View original document

The full text on this page is automatically extracted from the file linked above and may contain errors and inconsistencies.

A newsletter from the Philadelphia Federal Reserve Bank about consumer credit and community reinvestment

Volume 2, Number 2
December 1985

Spotlight on: Camden, New Jersey
One of the country's poorest cities,
Camden, NJ, is turning the corner
toward greater economic prosperity.
Community revitalization is proceeding on a number of fronts.
Three Philadelphia Fed Community
Affairs reporters, Patrick Bond, Renee
Bridges, and Constance Noll, toured
Camden development projects and
interviewed government and community leaders. They found major
long-range development projects
underway - none of which were in
existence a few years ago.
Among the most exciting news is that
one of the city's most prominent employers,
Campbell Soup, has
announced plans to build a new international headquarters on the Camden
waterfront. And right next door will be
a $15-$20 million state-financed
aquarium. This three-acre aquarium
will be operated by the Philadelphia
Zoo, under an affiliation agreement.
It seems that Camden is taking a page
from the Baltimore and Boston book
in developing the 75-acre waterfront.
Camden leaders were also stimulated
by Philadelphia, which is devoting
major resources to Penn's Landing
just across the river. So, in 1981, they
decided that $8 million would be a
wise investment to put into the Wiggin
Waterfront Park. The park is now being
fitted with a new marina, and plans for
Federal Reserve Bank of St. Louis

Also planned for Camden is a $16 million Transportation Terminal. This project
includes a new bus terminal, renovation of an existing rapid transit rail station with
connecting concourses, and parking facilities for over 400 cars. Scheduled for completion in the fall of 1986, the transportation center is expected to serve as a vital factor
in enhancing revitalization efforts in Camden's central business district.
a restaurant/festivities area are underway .
"We felt that we needed to spend
public dollars to attract private dollars.
Ultimately, we want to go after the
entertainment market, " Mayor Melvin
Primas stated.
Both the waterfront and downtown

areas are in for big changes. A new
$16 million transportation center and
a justice center will round out the twoarea project. (In the long term, the
city also hopes to build a hotel and
small conference center near the
This downtown and waterfront development plan is expected to create

about 2,500 permanent jobs. The
areas are beneficiaries of the state's
second Urban Enterprise Zone and a
package of tax incentives to cut the
burden of sales and unemployment
insurance taxes . An elaborate plan to
inject approximately $150 million in
new investment has been worked out
by the Cooper's Ferry Development
Association. This private non-profit
organization was formed in 1984 to
coordinate the development of the 75
acre parcel of underutilized land on
the Delaware River directly across
from Penn's Landing in Philadelphia.
The city's most prominent employers
(Campbell Soup and RCA) are represented on this body.
Camden is a city of neighborhoods.
The city's economic turning point is
also reflected in the rehabilitation of
housing and the promotion of small
business start-ups. Several community-based organizations are involved.
One is Concerned Citizens of North
Camden (CCNC). Their philosophy,
as expressed by staffers Tom Knoche
and Carlos Collazo, is to stabilize North
Camden. "We view housing for lowincome people as a resource unique
in the Delaware Valley," said Knoche.
"You can buy a house here for a few
thousand or rent one for $250. We
want to keep it that way."
What has CCNC accomplished? It
devised, with the city's help, a successful sweat equity housing program.
(A sweat equity is created by the labor
of the purchaser that increases the
value of the property.)
Since 1981 , CCNC has rehabbed
102 vacant houses at an average
materials and acquisition cost of
$3500 per house. Thirty were acquired
from HUD with city funding. CCNC's
housing division is now looking at
several major rehabilitation jobs. Also,
if mortgage and construction funding
are available, some new residential
construction - the first in North Camden in recent memory - is planned
in 1986.
Also in North Camden, the Black Peoples Unity Movement (BPUM) Community Economic Development Corporation has, with the help of public
funds, put together the "Poets Row
Industrial Park" to provide jobs and
economic activity in the area. While
Digitized forthe
projected job creation has not yet
Federal Reserve Bank of St. Louis

materialized, BPUM has been successful in renting out warehouse space
to major regional companies. BPUM's
various other projects - day care centers, fast food outlets, and investments
in suburban firms - are now realizing
benefits for a group of Camden residents who were once excluded from
political and economic power. A former BPUM activist, Melvin Primas, is
now Mayor of Camden.
In South Camden, the major community development group is the
Junior Chamber of Commerce (Jaycees). South Camden now benefits
from the Jaycees Housing Counseling staff and the South Broadway
Revitalization Project. Successful
programs devoted to rehabbing
housing as well as encouraging commercial revitalization on depressed
Broadway, the city's main street, are
continuing. A new hardware store and
a medical center are opening soon,
thanks to the Jaycees' assistance. A
major rehabilitation effort has resulted
in a day care center on Broadway.
Nearby, developers are looking at
the former Langston facility, a light
manufacturing plant which closed,
leaving 500 unemployed. The City of
Camden and the Camden Economic
Development Corporation are interested in converting the facility into
usable factory or warehouse space.
In a number of Camden neighborhoods, the "Camden Churches Organizing Project" (CCOP) is being formed.
Assisted by Philadelphia's Eastern
Communities Training Institute, CCOP
is striving to become a multi-issue,
multi-racial community-based coalition that will take an active role in local
The old Camden neighborhoods went
through profound changes in the last
few decades as middle class residents deserted many areas for the
suburbs. Presently, one of the city of
Camden's strategies for economic
growth is to attract a new middle class.
By exploiting some of the area's advantages in location, low-cost housing,
and historic edifices, the city hopes to
reverse an exodus which has decimated its economy and led to major
social problems.

roots as an early settlement came
earlier. Originally named "Cooper's
Ferry," Camden served as a country
setting for Philadelphians who took
the ferry across the Delaware River.
There are three neighborhoods in Camden which are the focus of historic
rehabilitation work. One - the Cooper
Plaza district near Camden's major
hospital - already has the status of a
federal and state Historic District. In
total, 200 structures in a fourteen block
area qualify as historically significant.
Camden City Department of Housing
and Community Development Director
Ann Howard commented that the effort to promote Camden's historic legacy had two purposes: a desire to
preserve what is unique to Camden,
and the benefits of tax credits for historic rehabi litation. Since renovation
began in Cooper Plaza in 1982, $8
million worth of work has been done.
According to Howard, "Without the
tax credit incentive, we would not see
that level of private investment."
Another center for historic rehabilitation is Cooper Street. Bounded by the
major faci lities of RCA and Campbell Soup on the west and by Rutgers University on the north, Cooper
Street is now awaiting final certification as an Historic District. A local
group, the Camdentown Civic Association, has been promoting authentic
rehabilitation, although the work is
proceeding atan uneven pace. Nonetheless, with the old Belleville Mansion
as a centerpiece and with Rutgers
professors embarking on archeological digs in the area, Cooper Street's
renovation appears to have some of
the elements for ultimate success.
The third area slated for historic rehabilitation is the Fairview neighborhood,
in the extreme southern end of Camden. Already on the National Register
as the third oldest planned community
in the U.S. (1914), Fairview boasts a
strong commercial square which is a
prospect for assistance from the
National Trust's Main Street Program.
Facade improvement elsewhere in
Camden is underway, supported by
annual expenditures of $150,000 in
Community Development Block Grant

An Historic Legacy
Existing Economic Resources

Camden was founded in 1828 as a
nine square mile town, although its

Some of the new development pro-

jects in Camden have just been described. But what of the existing economic base and Camden's other strong
points? With job losses since the 1950s
in the tens of thousands, Camden's
population dropped from 124,000 in
1970 to 84,000 in 1980. Mayor Primas
believes the decline of manufacturing
in Camden has bottomed out. And
another major source of job losses the CETA training program which was
the victim of federal funding cuts reduced Camden's municipal workforce from 2259 to 960 in the last
eight years.
What's left is a service-oriented economy, bolstered by the Camden
County government, a hugh health
industry which is growing rapidly, and
three institutions of higher education:
Rutgers University-Camden, Camden
County College, and a Glassboro State
College campus.
Ironically, a major new prison facility
has opened up construction and other
jobs for many Camden residents.
Mayor Primas commented, "I viewed
the prison as an economic development tool." Camden's prison is slated
for expansion from 400 to 800 beds
in the near future.
Camden's port is another economic
resource. It is a thriving part of the
Delaware River Port Authority, one of
the world's ten largest ports.

