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CDBG
FUNDS
A RESOURCE FOR BUSINESS DEVELOPMENT
RICK PATOSKI, U.S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
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t one time or another, many
banks have participated in public/private collaborations to assist
business development in their communities. In most cases, city funds
have been used to fill a financing
gap between what a bank can reasonably provide under its normal
underwriting standards and the
amount needed by the business client. One government resource for
business assistance is often overlooked by lenders, however - the
Community Development Block
Grant.
Community Development Block
Grants (CDBG) are federal entitlement funds distributed annually to city
and state community development departments by the U.S. Department of
Housing and Urban Development
(HUD) for use in locally designed programs. In 1991, New England's larger
cities received approximately $150
million directly; smaller cities are
served by state programs funded
annually with approximately $62
million in CDBG funds. Each community has a great deal of flexibility in
deciding how the funds will be distributed. Historically, CDBG funds
have been used for general community revitalization projects such as
sidewalk repair, storefront renovations, and sewer line installation,
although many other applications
are possible.
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Throughout the last decade, much
CDBG money was used to mitigate
the affordable housing crunch, an
outgrowth in part of the tremendous
economic expansion in the region.
Now, as businesses find private credit
harder to obtain, community development agencies are using CDBG
funds to assist local businesses caught
in the "credit crunch". This ass is-
tance can take many forms: grants,
loans, loan guarantees, interest rate
buydowns, loan payments on behalf
of the business during a start-up
phase, employee wage payments
during an on-the-job training period
(working capital grants), or whatever
is needed to make a project financially viable.
Following public benefit requirements
set out by the federal government,
the community seeks to assist businesses that either create or retain
jobs for persons from low- and
moderate-income households, businesses that provide a service to lowand moderate-income residential
areas, or businesses that invest in a
blighted area. A city's financial consideration centers on ensuring that
the financial assistance is not excessive, taking into account the funds
available to the business in the private market and the extent of public
benefits expected. A financial return
is not the investment objective here.
While most communities require at
least repayment of principal at some
future date, many forms of assistance
are structured to ensure that all initial
cash flow is available for bank debt
service. AnyCDBG-funded mortgage
or equipment loan is almost always
subordinated to private market lenders. Repayments of CDBG funds are
retained by the city for continued
use, and many communities now
operate well-capitalized revolving
loan funds for business assistance.
It is important to remember that city
governments rely on local banks to
inform them of the types of community assistance needed to ensure that
loans to local businesses are bankable. If lenders are not aware of, or
do not actively consider, CDBG
Continued on page 2
Joss FOR
money as an additional source of
financing when reviewing loan applications, the leveraging potential
of these funds remains untapped.
The most active programs today are
those that resulted from the direct
involvement of local banks.
RICK PATOSKI,
all River, Massachusetts is an
example of a city once economically dependent on a sirigle industry
that has managed to develop a diverse business community. Once the
hub of the nation's textile industry,
Fall River has skillfully combined
public funds and private initiative to
attract new businesses into the city,
help local businesses grow, and provide jobs for its lower-income residents. The Fall River Office of Econom i c Development, otherwise
known as Jobs for Fall River Inc., has
played an integral part in the city's
development.
Jobs for Fall River, a private, nonprofit agency established in 1978,
provides a variety of financial and
technical services, including employee recruitment and business
planning assistance, to businesses
wishing to relocate or expand in Fall
River. Using U.S. Economic Development Administration funds, Community Development Block Grants,
and paybacks from the now defunct
Urban Development Action Grant
program, Jobs for Fall River provides
below-market financial assistance in
a variety of forms, including working
capital and bridge loans.
F
ree subscriptions and additional
copies ore available upon request
to the Community Affairs Deportment,
Federal Reserve Bank of Boston,
P.O. Box 2076, Boston, MA 021062076, or coll Sheryl Snowden at
(617) 973-3097.
Elizabeth McMurtrie
Editor, Communities & Banking
Community Affairs Department
Federal Reserve Bonk of Boston
P.O. Box 2076
Boston, MA 02106-2076
DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
F
565-5386.CB
Financial institutions, communitybased organizations and other orgonizations involved in community development that hove interesting
projects, programs or ideas that they
would like to have mentioned in the
next issue of Communities & Banking
should contact:
R1vER
BETH McMuRTRIE, FEDERAL RESERVE BANK OF BosTON
A great deal of flexibility exists in the
type of assistance that can be provided. lnformaticm on what a specific
community is currently offering, or is
willing to consider offering, is best
obtained by contacting your local
Community Development Department for larger cities, or your state
Community Development Office for
smaller communities. The name of
an appropriate contact person can
be obtained by calling HUD at (617)
The views expressed in Communities
& Banking are not necessarily those
of the Federal Reserve Bank of Boston
or the Federal Reserve System. Information provided on upcoming events
and other organizations should be
viewed as strictly informational and
not as an endor~ement of their
activities.
