sources from both the public
and the private sectors.  Federal funds generally flow through state
and local governments in the form of block grants or go directly to
community organizations in the form of categorical, or
program-specific, funding.  Additional funding--often to support
specific programs or projects--is available directly from state and
local governments.  Private funding and technical assistance come
from a myriad of sources, including intermediaries and foundations. 


      PUBLIC FUNDING AND SUPPORT
-------------------------------------------------------- Chapter 1:2.1

Several federal block grant funding sources are available to
community development organizations through state and local
governments.  Under HUD's CDBG program, a wide range of neighborhood
revitalization activities can be funded.  For example, these grants
may be used to rehabilitate housing, support economic revitalization
projects, and provide public facilities.  HUD also offers funding for
housing development through the Home Investment Partnership (HOME)
program\5 to state and local governments, which may pass a portion of
the funds on to eligible housing development organizations.  The
Department of Health and Human Services (HHS) makes funds available
through the Community Services Block Grant (CSBG) and the Social
Services Block Grant (SSBG).\6 The CSBG funds can be used for a range
of activities to provide social services, such as emergency
assistance, employment assistance, and elderly care.  The SSBG funds
can also be used for a wide variety of social services, including
preventing and treating drug and alcohol abuse and training and
employing disadvantaged adults and youth in housing construction and
rehabilitation. 

The federal government also provides funding to community
organizations through many separate programs operated across federal
departments.  This funding tends to be categorical--designated for
specific activities--and must be applied for in accordance with
specific program guidelines.  For example, HUD offers funding for
homeownership through the Housing Opportunities for People Everywhere
(HOPE) program and for assistance to the homeless through the
McKinney Act programs.  HHS provides grants to local entities to
develop and implement projects that create jobs for low-income people
in distressed neighborhoods through its Community Initiatives
Program.  It also provides grants for substance abuse prevention and
treatment demonstration projects, among other things.  Other
agencies--including the Departments of Commerce, Education, Justice,
Labor, and Transportation; the Environmental Protection Agency; and
the Small Business Administration--operate additional programs that
are available to community organizations.  In addition, various
federal tax credit and loan guarantee programs are available to
community organizations. 

Some states and localities administer additional programs and provide
grants or loans to community organizations for affordable housing,
economic development, and social services.  For example, a city
government may have its own homeownership program that the community
organizations can use.  Sometimes, state or local governments provide
other types of assistance by donating land or offering to work with
lenders to negotiate lower interest rates.  In addition, some states
and localities provide financing--sometimes tax-exempt--for specific
projects. 


--------------------
\5 The HOME program replaced several other housing programs,
including the Section 312 Rehabilitation Loans, Nehemiah Grants,
Rental Rehabilitation, and Urban Homesteading programs. 

\6 HHS also administers programs that provide benefits directly to
needy individuals, such as Aid to Families with Dependent Children
and Medicaid. 


      PRIVATE FUNDING AND SUPPORT
-------------------------------------------------------- Chapter 1:2.2

National intermediaries provide grants and loans, technical
assistance, and coordination with other organizations.  These
organizations possess advantages of scale that allow them to give
local groups access to tax credits and corporate equity investments,
secondary mortgage markets, and lenders' commitments.  For example,
the National Equity Fund--a subsidiary of LISC--and the Enterprise
Foundation use the federal low-income housing tax credit to raise
capital for community organizations.  In addition to raising funds,
NRC's Neighborhood Housing Service helps form local partnerships of
residents, governments, and businesses.  Local intermediaries also
support community organizations by creating support systems, helping
to arrange financing, and providing training and other technical
assistance. 

Foundations provide funding and assistance in a variety of ways. 
Several national and local foundations have formed direct
partnerships with community development organizations.  These
foundations provide the organizations with funding and technical
assistance for planning and executing projects.  Other foundations
provide grants for specific projects or as "seed" or "glue" money to
be used in leveraging additional financing from other sources or to
give a project already under way the resources necessary to continue. 

Commercial banks, businesses, and insurance companies also provide
assistance in varying forms to community-based development
organizations.  Some banks offer loan programs to promote housing,
small business, and property development or make below-market-rate
mortgage loans for low- and moderate-income housing.  Some banks also
invest in development projects and local businesses.  Businesses and
insurance companies have generally contributed to community-based
organizations through donations to foundations and intermediaries. 
However, some businesses work directly with neighborhoods by
providing technical support and by donating supplies or products for
fund-raising or special events.  Other businesses invest by locating
their stores or plants in shopping centers or industrial parks within
distressed communities. 

Other organizations, such as universities, hospitals, and religious
institutions, also support community-based organizations.  In some
cities, universities and medical centers have teamed up with
community-based groups to sponsor neighborhood-based development
activities, such as housing rehabilitation or child care.  Many
community-based development organizations began in church basements. 
Aside from providing financial support, some religious institutions
provide technical assistance. 


   OBJECTIVES, SCOPE, AND
   METHODOLOGY
---------------------------------------------------------- Chapter 1:3

The Subcommittee on Human Resources and Intergovernmental Relations,
House Committee on Government Reform and Oversight, asked GAO to
assess (1) the reasons why experts advocate a comprehensive approach
to community revitalization, (2) the challenges to implementing these
efforts, and (3) the ways the federal government might support
comprehensive approaches. 

To respond to this request, we conducted case studies of four
comprehensive community revitalization efforts:  (1) the Core City
Neighborhoods in Detroit, Michigan, (2) the Dudley Street
Neighborhood Initiative in Boston, Massachusetts, (3) the Marshall
Heights Community Development Organization in Washington, D.C., and
(4) the Neighborhood Housing Services in Pasadena, California.  We
neither evaluated these efforts to determine whether they were
successful nor compared the comprehensive approach to single-focused
approaches.  Instead, we examined the history of each organization to
find out why it chose a comprehensive approach and studied the major
factors that helped and hindered its efforts.  We judgmentally
selected our case study sites through consultations with community
development experts according to the following criteria: 

Each effort had to

have at least 3 years' experience;

plan housing, social, and economic development;

include residents in planning and decision-making;

focus on a specific geographic area, and

be located in an urban area. 

These sites varied in their geographic location, style of management,
origin (how the effort began and who started it), and evolution (how
the effort incorporated housing, social, and economic development). 
They also varied in their demographic and economic profiles,
differing, for example, in their rates of unemployment and poverty. 
Table 1.1 summarizes this information. 



                          Table 1.1
           
            Selected Characteristics of Case Study
                        Neighborhoods

                                      Heig
                Citi                  hts\
                  es      Street         a        NHS
--------------  ----  --------------  ----  ----------------
Population      8,75      23,361      40,3       47,425
                   9                    33
Race
White             6%       12%          1%        30%
Black            94%       63%         99%        37%
American          0%        1%          0%         1%
 Indian,
 Eskimo, or
 Aleut
Asian or          0%        2%          0%         5%
 Pacific
 Islander
Other\b           0%       23%          0%        28%
Hispanic          1%       23%\         1%        44%
 origin\c
Unemployment     31%       15%         11%        11%
 rate
Poverty rate     50%       32%         26%        25%
------------------------------------------------------------
Source:  Bureau of the Census data, 1990. 

\a Figures are for the Marshall Heights community development target
area.  Some Marshall Heights services are provided over a larger
geographic area. 

\b Includes all persons not included in the above categories. 

\c Persons of Hispanic origin may be of any race. 


      PROFILES OF CASE STUDY
      NEIGHBORHOODS
-------------------------------------------------------- Chapter 1:3.1

The Core City neighborhood in southwest Detroit was once home to many
of the city's auto workers and was one of the city's more elaborate
business and shopping districts.  The neighborhood declined rapidly
after the 1967 riots as people and businesses moved out of the area
and crime and drug trafficking increased.  Now, it is largely vacant,
in terms of both people and businesses.  Burned-out, abandoned, and
boarded-up buildings and vacant lots are scattered throughout the
neighborhood.  In 1984, a local Catholic parish began community
outreach efforts that resulted in the establishment of a nonprofit
organization--Core City Neighborhoods (CCN)--that collaborates with
other local organizations to provide comprehensive services to the
neighborhood (see app.  II). 

The Dudley Street neighborhood--located about 2 miles south of
Boston's major financial and cultural districts--was once a thriving
business and residential district.  Over a period of nearly 30 years,
the neighborhood was effectively isolated from the rest of the city
and experienced financial disinvestment, arson, influxes of poor
residents, and illegal garbage dumping.  Twenty-seven percent of the
households in the neighborhood receive public assistance, compared
with 12 percent in Boston as a whole.  The Dudley Street Neighborhood
Initiative (DSNI) began in 1984 as a nonprofit community organizing
and planning entity.  It collaborates with neighborhood residents,
nonprofit organizations, foundations, and city agencies to meet its
planned housing, economic, and social service objectives (see app. 
III). 

Located in the northeast/southeast area of Washington, D.C., the
Marshall Heights neighborhood was once a thriving African-American
middle-class residential and business area.  However, since the 1970s
the community has suffered as its middle-class residents and
businesses have moved out of the area.  The community is cut off from
the rest of the city by the Anacostia River and Interstate 295.  It
is home to one-third of the city's public housing units, yet 38
percent of its residents are homeowners.  The Marshall Heights
Community Development Organization (MHCDO) is a nonprofit CDC begun
in 1978 to concentrate on economic development projects that would
lead to self-sufficiency for the area's residents.  The organization
has since expanded into housing development and social services (see
app.  IV). 

Northwest Pasadena is a residential community that consists of older
single-family and multifamily units in need of rehabilitation.  The
majority of the community's small businesses are unstable, marginally
profitable, and undercapitalized.  The area has the city's highest
living density and lowest household income.  Until recently, the
Pasadena city government played a limited role in the community,
which, for the last 50 years has been socially isolated from the rest
of the city.  Adding to the sense of isolation, a highway was
constructed in the early 1970s, displacing many residents and
creating a shortage of affordable housing.  The Pasadena Neighborhood
Housing Services (PNHS) was formed in 1979 as a nonprofit
organization after the city asked for help from the federally
chartered NRC.  PNHS' initial efforts centered around organizing the
community and rehabilitating its housing.  However, the organization
has since expanded its efforts into economic development and social
services (see app.  V). 


      METHODOLOGY
-------------------------------------------------------- Chapter 1:3.2

To determine why community development experts advocate a
comprehensive approach to community revitalization, we convened three
expert panels (see app.  VII) to obtain the views of researchers;
national intermediaries; government officials; and public interest
groups representing community development organizations, social
services organizations, and state and local governments.  We also
reviewed pertinent literature and interviewed leading researchers,
foundation representatives, and federal agency officials.  In
conducting our case studies, we gathered data and interviewed
community officials about their choice of a comprehensive approach. 
We developed information on the structure of the revitalization
efforts, the nature of the collaborations the organizations had
developed with public and private groups, and the range of funding
sources used by the organizations.  In addition, we collected
demographic and economic data from the Bureau of the Census for our
case study cities and for the census tracts that make up the case
study neighborhoods. 