Primas noted that the size of Camden
is very manageable. The scale is such
that it can have a strong and favorable impact on problems if all the
pieces fall together, he pointed out.
Some Sticky Problems
With all the work in progress and the
plans being readied, Camden still must
overcome some long-standing drawbacks. The most major of these appears to be a mortgage market that is
functioni ng ineffectively. HUD underwriting practices and disposals of
properties have been blamed for much
of the blighted housing stock. Between
900 and 1000 FHA mortgages were
delinquent or in default in late 1984.
And commercial banks and thrifts
have been slow to lend in areas they
perceive as high-risk.
According to Dr. Michael Lang of
Rutgers University, during one recent
twelve month period, banks and thrifts
made 0% of Camden's 308 first mortgage loans but made 35% of the 1,805
first mortgages in the surrounding
suburbs. The local fair housing group,
Camden County Community Housing
Resource Board, is attempting to develop a Camden Mortgage Plan, equivalent in nature to the Philadelphia
Mortgage Plan, to help address the
problem. The City of Camden has
used $300,000 in low-interest loan
funds and rental rehabilitation money
to shore up the market.

Mayor Primas recognizes other problems which hamper development: a
high crime rate bred by conditions of
extreme poverty, a bad image "which
just won't go away," and the location
across the Ben Franklin Bridge from
center city Philadelphia. The advantage of being so close to Philadelphia,
Primas says, can be offset by the
problem that if a company or a resident is attracted to Camden's waterfront location and historic traditions,
they might as well just move to Philadelphia, where there are more industrial locations and historic properties
Camden's Future
With deindustrialization nearly bottomed out, and with new jobs and
better morale being created by such
projects as the waterfront and downtown developments, the BPUM industrial park, the Enterprise Zone and a
growing service secto r, Camden's
future looks brighter. The city has the
appearance of "coming on," as its
slogan says.
Considering the longevity and persistence of the city's problems, the developments, although fractional and tentative in some places, are encouraging,
and add to the belief that Camden
may be in the long process of turning
the corner toward more prosperous

As to Camden's other benefits, Mayor

Equibank To Open
Philadelphia Branch
At Community's Urging
Residents of a community wanted a
So they hung a big banner reading,
"East Falls Wants Bank" high over
Midvale Avenue. And though the banner attracted attention in the Philadelphia neighborhood, it did not attract
a bank. At least, not right away.
But good news finally came to the
historic East Falls area. There will soon
be a bank there - for the first time in
50 years. Pittsburgh-based Equibank
recently purchased a vacant lot at
Ridge and Midvale Avenues, and plans
to build a branch office as soon as
regulatory approval is received.
Federal Reserve Bank of St. Louis

And now the banner, still waving high
above Midvale Avenue , reads, "East
Falls Welcomes You ."
It's a good story, and a true one. The
acquisition of a bank was the culmination of a two-year effort headed by
Harry Higgins, president of both the
East Falls Business Association and
Community Council. He and five other
businessmen bought the vacant land
option agreement for $1,200 to insure
that the property would be preserved
for good commercial use. Higgins
added, "Equibank initially did not want
to move into lower East Falls."
But Equibank had a change of mind
after an arrangement was made with
the Medical College of Pennsylvania
to place automatic teller machines
within campus bui ldings, improving
the economic justification for estab-

lish ing a new branch office.
"That's what sealed it," Higgins said .
And Equibank agreed. According to
Al Roberts, Equibank Senior Vice
President of Community Banking, "The
pronounced presence of the College
and the Eastern Pennsylvania Psychiatric Institute, with their numerous
employees and no place to bank,
tipped the scales in Equibank's decision to move into East Falls." He credited "teamwork" by the bank and community for creating a way to provide
banking services to this area, and
pointed out, "We are a consumer oriented bank - serving communities
other banks locally had neglected."
In fact, Equibank is a major new player
in the Philadelphia banking market.
East Falls is not the only project of
interest. Eleven branch offices we re

purchased from other area banks and
opened during August, assuring continuation of retail banking services,
including those in some low to moderate income areas. Six of the branches
were purchased from Atlantic Financial (locations: 5225 Chestnut Street,
4000 Chestnut Street, 1605 S. Broad
Street, 7601 Lindbergh Boulevard,
12340 Academy Road, and 13th and
Sansom Streets) . Five branches, purchased from First Pennsylvania Bank,
are located at 4826 Baltimore Avenue,
4623 Frankford Avenue, 1709-15
Passyunk Avenue, City Avenue and
Presidential Boulevard, and 100 W.
Lancaster Avenue, in Wayne.
In acquiring the 11 offices with 74
employees, Equibank has assumed
$160 million in deposits. At the time
of the branch openings, then-Chairman
James D. Lowry explained that Equibank would pursue low and moderate
income customers "in geographic
areas of the city other banks have
concluded they don't care for." Also
targeted for solicitation from these
offices are commercial customers with
small to medium-sized businesses.
To serve this market, the bank indicates it will offer several deposit accounts at low fees and will "unbundle"
its service charges, allowing customers to pay only for the services they

Philadelphia Fe d Hosts
Consumer Banking
On June 26, a half-day seminar for
retail bankers on consumer perceptions of the financial services industry
was hosted by the Federal Reserve
Bank of Philadelphia. The sem inar
was geared toward senior level consumer lending personnel from banks
located within the Philadelphia metropolitan area. Larry Murdoch, Vice
President and Secretary of the Reserve
Bank, opened the program with
welcoming remarks for the audience
and speakers. Fred Manning, Community Affairs Officer for the Reserve
Bank, served as moderator and provided some thoughts on the recent
changes in the financial services
industry and the challenges facing
consumers and bankers as a result of
these changes.
Federal Reserve Bank of St. Louis

David Reichman, President of Reichman Research, Inc. discussed the
findings of a poll his firm conducted
for the American Banker to determine
consumer attitudes toward lifeline
banking, expanded powers for banks,
service charges, and other issues.
Robert Stevens, President and CEO
of Bryn Mawr Trust and Chairman of
the ABA's Consumer Issues Task
Force, led a discussion of the survey
results and their implications for bankers. Mr. Stevens urged bankers to
listen to the messages being sent by
representatives of consumer groups
and to be willing to sit down and talk
with them. He pointed out that if bankers are more forthcoming with informational disclosures on their services,
many consumer concerns and complaints may disappear.
Ellen Maland, an attorney in the Division of Consumer and Community
Affairs with the Federal Reserve Board,
remarked on the shift in consumer
group attitudes nationally toward
more cooperation and less confrontation with banks. Ms. Maland indicated that lifeline banking is more
likely to be an issue in 1986 than in
1985. She also suggested that a voluntary approach to lifeline services is
regarded as preferable to possibilities
mandated by legislative action. The
Federal Reserve Board, and Ms.
Maland specifically, are currently
studying the lifeline banking issue.

IT'S A FIRST: Neighborhood
Housing Services Day at
Philadelphia Fed
On May 29, 40 members of five
Neighborhood Housing Services offices in Pennsylvania and New Jersey
attended the Philadelphia Fed's first
"Neighborhood Housing Services
Day." The NHS staff and board members heard presentations about the
state of the respective NHS programs
from the following officials: David Klimas, Executive Director of Scranton
NHS; Edith Key, President of Reading
NYHS; Jeffrey Wilkins, Assistant Director of Allentown NHS; Barry Black,
Executive Director of Trenton NHS;
and Ron Reed, Chairman of Philadelphia NHS.
James Lowell, the Federal Reserve
Board's Community Affairs Coordinator and the former Executive Director
of the Washington, DC NHS, gave the
luncheon address. Fred Manning,
Community Affairs Officer at the Philadelphia Reserve Bank, moderated
the program. He indicated that the
interest of the Federal Reserve in
NHS's activities, as well as its active
support, is longstanding and deep .
Several of the Reserve Banks, including Philadelphia, have staffers serving
part-time on NHS boards of directors.
Federal Reserve Board Governor J.
Charles Partee is Chairman of the
Board of Neighborhood Reinvest-

More about NHS
What is NHS? Who are its three partners? And what services does it

The first NHS was established in Pittsburgh, in 1968, when a group of
residents, concerned about neighborhood deterioration, met with city
officials and local lenders to come up with practical solutions. The
result: the development of a partnership of corporations, locally controlled and non-profit, working to stem decline in selected neighborhoods throughout the country.
The three partners in NHS are residents, lenders, and the local government. A key element of success is a revolving loan fund, to make loans to
residents who cannot meet normal lending requirements. Funds are
contributed by foundations, local corporate sources, and by local governments from their federal Community Development Block Grant funds.
Generally, each NHS program provides rehabilitation counseling, construction monitoring, financial services, and community outreach.