U.S.
FALL
Lenders in Fall River play an integral
part in the work that Jobs for Fall
River does. Several lending institutions in the city have representatives
on JFR's board of directors, working
alongside local business and political leaders. The integration of public
and private interests is one reason
why Jobs for Fall River has been able
to effectively distribute over $3 mil• lion of CDBG funds in direct lending
assistance to 164 Fall River companies since its inception in 1978,
leveraging an additional $25 million
in private financing. Over 1,800
jobs, primarily for people from lower-
2
income backgrounds, have been
created in the process. Factoring in
other federal funds, such as Urban
Development Action Grants (the
predecessortoCDBG) and Economic
Development Administration funds,
Jobs for Fall River has been able to
leverage a total of $100 million in
private financing, creating 7, l 09
new jobs in Fall River.
Explaining his city's success in using
federal community development
funds, Paul Vigeant, Executive Vice
President of Jobs for Fall River, noted,
"A lot of people look at federal regulations as being constraining, but there
are actually a lot of eligible uses for the
funds. We succeeded by not being
conventional, not assuming that what
this money had been used for in the
past was all it could be used for." By
Vigeant' s estimates,JFR' s projects now
generate $1. l million a year in taxes,
l O percent of Fall River's total i ndustrial and commercial tax revenue. "We
go all out. We're not afraid to try things
that are creative," he noted. That approach is helping to push Fall River
from the nineteenth century into the
twenty-first.
PROJECTS FUNDED
A brief review of several projects
and programs funded by the city
through Jobs for Fall River, Inc. can
provide some practical insights into
the types of projects and the manner
in which assistance has been provided.
• BRIDGE LOAN The city provided a
short-term loan of $400,000 for
working capital to a manufacturer of
aircraft engine components who is
building a major facility in the city.
The loan should cover non-construction start-up costs during plant construction and until sales generate
Continued on page 5
SPRINGFIELD BUSINESS DEVELOPMENT fUND
STATE STREET PLAZA
BETH McMuRTRIE, FEDERAL RESERVE BANK OF BosTON
L
i ke other entitlement cities,
Springfield receives Community
Development Block Grant funds directly from the federal government
every year. These funds can be used
in a variety of ways. Whether a city
chooses to focus on housing, commercial, or business development
depends on the needs of the particular community. In the 1980s, while
many Community Development Departments focused on affordable
housing, Springfield developed a
plan to assist small businesses in its
area as well. The city's Office of
necessary permit process. Applicants
might also be referred to organizations such as the University of Massachusetts Small Business Development Center to further refine their
proposals.
STATE STREE PLAZA, BEFORE RENOVATIONS BE-
... AND AFTER: HELEN S HAIRUM, OWNED BY
GAN ...
GEORGE AND HELEN JOHNSON.
Community Development created the
Springfield Business Development
Fund to provide subordinated financing to small businesses looking to
start up, expand, or relocate within
the city.
The Springfield Business Development Fund is structured as a revolving loan fund in order to ensure that
a perpetual supply of money will be
available to help locally based
business ventures. Since the fund is
administered by Community Development staff, those seeking a loan
from SBDF are also offered additional resources. Many times the
potential SBDF applicant is provided
with technical assistance such as
business plan review, financial
analysis, or identification of the
G & H Development Corporation
may sound like an anonymous firm,
but it represents one couple's efforts
to bring life back to an area of their
city. G & H are George and Helen
Johnson. Together with the city of
Springfield and several local banks,
they developed a plan to renovate a
deteriorated shopping plaza, which
had come to look like a junkyard
replete with abandoned cars. The
property was vacant except for a
small restaurant. The Johnsons presented their business plan first to a
local loan consortium, the Mason
Square Mortgage Pool, and received
a commitment of $410,000 in permanent financing. The project could
not support any more market-rate
debt, so the company applied for a
low-interest loan from the Springfield
Business Development Fund. They
were given a $100,000 below-market loan, the largest amount ever put
into a single project by the city. The
Johnsons injected $100,000 in equity to cover the remaining project
costs.