To determine the challenges involved in a comprehensive approach to
improving the conditions in the four neighborhoods, we relied
primarily on our case studies.  We interviewed individuals involved
in or having knowledge of the revitalization effort about the primary
factors that had promoted or impeded these organizations' success. 
Persons interviewed included the executive director and primary staff
of the organizations, members of each board of directors,
neighborhood residents, state and local government officials, and
representatives of major funding organizations and local nonprofit
organizations.  To the extent possible, we corroborated this evidence
by reviewing studies and publications. 

To identify ways for the federal government to support comprehensive
approaches, we discussed the federal role with neighborhood
organizations, members of our expert panels, and federal and local
government officials.  We also reviewed previous GAO reports on
community development issues and on social service integration.  In
addition, we reviewed relevant studies, including the National
Performance Review's reports on reinventing government and the
National Academy of Public Administration's report on HUD. 

We conducted our work between October 1993 and January 1995 in
accordance with generally accepted government auditing standards.  We
discussed the findings in this report with HUD officials, including
the Director of the Office of Affordable Housing within the Community
Planning and Development Division, who generally agreed with the
information presented in the report.  We also discussed our findings
with the Director of the Office of Community Services within HHS'
Administration for Children and Families, who stated that local
communities should be the focus of program decision-making to improve
housing, economic, and social conditions in distressed urban
neighborhoods.  He noted that the experience and participation of the
people most directly involved in the neighborhood improvement
process--members of the community--are of paramount importance in the
effort. 


COMPREHENSIVE APPROACHES ADDRESS
THE MULTIPLE NEEDS OF DISTRESSED
COMMUNITIES
============================================================ Chapter 2

The problems in distressed urban neighborhoods are severe and growing
worse.  Nonetheless, community-based organizations that use a
comprehensive approach hold promise for significant, long-term
neighborhood improvement, according to experts from government
agencies, foundations, and community development programs. 
Researchers said that such an approach is feasible because community
organizations and an infrastructure to support them have evolved over
the last several decades.  Although comprehensive efforts--including
those we reviewed--are diverse, they often share certain
characteristics.  Typically, they are community-based--focusing on a
specific geographic area and actively involving residents--address
physical and social needs, and are initiated and sustained through
collaborations with both the public and the private sectors.  The
organizations we studied evolved their comprehensive approach as they
matured to respond to neighborhood needs.  However, the variety of
programs offered by these groups and the inability to quantify some
of their results make it difficult to measure their impact.  In
addition, community development experts emphasize that many of these
neighborhoods have suffered decades of disinvestment that cannot be
quickly reversed.  They cautioned that significant improvements in
conditions in these neighborhoods may take a generation or longer to
achieve. 


   PROBLEMS IN DISTRESSED
   COMMUNITIES ARE SEVERE AND
   GROWING WORSE
---------------------------------------------------------- Chapter 2:1

Across the country, distressed communities face an array of
escalating physical, social, and economic problems.  The number of
people in poverty\1 has climbed from 29 million in 1980 to 39 million
in 1993.  Many of these poor are concentrated in distressed urban
communities where poverty and neighborhood distress--as indicated by
the rates of poverty and joblessness and the numbers of female-headed
households, welfare recipients, and teenage school dropouts--worsened
between 1980 and 1990, according to a 1993 study.\2

Studies suggest that these problems are complex and interrelated. 
For example, a 1989 study reported that 81 percent of the families in
poverty face two or more obstacles to achieving self-sufficiency. 
Such obstacles include joblessness, poor education, reliance on
welfare, or poor health.\3 Furthermore, over half of the families
face three or more obstacles.  According to an Annie E.  Casey
Foundation study, the vast assortment of interconnected problems,
unmet needs, and disinvestment combine to produce dysfunctional and
socially isolated neighborhoods.\4 Another study by the Local
Initiatives Support Corporation states that problems in low-income
communities such as escalating crime, drug trafficking, joblessness,
teen pregnancy and school dropout rates are both the causes and the
effects of social disorganization.\5

We found that despite the progress made by the organizations we
studied, these same problems exist in our case study neighborhoods. 
Each of these neighborhoods has significantly higher rates of poverty
and unemployment and higher proportions of welfare recipients and
school dropouts than the city as a whole (see app.  I).  In addition,
the physical condition of these neighborhoods has deteriorated and
crime rates are high.  For example, the Core City neighborhood has a
high percentage of vacant land on which burned-out or dilapidated
homes stand.  A study by the city of Pasadena found a high
concentration of violent crimes, neighborhood disturbances, and
trafficking in narcotics.  In the Marshall Heights neighborhood, most
units are vacant in two public housing complexes that are awaiting
demolition or renovation.  Figure 2.1 shows the conditions that exist
in these neighborhoods. 



(See figure in printed edition.)Figure 2.1:  Conditions in the Case
Study Neighborhoods


--------------------
\1 The federal government measures poverty according to annual
income.  For example, a household of two with an income at or below
$9,411 (the 1993 poverty threshold) would be considered poor. 

\2 John D.  Kasarda, "Inner-City Concentrated Poverty and
Neighborhood Distress:  1970 to 1990," Housing Policy Debate, Fannie
Mae, Vol.  4, Issue 3 (Washington, D.C.:  1993). 

\3 Sar Levitan and others, A Proper Inheritance:  Investing in the
Self-Sufficiency of Poor Families, Center for Social Policy Studies,
George Washington University (Washington, D.C.:  July 1989). 

\4 Rebuilding Communities:  A Neighborhood Reinvestment Strategy of
the Annie E.  Casey Foundation (Aug.  1993). 

\5 Mindy Leiterman and others, Building Community:  A Report on
Social Community Development Initiatives, Local Initiatives Support
Corporation (Washington, D.C.:  June 1993). 


   EXPERTS ADVOCATE A
   COMPREHENSIVE APPROACH TO
   COMMUNITY REVITALIZATION
---------------------------------------------------------- Chapter 2:2

Given the conditions in these neighborhoods, community development
experts cautioned us that significant improvements may take a
generation or longer to achieve.  Nonetheless, experts from
government agencies, foundations, public interest groups, and
community development programs believe that community-based
organizations that use a comprehensive approach enhance the chances
of significant, long-term neighborhood improvements because they
address multiple neighborhood needs.  They told us that the
conditions in the neighborhoods are interrelated and need to be
addressed in tandem if long-lasting results are to be achieved. 

An expert on comprehensive approaches does not believe that the
comprehensive initiatives were begun in response to research or
theory but were rather inspired by the logical appeal of the
approach.  She said that there has been an increasing recognition of
the limits of narrowly defined, categorical strategies.  For example,
new housing has been built in many distressed communities without
much attention having been given to the social problems facing its
occupants.  Social services have been carried out as if in a vacuum,
separate from the conditions in the neighborhood.  The expert said
that each intervention was governed by a separate bureaucracy without
any sense of coordination.  In contrast, she said, a comprehensive
approach recognizes that the problems in distressed communities are
interrelated, and it tries to begin change in a number of areas.  For
example, she said, rather than addressing just one of a family's
needs, such as housing, a comprehensive organization would also
attempt to meet the family's needs for employment, education, child
care, training in parenting skills, or treatment for substance abuse. 

The need to address the interrelated problems in distressed areas
through a multifaceted approach is also recognized by researchers,
HUD, and HHS.  The appeal of the comprehensive approach is that it
ensures attention to the interrelationships among the needs of the
community by linking human services, physical revitalization, and
economic development in a concerted effort, according to a University
of Chicago study.\6 A study by the New School for Social Research
reported that the problems in distressed communities are "complex and
multidimensional and require long-term integrative approaches to
their solution."\7 In addition, HUD endorsed the comprehensive
approach in its March 1994 publication entitled Strategies for
Community Change in which the Secretary wrote, "We believe the best
strategy to community empowerment is a community-driven comprehensive
approach which coordinates economic, physical, environmental,
community, and human needs." July 1994 initiatives by HHS'
Administration for Children and Families are also intended to make it
easier for community organizations to use HHS programs to meet
community needs. 

Dissatisfied with the results of previous single-focused approaches
to community revitalization, national organizations and foundations
are also emphasizing a comprehensive approach.  While they recognize
that the comprehensive approach is not new, they said that such
approaches are more feasible now than in the past because community
organizations have gained experience and an infrastructure for
providing funding and technical assistance has evolved.  According to
the Director of Field Services for the Neighborhood Reinvestment
Corporation (NRC), many programs supported by NRC in the past were
developed with a housing rehabilitation focus.  Over the years,
however, the organization has learned that community needs extend
beyond housing.  As a result, NRC is encouraging its community
organizations to make their programs more comprehensive.  The Ford
Foundation's Neighborhood and Family Initiative--a multiyear
program--uses the comprehensive approach because the foundation
believes single-focused approaches to neighborhood problems are not
effective in providing for the range of interrelated needs in poor
neighborhoods.  Additionally, the Annie E.  Casey Foundation found
that efforts to assist low-income children at risk were insufficient
and needed to be augmented with social and economic initiatives that
target the whole community.  To encourage comprehensive
revitalization, the foundation has provided $160,000 in planning
grants and is willing to commit up to $3 million to each of five
comprehensive organizations that attempt to improve conditions in
their neighborhoods, including two of our case study organizations. 
Finally, the Enterprise Foundation--an intermediary that formerly
focused primarily on housing--has begun a Transforming Neighborhoods
demonstration in the Sandtown-Winchester neighborhood of Baltimore
that brings community residents together with public and private
agencies to plan and undertake comprehensive strategies. 


--------------------
\6 Prudence Brown, Comprehensive Neighborhood-Based Initiatives: 
Implications for Urban Policy, Chapin Hall Center for Children,
University of Chicago (Chicago:  Dec.  10, 1993). 

\7 Ronald Shiffman with Susan Motley, Comprehensive and Integrative
Planning for Community Development, Community Development Research
Center, New School for Social Research (New York:  Mar.  1990). 


   COMPREHENSIVE EFFORTS SHARE
   COMMON CHARACTERISTICS
---------------------------------------------------------- Chapter 2:3

Although comprehensive efforts are diverse, researchers have found
that many--including the four we reviewed--share certain
characteristics.  Typically, they are community-based, focusing on a
specific geographic area, and actively involving residents.  Although
they may evolve differently, they consider the needs of the community
holistically so that their efforts confront the range of problems
facing the community.  Finally, they are frequently initiated and
sustained through collaborations with many other organizations. 


