Federal Reserve Articles Explore Housing and Community Development Issues

The Federal Reserve Bank of San Francisco recently published a series of 28 articles under the title “Investing in What Works for America's Communities.” Contributing authors include Eric Belsky and Nic Retsinas of Harvard University’s Joint Center on Housing Studies and Shaun Donovan, Arne Duncan, and Kathleen Sebelius, the Secretaries of the U.S. Departments of Housing and Urban Development, Education, and Health and Human Services. The commentaries focus on a variety of topics that impact community development. They explore the history of affordable housing and its evolving relationship to jobs, educational opportunities, transportation, health care, and other services in creating sustainable communities in rural and urban America.

In “Fighting Poverty through Economic Development,” Donovan, Duncan, and Sebelius highlight the federal government’s efforts to solve housing, education, safety, workforce, and health challenges concurrently with state and local actors, in partnerships built across government, business, and non-profit sectors. Their article highlights innovative solutions developed at the neighborhood level using federal programs such as Choice Neighborhoods, the successor to the HOPE VI program; the Promise Neighborhoods initiative, which emphasizes local partnerships to fight poverty by improving education; the HUD-VASH program to help end veterans homelessness; and HHS’ Money Follows the Person initiative through which HUD and HHS are partnering with public housing authorities and Medicaid agencies in five states to help people with disabilities transition from institutional care to community living.

Although there are many other aspects of building sustainable communities, Sister Lillian Murphy and Janet Falk of Mercy Housing stress the importance of quality, affordable housing as a crucial part of the equation. They suggest that housing development organizations, particularly non-profit developers with a long-term mission to own and preserve housing affordability, need a new sustainable business model that fosters flexibility and diversity; encourages innovation; acquires funding at an organizational level rather than project-by-project; and measures the social, environmental, and economic impacts of their work. Murphy and Falk cite the Mortgage Resolution Fund (MRF), a joint venture of the Enterprise Foundation, the Housing Partnership Network, the National Community Stabilization Trust, and Mercy Housing, as an example of a model that can operate to scale and address today’s acute challenges. MRF is funded by the Hardest Hit Fund program administered by state HFAs to help families at risk of foreclosure.

In “Our History with Concentrated Poverty,” Professor Peter Edelman of the Georgetown Law Center says policy changes have succeeded in keeping some 40 million people from becoming poor but argues that we have not done as well in tackling persistent and intergenerational poverty, a particular feature of concentrated poverty, both urban and rural. While Edelman focuses on urban poverty, Cynthia Duncan, former director of community and resource development at the Ford Foundation, writes about the 9 million people living in poverty in rural America and the challenges and opportunities faced by rural development practitioners.

Alan Berube of the Brookings Institution charts the trends in the U.S. poverty rate and the changing demography of poverty in terms of race, age, and household formation. Citing research showing that adults who finish high school, work full-time, and wait until marriage to have children have a poverty rate equivalent to one-sixth of the national average, Berube concludes that the future success of community development as an antipoverty strategy may depend on its ability to increase the likelihood that children achieve, at a minimum, those fundamental outcomes.

In concluding the series, Retsinas charts the course for the community development field to become the “go-to” partner for improving the life chances of individuals and fostering healthier communities.