Assessing the Effectiveness of Two CDCs in Generating Wealth for Constituent Communities

DO THEY WORK ASSESSING THE EFFECTIVENESS OF TWO COMMUNITY DEVELOPMENT CORPORATIONS IN GENERATING WEALTH FOR CONSTITUENT COMMUNITIES

ABSTRACT This research profiles two Pittsburgh based community development corporations with the purpose of assessing how effective they are in generating long-term, intergenerational wealth for individuals in their constituencies.

Ariam Ford – May 2016 Master of City Planning Candidate

TABLE OF CONTENTS

Table of Figures............................................................................................................. 3 Introduction ................................................................................................................... 4 Foundational Arguments .............................................................................................. 6 Public Funding .......................................................................................................................................... 6 Assessing the Community Development Corporation ................................................................................... 8 CDC Organizational Structure .................................................................................................................. 8 CDCs & Housing Development ................................................................................................................ 9 CDCs & Community Activism ............................................................................................................... 10 CDCs & Economic Development ........................................................................................................... 11 History of CDCs in the United States ..................................................................................................... 12 Measuring CDC Success ......................................................................................................................... 14 Academic Critique of the CDC ............................................................................................................... 15 Measuring Wealth ....................................................................................................................................... 16

CDC & Community Profiles ........................................................................................ 18 Bloomfield – Garfield ................................................................................................................................. 18 The CDC ................................................................................................................................................. 18 The Community....................................................................................................................................... 19 The Hill Community Development Corporation ......................................................................................... 20 The CDC ................................................................................................................................................. 20 The Community....................................................................................................................................... 20

Conclusions ................................................................................................................. 21 Appendix ...................................................................................................................... 26 The Hill Community Development corporation .......................................................................................... 26 Bloomfield – Garfield Corporation............................................................................................................. 32

Works Cited ................................................................................................................. 37

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TABLE OF FIGURES

Figure 1 The Hill CDC: 2010 Community Demographics – Race ............................................... 26 Figure 2 The Hill CDC: Community Population % Change '00 - '10........................................... 27 Figure 3 The Hill CDC: 2010 Community Housing Tenure ........................................................ 27 Figure 4 The Hill CDC: Housing - % Change in Real Value '00-'10 ........................................... 28 Figure 5 The Hill CDC: % Change in Income (1999-2009)......................................................... 29 Figure 6 The Hill CDC: 2010 Neighborhood Resident Employment .......................................... 30 Figure 7 The Hill CDC: Highest Level of Education Completed 2010........................................ 31 Figure 8 Bloomfield-Garfield Corporation: Community Demographics - Race .......................... 32 Figure 9 Bloomfield-Garfield Corporation: Community Population % Change '00-'10 .............. 32 Figure 10 Bloomfield-Garfield Corporation: Community Housing Tenure 2010 ........................ 33 Figure 11 Bloomfield-Garfield Corporation: Housing - % Change in Real Value '00-'10........... 33 Figure 12 Bloomfield - Garfield Corporation: Housing - Median Value 2010 ............................ 34 Figure 13 Bloomfield - Garfield Corporation: % Change in Income (1999-2009) ...................... 34 Figure 14 Bloomfield-Garfield Corporation: Neighborhood Resident Employment ................... 35 Figure 15 Bloomfield-Garfield Corporation: Highest Level of Education Completed 2010 ....... 36

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INTRODUCTION

The purpose of this research project is to explore the relationship between the programmatic efforts of urban community development corporations (CDCs) and the level of wealth generated within their respective constituent communities over time. The idea for the project originated from a collection of observations taken during my time as an intern at a Boston CDC. After working in the organization for a summer, I came under the impression that the amount of effort put into running the organization and fundraising took more precedence over the actual programmatic efforts undertaken at the organization. Similar to the CDC I interned for, the majority of CDCs in the United States focus on providing low-income housing production, often using the number of low-income units as a benchmark for success. In addition to other concerns such as the organizational efficiency of CDCs and the viability of the model, it is distressing that these organizations may spend more resources producing and managing subsidized housing for low-income residents than perusing programs that contribute to increases in their constituencies’ ability to be full participants in the market economy. Given the gravity of need in urban communities and the increasingly limited resources of CDCs, it is possible that using resources to help individuals accumulate greater wealth over time is more valuable to a community than the production of low-income housing units.