mentCorporation (NRG) in Washington, the supporting organization for
NHS affiliates nationally. The Federal
Reserve Board has also been an important contributor to the operating
budget of NRG in recent years helping
to make possible locally-based revitalization efforts.
Neighborhood Housing Services
(NHS) is a unique concept in the restoration and preservation of older
neighborhoods in cities across the
The NHS concept is based upon a
strong partnership of community residents, local government and private
industry. This partnership jointly works
to maintain and improve the housing
stock and quality of life within its target
Private industry is a key member of
the NHS partnership. Banks and savings and loan associations make a
commitment to funding loan requests
from qualified borrowers in the NHS
neighborhood. Their participation on
the board of directors brings a firm
leadership and business sense necessary to maintain a strong program.
Together with other corporations and
foundations, the lending community
provides funds for the operational
budget of the NHS, the development
of special projects, and the maintenance of the High-Risk Revolving Loan
Community residents make a commitment to rehabilitating their own homes
and encouraging their neighbors to
do the same. Residents provide the
majority of leadership and input into
the board of directors. This local flavor makes each NHS a unique program that best serves its community.
Local government provides input to
the NHS partnership through contributions to a High-Risk Loan Fund,
technical assistance from various
departments and free home safety
inspections for rehab planning.
A professional staff is hired to carry
out the day to day operations of the
NHS . This staff reaches out into the
community; provides technical assistance for rehab planning, project bidding, and project monitoring; provides
for financial counseling and loan referrals, and processes and services high
Federal Reserve Bank of St. Louis

risk loans for home improvements.
This simple partnership concept is
successful in solving the complex
issues of rehabilitation and preservation of older neighborhoods.
Since 1975 every dollar spent operating the NHYS program has generated $48.53 in reinvestment activity
in the community.

Trenton NHS Celebrates
Six Years of Success
(Editor's no te: With this issue, CASCADE begins reporting activities of
the several Neighborhood Housing
Services (NHS) affiliates within the
Third Federal Reserve District.)

NHS of Trenton incorporated in 1979
to help residents improve their homes
and environment. The track record of
the organization is already impressive.
To date, NHS of Trenton has served
608 homeowners, representing an
investment of 1.6 million dollars.
Located in the Wilbur area, in the
eastern part of the city, the NHS section
has 8,000 residents and encompasses 64 blocks.
"In addition, NHS has purchased,
rehabilitated, and sold 16 previously
vacant properties to first time homeowners, who are now proud NHS
residents," commented Barry Lee
Black, executive director.
Services have increased, he added,
and now include "acquisition, rehab
and sale projects, increased community involvement, and, most recently,
modular housing. The City of Trenton
has provided more than $400,000 in
capital improvement for the neighborhood, while the New Jersey Department of Community Affairs has contributed more than $400,000 for the
revolving loan fund since 1980."
Another accomplishment is the "Walnut Avenue Phase One" project, involving the rehabilitation of seven
abandoned properties at the cost of a
quarter of a million dollars. All of these
properties have been sold to first time
moderate income residents.
Black reported the above developments at a July 12 fund raising break-

fast hosted by Owen "Chip" Freeman,
President of the Broad Street National
Bank. The breakfast was attended by
37 Presidents and CEOs from the
business and financial community
who heard Freeman announce that
the Broad Street National Bank would
be doubling their NHS contribution
and urge his colleagues to join him in
support of "one of the most impressive
NHSs in the country."
In fact, the Trenton NHS has been
selected to host a visit from a Congressional delegation in 1986, which will
also include a tour of the Wilbur neighborhood . The NHS was selected by
the Neighborhood Reinvestment Corporation (NRG), the NHS parent corporation, in recognition of its ongoing
commitment to revitalization.
Black explained the NRG like this:
"The NRG helps each NHSgetstarted.
From the drawing board to the office,
so to speak. They help with support,
training, and start-up money. For example, NRG gives up to $75,000 as
an initial grant to get the revol ving
loan activity in operation. The NHS
utilizes the New Jersey Housing and
Mortgage Finance Agency for first
mortgages on our purchased,
rehabbed, and sales properties."
Many members of the Trenton banking community are active in NHS,
Black added. In addition to Freeman,
they include Joseph Merz, Ill, Vice
President of the Trenton Savings Fund
Society, and NHS President, who is
now entering his 7th year of NHS
participation; and Board members:
J. Donald Homer, Vice President,
Broad Street National Bank; Steven
Massey, Vice President, National State
Bank; and Gloria Campbell, Branch
Manager, First Fidelity Bank. A member of the NHS loan committee for the
past six years is Joseph Patrick, Vice
President, New Jersey National Bank.


Philadelphia Fed Hosts
Community Affairs
"The function of comm unity relations
has changed over the years from
'apple polishing ' to bona fide programs.
The future looks brighter for communities because corporations have
realized that community relations pays
bottom line dividends."
That was the optimistic message from
Ray Hoewing, Vice President of the
Public Affairs Council, speaking to
240 attendees at the third annual

hear about "the various ways in which
financial organizations can upgrade
their community affairs efforts, and
can help lead society in making our
towns and cities good places in which
to live and work."
Hoewing, the first speaker, urged
banks and corporations to participate
in community improvement, because
of new forces created by banking
deregulation , the nation's deteriorating infrastructure, troubled school
systems , the loss of blue collar jobs,
and the large number of homeless
Americans .
"Banks have inherent advantages in
forming successful community development programs because of their
financial involvement in the commun ity and their generally favorable image
with the public," he said. "Bank profitability is linked closely to the vitality
of community progress."

Raymond L. Hoewing
Vice President
Public Affairs Council
1255 23rd Street, N.W. Suite 750
Washington, DC 20037
(202) 872-1790
Community Affairs Conference, sponsored by the Federal Reserve Bank
of Philadelphia.
Bank President Edward G. Boehne
welcomed guests at the morning session of the October 4th event, held at
the Holiday Inn, Philadelphia. Guests
in cluded chief executi ves and community affairs officers from Th ird District financial institutions, and representatives of community organizations,
charitable foundations, and economic
development agencies. In all, 130
different organizations were represented at the Conference, which was
organized and moderated by Fred
Manning , Community Affairs Officer.
In his welcome, President Boehne
predicted that the audien ce would
Federal Reserve Bank of St. Louis

He cited eight institutions for outstanding community involvement: Mellon
Bank, Pittsburgh, for a resource guide
for nonprofit organizations looking
beyond "checkbook philanthropy";
Bank of New England, Boston, for
donating $300,000 for educational
fellowships for teachers; South Shore
Bank, Chicago for demonstrating
"that the line between community relations and the bottom line is often nonexistent. "
Also congratulated were: Security
Pacific National Bank, Los Angeles ,
for its volunteer program; Bank of
America Foundation, Los Angeles ,
for financing a foundation to fund
experimental education ; First Chicago
Corp., for setting aside "a pool of
millions of dollars" for low-cost housing and commun ity development,
National Bank of Detroit for seminars,
newsletters, management assistance
and troubleshooting "to invigorate
neighborhood groups , reaping both
indirect and business benefits" ; and
the Chemical Bank, New York, for
sponsoring a trade show for small
businesses .
"Why can't a bank holding company
be a Community Development Corporation?" That rhetorical question
was answered in the affirmative by
speaker Ronald Grzywinski, President of the Illinois Neighborhood

Ronald Grzywinski
Illinois Neighborhood
Development Corporation
7054 S. Jeffrey Blvd .
Chicago, IL 60649
(312) 288-1000
described how he and a small group
of investors purchased the Chicago
South Shore Bank, and created three
CDC subsidiaries to rebuild a blighted
urban neighborhood . The Ill inois
Neighborhood Development Corporation was formed under the Bank Holding company Act as a CDC and a
holding company that owns both the
bank and the community development subsidiaries. They have financed
minority businesses and rehabilitated
more than 500 housing and com mercial units, he said.
"We are very keen on community
development corporations in the Federal Reserve right now," said Fred
Mann ing. He reminded the audience
that under 1970 amendments to the
Bank Holding Company Act, banks
can form commun ity development
corporations to buy, sell, develop and
manage real estate, either nonprofit
or for profit.
Mitchell Sviridoff, President of the
Local Initiatives Support Corporation
(LISC), endorsed the concept that
"seeing is believing " as he presented
slides to enhance his remarks on the
plight and promise of urban blight.
He showed examples of USC-assisted
housing and commercial projects in
Brooklyn, Chicago, Washington , and
Philadelphia, while explaining that
USC functions as an intermediary in
development. It provides corporations
with the right conditions to invest monies in community revitalization pro-

President for Community Affairs,
Security Pacific National Bank, Los
Angeles . Her bank maintains a successful volunteer program, which not
only has filled a community need, but
has raised employee morale .