      COMPREHENSIVE EFFORTS ARE
      COMMUNITY-BASED
-------------------------------------------------------- Chapter 2:3.1

Community-based efforts focus on a specific neighborhood and involve
those affected by the problems in shaping strategies to improve
conditions in the neighborhood.  Several studies have concluded that
what distinguishes these efforts from their predecessors--Community
Action Programs, Model Cities, and many single-focused efforts--is
the extent of residential support for the community organization and
its agenda.  For instance, a study by the University of Chicago
suggests that many of the earlier community efforts did not achieve
their goals because they were initiated by outside organizations and
did not involve the residents.\8 A study conducted by Rainbow
Research stated that significant community development takes place
only when residents are committed to investing themselves and their
resources in the effort.\9 When residents identify their own needs
and take advantage of skills already available in the community to
foster their goals, a sense of ownership and community pride develops
that allows a change in community conditions, according to community
development experts.  The experts also said that without residents'
involvement, results were often short-lived. 

The four organizations we reviewed cited several benefits of
residents' participation in their community-based efforts.  First,
residents' participation ensures that an organization's activities
support the real needs of the community.  In addition, they said
residents' support and participation gives the organization social
and political legitimacy as a voice of the community.  Residents'
participation also gives the organization a source of support in the
form of volunteers to sit on the board of directors, to fill staff
positions in the organization, or to assist with specific events or
activities.  Community leaders said they have also noticed that
participation instills a greater sense of pride and hope in the
residents. 


--------------------
\8 Prudence Brown, Comprehensive Neighborhood-Based Initiatives: 
Implications for Urban Policy, Chapin Hall Center for Children,
University of Chicago (Chicago:  Dec.  10, 1993). 

\9 Tom Dewar, Hunting for Hope:  Themes, Dilemmas and Opportunities
in Community Development, Rainbow Research (June 30, 1993). 


      COMPREHENSIVE EFFORTS OFTEN
      EVOLVE TO ADDRESS MULTIPLE
      NEEDS
-------------------------------------------------------- Chapter 2:3.2

Another common characteristic of these efforts is that they attempt
to consider the multiple needs of the residents.  According to a
study prepared for the Ford Foundation, most comprehensive approaches
fit one of three patterns.\10 First, some focus on better
coordinating the delivery of existing services toward a more
comprehensive approach.  Second, some efforts begin with a single
focus--such as housing development--but evolve over time to encompass
a variety of services and projects.  Finally, according to the study,
a few efforts begin with a comprehensive agenda.  These efforts
typically take on the most pressing issue first.  They add to their
activities in accordance with their overall plan as their
organizational capacity grows. 

Although the four organizations we studied were unique in terms of
structure and services, two of the four organizations began with a
single focus and evolved a more comprehensive approach as needs were
identified.  For example, in Pasadena, housing services officials
began with a housing rehabilitation program and later expanded into
community development activities, child care, and economic
development.  The Marshall Heights community group initially focused
on economic development.  Although its first project was the
renovation of a shopping center, the group soon recognized that this
effort alone would not make residents self-sufficient.  Over the next
decade, the group expanded into housing rehabilitation, drug abuse
prevention and treatment, emergency services, and job training. 

Core City Neighborhoods in Detroit began, in contrast, with a
community organizing effort to identify residents' needs.  The
organization established a comprehensive approach to address the
identified needs, which included improved housing conditions, crime
prevention, business development and improved job opportunities, and
enhancement of the neighborhood's physical appearance.  Also, the
fourth organization--Dudley Street--identified the development of a
comprehensive plan as one of its first objectives.  Concurrently, the
organization began a campaign to stop the illegal dumping of trash as
a mechanism for showing results and gaining community support.  As
the organization acquired more political power, funding, and staff
support, it began addressing the other issues--housing, social
services, and economic development--identified in its comprehensive
plan. 


--------------------
\10 The Ford Foundation's Neighborhood and Family Initiative:  Toward
a Model of Comprehensive Neighborhood-Based Development, Chapin Hall
Center for Children, University of Chicago (Chicago:  Apr.  1992). 


      COMPREHENSIVE EFFORTS
      INVOLVE COLLABORATIONS WITH
      OTHER ORGANIZATIONS
-------------------------------------------------------- Chapter 2:3.3

Finally, comprehensive community organizations often collaborate with
other local public and private organizations to help use resources
more efficiently and to meet residents' needs.  These collaborations
may include foundations, schools, social service agencies, and other
nonprofit organizations.  According to a Ford Foundation study,
collaborations can range from a few to several participants and can
have either formal agreements of cooperation or informal agreements
that include the occasional sharing of information, personnel,
supplies, or materials.  In addition, these arrangements can be
structured through a local institution or government, a consortium of
existing institutions, or a specially created independent
organization. 

The four organizations we studied collaborated with other groups to
expand their resources and address areas that they would not
otherwise have been able to take on.  For example, Core City
Neighborhoods collaborated with other groups extensively.  They
networked with six other groups to provide social services, such as a
parenting skills program and an after-school and summer program for
youth.  They also collaborated with a local foundation that provides
publicity and funding for the organization and with a bank that funds
other efforts and provides volunteers. 


   ORGANIZATIONS CITED MULTIPLE
   BENEFITS DERIVED FROM A
   COMPREHENSIVE APPROACH
---------------------------------------------------------- Chapter 2:4

In all four locations we visited, key stakeholders agreed that the
comprehensive approach has benefited the community and holds promise
for long-term results because the approach has enabled them to
provide multiple services and to make these services accessible to
community residents.  In addition, residents and community leaders
from all four locations cited an improvement in the physical
appearance of the neighborhood and the attitudes of some of the
residents.  For example, the Marshall Heights community organization
believes that it has improved the quality of life for many residents
by bringing services to the community.  Residents no longer have to
take several buses to obtain emergency services or housing assistance
outside the community.  From one organization, they can obtain
emergency food, temporary housing, homeownership assistance,
employment referrals, drug abuse prevention and treatment services,
advice on starting a small business, and assistance in cleaning up
and organizing the neighborhood.  Some of these services were not
previously available in the community but were developed by the
organization over the last decade as it evolved and recognized the
many needs of the community.  For example, a lack of services for
treating drug-addicted residents prompted the organization to create
its own treatment center.  The center takes a holistic approach and
provides a framework for a wide range of prevention, intervention,
treatment, and follow-up services and programs (see app.  IV). 

The Dudley Street organization emphasized the value of being able to
help people improve themselves from whatever level they begin.  For
example, one person may need access to elderly care only, while
another may need assistance in finding affordable housing and child
care.  Dudley Street's goal is to help residents organize to gain
access to services the community needs, according to the
organization's executive director (see app.  III).  In Pasadena, the
director of a program for potential small business owners described a
number of outcomes from the program that go beyond the acquisition of
business skills.  Some participants reassess and replace their
initial business ideas, others succeed in getting jobs, while some
return to school.  The director believes that for many of the
participants, the motivational benefits gained from learning to
organize efforts in pursuit of a goal are often more important than
the economic benefits (see app.  V). 

However, each organization stressed that its efforts would require a
sustained commitment over a long period of time because of the
magnitude of the problems being addressed.  The Core City
organization in Detroit has developed a 50-year strategic plan,
anticipating that the neighborhood's revitalization will take a
considerable amount of time (see app.  II).  The executive director
of the Pasadena organization pointed out that because the housing
stock is older and the population transient, the need for housing
rehabilitation and social services will be ongoing. 

Figure 2.2 depicts conditions before and after cleanup and/or
renovation in our four case study neighborhoods.  The photographs on
the first page of the figure, taken during the mid-1980s, illustrate
the effects of illegal dumping on vacant lots in the Dudley Street
neighborhood.  The photographs on the facing page show the results of
the Dudley Street organization's efforts--housing, offices, a
restored park, and a mural.  On the third page, contrasting pairs of
photographs depict a shopping center in the Marshall Heights
neighborhood before and after rehabilitation, as well as a vacant
building that the neighborhood organization converted into a
community resource center.  The photographs on the final page
illustrate improvements in housing and commercial areas achieved
through the efforts of three neighborhood organizations. 



(See figure in printed edition.)Figure 2.2:  Conditions Before and
After Renovation in Case Study Neighborhoods



(See figure in printed edition.)



(See figure in printed edition.)



(See figure in printed edition.)


   EVALUATIONS SUPPORTING THE
   LONG-TERM IMPACT OF
   COMPREHENSIVE EFFORTS ARE
   LIMITED
---------------------------------------------------------- Chapter 2:5

Few empirical studies have been completed that are able to capture
the long-term impact of groups carrying out a comprehensive approach. 
According to community development researchers, there are several
reasons for the lack of empirical research.  First, because these
organizations have evolved to respond to the specific needs of their
community, each organization is different from its counterparts. 
Such diversity makes generalization difficult.  Second, the results
of much of the work these groups do--community outreach, counseling,
and referral--are difficult to measure or quantify.  According to a
University of Chicago study, traditional evaluations are rarely
designed to measure the depth and complexity of factors occurring at
the neighborhood level or to relate the cause and effect of changes
over time.  As a result, existing evaluations of these efforts
generally focus on tangible benefits, such as the number of goods and
services produced, rather than intangible benefits, such as building
self-esteem, pride, and hope within the community. 

The few formal evaluations that have been completed for the four
organizations we reviewed were requested and funded by outside
organizations.  For example, as a prerequisite for participating in
an operating support initiative, LISC required and funded an
evaluation of the Marshall Heights organization by a consulting firm
in 1992.  The evaluation pointed out success factors (holistic
vision, strong leadership) and weaknesses (inability to integrate
programs) and made several recommendations to the organization.  The
Pasadena organization is evaluated quarterly by its parent
organization, the Neighborhood Reinvestment Corporation.  These
evaluations focus on financial and program performance.  The Annie E. 
Casey Foundation is developing an evaluation framework for its
Rebuilding Communities Initiative.  This framework will be applied to
the Dudley Street and Marshall Heights organizations to meet a
requirement for participation in the foundation's community
revitalization effort. 

Officials from all four organizations we studied said that they do
not formally evaluate their own programs.  These officials told us
that self-evaluations have not been done because of resource
constraints.  However, all four community organizations have assessed
their activities informally.  Some have reviewed their
accomplishments each year to ensure that they are meeting the
objectives laid out in a strategic planning document.  Others have
compared their current program offerings with the results of ongoing
community needs assessments.  The organizations also maintained
records of results, such as the number of housing units produced,
clients served, or participants involved.  They told us that this
information is often required by funders. 