These types of considerations effectively lead to questions about the organizational missions of CDCs and the efficiency with which they accomplish their goals. What are CDCs trying to achieve? How do we identify successful CDCs? How well are these organizations using their funding, much of which comes from the taxpayer, to make sustainable improvements to the lives of their community members?

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To begin to understand these important questions, this paper offers and seeks to test the following proposition: I hypothesize that the programmatic efforts undertaken by CDCs do not result in substantial increases in wealth for constituent community members over time.

To test this hypothesis, this paper presents organizational profiles and constituent community profiles of two Pittsburgh CDCs: The Bloomfield-Garfield Corporation (BloomfieldGarfield) and The Hill Community Development Corporation (Hill CDC). Using the profiles to compare data concerning the missions and programmatic efforts of the two Pittsburgh CDCs against the demographic and socio-economic trends of their respective constituent communities, I hope to gain more clarity into the efficiency of these organizations in improving the socioeconomic position of those they serve. Data used to gain insight into CDC programmatic efforts include organizational history, organizational structure, foundational doctrine, number and types of programs, and public aid received. Data used to understand the accumulation of wealth over time include changes in home ownership, property valuation, median household income, educational attainment, employment rates and employment type.

This paper begins with an overview of a research implication considered particularly pertinent in relation to the evaluation of the successfulness and efficiency of CDCs. CDCs rely heavily on an ever-dwindling pot of public money. Although it comprises the majority of many CDC budgets, public funding is an unsustainable resource. As Public funds continue to dwindle, they must be used to the highest degree of efficiency and seek a high return on investment. I hypothesize that this is not currently the case with the CDC model.

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To provide a greater context for an analysis, this paper presents a literature review presenting an overarching assessment of community development corporations. Topics include CDC organizational structure, an overview of the History of CDCs in the Unites States, typical CDC activities, an evaluation of how CDCs success is measured, as well as an academic critique of the model as a whole. In preparation for the evaluation of the relationship between CDC efforts and wealth accumulation, the literature review concludes with a discussion about how wealth can be measured. Next, this paper presents organizational profiles of the two Pittsburgh CDCs along with socio-economic profiles of their respective constituent communities. Finally, the paper concludes with an analysis of the research findings and the implications of these findings on the aforementioned hypothesis. Also included in the conclusion is a important discussions evaluating the research limitations of this effort and sugesting future research implications.

FOUNDATIONAL ARGUMENTS PUBLIC FUNDING

Understanding the impact and efficiency of CDCs is important because of the amount of public funding invested into these organizations. The Department of Housing and Urban Development (HUD) is the primary vehicle used by the federal government to subsidize CDC activities, especially low-income housing development.

The Community Development Block Grant (CDBG) is one of the largest grant giving programs managed by HUD. Authorized under the 1974 Housing and Community Development Act, the CDBG confers annual grants to states and local governments. According to federal regulations, activities funded by CDBG money must benefit low and moderate-income persons,

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must prevent or eliminate slums or blight, or must address community development needs having of particular urgency due to the nature of existing conditions posing a serious and immediate threat to the health and welfare of the community. CDBGs have been the primary funding source for CDCs for the past two decades (Krigman, 2010). One might connect the passing of the Housing and Community Development act with the significant increase in the number of CDCs that occurred in the 1970s. The decade saw the creation of hundreds of new organizations taking advantage of the increase in federal funding for low income housing development (Gittell & Wilder, 1999).

The Low Income Housing Tax Credit (LIHTC) is another funding source for CDCs. A result of the 1986 Tax Act, LIHTCs provide approximately $8 billion in tax credits annually.

States and local governments can issue these funds for the acquisition, rehabilitation, or new construction of rental housing targeted to lower-income households. This strategy was designed to increase the monetary incentive for private developers to invest in a less-profitable affordable housing market. Because of their ability to operate similarly to private developers, CDCs have access to these tax credits (Krigman, 2010).

Following a reduction in federal support for community development programming during the Reagan Presidency, the 1990s brought a new wave of federal funding for CDCs. The HOME Investment Partnership Program (HOME) began in 1990 as a part of the Cranston Gonzalez National Affordable Housing Act. Under this program, state and local governments receive funds from the federal government and have the discretion to distribute the funds based on what they feel will best serve the community. However, participating governments are required to earmark 15% of the HOME funding they receive to exclusively fund community housing development organizations (CHDO) (Robinson, 1996). Under the definitions applied by

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the program, a CHDO is a nonprofit organization that provides affordable housing to low income and moderate families. In addition, the program permits these development activities to include the involvement and sponsorship of for-profit enterprises (Krigman, 2010).