Mitchell Sviridoff
Local Initiatives
Support Corporation
666 Third Avenue
New York, NY 10017
(212) 949-8560
grams at acceptable risk, and for high
social return. LISC, a nationwide and
prominent lending and grant making
institution which attracts private sector
financial and technical resources into
redevelopment of deteriorating communities, " has proven that corporations, community groups , and local
residents can work hand-in-hand in
urban reclamation."

Following a luncheon in the Philadelphia Fed's Eastburn Court, guests
heard remarks by the keynote speaker,
Brother F. Patrick Ellis, F.S.C. , Ph.D.
He is President of LaSalle University,
located in Germantown, an urban
Philadelphia neighborhood . Long active in community affairs, Brother Ellis
is a board member of the Greater
Philadelphia First Corporation , the
Philadelphia Urban Affairs Partnership, the Friends of Independence
Hall, and the Mayor's Commission
on the 21st Century.

Corporate volunteerism is another
important aspect of community relations, explained Gayle Jasso, Vice
Federal Reserve Bank of St. Louis

Accompanying her was Dr. Geraldine
Bower, Associate Director of the Division of Consumer Education in
Knauer's Washington office. Also
present was Ruth Rodman, of the
Philadelphia Public School District.
The government visitors discussed
mutual concerns and interests in the
consumer field with Bank officials:
Larry Murdoch, Vice President and
Secretary; Fred Manning, Assistant
Vice President and Community Affairs
Officer; and Jim Dygert, Manager of
Consumer Affairs. Other Bank representatives present included Henrietta
Kiel, Consumer Affairs, Renee Bridges
and Constance Noll, Community

FED Otters New
Compliance Guide
Brother Patrick Ellis, F.S.C. , Ph. D.
LaSalle University
20th Street & Olney Avenue
Philadelphia, PA 19141
(215) 951-1010
In his talk, "Developing a Spirit of
Community," he urged bankers to
become more involved in community
affairs , reminding the audience that
"direct community involvement is as
important as grantsmanship." In order
to mix and survive in a community , he
added, the corporation must be perceived above all "as being animated
by respect and something like love
for all concerned ."

Gayle Jasso
Vice President,
Community Affairs
Security Pacific National Bank
333 S. Hope Street
Los Angeles, CA 90071
(213) 613-5109

er Affairs. Knauer, a native of Philadelphia, explained her role in consumer protection at the national level
and expressed interest in the operation of the consumer complaint function
at the local Fed. (The Philadelphia
Bank processed 18% of the consumer
complaint resolution activity in the
entire Federal Reserve System in

White House Advisor on
Consumer Affairs Visits
Philadelphia Fed
A distinguished visitor and authority
on consumer protection issues came
to the Philadelphia Federal Reserve
Bank in May.
She was Virginia Knauer, Special
Advisor to the President for Consum-

A new guide to understanding the
Federal Banking Regulations is
available, and will be of special interest to newly established banks, or
banks newly involved in compliance
Titled Winning The Compliance
Game, it is written by David M.
Vandre, Federal Reserve Bank of
San Francisco, and is the latest of
several manuals on consumer and/
or community banking topics distributed free upon request by the
Department of Community Affairs
and Regulations Assistance, Federal Reserve Bank of Philadelphia,
Ten Independence Mall, Philadelphia, PA 19106 (215) 574-6570.
"While there are a number of
sources that describe specific aspects of compliance, little has been
written in general terms on the
overall program design," stated
Fred Manning, Community Affairs
Officer. "While not a 'how-to' manual, this publication does describe
the basic components of an effective compliance program, particularly for use by small and medium
sized banks," he added .


Father Joseph Kakalec, S.J., President, Regional Council
of Neighborhood Organizations
Father Joseph Kakalec heads any list
of Philadelphia neighborhood leaders. He founded the Philadelphia
Council of Neighborhood Organizations (PCNO) in 1975 after organizing a major North Philadelphia group
(The North Central Community Organizaiton) and working for the past two
years to network other groups in the
region. PCNO won early campaigns
on crime, city services, and mortgage
lending issues. Following a year's
sabbatical at the University of California (Berkeley) in 1982-3, Father
Kakalec returned to Philadelphia and
formed a new organization, the Regional Council of Neighborhood Organizations (RCNO).
Born in McAdoo, Pa., Father Kakalec
served two years in the U.S . Army
and later began studying and training
for the priesthood. He was ordained
a Roman Catholic priest in 1967.
Father Kakalec holds a bachelor's
degree from Georgetown University's
School of Foreign Service and master's degrees from St. Louis University
(Political Science) and Woodstock
College (Sacred Theology). He also
holds a Licentiate in Philosophy from
St. Louis University and studied political science at the University of Pennsylvania. He teaches political science
part-time at Temple University.
Patrick Bond and Renee Bridges of
the Philadelphia Fed conducted an
interview with Father Kakalec in late
CASCADE: Where did your interests
in community organizing begin?
FATHER KAKALEC: I began working
in Baltimore's inner city in the late
1960's. Father Philip Berrigan had
set up an outreach residence in his
parish in West Baltimore in which I
was a staff member. At the same time,
the notion of the " City as Parish" also
influenced my thinking. I thought the
Church was bound to become more
involved in the life-blood of the city.

At the same time, you may recall,
there were extremists who wished to
"change the system." For our part,
Federal Reserve Bank of St. Louis



Father Joseph Kakalec, S.J ., President of the Regional Council of Neighborhood Organizations, talks with Renee Bridges, Community Affairs Representative, Federal Reserve Bank of Philadelphia.

and more practically , there were frequent discussions about how to sensitize decision-makers about the needs
of the cities and their people.
In feeling there was a need for change,
we tried to organize our work in a very
democratic way to empower people
to face and resolve the frustrations
and problems they met in their daily
and very often changing lives .
They were interesting years ... it was
a baptism of fire!
CASCADE: Did your ideas about
work in the city evolve directly from
your religious training?
FATHER KAKALEC: Yes, and in my
religious profession many clergy felt
the need to be involved in urban problems. Often we heard people writing
off the city by stating that the cities
were finished! I think remarks like that
are unfortunate. The cities are the
nerve centers of our country. The
question is, how do you make them
function to the fullest extent possible?
CASCADE: When did you come to
FATHER KAKALEC: In 1969, when I
began working on my doctorate in
political science at Penn. In the early
seventies I became involved in Philadelph ia's neighborhoods .

CASCADE: Where did you do your
initial organizing in Philadelphia?
FATHER KAKALEC: In North Philadelphia around 18th and Girard . Our
group, the North Central Community
Organization, was initially involved in
some very basic issues. We did housing rehabilitation and went to lenders
for mortgages. The lenders we approached refused our requests despite the fact that in one of the institutions our organization had a $10,000
deposit - a lot of money for a community group - and we could not
borrow our own money! Eventually
we succeeded in getting the mortgages but only after much hard bargaining.

City services were equally poor in this
area. For example, there was a terrible problem with abandoned cars
and with youth gangs. But we found
that these problems were common in
many sections of the city.
CASCADE: Then the idea for a citywide coalition began to develop?
FATHER KAKALEC: Yes, there were
other organizations in Germantown,
Kensington, South Philadelphia and
elsewhere in North Philadelphia. After
two or three years with North Central
Community Organization we concluded that North Philadelphia was not
alone in having been abandoned by

political decision-makers. To get them
to listen to our concerns, we needed
to have a larger group to dramatize
the needs of the neighborhoods. It
was after this realization that other
community leaders and I began to
put together what later became known
as PCNO.
The initial group was composed of
twelve organizations from as disparate
settings as possible. When this group
began to cooperate, I visited other
groups for about one year - almost
one hundred community groups. Not
all of these groups were as politicized
at the same level with the city administration or with private business. All
the groups realized, however, that
they had to cooperate and organize
to make changes.
CASCADE: From twelve groups,
PCNO grew very quickly. How did
that change your relationships with
the government and the public sector?
people came to PCNO's first convention in 1975. At the time, handpicked "blue ribbon" commissions
ostensibly represented the neighborhoods. Then PCNO began to analyze
the City's first year community development budget. This came after the
Community Development and Housing Act of 197 4. We found that 30% of
the budget was going to administrative
expenses! Now, you do not run a
business with a 30% overhead!