   CONCLUSIONS
---------------------------------------------------------- Chapter 2:6

In response to the interrelated problems in distressed communities
and out of dissatisfaction with the results of community development
efforts over the past several decades, community development experts,
foundations, government agencies, and community development
organizations are turning to the comprehensive approach.  While they
recognize that this approach is not new, they believe that it is more
feasible now than it was in the past because community organizations
are more experienced and an infrastructure to support them has
developed.  They emphasize that the conditions in these neighborhoods
cannot be quickly reversed.  In addition, the diversity of these
efforts and the difficulty in quantifying some of their results make
it difficult to measure outcomes.  Nonetheless, experts and
organizations believe that community-based efforts that involve the
residents and consider their needs holistically are promising because
these efforts recognize the intertwined nature of the problems
confronting these communities and the people who live there. 


COMPREHENSIVE APPROACHES ARE
DIFFICULT TO IMPLEMENT
============================================================ Chapter 3

Many challenges confronted the four organizations we studied as they
attempted to improve conditions in their neighborhoods.  Because many
residents were skeptical, a substantial challenge to each
organization was gaining the trust of residents and ensuring their
involvement in the revitalization effort.  In addition, the
organizations had to piece together a complex web of funding from
several private and public sources--often with restrictions on
use--to cover both their program and their administrative costs. 
They also faced the daunting task of concurrently managing a diverse
set of programs to address housing, economic development, and social
service needs.  These challenges required persistent efforts over
many years to build sufficient technical and management skills to
operate effectively.  Leaders of these organizations said that, to
sustain their organization, they have concentrated on building
support among diverse groups of residents, gaining access to multiple
funding sources, collaborating with other organizations, and
developing a cadre of experienced staff. 


   COMMUNITY-BASED ORGANIZATIONS
   FACE THE CHALLENGE OF ENSURING
   RESIDENTS' PARTICIPATION IN THE
   EFFORT
---------------------------------------------------------- Chapter 3:1

According to officials representing the organizations we studied,
involving residents was a challenge because some of them were
skeptical, fearful, or apathetic.  For example, in one community, the
executive director remembered shouting to residents through their
front doors and trying to communicate with them through peep holes. 
He said that residents who opened their doors talked about how
nothing they could do would make a difference in the neighborhood.  A
resident in one of the communities we studied said that people were
afraid to speak up in community meetings about problems such as drug
dealing in their neighborhoods because they were afraid of
retaliation. 

According to these officials, neighborhood conditions and the
failures of past community development efforts to address the needs
of residents were largely to blame for residents' feelings.  At each
case study location, conditions had declined as many middle-class
residents and the businesses that served them moved out. 
Subsequently, poverty increased and related problems grew in these
areas (see app.  I).  Physical isolation from the rest of the city
and reductions in both private and public services also affected
several locations.  Disinvestment, from cuts in police protection to
insurance and home mortgage redlining, had been taking place for
years.  One of the locations contained 2,995 public housing
units--one-third of the city's total units--784 of which were vacant
as of January 1994.  In addition, many residents remembered previous
promises that were broken when budgets were cut or displacements
occurred instead of neighborhood improvements. 

The organizations used a variety of methods to gain the trust of
community residents and involve them in the organization.  Each
organization cited visible accomplishments--rehabilitated housing and
economic development projects--as a factor in gaining the trust of
residents and reducing their skepticism about the revitalization
effort.  For example, in one case, residents did not begin to trust
the organization until they noticed the development of apartment
complexes and the establishment of youth activities.  In another
case, residents said that the redevelopment of the local shopping
center was a visible sign that the organization was serious about
improving neighborhood conditions.  In addition, the organizations we
studied conducted extensive neighborhood outreach and organizing
campaigns, involved the residents in developing plans to address
neighborhood concerns, formed boards of directors with seats
designated for residents, hired residents for staff and management
positions in the organization, and revisited their plans periodically
to obtain residents' input and to make sure that the plans still met
the community's needs. 

One of the organizations said that it has yet to involve sufficient
numbers of the neighborhood's public housing residents in the effort. 
The executive director said that under an Annie E.  Casey grant, the
organization had begun to plan ways to involve more public housing
residents.  However, he said that without reducing the concentration
of public housing units by creating mixed-income developments, it
would be hard to end the feelings of isolation experienced by public
housing residents.  Community development experts we interviewed
agreed.  They said that public policy contributes to the isolation of
public housing residents by concentrating low-income families in one
place and by creating a bureaucratic structure--the public housing
authority--that is typically not involved in community development
activities. 


   THE NEED TO FUND AND MANAGE
   MULTIPLE, DIVERSE PROGRAMS
   POSES A CHALLENGE TO
   COMPREHENSIVE APPROACHES
---------------------------------------------------------- Chapter 3:2

Each of the four efforts we studied was faced with the challenge of
funding and managing multiple social service, housing, and economic
development programs to address community needs.  The four
organizations relied on multiple public and private sources, such as
federal block grants and program-specific grants, foundation grants,
and corporate donations.  Identifying and soliciting additional
funding sources and establishing collaborations to provide services
posed a major challenge for each group.  Once the funds were obtained
and the collaborations were established, the groups were faced with
the challenge of concurrently managing multiple programs, each with
separate funding sources, application requirements, and reporting
expectations. 


      ORGANIZATIONS RELIED ON A
      COMPLEX WEB OF FUNDING
      SOURCES
-------------------------------------------------------- Chapter 3:2.1

The four organizations found that obtaining funding to meet the
diverse needs of the community was difficult and time- consuming.  In
general, they said that their primary problem with public funding
sources could be traced to the proliferation of categorical programs
and the programs' many different application and reporting
requirements.  For example, one organization said that applying for a
$725,000 HUD McKinney Act grant and tracking the program's reporting
requirements demanded one staff member's full-time attention. 
Representatives from this organization also said that the reporting
requirements for the program tend to focus more on processes and
expenditures than on results.  Another organization was reluctant to
apply for a HUD neighborhood development program because the cost of
hiring someone to write a proposal was too high compared with the
likelihood of being funded. 

Representatives from three of the organizations said that they have
turned down funding from certain federal programs or have chosen not
to apply for some federal grants because the programs were not
flexible enough to be used to address community needs.  For example,
one organization decided not to apply for a community development
initiative loan from HUD because it did not believe that the
repayment term was realistic for the planned project.  Another
organization does not use federal funding for some of its programs
because beneficiaries would be required to meet stricter eligibility
standards than the organization deems reasonable.  A third
organization intended to use funds from HUD's Nehemiah Grants program
to support its development of new homes in the community.\1

However, since mortgages supported by a program grant could not be
assumed by future homebuyers, the organization could not ensure that
the housing would be kept affordable for future homebuyers.  Because
of this restriction, the organization decided not to accept the
funding. 

In response to these problems, each of the four organizations we
reviewed developed diverse funding sources to support its programs. 
All four organizations used funding from federal, state, and local
programs and received support from foundations and corporations. 
Overall, the organizations relied on public funding for about 30 to
60 percent of their budgets.  Much of this funding was obtained
through CDBG or CSBG--two relatively flexible federal grant programs. 
The organizations credited these programs with providing a long-term
stream of funding for a wide range of services.  Total organizational
budgets for 1993 ranged from about $500,000 to about $2,600,000. 
Table 3.1 lists the major funding sources used by the four
organizations. 



                          Table 3.1
           
            Major Funding Sources Used by the Four
            Organizations and Their Collaborators
                            (1993)

                                        Dudl  Marsha
                                  Core  ey    ll
                                  Citi  Stre  Height  Pasade
Funding source                    es    et    s       na NHS
--------------------------------  ----  ----  ------  ------
CDBG                              X     X     X       X

CSBG                                    X     X

NRC                                                   X

McKinney Act                                  X

HOPE                              X

HOME                                    X     X

State/local housing programs      X     X

Other state/local programs        X     X     X

Corporations                      X     X     X       X

National foundations                    X     X

Local foundations                 X     X     X       X

Intermediaries                    X           X

Other fund-raising                X     X     X       X
------------------------------------------------------------
The four organizations said that they were able to develop multiple
funding sources more easily after they had accumulated a record of
accomplishments and small amounts of funding--seed money--that they
could use to leverage more resources.  For example, a city official
in one case study location informed us that the city continues to
provide funds because of the effort's established history and
effective use of funding for viable projects.  Similarly, two
foundations involved with another case study organization described
the effort as a good investment because of the organization's proven
track record and strong leadership.  The Marshall Heights
organization cited its use of $25,000 in CDBG funding to leverage
$3.2 million in private funds to rehabilitate its shopping center. 

Each of the organizations we reviewed also increased its capacity to
address community needs by collaborating with other organizations,
such as housing developers, churches, local governments, private
corporations, and other nonprofit organizations.  Representatives
from the organizations said that collaborating--while difficult and
time-consuming--allowed them to use the skills and expertise of other
organizations without necessarily developing the same capacity
themselves.  Two of the organizations relied on collaborations with
other organizations to expand their network of services.  The other
two organizations provided most of the services themselves but relied
on collaborations to supplement their programs.  In both instances,
the collaborations increased the resources available to the
organization.  For example, one organization established a
collaboration with an existing nonprofit housing developer who agreed
to complete the housing development portion of the organization's
comprehensive plan.  The other organization worked with a local
fund-raising organization that helped raise over $133,000 over a
4-year period and provided an attorney to untangle building titles,
architects to handle redesigns, and many volunteer hours and
consultations with other professionals. 


--------------------
\1 The Nehemiah Grants program was replaced by the HOME program. 


      THE NEED TO MANAGE AND
      INTEGRATE MULTIPLE PROGRAMS
      CHALLENGES COMPREHENSIVE
      EFFORTS
-------------------------------------------------------- Chapter 3:2.2

Each of the groups we studied also faced the challenge of managing an
organization that operates--or facilitates the delivery of services
through--multiple, concurrent, and diverse programs.  All of the
organizations said that the number of programs they operated had
increased over the last 10 years in response to community needs.  In
each case, increases in the number of programs created a strain on
the organization's managerial and administrative capacity.  For
example, during a 4-year period, the staff of one of the
organizations we studied doubled in size and the operating budget
nearly tripled with the addition of major programs to produce
affordable housing and provide social services.  According to an
organizational assessment prepared for the group, the expansion in
programs put a strain on the existing management systems, staff, and
finances.  The different funding sources needed to support the
organization's many programs created a strain on the financial system
because each program had a different set of expenditure definitions
and reporting requirements and, therefore, had to be tracked
separately. 

In addition, the collaborations developed by these organizations
sometimes caused management strains because they were time-consuming
and occasionally created competition.  One organization said that a
great deal of time had to be spent on building consensus before
collaboration could occur because the groups were used to competing
for funding.  Another organization said that collaboration can be
costly and difficult because it requires bringing together many
different groups that have to cooperate and share power.  In another
neighborhood, an organization official cautioned that the executive
director can be perceived as a political threat to city officials who
believe that, as a recognized leader in the community, the executive
director may run for office one day. 