Given the extent of public support for CDCs, it is critical that we have a clear understanding of the value that these organizations are providing for communities.

ASSESSING THE COMMUNITY DEVELOPMENT CORPORATION CDC ORGANIZATIONAL STRUCTURE

Throughout the academic literature, there are multiple references to a lacking consensus regarding the proper definition of a CDC. This makes it difficult to evaluate such an organization. One author describes CDCs as legally incorporated, non-profit agencies empowered to purchase, develop, and manage residential and commercial property, or to provide loans and technical assistance to other organizations doing the same things (Robinson, 1996).

Another describes CDCs as nonprofit, community-based urban development organizations that engage in economic development activities such as housing productions, commercial property development, business development, and/or job creation for the benefit of community residents (Krigman, 2010). According to U.S. law, a CDC is defined as the following: The term “community development corporation” means a nonprofit organization responsible to residents of the area it serves which is receiving financial assistance under part A of this subchapter and any organization more than 50 percent of which is owned by such an organization, or otherwise controlled by such an organization. (42 U.S. Code § 9802 )

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Part A of the subchapter expands on four acceptable areas of activity that qualify a CDC to receive federal funding, including: 1) community business and commercial development programs; 2) community physical development programs which contribute to an improved environment and which create new training, employment, and ownership opportunities for residents of such areas; 3) training and public service employment programs and related services for unemployed or low-income persons; and 4) social service programs which support and complement community development programs, including child care, educational services, and health services (42 U.S. Code ยง 9806). Under the law, a CDC must have a representative board of directors, by-laws, and must register as a 501(c)3 non-profit corporation for tax purposes. As such, CDCs enjoy tax-exempt status and are entitled to apply for restricted government development funds (Robinson, 1996).

CDCs & HOUSING DEVELOPMENT

Housing development is an integral part of many CDC operations. A 1995 national study revealed that, at the time, 90% of all CDCs were actively involved in housing production, rehabilitation, and/or management (Gittell & Wilder, 1999). A 1996 study of 130 CDCs showed that housing development was the least risky of all activities undertaken by CDCs. The results of the study showed that CDCs undertaking housing development failed 17-38% of the time depending on number of years in operation (Schill, 1996). Specifically, CDCs undertake housing development activities to benefit low income renters and families in their communities.

Arguably, through constructing affordable housing units, CDCs are able to provide an alternative to the private housing market, thus exerting pressure on surrounding landlords to keep rents competitive (Robinson, 1996). CDCs, as non-profit developers, have unique access to a variety of sources of equity and debt. Sources include programs under the U.S. Department of Health

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and Human Services, the U.S. Department of Housing and Urban Development, and grants and loans from foundations, local corporations, and financial institutions (Schill, 1996). By supplementing government housing programs, CDCs have been praised for contributing to the nationwide effort of housing those unable to afford housing prices in the market economy.

Between the years of 1960 and 1990, CDCs along with other non-profits produced approximately 736,000 housing units (Gittell & Wilder, 1999). By 2010, nonprofits had produced 4.6 million units (Krigman, 2010). Krigman describes this trend as the process of “nonprofitization�, were over time, greater and greater responsibility of housing policy and production is shifting from government to the hands of community-based organizations. He argues this is because non-profit organizations are most likely to work in distressed areas, and the narrowly tailored missions of governments and for-profit housing providers are not able to meet the needs of these communities comprehensively. In this light, Krigman views CDCs as consistent and effective affordable housing providers (Krigman, 2010).

CDCs & COMMUNITY ACTIVISM

Many authors commented on the role of the CDC as a community activist. On one hand, CDCs can be viewed as incubators of neighborhood leaders, seeking to involve local residents in the process of community change at the grassroots level (Robinson, 1996). On the other hand, CDCs can be understood as a bridge between local communities and those socio-economic institutions, such as governments and banks, who more or less control access to development activity through regulations and capital (Stoecker, 1997). In this respect, CDCs fill a knowledge gap in communities who may not have the political capital or professional know-how to cultivate successful property development projects (Robinson, 1996).