So one problem with the City Administration was a lack of genuine community representation. The other was
unbalanced, uneven development.
Center City was receiving the lion's
share of attention which led to PCNO's
clash with the city over the Center
City Tunnel. "What," we asked, "did
the tunnel do for Philadelphia's neighborhoods?"
The neighborhoods lost this challenge
but the needs of the neighborhoods
were dramatized to the fullest.
After enactment of the Home Mortgage Disclosure Act and the Community Reinvestment Act, PCNO, with
the Institute for the Study of Civic
Values , issued reports demonstrating
the problems that neighborhoods
were having with redlining. The re
Federal Reserve Bank of St. Louis

suits of these studies and complaints
were the Philadelphia Mortgage Plan
and the Philadelphia Rehabilitation
After the tunnel fight, it was clear that
neighborhoods needed attention and
a trickle of money started coming to
them. In addition, PCNO began to
develop Town Watches. We helped
other groups organize their neighborhoods. We began to see neighborhood persons on many city committees such as the Citizen Advisory
Committee. And we began to develop
better relations with the neighborhood
police. Finally there was clear and
unmistakable progress across the city
between various ethnic, racial and
neighborhood groups. The coalition
was developing a common focus for
grass-roots people.
The most important thing that PCNO
did during the years was to focus the
attention of decision makers upon
the city's neighborhoods. The second
most important th ing was to get community people throughout the city to
know each other and above all to
work with each other.
CASCADE: You resigned from
PCNO's presidency in 1982?
FATHER KAKALEC: Yes. I thought
that after such a long time in this work
a break was in order. There were
changes in theology - in Scripture
and Patristics - that I wanted to catch
up on. I was also interested in studying
the concepts of power, leadership
and authority. I went to Berkeley for
a year to study the early church fathers,
particularly in the Fourth Century, who
were also marvelous organizers. Saint
Basil, for example, opened a soup
kitchen, hostel and infirmary right on
the cathedral grounds! He served the
poor in the center of his Church. These
early church leaders were also very
practical. They knew how to work
with and use political power. They
were highly educated and knew the
emperor and top military men, and
were able to move with remarkable
ease in and between all sectors of
society. I always stand in awe at the
unique ability of these leaders.
CASCADE: But you returned from
your sabbatical in 1983?

and began to ask: What is happening
in our society, our region? Changes
in society and the economy were occurring daily - changes that were
affecting each one of us in this region.
One began to see more clearly that
this region is right smack in the center
of many of these changes and there
is emerging a clear understanding
that the region must begin to perceive
itself as one unit, as interdependent,
as one market and a region that has
enormous potential for becoming second to none.
CASCADE: So you then decided to
form a group with a regional focus?
FATHER KAKALEC: That is correct.
Most of our institutions are regional:
the electronic and print media, the
church, transportation, banks and
other businesses. Almost 25% of the
work force of Delaware County, for
example, works in Philadelphia.

With the Regional Council of Neighborhood Organizations we hope to
work in neighborhoods that are facing
profound and unsettling changes as
in Chester, Darby, Bristol, Norristown
and elsewhere. There are also other
areas of concern in the grass-roots
areas of the region. RCNO presently
has 24 member groups.
CASCADE: What is RCNO's immediate agenda?
FATHER KAKALEC: We are still growing but already we are beginning to
see tremendous interchanges and
support. We have had a series of
meetings with lenders to develop loan
programs. We have published a set
of data toolbooks for the counties.
We are hoping to delineate more
clearly a regional neighborhood agenda at our Board/Conference meeting
on October 17th as well as other issues
involved in networking.

Regionalism and RCNO are crucial if
this region is going to thrive. The value
of working on regionalism at the grassroots level is that we can come together
with a clear slate and without a history
of vested interests. We have a unique
opportunity to develop grass-roots
regional partnerships.
CASCADE: Do you have any views
on the banking industry you would
like to pass on to our readers?

FATHER KAKALEC: Lenders are often
genuinely surprised to hear of the
needs of the community. Lenders
have mentioned that they do not have
enough contact with neighborhood
groups particularly in the counties
surrounding Philadelphia. I would hope
that greater effort could be made to
develop a partnership between lend ers and neighborhood groups in the
region. This partnership is becoming
more and more important in face of
the profound changes occurring in
the banking industry and in our own

Data Too/books Developed
For Suburban Counties
The Regional Council of Neighborhood Organizations (RCNO) has produced a set of data toolbooks for
community development in Bucks,
Chester, Delaware and Montgomery
counties. Each toolbook contains
detailed information on population,
income, household characteristics,
housing and employment. Statistics
were obtained from U.S. Census
Bureau, Delaware Valley Regional
Planning Commission, and county
planning commissions along with
other sources.
The tool books are organized to facilitate practical use, convenient reference
and easy comparison. These books
should be useful for public officials,
civic leaders, business people, and
others interested in assessing community needs and planning local
development in the Philadelphia
metropolitan area.
The toolbooks were researched and
written for RCNO by Margie Du Brow
and Dr. Lawrence Quartana of Du Brow
Associates, Philadelphia. Assistance
was provided by the Community
Affairs Department of the Federal
Reserve Bank of Philadelphia and
the Sun Company, as well as the
Greater Philadelphia First Corporation,
in the development and distribution
of the toolbooks .
They are available to the public for
$10 each, or $30 for the complete set
of four. Copies can be obtained through
Saunta Hamilton, R.C.N.O., 2147
Manton Street, Philadelphia, PA 19146.
Federal Reserve Bank of St. Louis

New Community Reinvestment Legislation Proposed
A proposed amendment to the U.S.
House of Representatives' interstate
banking bill (H.R. #2707) would dramatically affect the implementation
of the Community Reinvestment Act
(CRA). CRA requires banks to show
an affirmative and continuing commitment to meeting the credit needs
of their entire communities, including
low- to moderate-income segments.
The proposed amendments to the
interstate bill would tie a bank's CRA
record to its ability to expand beyond
existing state boundaries.
The amendments are offered By Reps.
Charles Schumer (New York) and
Mary Rose Oakar (Ohio). They provide for public disclosure of CRA bank
examination ratings, data on bank
lending, written commitments by institutions describing "how the proposed
interstate acquisition would significantly improve the availability and
affordability of credit and deposit
services offered," and guidelines for
revising the CRA rating system allowing only institutions rated "good" to
expand beyond current boundaries.
The bank regulatory agencies would
be required to prepare a weekly applications listing and provide a 45-day
public comment period for community and consumer groups. Additionally,
if there is a protest against approval
of the application, the proposed bill
requires the regulatory agencies to
hold a public meeting to air the complaints.

Third District Repositories
tor HMDA Reports
The Home Mortgage Disclosure Act
of 1975 (HMDA) is a law requiring
"depository institutions" - banks,
savings and loans, savings banks and
credit unions - to report the general
location of their housing-related loans.
In 1980 the Act was amended and
HM DA was extended for a five -year
period ending October 1, 1985. An
additional extension was made through
November 15 of this year while Congress considers several bills that would
further extend, and in some cases

amend, the Act.
One often-heard criticism of HMDA
is the lack of availability of the data
once it has been compiled by the
depository institutions. The Act does
require that bank regulators aggregate
the data and provide it to the public
through regional data repositories.
The following is a list of the contact
people at repositories in the Third
Federal Reserve District.

