#158 Fall 2009

The Stimulus: Making Sense of it All

Between HARP, TARP, HERA, ARRA, TALF, NSP 1, NSP 2 and the rest of the alphabet soup of stimulus funding, there's a lot of government money circulating around the country right now. How are communities using this money, and will the stimulus provide the springboard needed for equitable, sustainable change?

As of mid-October, nearly $110 billion of the $787 billion in stimulus — over 36,000 projects — had been accounted for, with an additional $144 billion in the process of being distributed, according to Pro Publica. When speaking of the American Recovery and Reinvestment Act and its intended purpose to create or save 3.5 million jobs and to rescue the economy, we’re certainly seeing the “shovel ready” projects in place to rebuild — and not just repave — infrastructure, but we’re also witnessing the means by which deployment decisions are made, along with the Obama administration’s new budget priorities and commitment to leveraging funds and building collaborations that offer new opportunities for low-income families and communities.

Now that plans have been made and billions have been disbursed or are on their way, how is it all working? Moreover, how will it affect housing policy? Do the funds promote collaborations, and if so, will those collaborations result in lasting systems change for more effective community development? Will these collaborations change the nature of what community developers are doing? Are we finding that there is greater emphasis on regional systematic thinking that allows for compromise?

The authors of the following 11 essays were asked to consider not just the obvious bricks and mortar issues like how many foreclosed homes are being revived or how many windows are being weatherized, but also what it all means for the neighborhoods we care about. The authors, an array of leading voices in the community development field, point to the benefits of the stimulus, while offering critiques of how, or if, it falls short and how it can be improved to ensure equity analysis of what’s working and what isn’t.

In Ohio’s Cuyahoga County for example, the Cuyahoga County Land Reutilization Corp., the county housing authority, and a consortium of partners putting together a joint Neighborhood Stabilization Program application, requests $74 million for the acquisition, rehabilitation, and sale of 415 housing units, the demolition of 1,100 units, and for the acquisition, rehabilitation, and lease of 252 affordable rental units. This type of large-scale planning was, in part, made possible by the need to take a regional, collaborative approach toward market recovery in 20 key areas hit hard by the foreclosure crisis, and combines several common goals of the various stakeholders.

All over the country, from Minneapolis/St. Paul, to Chicago, from Philadelphia to Boston, and from Baltimore to Atlanta, we have strong neighborhood community-based organizations looking at the best ways to bring in and employ stimulus monies. Embedded in ARRA, of course, is the myriad of programs that apply to all areas of community development. Nan Roman and Norm Suchar of the National Alliance to End Homelessness look at the $1.5 billion portion of ARRA that funds short- and medium-term rental assistance, housing search assistance, and case management known as the “Homelessness Prevention and Rapid Re-housing Program.” While only a small slice of the stimulus, Roman and Suchar report that, used properly, HPRP can prove to be “a resource that can fund the transformation of homeless assistance that communities have been planning for many years.”

The National Housing Trust’s Michael Bodaken examines the dichotomous nature of the “Great Recession”; at once “the best of times” with an administration replete with the best and brightest leading the charge toward a renewed dedication to housing and community development, and the “worst of times” as the Low-Income Housing Tax Credit shrinks to its pre-2007 level (ARRA designates $2.25 billion for LIHTC), leaving remaining tax credit investment concentrated in the coastal regions, and leaving Midwest, Great Plains, and rural states — those areas hit hardest by the effect of subprime debt — in the lurch.

Deepak Bhargava and Seth Borgos of the Center for Community Change have a slightly different take, looking at the political realities of ARRA, it’s quick enactment, and the not-so-nascent notion that more stimulus is probably needed. While they acknowledge ARRA’s beneficial impact on community organizing, they attest that the stimulus is “a hodgepodge of programs and initiatives with no pretence to consistency or cohesion.

“Procedurally, it was drafted with minimal input from grassroots constituencies and little thought to their role in implementation,” Bhargava and Borgos write.

There is little doubt that these stimulus funds present opportunity for the community development field, from the chance to transform America’s carbon footprint, as Enterprise’s Doris Koo writes, to finally moving “beyond the current homeownership funding mechanisms and build quality, long-term assets for our communities,” as Roger Lewis of the National Community Land Trust Network writes, to creating opportunities for people to live in affordable homes while improving their own lives and communities, according to NeighborWorks’ Kenneth Wade.

Whether groups can come together, cooperate, and compromise to achieve best use of the funds is still in question. While this is the first administration in many years to clearly care for the well being of cities and all the people who live in them, heaven, and not the devil, is in the details.

These essays are just the beginning, of course. Over the next year and beyond, Shelterforce will track the outcomes of the stimulus, the foreclosure crisis and how it’s laying waste to our inner city and poor rural communities, and the new directions being promoted by the administration, while assessing whether the rules of the game for community development are being changed.


  • The Painful Impact of the Housing Downturn on Low Income and Minority Families

    November 23, 2009

    The current downturn in housing has seized the markets, pushed home prices down further than any time in generations and has sparked the worst recession since the Great Depression. At the same time, nearly 18 million households are severely burdened with housing costs that consume over half their household incomes. While few have escaped the fury of the recent downturn in housing, tenant, low-income, and particularly minority, households have fared the worst.

  • The Nitpicker’s Guide to Foreclosure Mitigation

    November 23, 2009

    First, it was judges like Justice Arthur M. Schack of the New York Supreme Court, who made waves by tossing foreclosure motions because he found a rising level of errors […]

  • Interview with Xavier de Souza Briggs, Associate Director for General Government Programs at the Office of Management and Budget

    November 23, 2009

    Xavier de Souza Briggs, Associate Director for General Government Programs at the White House Office of Management and Budget has a portfolio that includes HUD, Treasury, Commerce, Justice, Transportation, and Homeland Security departments, as well as the U.S. Postal Service and Fannie Mae and Freddie Mac. All of these make a direct and profound impact in the community development world.