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CDCs & ECONOMIC DEVELOPMENT

In addition to producing housing, CDCs also undertake economic development activities. A 1996 study by the National Congress for Community Economic Development revealed that 23% of all CDCs were involved in business development activities. Of those CDCs, 18% of them were involved in commercial and industrial development (Gittell & Wilder, 1999). CDCs engage in economic development for a variety of reasons, which include generating jobs for local residents, rebuilding the social fabric of distressed communities through commerce, and promoting commercial development that provides much needed services in their neighborhoods (Schill, 1996). A CDC can play many roles in economic development. CDCs are often facilitators of transactions and relationships between private enterprise and the community. They may also offer technical and professional assistance to local entrepreneurs looking for support. CDCs can participate in the economic development process as equity investors, putting up capital, both financial and human, in support of local enterprises. CDCs may even provide job training to better equip residents for the workplace. Despite these various roles, the most common economic development activity undertaken by CDCs is the leasing of commercial real estate.

Although the goals of CDC economic development projects seek to strengthen communities, research shows that the successfulness of these endeavors is in question. A study of 130 CDC showed 18-40% failure rates for commercial development endeavors with business enterprise development emerging as the least successful activity. The most common causes of failure were poor or inadequate planning and insufficient organizational capacity (Schill, 1996).

Such research should make stakeholders question if economic development activity at the CDC level is worth the investment risk.

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HISTORY OF CDCs IN THE UNITED STATES

CDCs in America have a long and storied history that can be traced back to a 1966 visit

by Robert Kennedy to Bedford-Stuyvesant, New York. Spurred by the desire to inject more investment into distressed, inner-city neighborhoods, Senator Kennedy put forth the 1996 Special Impact Amendment to the Economic Opportunity Act. This legislation laid the groundwork for CDCs by extending federal funding to these organizations through Title VIII of the Community Services Act – Neighborhood Self Help Development Program (Krigman, 2010).

The Special Impact Program (SIP), developed under this legislation, sought to address problems of long-term unemployment through public and residential construction. It also aimed to develop businesses in poor areas with greater levels of private sector involvement. To accomplish these goals, block grants and other flexible forms of funding were to be distributed by governments to community organizations whose missions centered on community development. Through this legislation, Kennedy sought to establish an organizational structure that could provide linkages between the private sector and the poor (Johnson, 2004).

Fewer than 100 CDCs emerged in the 1960s. Mirroring the era of social unrest that defined the 1960s in the U.S., the goals of this generation of CDCs included job creation, economic development, political advocacy, and fighting against residential redlining. These organizations looked to achieve their goals through an array of housing and commercial projects, as well as the provision of human services (Gittell & Wilder, 1999). The second generation of CDCs emerged during the 1970s, when the number of CDCs in the U.S. grew to 1000. This cohort of CDCs found themselves responding to the forces of urban renewal, slum clearance, and the displacement of low-income inner-city residents. In response to this context, CDCs shifted

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their missions away from economic development and job creation towards housing development to support the communities most affected, often inner city populations of color.

The 1980s was an important period of growth for CDCs. The number of CDCs in the United States doubled between 1981 and 1986. During this time, the organizational model began to adopt more entrepreneurial and corporate style practices. Some argue that this change was for the purpose of pursuing funding outside the government, as CDCs began to build relationships with private companies and foundations. Despites cuts in federal funding during the Regan presidency, the efforts of CDCs were still supported by government policy (Gittell & Wilder, 1999). The 1986 Tax Reform Act required that 10% of state’s allocation of housing tax credits go to non-profit projects, such as those run by CDCs. By 1987, 80% of all new low-cost housing nationwide was being produced by CDCs (Robinson, 1996). Schill describes this time as the period when CDCs, using their cornucopia of funding sources, began to fill the void of lowincome housing development left by declining government funding for the nations housing authorities (Schill, 1996).

The 90s brought a new wave of funding increases for CDCs at the Federal level, such as the 1990 National Affordable Housing Act. 15% of the funding approved to enact the legislation was earmarked specifically for CDCs (Robinson, 1996). Other Federal programs enacted during the 1990s included President Clinton’s Empowerment Zone and Enterprise Community Program, the Community Development Block Grant, and a host of other tax credit programs for lowincome housing developers (Robinson, 1996).