Wilmington, DE
Harry D. Sewell
Director, Department of Real Estate
& Housing
City of Wilmington
City/County Bu ilding
800 French Street
Wilmington, DE 19801
(302) 571-4058
New Jersey

Atlantic City, NJ
Dean Spitler
Senior Librarian
Atlantic City Free Public Library
Illinois and Pacific Avenues
Atlantic City, NJ 08401
(609) 345-2269 X25
Trenton, NJ
Richard Rebecca
Head of Business and Technology
Trenton Public Library
120 Academy Street
Trenton , NJ 08608
(609) 392-7188
Vineland-Millville-Bridgeton, NJ
Joanne Greenspun
Vineland Public Library
1058 East Landis Avenue
Vineland, NJ 08360
(609) 696-1100

Allentown-Bethlehem, PA
Office of the City Clerk
City of Allentown
City Hall, Room 510
435 Hamilton Street

Allentown, PA 18101
(215) 437-7538
Altoona, PA
Patrick M. Miller
Assistant Director/Program Planning
Southern Alleghenies Planning and
Development Commission
1506 Eleventh Avenue, Suite 100
Altoona, PA 16601
(717) 946-164 1

Municipal Building
Scranton, PA 18503
(717) 348-4216
State College, PA
Elizabeth Rodgers
Schlow Memorial Library
100 West Beaver Avenue
State College, PA 16801
(814) 237 -6236

Harrisburg-Lebanon-Carlisle, PA
Williamsport, PA
James R. Zeiters
Executive Director
Tri-County Regional Planning
112 Market Street, 7th Floor
Harrisburg , PA 17101-2015
(717) 234-2639

Janice Trapp
Acting Director
The James V. Brown Library
19 East Fourth Street
Williamsport, PA 17701
(717) 326-0536

Johnstown , PA

York, PA

Kathleen Brown
Federal Documents Librarian
Cambria County Library
248 Main Street
Johnstown, PA 15901-1677
(814) 536-5131
Lancaster, PA

Miriam L. Neff
York City Clerk
Offices of City Council
Market Way North , Third Floor
1 West Market Street
P.O. Box 509
York, PA 17 405
(717) 843-8841 X246

Robert N. Case
Lancaster County Library
125 North Duke Street
Lancaster, PA 17602
(717) 394-2651

Philadelphia Community
Groups Discuss
State of the Neighborhoods

Philadelphia, PA
Michael Ontko
Delaware Valley Regional Planning
The Bourse Building
21 South 5th Street
Philadelphia, PA 19106
(215) 592-1800
Reading, PA
Reading Public Library
Attention : Reference Department
Fifth & Franklin Streets
Reading, PA 19602
(215) 37 4-4548
Scranton-Wilkes Barre, PA
Eugene P. Barrett
Executive Director
Office of Economic and Community
Federal Reserve Bank of St. Louis

On June 22, several local communitybased organizations cosponsored a
conference at St. Joseph's Preparatory School in Philadelphia entitled
"The State of the Neighborhoods."
The groups were the Philadelphia
Council of Neighborhood Organizations, the Community Development
Coalition, Inc., the Greater Philadelphia Federation of Settlements, and
the Metropolitan Christian Council of
Philadelphia. Reports presented by
participants to guest speakers Mayor
W. Wilson Goode and Ralph Widner
(President, the Greater Philadelphia
First Corporation, a corporate civic
organization) developed from five
morning workshops. The workshops
discussed employment and training
issues, building neighborhood organizations , services to youth, and the
elderly, and housing and community

The housing and community development workshop offered three specific
recommendations. One recommendation was to have the Philadelphia City
Administration offer Community
Development Block Grant "Float
Funds" as low-interest rate loans for
non-profit community development
construction financing. According to
a statement released at the conference, such loans are now being offered,
at 2% rate of interest, "to for-profit
developers who are not working in
our neighborhoods. We need these
funds for our not-for-profit neighborhood development corporations,
which, unlike commercial developers,
do not have access to start-up
monies." Mayor Goode expressed
interest in implementing the recommendation .
A second proposal called for putting
Urban Development Action Grant loan
paybacks into neighborhood development projects. Presently the UDAG
payback funds "are rarely used to
improve our low and moderate income
neighborhoods," according to the
conference statement.
The third community development
proposal is potentially the most controversial, although at the conference
it was endorsed by Mayor Goode.
This proposal calls for the creation of
a Community Development Trust
Fund, modeled after a San Francisco
initiative, to set aside a small percentage of private sector downtown development spending for use in neighborhood economic development and
housing. In Philadelphia, such a setaside provision already exists for construction on Philadelphia Redevelopment Authority land. One percent of
such construction must be used for
the provision of art in some public
The conference experts suggested
that a Community Trust Fund would
create more than eight million dollars
in 1985ifthreesourcesareused: 1)a
1% of development costs contribution
from every developer doing a project
with a budget of greater than $100,000
in downtown Philadelphia, 2) paybacks
on UDAG loans, and 3) the interest
earned on CDBG float loans following
an increase in interest charged to
private developers of 8% and interest
earned from the current 2% charged
to non-profit developers.


Mellon Bank Saves
A Historic Site
One of the state's largest community
revitalizations will soon be happening
in Philadelphia, and it's happening
because of commitment from a local
financial institution, city officials, and
developers .
Mellon Bank (East) recently announced
the planned restoration, atan estimated
cost of $70 million, of the historic Lit
Brothers Building on Market Street
"This is an important development,"
stated Fred Manning, Community
Affairs Officer, Federal Reserve Bank
of Philadelphia. "It is important in terms
of the continuing development of
Market Street - a Center City area
badly in need of attention - and also,
because it clearly illustrates how a
major bank can make a decisive contribution to community development."

Why did Mellon Bank save the Lit
Brothers Building, a 19th Century
department store, from the wrecker's
"We have been crowded in our present
location, and the availability of the
building offered us a number of
advantages: the opportunity to remain
in the city, increased space, a highly
accessible and desirable location,"
Edward A. Montgomery, Jr., chairman
and chief executive officer of Mellon
Bank (East) stated. The Bank will use
the new space for their operations
Mellon will lease 475,000 feet in the
building from Independence Center
Realty, who will oversee the total renovation , expected to be completed in
1987. Completion is scheduled to
coincide with the completion of the
Market Street East reconstruction
project by the City of Philadelphia.
This project includes a $15 million

facelift, with improved traffic patterns,
new bus lanes, and widened, treelined pedestrian walkways. Bank officials credited David W. Brenner,
Director of Commerce, City of Philadelphia, for being "very supportive"
in the entire development project.
The Lit Brothers site, to be renamed
the Mellon Independence Center, is
surrounded by history. Thomas Jefferson wrote the Declaration of Independence in a house across the street.
George Washington , when he was
president, lived only a few blocks away.
And nearby is Independence Hall,
and the site of the former U.S. Capitol.
The site will not only be convenient
for strolling tourists, but is centered in
a transportation hub, including the
PATCO bus line to New Jersey, the
Market-Frankford subway/elevated,
the Center City commuter tunnel,
numerous bus lines, and, soon, convenient access to Interstate 95.

Today the Lit Brothers Building looks like this . Mellon Bank (East) has announced a major revitalization of this 19th century
department store.
Federal Reserve Bank of St. Louis


Soil, Seeds Transform
Point Breeze Area
When William Penn first looked at the
land, he envisioned Philadelphia as a
"Green Countrie Towne."
It's not all green today, by any means,
but neighborhood groups such as
the Point Breeze Federation are moving into "greening" with help from the
Pennsylvania Horticulture Society.
Through its Philadelphia Green Program, the Society selects a particular
area to receive both materials and

Couples can exchange wedding vows
in the gazebo of a wedding garden after walking down a slate path bright
with climbing roses and petunia-filled
"It's the best thing that ever happened
to Point Breeze, and we invite everyone to come see why we're so proud
of our 'Green Countrie Towne'," commented Haroldine Trower, Beautification Committee chairperson. The
Federation is planning 12 new gardens for next spring, and will put fencing around its existing gardens, as
part of the ongoing beautification

(Note: CASCADE is interested in learning about other community groups
who are making a difference in the
quality of life in their areas.)