Each organization said that these management challenges required
persistent efforts over many years to build sufficient capacity to
operate effectively.  They said that one way they build such capacity
was to develop a cadre of experienced staff members--both from within
the community and from outside it.  For example, one organization has
received assistance in maintaining its staff levels by obtaining
administrative funding from foundations.  Another responded by hiring
long-time board members--who were also neighborhood residents--as
staff.  Two organizations also developed leadership below the
executive director position by creating deputy director positions. 
In addition, the charisma and enthusiasm of staff and leaders were
cited by each organization as key ingredients that helped them
through difficult times. 


   CONCLUSIONS
---------------------------------------------------------- Chapter 3:3

Organizations using a comprehensive approach face multiple
challenges.  Community skepticism caused by declining neighborhood
conditions and the failures of some previous programs makes involving
residents difficult.  The need to fund multiple programs and to
manage them once funding is secured also poses challenges.  The
number and diversity of funding sources these organizations use
create demands on staff time because the organizations must
concurrently manage multiple programs, each of which has separate
application requirements and reporting expectations.  Despite such
challenges, the organizations we studied have managed to sustain
their comprehensive approach by employing several strategies,
including ensuring residents' participation in the revitalization
effort, developing consistent and diverse funding sources and
collaborations with other organizations, and making organizational
changes where necessary to respond to an increasing number of
programs. 


RECENT FEDERAL INITIATIVES MAY AID
COMMUNITIES TAKING A COMPREHENSIVE
APPROACH
============================================================ Chapter 4

Historically, coordination has been limited across and within the
federal departments and agencies that have responsibility for
programs intended to assist distressed communities.  Agencies have
tended not to collaborate with each other for a variety of reasons,
including concerns about losing control over program resources. 
Recently, the federal government has taken steps to improve
interagency coordination and reduce fragmentation by consolidating
and streamlining some of the federal programs intended to assist
distressed communities.  If fully implemented, these efforts could
help the federal government become more supportive of comprehensive
revitalization efforts. 


   FRAGMENTED PROGRAMS LIMIT
   INTERAGENCY COORDINATION
---------------------------------------------------------- Chapter 4:1

The federal government assists distressed urban communities and their
residents through a complex system involving at least 12 federal
departments and agencies.\1 Together, these agencies administer
hundreds of programs in the areas of housing, economic development,
and social services.  For example, in previous work we reported that
there are at least 154 employment and training assistance programs,
59 programs that could be used for substance abuse prevention, and
over 90 early childhood development programs.\2 A guidebook to
federal programs available for the Empowerment Zones and Enterprise
Communities program identified over 50 programs as a "sample" of the
universe of federal programs that agencies could consider in
developing their revitalization plans.  Considered individually, many
of these categorical programs make sense.  But together, they often
work against the purposes for which they were established, according
to a National Performance Review (NPR) report. 

According to Office of Management and Budget (OMB) officials we
interviewed, one reason for limited coordination among the many
federal programs with similar goals and objectives is that federal
agencies have become more protective of their programs as resources
have grown scarcer.  These officials and a community development
expert also believe that agencies are concerned that collaboration
and coordination could lead to a loss of control over program
resources.  Moreover, the OMB officials believe that federal efforts
to maintain program structures and funding levels have constrained
opportunities to identify and resolve instances of programmatic
overlap, regulatory burden, and limited access to funds. 

In addition, previous efforts at coordination have generally been
unsuccessful.  In earlier work, for example, we found that the
federal government had set up a patchwork of parallel administrative
structures to deliver an estimated $25 billion annually in employment
and training services.\3 Many of these programs target the same
population, yet despite decades of attempts to improve coordination,
conflicting program requirements continue to hamper administrators'
efforts to coordinate activities and share resources.  In the area of
social service delivery, evaluations of previous coordination efforts
have found that such initiatives were unable to coordinate different
categorical programs at the federal level and have had only limited
success at the local level.\4

Even within federal agencies, programs are sometimes fragmented and
uncoordinated.  For example, in fiscal year 1993 HUD's Office of
Community Planning and Development administered several programs that
provided about $5.4 billion to states, local governments, and public
and private nonprofit groups for (1) affordable housing, (2)
community and economic development, (3) assistance to the homeless,
(4) infrastructure, and (5) social services.  Until HUD recently
began efforts to consolidate four of these programs, applicants had
to complete four different applications and prepare two plans.  In
addition, each program operated on its own schedule and required
lengthy progress reports that included little information on the
program's accomplishments.  HUD reported that these requirements were
pushing communities away from comprehensive planning and toward
compartmentalized thinking. 

The proliferation of federal programs imposes a burden on local
organizations that attempt to piece together programs to serve their
communities.  As we mentioned in chapter 3, the neighborhood
organizations we studied found it burdensome to manage multiple
programs with individual funding streams, application requirements,
and reporting expectations.  In addition, one organization reported
that it had strained its managerial and financial systems to meet
federal record-keeping and accounting standards for several funding
sources.  While the organization implemented the necessary procedures
to comply with the standards, officials said that the administrative
burdens nearly forced the organization to reduce the scope of its
services. 


--------------------
\1 The Departments of Agriculture, Commerce, Education, Health and
Human Services, Housing and Urban Development, the Interior, Justice,
Labor, Transportation, and the Treasury; the Environmental Protection
Agency; and the Small Business Administration operate programs
available to distressed communities.  Other agencies, such as the
Department of Defense, also operate programs that may be regarded as
assisting distressed urban communities under certain circumstances. 

\2 See Multiple Employment Training Programs:  Major Overhaul Is
Needed (GAO/T-HEHS-94-109, Mar.  3, 1994), Drug Use Among Youth:  No
Simple Answers to Guide Prevention (GAO/HRD-94-24, Dec.  29, 1993),
and Early Childhood Programs:  Multiple Programs and Overlapping
Target Groups (GAO/HEHS-95-4FS, Oct.  31, 1994). 

\3 Multiple Employment Training Programs:  Major Overhaul Is Needed
(GAO/T-HEHS-94-109, Mar.  3, 1994). 

\4 Integrating Human Services:  Linking At-Risk Families With
Services More Successful Than System Reform Efforts (GAO/HRD-92-108,
Sept.  24, 1992). 


   SOME RECENT FEDERAL INITIATIVES
   MAY HELP COMMUNITIES IMPLEMENT
   A COMPREHENSIVE APPROACH TO
   REVITALIZATION
---------------------------------------------------------- Chapter 4:2

Recently, in response to recommendations by NPR to reduce the
administrative burden of federal programs and make federal programs
more responsive, a number of initiatives have been undertaken.  Some
of these initiatives may eventually aid communities currently taking
or planning to take a comprehensive revitalization approach.  These
initiatives include (1) governmentwide programmatic and managerial
changes intended to "reinvent" federal departments and agencies, (2)
program consolidation and streamlining measures designed to reduce
fragmentation among some federal programs and reduce administrative
burdens on recipients of federal funding, and (3) the establishment
of the Community Enterprise Board. 

Created in 1993, NPR undertook a broad review of the federal
government's management and operations in an attempt to "reinvent"
the way departments and agencies do their work.  Among its emphases
were recommendations on how major government programs could improve
their operations by enhancing their responsiveness to customers'
needs.  To implement these recommendations, Executive Order 12862 was
issued, requiring executive branch departments and agencies to
establish and implement customer service standards.  As an initial
step in this process, for example, HHS identified its partners,
direct and indirect customers, and stakeholders.  HHS plans to set
standards for its partners--most often state and local
governments--and then establish standards for its "ultimate
customers," such as substance abuse clients, Head Start families, and
children in foster care.  To achieve its customer service goals, HHS
intends to consult with state and local governments and service
providers when it formulates new policies and regulations that affect
its partners and the individuals and families who receive services. 

To reduce the level of fragmentation among federal programs used to
assist distressed communities and their residents, the federal
government has also taken steps to streamline application processes
and consolidate some programs.  For example, HUD recently issued a
proposed rule to consolidate into a single submission the planning
and application requirements for several formula grant programs
administered by its Office of Community Planning and Development. 
These include CDBG, Emergency Shelter Grants, HOME Investment
Partnerships, and Housing Opportunities for People With AIDS.  The
proposed rule would also consolidate the reporting requirements for
these programs, requiring one performance report instead of several
program-specific reports.  Other agencies that have taken steps to
consolidate programs include HHS, Education, and Labor.  However,
according to OMB officials and public policy researchers, a
significant reduction in the level of program fragmentation has
historically been difficult to achieve because of the congressional
subcommittee structure, the protectiveness of agencies toward their
programs, and the strong support of constituent groups for particular
programs.  Nonetheless, HUD has announced plans, pending
congressional approval, to consolidate 60 of its major programs into
3 flexible performance-based funds.  The funds would be designed to
give state and local governments the flexibility to develop local
plans for community and housing needs that, by their nature, would
vary from jurisdiction to jurisdiction and change from year to year. 

The Community Enterprise Board was established by executive order in
September 1993 to assist with the implementation of the Empowerment
Zones and Enterprise Communities program and to advise the President
on how the federal programs available to assist distressed
communities can be better coordinated across agencies.  To improve
such coordination, the Board has been tasked with (1) developing an
inventory of all programs providing physical, social, and economic
assistance to distressed communities and their residents, (2)
identifying programs or policies that overlap and/or conflict, and
(3) developing innovative strategies to collaborate on ways to
accomplish common program objectives.  While the experts we
interviewed agreed that an entity such as the Board is needed to
coordinate the federal programs available to assist distressed
communities, they also said that in the past such efforts have not
been very successful.  If the Board is to fulfill this mission, it
will require high-level departmental commitment and open dialogue,
according to the experts. 

According to a recent study on HUD by the National Academy of Public
Administration (NAPA),\5 flexibility should be a primary criterion in
any decision on consolidation reached by the Congress and the
administration or in any of the programmatic changes undertaken in
the interim.  Among the ways to ensure this flexibility are (1) to
build in appropriate waiver provisions (statutory or regulatory) for
new or demonstration programs so that communities can quickly get
them under way or make community-specific changes, (2) to provide
sufficient flexibility in funding major program areas so that the
Secretary of HUD has a range of options for addressing the varied and
changing needs of communities, and (3) to limit the number of
competitive awards by providing more funds through block grants. 


--------------------
\5 Renewing HUD:  A Long-Term Agenda for Effective Performance, NAPA
(July 1994). 