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MEASURING CDC SUCCESS

In order to understand and evaluate the effectiveness of CDCs in achieving their mission of community development, it is important to understand how the performance of these organizations can be measured. It is particularly difficult to measure such a concept, as CDCs vary greatly in size, nature, and geographical context. Despite this, measuring the success of CDCs is important because of the level of public funding they receive. Like any other effort supported by tax payer funding, CDCs should be expected to operate efficiently and with minimal incompetence and wastefulness (Schill, 1996). The academic literature on the topic provides a variety of definitions of success for consideration. One author measures CDC success by evaluating the contribution an organization makes to the improvement of residents’ access to financial resources, physical resources, human resources, economic opportunities, and political influence (Gittell & Wilder, 1999). Another suggests that a CDCs success should be measured by its ability to stay in existence, to achieve major objectives – whatever those may be – and to achieve those objectives in the most efficient way possible (Stoecker, 1997). In contrast, a third source attempts to evaluate CDC success by defining CDC failure, specifically in the context of housing development. From this perspective, failure would be defined by the complete collapse of activity, major cost overruns, poor quality construction, high vacancy rates, and poor management (Schill, 1996). The literature also provides suggestions regarding what separates successful CDCs from unsuccessful CDCs. Organizational characteristics such as size, the prioritization of activities, programmatic experience, leadership stability, and clear development strategies all contribute to a CDCs aptitude for success. Additional identifiers include a specific and tangible mission, a strong internal staff, the ability to leverage political capital and local

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relationships, and most importantly, the ability to consistently acquire funding (Gittell & Wilder, 1999).

ACADEMIC CRITIQUE OF THE CDC

To accompany an evaluation of the successfulness of CDCs, the academic literature also provides a comprehensive critique of CDCs as an organizational model. On the positive side, CDCs are viewed as filling a gap between local communities and the institutions that typically control the process of real property development. According to one author, CDCs fuse capital, community, and government in the pursuit of “sensitive neighborhood enhancement”, that is, neighborhood enhancement that prioritizes the needs of residents over profit. Using their institutional connections and corporate-like organizational structure, CDCs have the ability to influence the political balance of development politics, to change the calculus of capital investors, and to enhance the social and psychological fabric of a neighborhood (Robinson, 1996). In this capacity, CDCs are able to work with residents to leverage external resources for the purpose of local community development (Krigman, 2010). CDCs also play the role of mediator between the internal and external forces of community change. CDCs are skilled at negotiating resistance amongst low-income neighborhood stakeholders in the face of new development seen as threatening to the community (Robinson, 1996).

Despite their contributions to the production of low-income housing, and serving as a bridge between local residents and capital markets, CDCs have been criticized on a number of points. First, the literature suggests that the quasi-corporate nature of CDCs causes them to pull away from their grass-roots identity. Robinson argues that by replacing community advocacy with service provision – i.e. low-income housing – CDCs are forced to take on many characteristics of private developers (Robinson, 1996). This includes finding ways to maintain 15

sustainable connections with sources of investment capital. As CDCs spend time falling in step with grant stipulations and soliciting donations from companies and foundations, the constituency of the organization grows beyond the local residents whom they serve. Krigman agrees with this analysis, arguing that as CDCs become more narrowly focused on becoming developers, they become increasingly professionalized, and thus, less responsive to the community and social justice missions (Krigman, 2010). A second criticism of CDCs is the question of whether or not especially successful variation of the CDC model can be replicated effectively. Research shows that variability is the most consistent feature among CDCs. They differ wildly in size, activity, financial resources, outputs, staff size, and geo-political context (Gittell & Wilder, 1999). Stoecker argues that only the largest CDCs manage to stay in existence and achieve achieve their major objectives effectively (Stoecker, 1997). This suggestion is foreboding for small communities with limited social infrastructure. A third criticism of CDCs is the dependence on external monetary resources as a core element of the organizational structure.

CDCs depend heavily on government funded programs, making them vulnerable during times of scale-backs (Krigman, 2010). CDCs are also in constant financial crisis because of an inability to self fund operations (Robinson, 1996). Even so, when funding is available, CDC development projects still tend to be undercapitalized (Gittell & Wilder, 1999).

MEASURING WEALTH

A review of the academic literature has culminated in an understanding of CDCs as part grass roots advocate, part developer. The goal of CDCs is to revitalize distressed communities and to improve the lives of their constituents. CDCs work towards these goals by leveraging their unconventional legal status to forge connections with governing and financial institutions outside of their neighborhoods. These connections are used to obtain funding, to build partnerships, and

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to increase the social and political capital of communities. While programming varies between organizations, developing low-income housing units is the primary activity of the majority of CDCs. This is unsurprising giving the government support CDCs have received for this purpose over time. However, when speaking of the successfulness of CDCs, metrics such as the number of housing units developed or the number of years in existence are referenced. This paper supports an alternative understanding of CDC success that is interested in the affect that these organizations have on the socioeconomic status and wealth accumulation of residents within the communities they serve. To explore this relationship, it is first necessary to review the concepts of socioeconomic status and wealth to explore how they can be measured.