Point Breeze Federation
Addresses Wide Spectrum
of Needs

technical assistance. Point Breeze, in
South Philadelphia, was designated
recently, along with two other areas,
to participate in the Philadelphia Green
Program. Soil, seeds, fencing, shrubs,
gravel, benches (for a "sitting garden"),
and even trees are given to neighborhood residents in this Porgram.
This assistance, which is turning
vacant, trash-strewn lots into bright
gardens, was coordinated through
the Beautification Committee of the
Point Breeze Federation. The 12woman Committee directs people to
resources and offers encouragement,
based on their own organizational
and gardening experience.
Lindens and hedges, junipers in planters, window boxes and wine barrels
filled with geraniums - these are softening the Point Breeze landscape now.
Industrious gardeners have transformed 48 vacant lots into bountiful
gardens, ranging in size from a single
lot planted with trees, shrubs, and
flowers to a half-square block planted
with tomatoes, okra, and collard greens.
Federal Reserve Bank of St. Louis

The Point Breeze Federation, now
numbering more than 500 members,
was once a small coalition of residents,
organizations, and businesses. Its
purpose when it began, in the 1960s,
was to curb gang violence and handle
other problems in an 88-block area
of South Philadelphia.
Through the years, the Federation
has grown both in size and scope
and is focusing on aspects of community development such as housing,
social services, employment, education, beautification, and economic
Mamie Nichols, President, and the
Federation were the first recipients of
the "Good Neighbor Award" presented by the Mellon Bank in 1984. The
$10,000 award, Nichols explained,
"is given to an organization which is
contributing to the quality of life in the
There are many examples of innovative Federation projects. One,
underway now, is the "Winter Youth
Program" for 30 youngsters, who will
paint murals to brighten the neighborhood. In conjunction with the city and
other interested agencies, the Federation will improve and "adopt" the
Chew Manor playground and Wharton
Square park. Previous activities in-

eluded raising funds through foundations and corporations for the renovation of the Federation's new home
office, 1248 S. 21st Street, and the
rehabilitation of a grocery store that
was destroyed by fire. They were
assisted in the latter project by a
$20,000 grant from the Philadelphia
Citywide Development Corporation.

Germantown Community
Development Corporation
Marks 11 Years of Growth
Unemployment, coupled with commercial and housing deterioration,
were major problems faced by southwest Germantown residents 11 years
So they organized the Southwest
Germantown Community Development Corporation (SGCDC) to support neighborhood self-help projects.
The first priority was to acquire abandoned houses and convey them to
low income families who would rehabilitate and occupy them.
Today, SGCDC continues to carry
out housing rehab, together with scores
of additional community activities.
"We're a non-profit corporation,"
Steven J. Weinberg, executive director, explained. "Development is our
product. Our score for 1985 is $3.50
of additional neighborhood income
and private reinvestment for every
SGCDC dollar."
The neighborhood network involves
cooperation of all kinds. With banks,
for example. Two loans were recently
made by Provident National Bank
and the Philadelphia Citywide Development Corporation to open a new
minority-owned Superette, or minimarket. The Philadelphia National
Bank hired 12 bank - supervised low
income teenagers as part of their
summer jobs program and put them
to work full-time in southwest Germantown . They painted over graffiti
and distributed flyers on how to prevent it. The Self-Help Loan Fund from
the Germantown Federal Credit Union,
located in the SGCDC office building,
helps residents meet their credit
needs, providing low interest loans
for home repairs and personal requirements. The Credit Union has 1400
shares accounts and has lent about

$650,000 in approximately 400 loans,
pri marily invested in neighborhood
hou sing stock. In its early years , the
Credit Union was heavily supported
by SGCDC as the primary tool for
fig htin g redlining and developing indigenou s capital.
Youth unemployment has long been
a SGCDC concern . " Youth are our
fu ture," Weinberg pointed out. "That's
why we have helped prepare more
than 2,000 young adults for the world
of work. We teach neighborhood
yo ungsters, many of whom are out of
work or have never held jobs before,
howto findjobsand keep them."This
is done via career co unseling , preemp loymenttrain ing, resume preparation and fol low-up counseling to
insure job retention. Although the program is targeted for partic ipants 16 to
24 years of age, employment services
such as self-assessment and job referral s are also available to older residents.
Wayne Avenue was once a ghost street,
populated with em pty storefronts. It is
now a thriving area of small busi nesses. Much credit goes to the
SG CDC's Busin ess Incubator pro gram , wh ich provides a wide range of
su pport to new businesses. For example, it has assumed res ponsibility for
bri nging the Wayne Avenue shopping
area back to life during the past five
years. Once there was a 50% vacancy
rate along the street. Now the rate is
down to nearly zero . The new business start-ups are almost all minorityown ed . All told, SGCDC has assisted
ei ght businesses to get established
on Wayne Avenue, and th ese , in turn ,
have generated 22 new jobs .
In addition to helpin g retail stores ,
SG CDC boug ht a 95 ,000 square foot
industrial park, with the help of a neighborhood entre preneur. They subdi vided this eight-building complex into
fo ur parcels. Five new businesses,
re presenting 150 new jobs, now occupy three of these parcels. The fourth
is being developed by the Philadelphia
Enterp rise
(Phi lTEC) as a smal l bu siness incu bator, with occupancy in spring , 1986.
Profit generated by the industrial park
is being rein vested in PhilTEC .
Energy conservation education is
another interest of SGCDC, evidenced
by its assistance to a program call ed
Germantown Residents Acting to
Federal Reserve Bank of St. Louis

Conserve Energy (GRACE) . Formerly
a component of SGCDC, GRACE
has become a model organization ,
helping residents with home energy
assistance, weatherization , conservation, and emergency services .
A food cupboard, exercise classes,
after-school tutoring, and senior citizens programs take place at the Neighborhood Activities House Association
(NAHA). This organization operates
community programming in space
provided at no charge by SGCDC.
How does SGCDC account for its
success in so many varied activities?
"Credit is due to our Board of Directors ," Weinberg commented, " and to
neighborhood residents and business
owners who provide stability, guidance, and expertise."
Praise, too comes from Constance
Kelsey, SGCDC President, who returned
the compliment to Weinberg by lauding the efforts of "the hard -working
and professional staff."
What of the next ten years?
At a recent reception, hosted by the
Mellon Bank for SGCDC supporters,
Mayor Wilson Goode of Philadelphia,
and other city leaders, Weinberg expressed optimism about the future:
"We look forward to additional growth
in housing, youth employment, and
economic development, bolstered by
our location within the boundaries of
one of Philadelphia's three state-designated Enterprise Zones , The Hunting
Park West Zone," he said .

(Note: for fu rther information on
SGCDC, contact: Steven J. Weinberg,
SGCDC, 5002 Wayne Avenue, Philadelph ia, PA 19144, or phone (215)
843 -2000.)

The Old Wissahickon: A
SGCDC Success Symbol
Once upon a time there was a whitecolumned luxury apartment house
on Schuyler street in Germantown. In
its prime, 75 years ago, it was THE
place to live. It had leaded windows,
a servants ' elevator, and there were
wall safes for renters' jewels. Near the

exclusive Germantown Cricket Club,
it was a landmark in one of Philadel phia's most historic neighborhoods.
Time passed . Nearby manufacturing
jobs disappeared. The growth of suburban shopping malls hurt local merchants . And as the economic picture
worsened, housing deteriorated .
The apartment house just stood there,
a relic of happier days, with its windows
boarded up and its paint peeling . A
testimony, in fact, to the neighborhood's general decline.
But today the Wissahickon offers another sort of testimony. It is a sign,
among many, of the neighborhood's
resurgence, because it is currently
being revi ved and rehabil itated into a
modern apartment build ing . Located
conveniently opposite the Queen Lane
commuter station , the building wil l
contain 52 apartments. Most will be
rented at market price , but 13 will be
subsid ized for low income families .
How did th is $3.7 mil lion project happen?
It happened because the Southwest
Germantown Community Development Corporation (SGCDC) was able
to leverage a working partnership of
public and private resources . By leveraging the expertise of the Philadelphia Rehab ilitation Plan (PRP) and
the Rouse & Associates Urban Housing Group, SGCDC targeted the Wissahickon rehab as a project that would
qualify for a federal Housing Development Action Grant (HODAG) .
(A factor in the success of the project
was the excellent track record of the
SGCDC's ten years in neighborhood
development. In fact, two " alumni "
from SGCDC are now prominent
leaders in neighborhood development. They are James Wilcox, a cofounder of SGCDC, who is now executive director of PRP, and Roy Diamond,
fo rmer SGCDC board member, now
president of Rouse & Associates Urban
Housing Group.)
The Wissahickon project qualified for a
$1 .6 million HODAG loan, through
the city of Ph iladelphia, which was
the key to its financial feasibility. Once
the HODAG is fu lly repaid , the $1 .6
million wil l be returned to the city to
be used for additional community
economic development. Additional

financing, at below market interest
rates, came from CIGNA, PSFS, and
the Rouse Urban Housing Foundation.
Additional permanent financing was
provided by the ARCO Foundation
while the Crusader Savings & Loan
came up with critical interim financing.
And right now, if you drive by the
Wissahickon, you will see many local
residents working at the construction
site - SGCDC arranged for preferential hiring for neighborhood people.
You will see a bright red tile roof, new
paint on the cornices, and handsome
landscaping. The old lady of Schuyler street is shaping up!

