Leading up to and since the National Community Reinvestment Coalition (NCRC) conference in March, Woodstock Institute has been part of the surge in work on, and interest in, small business lending and Community Reinvestment Act (CRA) issues at local and national levels.
The City of Chicago requires the owners of vacant properties to register them with the city, and to secure and maintain them. The city amended its vacant building registration ordinance in November 2011 to require mortgagees to register vacant properties in an effort to address the growing problems created by vacant buildings stuck in the lengthy foreclosure process.
The number of home purchase mortgage applications decreased in 2014 compared to 2013, but origination rates were up across the board in the Chicago six county region.
Woodstock Institute is pleased to be holding our 2016 Community Investment Award reception May 12th at the wonderful Stony Island Arts Bank, a beautifully refurbished bank building serving now as a community arts and culture space. Located at 68th and Stony Island, the Stony Island Arts Bank rehab project was conceived and executed by Chicago public artist Theaster Gates and completed ahead of the building’s opening in October 2015.
Illinois’s legislative session is in full swing, and Woodstock is monitoring many bills that fall within the scope of our mission: to create a just financial system in which lower-wealth persons and communities as well as people and communities of color can achieve economic security and prosperity. Here are some of the bills that we are supporting this session.
In a letter to the editor published by The Chicago Tribune, I respond to Steve Chapman’s February 10 article on Bernie Sanders and Wall Street finance. Chapman writes about the trust he has in the financial firm handling his 401(k) and that he has “to the best of [his] knowledge” never been defrauded. Chapman proceeds to invoke his broader trust in Wall Street actors, attempting to delegitimize and downplay the Sanders campaign’s criticism of the financial sector.
The pay-walled tribune article can be found here, and my letter is reproduced below.
Hi, everyone. I’m very excited to be working as Woodstock Institute’s new Communications and Development Associate. Woodstock has a lot of exciting projects for the coming year, and I look forward to a unique and interesting experience adapting Woodstock’s communications and development strategies to frame and highlight developments on the policy and research side.
The Chicago six county region had an 11.2 percent decline in foreclosure filings, and Chicago a 9.6 percent decline, between 2014 and 2015. Chicago Community Areas with the greatest declines from 2014 to 2015 include Armour Square (60 percent), Forest Glen and Oakland (43 percent), and Irving Park (39 percent).
As I look at the current landscape in search of barriers to economic security and community prosperity and for opportunities to create effective solutions to those problems, I am excited about the year ahead and about using Woodstock Institute’s applied research, policy analysis, and coalition-building skills to reduce inequality and to increase equitable lending and investments in under served low- and moderate-income (LMI) areas and communities of color, help people and communities build and preserve wealth; and improve access to safe and affordable financial products, services, and systems.
Woodstock will continue to work at local, state, and national levels in 2016 in partnership with existing and new allies. While we will continue to provide extensive regional and Illinois data and technical assistance through our data portal and TA program, we will also use some of the lessons learned from our local data analysis and advocacy efforts to influence developments in other states and at the federal level. Here are some of the highlights of our 2016 policy agenda:
Several years ago, Woodstock joined with other consumer advocates to pass legislation to protect consumers from short-term predatory loans. The Payday Loan Reform Act became law in 2005, and reforms to the Consumer Installment Loan Act became law in 2011. Among other positive changes, those laws placed caps on the amount of interest that lenders can charge. But now, predatory lenders are creeping into the area of lending to small businesses. A report published by Woodstock in August 2014 entitled Discredited: Disparate Access to Credit for Businesses in the Chicago Six County Region reveals that lending by traditional banks is insufficient to meet the demand for small business loans, particularly for businesses in lower-income areas and for businesses in communities of color. Non-bank, “alternative” lenders, which are largely unregulated, are striving to meet this unmet demand. These alternative lenders, which provide high-cost loans with interest rates as high as 200 percent are not even required to disclose the Annual Percentage Rate (APR) on their loans, which makes it difficult for borrowers to know how much their loan costs, which, in turn, makes it difficult to engage in comparison shopping.
In 2015, the Illinois Secure Choice Savings Program Act became law. Under this law, employers with 25 or more employees are mandated to enroll their employees into a retirement savings account that is administered by the State. Employers who fall below the 25-employee threshold may voluntarily elect to participate in the program. Employees whose employers are participating in the program (whether by mandate or by volunteering) will have the option to opt out of the program. For those employees who don’t opt out, three percent of their pay will be deposited into the account unless the employee elects a different contribution amount. Employee enrollment in the program will begin in June 2017.
Millions of low-wage workers and small business employees in the United States are approaching retirement with inadequate savings to supplement Social Security benefits that will replace less than half of their pre-retirement income. Those workers face a bleak financial future in which their standard of living will be much lower than what they now enjoy as they try to subsist on near poverty-level incomes.
In June 2012, the Consumer financial Protection Bureau (CFPB) launched its Consumer Complaint Database, the nation’s largest public collection of consumer financial complaints. The CFPB’s Office of Consumer Response hears directly from consumers about the challenges they face in the marketplace, brings their concerns to the attention of companies, and assists in addressing their complaints. The information collected from those complaints has allowed the CFPB to take actions against financial institutions and put money back in consumers’ pockets. It’s vital that consumers continue to share complaints and stories as we work with the CFPB to create a just financial system for all.