One author defines socioeconomic position as an aggregate concept that includes both resource-based and prestige based measures. Resource-based measures refer to material and social resources as assets, including income, wealth, and educational credentials. Terms used to describe inadequate resources include "poverty" and "deprivation". Prestige-based measures refer to an individual's rank or status in a social hierarchy, typically evaluated with reference to people's access to and consumption of goods, services, and knowledge, as linked to their occupational prestige, income, and educational level (Krieger, Williams, & Moss, 1997). There are also US census based measures of socioeconomic position. These measures include educational attainment, occupational type, income, home ownership, and vehicle ownership (Krieger, Williams, & Moss, 1997). Asset ownership is also associated with wealth. Other than housing and vehicles, assets such as a business, stocks, savings, accounts, and bonds also help to quantify an individuals wealth (Juster, Smith, & Stafford, 1999).

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CDC & COMMUNITY PROFILES

With the purpose of evaluating the hypothesis that the programmatic efforts undertaken

by CDCs do not result in substantial increases in wealth for constituent community members over time, the next section presents a profile of two Pittsburgh CDCs along with profiles of their constituent communities. The goal is to investigate the relationship between the programming efforts of the CDCs and data regarding the socioeconomic status of community residents.

BLOOMFIELD – GARFIELD THE CDC

The Bloomfield-Garfield Corporation (BGC) was founded in 1976 by Reverend Leo Henry to serve the two northern Pittsburgh neighborhoods of Bloomfield and Garfield. The stated mission of the organization is to improve the quality of life for all through active community engagement (Bloomfield-Garfield Corporation, 2015). In 1981, the BGC was the first community group in Pittsburgh to receive Federal Community Block Grant funding.

Housing is a major concern of the organization. To ensure that decent, affordable housing is available for all residents, the organization renovates and builds new homes to offer for sale to owner occupants. Over the past 25 years, BGC has renovated over 200 units of rental and owneroccupied housing (Bloomfield-Garfield Corporation, 2015). The organization also engages in economic development through its Mainstreets Program. The purpose of this program is to develop and execute revitalization strategies within their community by connecting community groups, residents, businesses, and government officials. Youth Education is a third concern of BGC. The organization’s Youth Development Center aims to increase opportunities for children and teens in the areas of education, employment, health care, and social development. To help

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reduce criminal activity within its communities, the BGC has also initiated a Public Safety Task Force. BGCs Public Safety Task Force meets every month to bring together police officials, residents, and other community leaders to examine crime trends and illegal activity in the neighborhood.

THE COMMUNITY

The neighboring communities of Garfield and Bloomfield differ widely in respect to race.

Garfield is overwhelming comprised of Black residents (80%) while Garfield is 82% White.

Between 2000 and 2010, both the communities experienced population losses. Bloomfield lost 7% of its population, less than the entire City of Pittsburgh which lost 8% of the population in the same amount of time. In stark contrast, Garfield lost 33% of its population within that decade. In both Garfield and Bloomfield, more residents rent than own their own homes.

Between 2000 and 2010, both communities experienced increases in housing values. However, this increase masks disparities between the two. In 2010, data shows that the median housing value in Bloomfield was approximately $30,000 greater than in Garfield. The majority of residents within Bloomfield and Garfield work in the education, health, and social services industries. In Garfield, the highest level of education achieved by the majority of residents (55%) is a high school degree. In contrast, 45% of Bloomfield residents have obtained an associates degree or higher. The neighborhood of Garfield saw incomes decline by 20% between 1999 and 2009. In stark contrast, the Bloomfield neighborhood remained at the status quo, seeing neither and increase or decrease in income for community residents. All of this stands in contrast to the City of Pittsburgh which saw a 4% increase in income during the decade (City of Pittsburgh, 2010).