PSFS Funds Tenant
Purchase of Philadelphia
Housing Complex
The Jefferson Manor Housing Development Corporation is a non-profit
tenant organization which recently
purchased 226 apartment and townhouse units in North Central Philadelphia. Fifteen years of organizing went
into the acquisition. With assistance
from the non-profit Philadelphia
Housing Development Corporation
and a $2.5 million mortgage from
Philadelphia Savings Fund Society,
the tenants' dream of owning their
apartments is becoming a reality.

Growth in Student
Loan Activity

Notes from arou: - ~
the District:
Federal Reserve District Three includes
most of Pennsylvania, New Jersey,
and all of Delaware. We're pleased to
describe briefly any interesting and
innovative community development
and community service efforts within
the district, particularly where financial institutions play a role. Interested
organizations and individuals should
phone Fred Manning, (215) 574-6482,
with news from your area.

A Southwest Philadelphia
Partnership Formed to
Rehab Houses
In late July, several respected Philadelphia organizations joined forces
to produce the Neighborhood Housing
Network (NHN). NHN will work in the
West Shore neighborhood of Southwest Philadelphia, rehabilitating abandoned houses and selling them for
under $20,000 to low-income families.
One bank - Philadelphia National
Bank - has joined the effort, offering
mortgages at 1% off the market rate.
Other partners in NHN include the
Philadelphia Rehabilitation Plan, the
Institute for the Study of Civic Values,
and the Horticultural Society, each
offering assistance in their fields of
expertise. The Sun Corporation is
contributing paint and funds for rebuilding porches.
Federal Reserve Bank of St. Louis

First Eastern Bank of Wilkes-Barre,
Pa. ranks 18th in the state among 260
participating lenders in the Pennsylvania Higher Education Assistance
Act (PHEAA). In 1984, educational
lending grew by 26.6 percent, resulting in a total of $54,044,000 in outstanding educational loans as of 12/
31/84. In addition, among 74 national
lending institutions with the Health
Education and Assistance (HEAL)
Program, First Eastern is ranked fifth.
The bank is one of six national lenders
to participate in the Guaranteed Parental Loan Program of the United Student Aid (USA) Fund of Indianapolis.
First Eastern was the first bank to
enter into an agreement with the USA
Fund to serve as a national lender for
student loans and today remains first
in the nation with the organization in
terms of student loan activity.

Speakers Bureau
Available in Harrisburg
A Speakers Bureau was formed by
Commonwealth National Bank of
Harrisburg, Pa. to create an active
dialogue between this bank and civic
groups, service clubs, business and
professional organizations, local government organizations, schools and
colleges. The Bureau has been in
existence at the bank for over five
years. Approximately 150 bank employees have volunteered to participate in the program, which has grown
to an average of 100 presentations
each year. A brochure which describes
the program and provides examples
of possible topics is distributed each
year as a reminder that this service is
available to the community. Additional
details are available from Robert
Gentry, Vice President, Marketing
(717) 564-9500.

Pamphlet Describes Community Credit Programs
Provident National Bank of Philadelphia has developed a pamphlet entitled "Provident's Community Credit
Programs." Included in the pamphlet
is a description of financial assistance
programs, how to qualify, what the
loan can be used for and how the
bank can help to expedite the process.
The four programs described in the
pamphlet are the Action Loan Program,
Small Business Assistance, Philadelphia Rehabilitation Plan, and Philadelphia Mortgage Plan. These pamphlets are available in the lobbies of
all Provident offices.

Loans Lead to Employment New Jersey Bank Wins
in Johnstown
Humanitarian A ward
During 1984 and 1985 Somerset
County gained an additional 25 to 30
jobs through the expansion of Riggs
Enterprises. Johnstown Bank and
Trust Company financed this project
with a loan of $900,000. In addition,
Bedford County is expected to gain
100 new jobs with the relocation of
Exact Level & Tool Company. This
move was made possible by a
$1,000,000 loan, also from Johnstown
Bank and Trust.

Garden State Bank of Jackson, N.J.
was named winner of the 1984 Humanitarian Award of the Monmouth-Ocean
Counties Development Council Silver
Gull Awards Program . The bank was
selected for its efforts in the areas of
volunteerism, fund-raising and community involvement.
In particular, Garden State Bank was
cited for its ongoing efforts to aid
financially troubled enterprises, to
quickly respond during emergency

situations, and to offer low-interest
loans to low- and middle-income fami lies. Garden State also provides firsttime home buyers with mortgages
through the New Jersey Mortgage
Finance Agency, preferred-rate longterm mortgages through the Neighborhood Loan Program , and home
improvement funds to low- and middle-income families .

Advisory Boards Created
By Bank of Mid-Jersey
The Bank of Mid-Jersey in Bordentown
has replaced its Consumer and Busi ness and Industry Advisory Boards
with two new boards. The Northern
Regional Advisory Board and South ern Regional Advisory Board perform
the same functions as the previous
boards, but operate more effectively
by focusing on issues pertaining to
these two geographic areas. Specifically, the boards meet quarterly with
members of management to discuss
bank services (current and proposed),
make recommendations to the board
of directors on how to better serve the
bank's customers and community,
and to provide input from the viewpoint
of the consumer. For more information
on the operation of these boards, call
Rosemarie Hobson, Secretary and
Compliance Officer, (609) 298-5500.

Participant in Loan Subsidy
The Broad Street National Bank of
Trenton, N.J. has been a participant
in the City Loan Plan Subsidy Program
since its inception fourteen years ago.
Applications are originated by the
City of Trenton, Department of Housing & Urban Development, wherein
loans are initiated for renovations or
improvements. The city subsidizes
30% of the loan and the bank will
consider the difference based on its
criteria for home improvement loans .
The prerequisites to qualify under
this program, which is directed toward
low-income areas, are determined
by the city.


Customer Councils Formed
The Drovers and Mechanics Bank of
York, Pa., is in the process of creating
customer councils for each of its ten
branch offices. Councils for two branch
offices were formed in 1985, with two
more to be selected during the first
quarter of 1986. These councils serve
as liaison between branch customers
and branch management and are
composed of two employees from
each branch, plus residents from the
local commun ity. The objective is to
provide management with feedback
on customer knowledge and attitudes
concerning bank products and services. For more information on these
councils contact George Guyer, Senior
Vice President, Marketing (717) 8431586.

Do You Need
A Speaker?
Staff members of the Philadelphia
Federal Reserve Bank may be available on request, subject to scheduling
arrangements, to talk to various audiences. They will discuss the Federal
Reserve's interest and involvement in
community and consumer banking,
and in regulatory compliance issues.
Speakers and their respective topics
are: Fred Manning, Community Affairs;
Jim Dygert, Consumer Banking; and
Phil Farley, Regulatory Compliance.
Inquiries regarding speaking engagements should be sent to the particular
speaker desired, at the fol lowing
Federal Reserve Bank of Philadelphia
10 Independence Mall
Philadelphia, PA 19106

Community Affairs
Staffer Departs
Patrick Bond, a Philadelphia Fed
Community Affairs Representative from
August 1983 to August 1985, left the


Ten Independence Mall , Philadelphia, PA 19106, (215) 574 -6000
Federal Reserve Bank of St. Louis

Fed before this issue of CASCADE
was published to pursue graduate
studies at the John Hopkins University
in Baltimore. Bond edited this and the
previous three issues of CASCADE,
developed a survey of small business
credit needs, was a liaison with numerous community groups in the metropolitan Phi ladelphia area, and implemented for the Fed a mortgage tracking system which is now being proposed to Congress for adoption as an
improvement over the Home Mortgage Disclosure Act Reporting system.
Community Affairs Officer Fred Manning indicated that Bond 's exceptional
contributions to the function will be
missed by the Reserve Bank. His colleagues lament the loss of his affable
and cooperative service. In his letter
of resignation Patrick stated, "The
two years I spent here were tremendously stimulating, and I wish to thank
everyone here, as wel l as my friends
in the community and banking industry, for cooperation and kind ness."

Philadelphia Fed Otters
Community Affairs;
The Philadelphia Fed's Department
of Community Affairs and Regulations
Assistance offers three publications
to banks, community groups, government agencies, and the public. Single
copies of the publications, described
below, may be requested by writing
Mr. Frederick Manning
Community Affairs Officer
The Federal Reserve Bank of
Ten Independence Mal l
Philadelphia, PA 19106
or call : (215) 574-6458
The Options for Investing in our Communities directory may be of interest
also to economic development organ izations.