Heroes Need Saving, Too
Since the 1980s, community development corporations (CDCs) have breathed new life into poor neighborhoods throughout the City, built and managed affordable housing, offered job training and day care, and provided commercial space. Although these enterprises have helped residents and businesses thrive, many CDCs are now in serious financial trouble.
|Playtime at Cypress Hills Child Care Center for these Brooklyn preschoolers is one of hundreds of programs provided by Community Development Corporations around the City. A grant to the Local Initiatives Support Corporation helped these groups restructure their business models to survive major losses in revenue.|
Their revenue often comes through government contracts, bank loans and grants, and developers’ fees, all of which dropped drastically as the housing market and banking industry collapsed in 2008 and 2009. Times like these show how heroes need saving, too.
The Local Initiatives Support Corporation’s (LISC)
First Responder Initiative came to the rescue of these troubled groups in 2009. The Corporation works with dozens of CDCs with sizable real estate holdings, and employs consultants that provide individualized help. After a thorough review of their cash flows, audits, and operating budgets, LISC makes recommendations to help put the CDCs on better financial footing.
In 2009, the Trust made a $60,00
0 grant to bolster the program, which helped 21 struggling CDCs. LISC helped CDCs tap into $500,000 in an underutilized City reserve fund allotted for social services in low-income housing. It raised $153,000 for salaries of CDC staff; $500,000 was allocated for management improvements for a handful of CDCs. Through the Deutsche Bank/LISC NYC Volunteer Advisors Program, LISC was able to get free financial, real estate, and marketing help for six CDCs.
In 2011, The Trust gave an additional $70,000
to continue helping CDCs manage their real estate portfolios. Danielle Pulliam, the NYC director of capacity building at LISC says, “We have been working for years to strengthen the sustainability of CDCs by diversifying their revenue streams; the economic downturn has given many of them a needed push in this direction. This is also an opportunity for a broader discussion on how to bring more resources to the industry.”