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THE HILL COMMUNITY DEVELOPMENT CORPORATION THE CDC

In contrast to the Garfield-Bloomfield Corporation, the Hill CDC serves a much larger constituency over six distinct Pittsburgh neighborhoods: Bedford Dwellings, Bluff, CrawfordRoberts, Middle Hill, Terrace Village, and Upper Hill. This grouping of areas is sited just east of Downtown Pittsburgh and serve as a gateway to higher growing areas of the city such as Oakland and Shadyside which are currently benefiting from greater injections of investment and development anchored by high profile universities and corporate establishments. The Hill CDC has been in operation there since before 1980. The mission of the Hill CDC is to work in partnerships with residents and stakeholders to create, promote, and implement strategies and programs that connect plans, policies and people to drive compelling community development opportunities in the Greater Hill District (The Hill Community Development Corporation, 2015).

The organization facilitates and implements real estate development and urban design proposals within the Hill District of Pittsburgh. Less focused on housing development, the services offered by the Hill CDC include real estate development facilitation, neighborhood planning, program planning support, business development, neighborhood-centric marketing, and community relations and outreach services. Underlying its efforts in community building is the Hill CDCs belief that development should be sustainable, equitable, and beneficial to the community and to the developer. This CDC is representative of the more entrepreneurial and professionalized CDCs that emerged during the 1980s.

THE COMMUNITY

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Five out of six of the neighborhoods served by the Hill CDC are majority Black, with Middle Hill having the largest relative population at 94%. Bluff has the highest concentration of Whites within the Hill CDC constituency (66%). In all of the other neighborhoods, whites make up less than 28% of the community. This is misrepresentative of overall Pittsburgh demographics, as the City is comprised of 67% Whites and 27% Blacks, suggesting that Black communities in Pittsburgh are compact and co-located. Between 2000 and 2010, five out of six of the Hill CDC communities experienced population loss. Four of these communities saw twice the population loss than the entire City of Pittsburgh. Owner occupied housing rates exceed rental occupied housing rates in only one community served by the Hill CDC. Again, this is a contrast to the City of Pittsburgh where the majority of properties are owner occupied. The real value of housing properties in the Hill CDC communities is varied. For example, Bedford Dwellings saw housing values increase over 200% between 2000 and 2010. This statistic is tempered by the fact that the median housing value in Bedford Dwellings following this massive increase in value was still only $81,000 in 2010. In contrast, the 2010 median home value of Bluff was $21,200, up 59% from 2010. In every neighborhood, save Crawford Roberts, 50% or more of the population has not obtained higher than a high school degree. Despite this, an overwhelming amount of Hill CDC constituents work in the fields of educational, health and social series, leading to further questions about the role and class of these workers in these institutions. This population makes up over 30% of every neighborhood. Between 1999 and 2009, incomes increased in only one neighborhood served by the Hill CDC. In fact, the majority of residents saw declines in income between 10% and 15% (City of Pittsburgh, 2010).

CONCLUSIONS

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This paper began with a hypothesis that the programmatic efforts undertaken by CDCs do not result in substantial increases in wealth for constituent community members over time. The first step of testing this hypothesis was to begin to understand the history, structure, and mission of CDCs. Research revealed that CDCs have been a force in community development in the United States since the 1960s. They are active in areas such as community activism, economic development, and especially, affordable housing development. CDCs depend heavily on government funding, but are also allowed by their unique legal status to participate in joint ventures with private companies and institutions. CDCs vary widely in their programming, size, and success. Some define success as the amount of housing units a CDC produces, or even how long the organizations leader has been in place. This paper, however, challenges those definitions by instead suggesting that a CDC should be judged by the affect they have on increasing the wealth and improving the socioeconomic status of residents.

Using information about the mission’s and program offerings of the two CDCs in questions and comparing it to socioeconomic data regarding their relative constituent populations, it can be argued that the socioeconomic trends within the communities do not reflect the mission and programmatic efforts of the two organizations. While the Bloomfield-Garfield Corporation is focused on providing affordable housing, the Bloomfield-Garfield neighborhoods still struggle with home ownership and population losses. Additionally, this all seems to be playing out in a context of micro-segregation. Such monolithic racial profiles between the two co-located neighborhoods of Garfield and Bloomfield add undertones of racial disparity to this analysis. Garfield, a neighborhood made up of 80% Black residents, has median housing values $30,000 less than Bloomfield, a neighborhood made up of 82% White residents. More concerning is the 20% drop in incomes experienced in majority Black Garfield between 1999

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and 2009. While there were no substantial increases in income during this same period in Bloomfield, the community experienced relatively no decreases in income relative to Garfield.