   CONCLUSIONS AND OBSERVATIONS
---------------------------------------------------------- Chapter 4:3

The federal government's approach to assisting economically and
socially distressed communities has led to the creation of numerous
individual programs intended to address specific needs faced by these
communities.  Considered individually, many of these categorical
programs make sense.  But together, as the NPR report noted, they
often work against the purposes for which they were established. 
Because previous federal efforts to consolidate or streamline
programs have had only limited success, local organizations must
still piece together programs to serve their communities.  Although
past efforts to coordinate and consolidate programs across agencies
have had limited success, we believe that consolidation measures such
as those HUD has proposed, if fully implemented, could make it easier
for communities to plan and undertake a comprehensive approach to
neighborhood improvement. 


SELECTED DEMOGRAPHIC AND ECONOMIC
DATA FOR THE FOUR CASE STUDY
LOCATIONS (CALENDAR YEAR 1990)
=========================================================== Appendix I

                                                                                                              Marshall
                                                                                                               Heights
                                                                        Dudley Street                        Community                       Pasadena
                                                 Core City               Neighborhood                      Development                   Neighborhood
                                Detroit,     Neighborhoods     Boston,     Initiative     Washington,     Organization      Pasadena,         Housing
                                   Mich.              area       Mass.           area            D.C.           area\a           Cal.   Services area
----------------------------  ----------  ----------------  ----------  -------------  --------------  ---------------  -------------  --------------
Population of target area      1,028,000           8,759\b     574,000         23,361         607,000           40,333        132,000        47,425\b
Race
Asian or Pacific Islander           0.8%              0.2%        5.3%           1.7%            1.9%             0.3%           8.2%            4.7%
Black                              75.7%             93.9%       25.5%          62.8%           65.9%            98.5%          19.0%           36.8%
American Indian, Eskimo,            0.3%              0.1%        0.3%           0.7%            0.3%             0.2%           0.6%            0.6%
 Aleut
White                              21.6%              5.5%       63.0%          11.6%           29.6%             0.7%          57.1%           29.6%
Other\c                             1.5%              0.2%        5.9%          23.2%            2.4%             0.3%          15.1%           28.3%
Hispanic origin\d                   2.6%              0.7%       10.4%          23.4%            5.2%             0.7%          26.9%           44.4%
Unemployed                         19.7%             30.8%        8.3%          14.5%            7.0%            10.6%           6.3%           10.9%
Over 25 without a high             37.9%             53.2%       24.3%          39.2%           26.9%            40.9%          22.5%           41.5%
 school diploma
Income below the federal           32.4%             49.6%       18.7%          31.9%           16.9%            25.8%          14.9%           24.9%
 poverty level
Household receiving public         26.1%             39.3%       11.9%          26.8%            8.9%            15.2%           9.2%           19.0%
 assistance
Female head-of-household           19.4%             16.6%        9.2%          24.3%            9.6%            19.4%           6.8%           14.1%
 with children
Median family income             $22,566           $12,493     $34,377        $23,359         $36,256          $25,597        $40,435         $24,388
Households                       373,857             5,629     227,958          7,332         249,034           14,819         50,409          15,188
Housing units occupied by          47.1%             66.3%       69.1%          74.1%           61.1%            65.8%          53.7%           67.6%
 renters
Vacant housing units                8.8%             16.4%        8.9%          12.3%           10.4%             9.4%           5.3%            4.6%
-----------------------------------------------------------------------------------------------------------------------------------------------------
\a Figures for the Marshall Heights community development target
area.  Some Marshall Heights services are provided over a larger
geographic area. 

\b Weighted population totals used to reflect census tracts that were
not fully contained within the identified neighborhood. 

\c Includes all persons not included in the above categories. 

\d Persons of Hispanic origin may be of any race. 

Source:  Bureau of the Census data, 1990. 


CORE CITY NEIGHBORHOODS
========================================================== Appendix II


   ORIGINS AND EVOLUTION
-------------------------------------------------------- Appendix II:1

Core City Neighborhoods (CCN) began with the dreams of a Roman
Catholic Bishop.  Raised in Detroit, the bishop had pleasant memories
of a vibrant community, now distressed and largely abandoned.  He
hoped to rekindle the area through community outreach.  The bishop
was aware of the success of a nearby community-based organization in
sustaining businesses and residents within its boundaries and hoped
to do the same within the boundaries of his parish.  In 1984, the
bishop enlisted the help of a Sister of Mercy.  With the sister's
background in community organizing and redevelopment, financial
assistance from the Sisters of Mercy, and a 3-year grant from the
Campaign for Human Development, CCN began. 

During the first 4 months of organizing, the sister and several
volunteers, including residents from the neighborhood, went door to
door to talk with other residents.  Through these encounters, the
group became acquainted with the residents and their needs,
strengths, and visions.  The group gained the residents' support and
involvement before moving ahead with a revitalization plan. 


   ORGANIZATIONAL STRUCTURE
-------------------------------------------------------- Appendix II:2

CCN is a community-based nonprofit organization as defined under
section 501(c)(3) of the Internal Revenue Code.  The 18-member board
of directors consists of 9 residents, 3 representatives of
institutions, 3 representatives of businesses, and 3 representatives
of community-based organizations.  All board members are elected, and
residents must hold at least 50 percent of the positions.  The
elected officials must (1) live or work in the CCN area, (2) belong
to a community group such as a block club, tenant association, or
church, and/or (3) be associated with an institution such as a
hospital, school, or library in or near the CCN area.  Much of CCN's
board of directors' ongoing work is carried out through committees
formed to address business development, crime prevention, employment
and training, finance and resource development, housing and land use,
leadership development, membership, community newsletter publication,
and youth development. 

CCN has 11 full-time and five part-time paid employees.  It also
employs five seasonal employees who primarily mow vacant lots during
the summer months.  These workers are paid through a contract that
CCN arranged with the city of Detroit.  In addition, one full-time
volunteer is involved in general operations, and a number of
volunteers help with different events, activities, and projects.  On
average, CCN has 20 volunteers involved in its youth program and 40
to 60 volunteers involved in its Paint-up/Fix-up Program.  CCN also
operates six subsidiary housing corporations established to take
advantage of tax credits and to provide liability protection for the
parent corporation. 


   GOALS AND STRATEGIES
-------------------------------------------------------- Appendix II:3

CCN's mission, developed during the early days of organizing and
talking to residents, is twofold:  (1) to strengthen the social and
human development needs of the community and its residents and (2) to
rebuild or develop the physical and economic base of the area.  The
residents expressly wanted to improve housing conditions, prevent
crime, develop businesses, provide job opportunities, and enhance the
physical appearance of their neighborhood.  CCN's planning team and
staff developed a 50-year revitalization plan, which included
surveying neighborhood residents, holding planning workshops, and
consulting with many individuals and organizations that have an
impact on the neighborhood. 

To achieve its goals, CCN collaborates extensively with
community-based organizations, businesses, public and financial
institutions, and any other group that offers the types of services
that CCN's residents need.  According to CCN's directors, one
organization cannot do everything.  Some of CCN's more successful
programs are collaborations with other organizations.  For example,
the youth program started as a collaboration with a local church that
was already offering a youth program to its members.  The church had
the facilities and could provide some transportation, but CCN was
able to enhance the existing program with staff and grant funding to
offer a more extensive program to all of the children in its
neighborhoods.  CCN also collaborated with a local school to gain its
support for the youth program. 

Residents' involvement is also a key factor in CCN's strategy. 
Gaining residents' support for the effort was not easy.  However,
according to several representatives of institutions and businesses,
the sister's charisma and the integrity of the church, as well as
visible evidence of changes in the neighborhoods, helped gain
residents' trust.  Residents of the neighborhoods say that they do
not want an outside group coming into their area and making changes. 
They know their area and the needs of the people in their area best. 
According to residents, changes should be made with their consensus
and involvement. 

To this end, CCN staff and board members take their orders from the
residents.  Programs are designed around the residents' needs, not
around what available funding allows.  CCN staff use their
collaborations to identify funds that are not restrictive and
directive.  Programs are designed; then funding is fashioned around
the program.  For example, a local community foundation official
noted that CCN--in collaboration with a local mental health facility,
elementary school, and other community organizations--designed a
training program for parenting skills for which it needed funding. 
At the time the program was designed, the foundation did not have a
funding mechanism that would accommodate the program.  Rather than
change the program to satisfy the funding source, CCN officials put
the program on hold until an appropriate grant program was available. 


   ACCOMPLISHMENTS
-------------------------------------------------------- Appendix II:4

CCN has many accomplishments.  The most visible activities are in the
areas of multifamily housing rehabilitation and youth programming. 
The following are some of CCN's accomplishments: 


      HOUSING DEVELOPMENT
------------------------------------------------------ Appendix II:4.1

Rehabilitated 45 apartments within six multifamily housing
facilities. 

Developed a seven-unit transitional housing facility, which was
completed in collaboration with the Coalition on Temporary Shelter. 

Rehabilitated the interior and exterior of 40 private residences and
painted and performed minor home repairs on an additional 275 private
residences. 

Conducted over 50 workshops for homeowners and prospective homeowners
on credit and budgeting through CCN's Housing Counseling Services. 


      SOCIAL SERVICES
------------------------------------------------------ Appendix II:4.2

Sponsors after-school and summer programs for about 40 children, aged
6 to 12, each year providing tutoring, cognitive skills building,
arts and crafts, recreation, and mentoring. 

Conducts an annual Junior Olympics program in collaboration with
Wayne County, local businesses, residents, and other community
organizations for youth development.  The 1-day competition
emphasizes both physical and academic development and is designed as
a way to build self-esteem and enable parents to spend quality time
with their children. 

In collaboration with the Detroit Police and the State of Michigan,
provides vehicle identification labeling to deter theft and the
transfer of stolen vehicles. 

Carries out crime prevention through a citizen band radio patrol. 


      ECONOMIC DEVELOPMENT
------------------------------------------------------ Appendix II:4.3

Created jobs through CCN's landscaping company.  Through a contract
with the city of Detroit, CCN annually employs nine residents to mow
2,000 vacant properties. 

Provided business counseling and guidance to 185 small business
owners, including one-on-one advising on marketing and accounting
skills, advertising strategies, and management practices. 

Is currently identifying consumer buying patterns and the types of
businesses the area could sustain.  This is part of an asset survey
CCN is conducting in preparation for constructing a shopping center
and residential complex. 


