Illinois NCRC members call on Congress to extend tax exemption for principal reductions, support job creation

Written by Tom Feltner on May 23, 2012 - 12:00am

In an effort to highlight the local impact of the ongoing foreclosure and economic crisis, Woodstock Institute and Illinois members of the National Community Reinvestment Coalition went to Washington on April 19 to call on policymakers to support a broad economic development agenda to keep homeowners in their homes, return vacant properties to productive use, and increase employment opportunities.

 

 

In all, 23 advocates representing 13 Illinois nonprofits went office to office reaching out to legislators, walking them through the impact of vacant properties and sharing client success stories.  The Illinois groups were joined by over 750 community reinvestment and consumer protection advocates from around the country as part of the annual NCRC conference.

 

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Woodstock Institute was joined by the Illinois Black Chamber of Commerce, the Chicago Community Loan Fund, the Oak Park Regional Housing Center, the LEED Council, the Northwest Side Housing Center, Partners in Community Building, Inc., the South Austin Community Council, the Coalition for Community Banking, Partners in Charity, the European Community Reinvestment Coalition, Gamaliel of Metro Chicago, and the Chicago Rehab Network.

 

Legislators pledged to support tax-friendly principal reductions and promised to consider an additional round of Neighborhood Stabilization Program funding, called Project Rebuild, which would provide job creation and training on rehabilitating foreclosed properties.  “We must rebuild our communities by linking local residents to the jobs that can be created in restoring vacant properties for affordable housing. With jobs, people hardest hit will again be able to afford homes and only then will our national economy recover,” said Ted Wysocki, president and CEO of the Local Economic & Employment Development Council in Chicago and NCRC board member.

 

“We were pleased to hear from members of our Congressional delegation that extending tax exemptions for principal reductions is picking up bi-partisan support,” said Vanessa Valentin, community organizer from the Northwest Side Housing Center in Chicago.

 

Since 2010, funding for housing counseling has been slashed from $87.5 million to just $10 million.  “Housing counseling represents a homeowner’s last, best chance to save their home and now is not the time to roll back support,” said Partners in Community Building, Inc.’s executive director Bobbi Ball.  “At the same time, we need renewed focus on cultivating a pipeline of new buyers to create demand and move towards a housing recovery.”

 

Advocates also called on the Illinois Congressional delegation to pledge their support to increased data disclosure for small business lending, the modernization of the Community Reinvestment Act, and new investigations into the accessibility of bank branches.  While Congress is not directly responsible for all of these regulatory issues, it is critical that policymakers weigh in on important access to credit and financial services issues on behalf of their low-wealth constituents.

 

The conference also included several workshops and interactive sessions led by Illinois members.  Long-time NCRC member Bobbi Ball led a discussion on the economic security needs of older Americans.

 

Tom Feltner, Woodstock Institute vice president, led a discussion on Chicago region foreclosure prevention strategies and efforts to expand vacant property stewardship requirements in Chicago and Cook County.  Feltner walked nearly 60 NCRC members through the impact of foreclosure accumulation in Chicago region communities of color and how concentrated foreclosure filings have driven default rates and high rates of negative equity.  The presentation also identified two local strategies that are helping communities recover from the foreclosure crisis, the Illinois Hardest Hit Fund and the recently passed changes to the Chicago and Cook County vacant property ordinances.

 

In advance of a forthcoming report analyzing the mortgage credit constraints faced by low-wealth communities and communities of color, Katie Buitrago, Woodstock policy and communications associate, along with staff from New York’s Empire Justice Center and Neighborhood Economic Development and Advocacy Project, discussed local strategies to use data to highlight community investment priorities.  The workshop included a discussion on building media interest in neighborhood-level factsheets that highlight the impact of concentrated foreclosures or lack of access to mainstream mortgage products.

 

Dory Rand, Woodstock president, also led a panel discussion on the need to expand small business lending data.  The recently established disclosure requirements created by the Dodd-Frank financial reforms require lenders to expand the small business credit data they release annually.  “The credit options for many small businesses remain limited and, too often, small business owners are forced to capitalize their businesses with personal or business credit cards,” said Rand.  “Identifying market opportunities and credit gaps is the first step to expanding access to low-cost, sustainable small business loans.”

 

"Woodstock’s financial services research, policy development and technical assistance are invaluable to our efforts in Illinois to expand access to capital in low-wealth communities," said John Taylor, NCRC President and CEO. "They really get the value of working in coalition, strengthening our efforts locally and at the national level. Each year, Woodstock brings a strong contingent to our conference, building up a reputation as the "go to" organization with local community groups and members of Congress alike."

 

Edited 5/23 to include quote from John Taylor