The Hill CDC serves six neighborhoods in Pittsburgh: Upper Hill, Terrace Village, Middle Hill, Crawford-Roberts, Bluff, and Bedford Dwellings. In contrast to the developmental nature of Bloomfield-Garfield Corporation, the Hill CDC focuses more on connecting the community to external institutions and using the political capital built up over time to influence the forces of government and community and economic development. Even so, it is hard to see how these efforts can be connected to improvements in the socioeconomic status of residents.

Between 2000 and 2010, the majority of the communities served by The Hill CDC experienced population losses greater than the rates seen at the city level. One hopeful sign was the increasing real value of housing in four out of the six communities between 2000 and 2010. Despite this, only one community exceeded the City of Pittsburgh average median housing value of $83,100 in 2010. In regards to education, five out of six of the neighborhoods have populations where a high school diploma is the highest level of education completed by 50% or more of residents.

A situation of declining populations, low levels of educational attainment, and decreasing incomes seems to be the antithesis of the mission of CDCs. However, these are the conditions are present within the constituent communities of two Pittsburgh CDCs with histories that span well over 30 years. While this study is microscopic compared to the number of communities served

by CDCs across the country, it does lead to a variety of questions regarding the mission and impact of the organizational model. One particular concern is whether CDCs put place before people. What use are renovated, affordable homes, outreach programs, and development ventures if they do not leave communities in a position to be internally sustainable and to grow out of the dependence on external sources of capital. This paper argues that the ability for a

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community to be self-sustainable depends not on the amount of government funding injected into the neighborhood, but on the ability of residents to increase their own socioeconomic status to the point where they are able to invest into the community in which they live. Inspired by the undertone of racial disparity present within much of the statistical data reviewed in this paper, we must also ask how CDCs ensure that community development is equitable across all populations.

A third concern refers to the connection between CDC success and the socioeconomic status of residents. Should we expect CDC activities to result in tangible results within the lives of individuals relative to the amount of public funding they receive? Or is it enough that CDCs try and fail? These are the types of questions that need to be addressed if CDCs hope to reach a level of success where they are no longer needed.

Because of the drastic variation in CDCs and geographic locations, there are a number of limitations to this research that should be mentioned. First, this paper did not investigate the larger geo-political contexts in which the two CDCs reviewed here exists. Pittsburgh, the City of Steel, suffered drastic losses in population and wealth during the periods of American deindustrialization. Undoubtedly, this shift in industry affected the communities surveyed in this paper. Additionally, a larger analysis including more Pittsburgh neighborhoods in different parts of the city could reveal variations and conclusions absent from this small sample. Finally, the two CDCs profiled in this paper represent a miniscule percentage of the total number of CDCs across the country. Mirroring the concerns of other authors, the near impossible replicability of the CDC model could be at play here. It is possible that these two CDCs could simply be poor examples of the CDC model, warranting a larger and more comprehensive study of American CDCs. Despite these limitations, it is clear that the need for community building is great, and

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that we should hold CDCs to a clear and consistent standard as they continue to work at the neighborhood level to address complex issues.

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APPENDIX THE HILL COMMUNITY DEVELOPMENT CORPORATION

Figure 1 The Hill CDC: 2010 Community Demographics – Race

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Figure 2 The Hill CDC: Community Population % Change '00 - '10

Figure 3 The Hill CDC: 2010 Community Housing Tenure

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Figure 4 The Hill CDC: Housing - % Change in Real Value '00-'10

Figure 5 The Hill CDC: Housing - Median Value 2010

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Figure 5 The Hill CDC: % Change in Income (1999-2009)

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Figure 6 The Hill CDC: 2010 Neighborhood Resident Employment

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Figure 7 The Hill CDC: Highest Level of Education Completed 2010

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BLOOMFIELD – GARFIELD CORPORATION

Figure 8 Bloomfield-Garfield Corporation: Community Demographics - Race

Figure 9 Bloomfield-Garfield Corporation: Community Population % Change '00-'10

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Figure 10 Bloomfield-Garfield Corporation: Community Housing Tenure 2010

Figure 11 Bloomfield-Garfield Corporation: Housing - % Change in Real Value '00-'10

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Figure 12 Bloomfield - Garfield Corporation: Housing - Median Value 2010

Figure 13 Bloomfield - Garfield Corporation: % Change in Income (1999-2009)

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Figure 14 Bloomfield-Garfield Corporation: Neighborhood Resident Employment

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Figure 15 Bloomfield-Garfield Corporation: Highest Level of Education Completed 2010

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