DUDLEY STREET NEIGHBORHOOD
INITIATIVE
========================================================= Appendix III


   ORIGINS AND EVOLUTION
------------------------------------------------------- Appendix III:1

The Dudley Street Neighborhood Initiative (DSNI) was begun in 1984
with the help of the Riley Foundation--a Boston-area community
foundation--and the Community Training and Assistance Corporation. 
The area encompassed by DSNI contained wide expanses of vacant land
and abandoned buildings.  The foundation, which had been called upon
by a multiservice agency to provide funding, believed that the
neighborhood required a broad-based approach to improve local
conditions.  Rather than spreading its grant-making to community
groups throughout Boston, the foundation dedicated itself to
providing long-term support solely to Boston's Roxbury and North
Dorchester communities, the poorest areas of the city--which include
the Dudley Street neighborhood. 

With the foundation's encouragement, local community organizations
formed an advisory group to identify the neighborhood's problems, set
priorities, and develop the structure for an organization to carry
out local plans.  However, the advisory group initially proposed a
structure that was an "organization of organizations." When the
proposal was presented at a community meeting, residents challenged
the organizational structure.  A consensus of the residents at the
meeting was that the majority of the board of directors should be
residents.  The residents also sought equal representation on the
board for the neighborhood's four ethnic cultures.  Thus, early in
its development the hallmarks of DSNI's operations and structure were
set:  resident control, cultural sensitivity, and collaboration with
existing neighborhood organizations. 


   ORGANIZATIONAL STRUCTURE
------------------------------------------------------- Appendix III:2

As designed by local residents, DSNI's 31-member board of directors
must have a majority of residents; the balance of the members must be
representatives of community nonprofit organizations, development
corporations, business and religious groups, and government agencies. 
In addition, the resident members must represent equally the
neighborhood's major cultural populations--African-American, Latino,
Cape Verdean, and White. 

Currently, over 1,800 residents are voting members of DSNI.  The
governing body is the board of directors, first elected in April 1985
and elected every 2 years thereafter.  The executive director and
staff are charged with carrying out the board's mandates.  As of
January 1995, DSNI employed 16 full-time staff members.  Staff
resources are supplemented, when needed, by the voluntary
contributions of residents and other individuals, local law firms,
downtown Boston organizations, and several interns from local
universities. 

DSNI was organized in Massachusetts as a not-for-profit corporation
in March 1985.  Its financial statements are independently audited
annually, and its management is informally reviewed by the Riley
Foundation.  In addition, DSNI conducts self-assessments using board
member and staff input and other sources of information.  Such
assessments are recorded in quarterly reports for public review. 


   GOALS AND STRATEGIES
------------------------------------------------------- Appendix III:3

DSNI members and staff view their organization as a community
planning and organizing entity rather than as a traditional Community
Development Corporation (CDC) or service provider.  DSNI has combined
a variety of techniques to complement its organizing activities and
increase residents' involvement, including conducting short-term
campaigns, developing a long-term strategy, developing goals through
consensus-building, developing local leadership, leveraging community
support to gain political support, and developing a comprehensive
community development plan. 

DSNI's purposes in organizing were to provide information to
residents, including information about where to call for assistance,
and to expand the circle of people involved through
membership-building, coalition-building, problem-solving, and
morale-building.  Consensus-building was an integral feature to
fostering residents' ownership of both the problems and the proposed
solutions.  Lastly, DSNI continually sought to develop community
leadership by, for example, selecting a resident to serve as DSNI's
second president. 

Because DSNI's resident-driven, consensus-based approach achieved
early successes, the organization has been able to obtain
broad-based, ethnically diverse community support for its activities. 
This type of support gained recognition from the mayor and city
agencies.  As a result, the Boston city government has provided
extensive political, financial, and technical assistance for DSNI's
projects. 

In 1987, DSNI developed a comprehensive plan of action that included,
among other goals, developing community pride, strengthening cultural
diversity, improving residents' job skills, providing housing
counseling, promoting human service programming and resource
allocation, and developing new housing opportunities.  According to
neighborhood residents and officials from DSNI and other
organizations, this plan achieved multiple purposes.  Because it was
developed through a consensus of the participating residents and the
board, it had widespread support.  It provided the board, staff, and
residents with a long-term vision for the neighborhood's
revitalization, thereby enabling those involved to remain focused on
the agreed-upon goals.  Thirdly, it demonstrated residents'
commitment to city officials, foundations, banks, and other
institutions.  The city adopted DSNI's comprehensive plan as its
official plan for improving the neighborhood. 


   ACCOMPLISHMENTS
------------------------------------------------------- Appendix III:4

From the beginning, DSNI sought to blend short-term campaigns with
the longer-term goals described in the comprehensive plan.  To this
end, DSNI's first accomplishment was stopping the illegal dumping of
garbage, old appliances and vehicles, and animal carcasses on the
neighborhood's 1,300 vacant lots.  Annual neighborhood cleanups have
helped build community morale and prepare the sites for development
or community use.  Over 10 years, DSNI has accomplished many other
things, some of which are listed below: 


      HOUSING DEVELOPMENT
----------------------------------------------------- Appendix III:4.1

Obtained a low-interest loan from the Ford Foundation to buy land
under eminent domain and developed a community land trust. 

Constructed 77 single-family and cooperative homes that will be
affordable to low- and moderate-income families. 

Took control of 30 acres of vacant land in the Dudley Street
neighborhood, half of the acreage through eminent domain, and
developed a long-term community land trust in an effort to maintain
the neighborhood's stability and affordability. 

Provided homeownership classes covering topics such as home financing
and housing rehabilitation.  DSNI also maintains a data base on
homeownership and the housing needs of over 500 residents in the
Dudley Street neighborhood. 


      SOCIAL SERVICES
----------------------------------------------------- Appendix III:4.2

Developed multicultural festivals to celebrate the traditions of each
ethnic group represented in the neighborhood.  These and other
activities supported DSNI's goal of recognizing and being sensitive
to the many cultures that make up the Dudley Street area and fostered
ethnically diverse community support for its activities. 

Organized a youth committee to address issues important to the youth
in the community, such as recreational activities and education.  The
committee, in a unifying effort, designed and completed a large
neighborhood mural depicting the growth and development of the
individuals and ethnic groups that are an integral part of the
community. 

Organized an agency collaborative to help local social service
providers form an integrated network that is responsive and
accountable to the residents.  Currently, several participating
organizations have identified program goals and resources they could
integrate with other participating agencies.  However, the
collaborative has encountered some difficulties in obtaining
commitments from agencies to participate fully.  As of December 1994,
eight agencies had signed the agency collaborative agreement. 

Was awarded a 3-year grant by the W.K.  Kellogg Foundation to provide
training and leadership development for residents and agency
personnel.  The purpose of the grant is to create a consumer-driven
social service delivery model. 


      ECONOMIC DEVELOPMENT
----------------------------------------------------- Appendix III:4.3

Provided training or employment in the summer of 1994 for 34 local
youths, covering asset-mapping, landscaping, environmental cleanup,
and mentoring.  Provided job placement and advocacy for 250 youths. 

Arranged to purchase and began planning the rehabilitation of an
abandoned furniture factory for potential lease or sale for
commercial use. 

Matched residents with employment opportunities in local retail
establishments. 


MARSHALL HEIGHTS COMMUNITY
DEVELOPMENT ORGANIZATION
========================================================== Appendix IV


   ORIGIN AND EVOLUTION
-------------------------------------------------------- Appendix IV:1

In 1976, a group of concerned citizens in the Marshall Heights
neighborhood of northeast Washington, D.C., organized themselves
around issues such as substandard streets and sidewalks, poor storm
drainage, and housing in need of rehabilitation.  Marshall Heights is
one of 26 individual neighborhoods located in a section of Washington
known as Ward 7.  Geographically, Ward 7 is the District's
easternmost ward, and it is physically separated from the central and
western sections of the city by the Anacostia River.  Although it was
never among the wealthiest of the District's communities, Ward 7 once
had a solid base of middle- class families, as well as a substantial
number of small businesses and retail establishments.  However, the
out-migration of many middle-income families and businesses, which
began in the 1970s, has helped to destabilize the ward. 

In 1978, the citizens of Marshall Heights incorporated as a nonprofit
organization to provide a formal avenue to express their needs to the
District of Columbia's Department of Housing and Community
Development.  At the same time, the organization expanded to include
other neighborhoods within the ward.  The organization's current
executive director, hired in 1980, is largely credited with focusing
the organization's efforts on economic development and
self-sufficiency.  The executive director and the chairman of the
board of directors also encouraged linking the organization's efforts
to housing and social service issues.  Residents who attended the
organization's first community development conference in 1981 agreed
with and supported the comprehensive approach. 


   ORGANIZATIONAL STRUCTURE
-------------------------------------------------------- Appendix IV:2

The Marshall Heights Community Development Organization (MHCDO) is a
nonprofit corporation as defined by section 501(c)(3) of the Internal
Revenue Code.  MHCDO's by-laws provide for a 69-member board of
directors, with membership categories designed to provide
representation for a broad cross-section of the community.  Board
members represent citizens at large, churches, Advisory Neighborhood
Commissions (a community-participation vehicle organized by the
District government), civic associations, commercial interests, and
public housing tenants.  The board sets overall policy for MHCDO's
three program areas:  economic development, human development, and
housing.  MHCDO started with two full-time staff and evolved to its
current staff of 56.  It also uses volunteers extensively to carry
out its diverse activities.  Aside from its main nonprofit
corporation, MHCDO also operates three for-profit subsidiaries--East
River Park, Inc.; Citizens' Housing Development Corporation; and
Burroughs Development Corporation--each of which was established to
insulate MHCDO from financial risk and protect its tax exempt status. 


   GOALS AND STRATEGIES
-------------------------------------------------------- Appendix IV:3

MHCDO's strategy for revitalizing Ward 7 is to involve residents in
the process of improving conditions in the community by creating new
and diverse economic activities, increasing the availability of
affordable housing, and assisting residents to overcome barriers to
self-sufficiency.  Central to MHCDO's strategy is the use of economic
development to reduce reliance on outside funding and to increase
economic opportunities within the community.  In fact, one of MHCDO's
most visible accomplishments is the revitalization of the East River
Park Shopping Center, a 155,000-square-foot facility that currently
has 11 tenants, including a large Safeway supermarket, a CVS drug
store, and a Citibank branch office.  One of MHCDO's subsidiaries,
East River Park, Inc., owns 40 percent of the shopping center and
receives income through rents and management fees.  Income from the
shopping center is used to leverage funding to operate other programs
and to cover program shortfalls and funding gaps. 

Affordable housing is provided through another of the organization's
for-profit subsidiaries.  The Citizens' Housing Development
Corporation acquires, rehabilitates, and sells single- family housing
to low- and moderate-income families.  The organization also provides
counseling to help residents qualify as homebuyers, manage their
finances, or gain information on arranging a mortgage. 

