Community Development Corporations and Welfare Reform: Linkages, Roles, and Impacts
This study examined the impact of welfare reform on housing owned by community development corporations (CDCs), investigating how early implementation of the Personal Responsibility and Work Opportunity Reconciliation Act (PRWORA) affected the financial status of CDCs' affordable housing developments. Five types of financial impacts were considered: tenant incomes and employment; other tenant behaviors; late payments; turnover; and aggregate changes in CDC income and expenses. The study examined four CDCs in each of six cities: Atlanta, Georgia; Cleveland, Ohio; Chicago, Illinois; Minneapolis, Minnesota; New York, New York; and San Francisco, California. Research methodology included interviews with CDC staff, tenant representatives, and leaders from other civic institutions; follow-up questionnaires of key respondents; and focus groups with tenants. Overall, among those organizations that engaged in various nonhousing activities or viewed their missions as including community development in broader terms, many were already providing job training, child care, or other social services that might be thought of as responding to welfare reform. These groups reported that such efforts had little to do with the advent of welfare reform. While many CDC staffers were concerned about the impact of welfare reform laws on impoverished communities, they reported little evidence of increased problems and found most changes in their neighborhoods to be positive.