MHCDO also emphasizes social services.  In most cases, MHCDO provides
services directly, such as drug and alcohol counseling, HIV testing
and counseling, and crisis intervention.  In other cases, the
organization refers clients to other community-based or District
government agencies that provide social services. 

Residents become involved in MHCDO primarily by serving on the
organization's board of directors.  However, residents also
participate as volunteers in many of MHCDO's activities, such as
neighborhood cleanups and community appreciation days.  According to
MHCDO officials, the size and diversity of the board of directors,
which is one of the largest of any community development corporation,
helps to ensure a cross section of community representation and a
broad base of support for the organization's projects and activities. 

MHCDO is expanding into community outreach, particularly for
residents living in public housing in Ward 7.  According to MHCDO's
executive director, although seats are set aside for public housing
residents on the MHCDO board of directors, the seats generally have
not been filled.  To increase participation by public housing
residents, MHCDO established a youth advisory council and, in January
1994, received a planning grant from the Annie E.  Casey Foundation
to, among other things, develop its base of support within the
community, including residents of public housing. 


   ACCOMPLISHMENTS
-------------------------------------------------------- Appendix IV:4

MHCDO's most visible accomplishment in economic development is the
East Park Shopping Center.  However, MHCDO also has accomplishments
in housing rehabilitation and social services.  Some of MHCDO's many
accomplishments are listed below: 


      HOUSING DEVELOPMENT
------------------------------------------------------ Appendix IV:4.1

Rehabilitated 33 single-family homes and 14 condominiums. 

Constructed 10 new single-family homes and 12 new condominiums. 

Constructed seven transitional housing units. 

Manages two rental properties containing a total of 21 apartment
units. 


      SOCIAL SERVICES
------------------------------------------------------ Appendix IV:4.2

Provided counseling, referral, and other services to relieve
residents during immediate crises brought on by sudden disruptions of
their daily lives, such as the loss or impending loss of housing or
jobs, domestic violence, and other emergency situations, including
lack of food, heat, or electricity.  In 1993, the crisis unit
provided needs assessments and counseling services for 3,700
residents, emergency food for 2,500, and emergency clothing for
3,100. 

Established the "Fighting Back" program to combat drug and alcohol
abuse by increasing public awareness of the extent and consequences
of substance abuse, increasing and accelerating efforts to prevent
substance abuse and to intervene as early as possible when problems
arise, stimulating the development of new treatment services, and
providing the necessary support for people who have been treated for
substance abuse problems.  Fighting Back is housed in a
5,000-square-foot commercial facility that was purchased and
rehabilitated by MHCDO's subsidiary, East River Park, Inc. 

Manages a socialization program for the mentally ill elderly.  This
program offers a wide range of social and recreational activities,
including group discussions, exercise sessions conducted by the
University of the District of Columbia's Institute of Gerontology
Department, arts and crafts, and field trips.  It also offers
programs to improve literacy and math skills. 

Provides employment and training services, including a job bank, job
development services, counseling, job readiness workshops, job
retention counseling, vocational training, and referrals.  In 1993, a
total of 8,214 clients received employment and training services. 

Took over the city's Automated Labor Exchange system after the
District government closed its Ward 7 Employment Services Office
because of insufficient funding.  The system lists employment
opportunities from coast to coast, including government and private
sector jobs.  Since its installation in May 1993, 5,260 queries have
been made.  According to the District's Department of Employment
Services, Ward 7's system is one of the most active in the city. 


      ECONOMIC DEVELOPMENT
------------------------------------------------------ Appendix IV:4.3

Rehabilitated a 155,000-square-foot commercial shopping center, which
now employs over 300 members of the community. 

Established an industrial park to attract light industry to the
community.  MHCDO owns 6.5 acres of land zoned for industrial use
with a 13,000-square-foot building that houses MHCDO's business
incubator. 


PASADENA NEIGHBORHOOD HOUSING
SERVICES
=========================================================== Appendix V


   ORIGIN AND EVOLUTION
--------------------------------------------------------- Appendix V:1

Pasadena Neighborhood Housing Services, Inc.  (PNHS) was established
by the city of Pasadena in the late 1970s to provide much-needed
affordable housing.  According to officials, highway development in
the early 1970s had displaced many residents of northwest Pasadena
and created a serious housing shortage for the city's low-income
residents.  Although the city promised, after constructing the
highway, to alleviate the housing shortage, its subsequent inaction
caused residents to distrust its commitment to the matter. 

In 1979, city officials approached the congressionally chartered
Neighborhood Reinvestment Corporation (NRC) to assist the city in
establishing a housing rehabilitation program in Pasadena's northwest
area.  Together, they formed PNHS.  To help finance the program, the
city named PNHS as a Community Development Block Grant (CDBG)
subrecipient. 

Although PNHS began when the community organized around housing
development, the range of programs it offers has grown steadily since
its inception.  Two factors that contributed to the community group's
expansion to other activities were (1) the community's unmet need for
economic opportunity and social equalization and (2) the increasing
capacity of community-based organizations to take on other issues
once their primary areas of focus have become self-sufficient. 


   ORGANIZATIONAL STRUCTURE
--------------------------------------------------------- Appendix V:2

PNHS is a private, community-based nonprofit organization.  Its
15-member board of directors is composed of two municipal
representatives, five business sector representatives, seven
residents, and one member-at-large.  Former board members with
backgrounds in housing and economic development remain active as
advisers to PNHS. 

In addition, PNHS has one subsidiary organization, the Neighborhood
Enterprise Center.  The center has a nine-member board of directors,
including the PNHS executive director, bank representatives, and
graduates of the center's program.  The center's board reports to
PNHS' board of directors. 

Six full-time employees and 5 consultants make up the PNHS staff,
according to the PNHS executive director.  The center employs one
full-time director and a part-time instructor.  In addition, NRC
assigned a representative field service officer to serve as an
adviser.  This role includes evaluating and monitoring, assisting
with the board's development, and providing technical assistance,
such as training in loan origination and proposal writing.  NRC
maintains quarterly reports on PNHS' financial and program
performance. 


   GOALS AND STRATEGIES
--------------------------------------------------------- Appendix V:3

PNHS believes community organizations should try to be catalysts for
needed actions and then find niches from which to contribute. 
Collaboration is an important factor in this strategy because,
according to the executive director, the organization cannot pursue
all strategies with the same intensity.  PNHS' goals are to assist
residents in upgrading and maintaining the area's existing housing
stock, empower residents through leadership training and development,
increase homeownership opportunities for low-income residents, and
improve the quality of life for the residents of northwest Pasadena. 
Through the Neighborhood Enterprise Center, the organization strives
to stabilize the neighborhood's economy, increase employment
opportunities and family incomes, and provide a service system for
small businesses as they advance. 

To achieve its goals, PNHS encourages the formation of block clubs,
neighborhood watches, and community forums.  In addition, it aims to
build trust while advertising to homeowners, landlords, and renters
the housing resources it makes available.  According to an NRC
official, PNHS' general strategy has been first to build community
trust through the core business of rehabilitating housing.  As it has
achieved progress in this area, PNHS has taken on other issues and
has further gained community trust through commitment and tenacity. 
For example, the executive director stressed that community
revitalization is not a nine-to-five job.  Commitment demonstrated
through availability and follow-up is the most important ingredient. 
At the same time, numerous incremental improvements are the currency
for building and retaining community support. 

PNHS' housing revitalization efforts have been largely supported by
NRC, the city of Pasadena, and collaborations with community
foundations and local banks.  NRC assists community-based
neighborhood revitalization organizations in low- to moderate-income
areas.  PNHS is part of NRC's network of 240 community-based
nonprofit neighborhood works organizations.  The city of Pasadena has
an important and effective relationship with PNHS.  The city's
Housing Development Department administers CDBG funds to PNHS to
carry out the city's housing rehabilitation program.  In fact, the
city is involved in several redevelopment and revitalization efforts
in northwest Pasadena that require the coordination of services
between the city government and PNHS. 

PNHS' strategy for expansion into areas other than housing has been
driven to a large extent by residents' identified needs.  In some
instances, programs were tailored to residents' needs through the use
of private funding sources.  For example, the community's needs for
child care and economic opportunities led PNHS to expand into day
care and a micro-entrepreneur program.  While the latter program was
initially sponsored by NRC, PNHS chose not to seek public funds
because of funding requirements.  According to the director,
participation in a government- subsidized program may disqualify some
applicants from public benefits.  The program is supported through
private funding sources. 


   ACCOMPLISHMENTS
--------------------------------------------------------- Appendix V:4

PNHS' accomplishments center around the organization's business of
housing development.  However, PNHS also has accomplishments in the
areas of social services.  Some of PNHS' accomplishments to date are
as follows: 


      HOUSING DEVELOPMENT
------------------------------------------------------- Appendix V:4.1

Provides rehabilitation loans to low- and moderate-income residents. 
Also, provides home pre- and post-purchase counseling, code
inspections, energy audits, weatherization, house painting, and
counseling for home security/insurance. 

Purchased and rehabilitated 15 homes and a 12-unit senior citizen
apartment complex and built 5 single- family homes in collaboration
with Pasadena City College. 

Owns and manages 32 units of affordable housing, including 4
multifamily housing facilities and a single-family rental property. 

Processed loans and supervised construction for housing
rehabilitation projects whose costs exceeded $2.4 million. 

Provides other related housing services, such as handyman referral,
assistance with relocating, disposition of foreclosed property,
senior citizen housing, lead poisoning prevention, a tool lending
library, free paint supplies, and a homebuyers' club. 


      SOCIAL SERVICES
------------------------------------------------------- Appendix V:4.2

Provides resources, support, and leadership training to 20
neighborhood block clubs pursuing self-initiated activities and
goals. 

Sponsors a child development center that provides day care services
to children from low- and moderate-income families. 


      ECONOMIC DEVELOPMENT
------------------------------------------------------- Appendix V:4.3

Maintains a Neighborhood Enterprise Center program that provides
local entrepreneurs with training in business and entrepreneurship
basics, including developing marketing plans and bookkeeping. 
Financial assistance is available through a peer lending model of
support groups and individual counseling.  Through the center, PNHS
provided a 4-week intensive training program to 120 entrepreneurs and
set up 13 peer groups that approved 20 loans. 

Sponsors a monthly African marketplace for small business
entrepreneurs. 

Works with the Greater Pasadena Business Partners, a collaboration of
businesses and interested parties, to promote economic development. 
The collaboration provides mentoring, training, and credit services
through three community-based business development programs.  It also
provides loan guarantees or direct grants to cover the costs of
management, operations, and mentoring.  Its goal is to establish a $1
million loan pool for businesses that are starting up or growing. 


SELECTED PROGRAMS AND ACTIVITIES
OF CASE STUDY ORGANIZATIONS
========================================================== Appendix VI