Since its inception in 1984, the Small
Business Development Fund has
loaned almost one million dollars
and created over 500 jobs in
Springfield. In addition, over $3 .5
million in private investments have
been leveraged by the Fund. Businesses assisted by SBDF range from
1
The commitment of the Johnsons,
local banks, local political leaders,
and the city made the project work.
Previous attempts to rehab the
property had not met with success,
and there had been several calls for
the demolition of the plaza. Once
the renovations were completed,
leasing out space presented little
difficulty. Tenants in the new State
Street Plaza include a clothing store,
a record store, and a beauty shop
(see photos). The Springfield Business Development Fund was also
able to provide technical assistance
and CDBG funds for public improvements to the area, including sidewalk repair. What was once a
blighted area has now become the
center of a publicly supported urban
revitalization program.CB
a neighborhood florist to a shopping
plaza (see sidebar). In 1990-91,
approximately $346,000 was
loaned to five businesses, leveraging $1,400,300 of private investment and creating 58 new job opportunities for people with low and
moderate incomes.
Dominic R. Sarno, President of SBDF,
attributes the success of the fund to the
commitment of the City of Springfield.
"SBDF provides a needed financing
resource to support long-term sustained
economic development."
To learn more about the Springfield
Business Development Fund, contact
Jim Asselin or Jim Krzystofik of the
Springfield Office of Community Development at (413) 787-6050.
3
HOME MORTGAGE
MAINE DEVELOPMENT FUND
D1scLosuRE AcT
MAINE DEPARTMENT
wo years ago Congress
amended the Home Mortgage
Disclosure Act (HMDA) in light of a
growing concern that predominantly
minority neighbqrhoods were receiving disproportionately fewer home
mortgage loans than nonminority
areas. As most home mortgage lenders are required to report their loan
activity under HMDA, Congress saw
the disclosure law as a potentially
powerful tool in combatting discriminatory lending practices. In general,
the amendments to HMDA:
• require disclosure of the race, sex,
and income of the applicants.
• permit institutions to report the
reasons for loan denials.
• expand coverage to include independent mortgage companies.
1990 HMDA data, which reflect the
new disclosure requirements, have
been tabulated by the Federal Fi nancial Institutions Examination Council
(FFIEC), an interagency council of
federal regulators, and are now available to the public in the form of
disclosure statements.
• Lenders must make their institution's
statement available for inspection by
the public. A copy must be kept in its
main office and in at least one office
in every Metropolitan Statistical Area
(MSA) in which it operates. A reasonable fee may be charged for
copies of the statement.
Continued on page B
LINDA SHAPLEIGH
ECONOMIC AND COMMUNITY DEVELOPMENT
In 1986, following the death of its
I owner, Belfast Manufacturing, a
sportswear assembler in Belmont,
Maine, closed its doors. George
Rybarczyk, Belfast's Director of
Manufacturing, was encouraged by
a long-time business associate to try
to reopen the plant and run it himself. Rybarczyk decided to test the
waters by leasing the facility from the
owner's widow for a two-year period. He succeeded in getting a below-marketworking capital loan from
Key Bank of Maine through the Finance Authority of Maine's Commercial Loan Insurance Program and
its Linked Investment Program. The
former helps reduce credit risk and
the latter invests state funds in a
financial institution at below-market
interest rates, in return for the financial institution making loans to commercial enterprises.
• require disclosure of data on loan
applications and their disposition.
Previously, only loan originations
were recorded.
• Every MSA also has a HMDA
depository, which stores the disclosure statements for every lender op-
OF
4
In 1988, Rybarczyk again approached Key Bank for financing,
this time to purchase the building
and equipment and to provide money
for working capital. His experience
in running the business during the
previous year and one-half convinced
him that he could make it grow. Larry
Quinn, Vice President and Manager
at Key Bank, felt that Rybarczyk' s
company needed some low-interest
subordinated debt to help facilitate
the firm's growth with respect to both
the company's cash flow and the
bank's collateral position. Quinn
contacted the Eastern Maine Development Corporation (EMDC) in
Bangor to assist him in finding such
financing. EMDC is a private, nonprofitorganization that, among other
things, assists public sector clients by
providing specialized services such
as grant writing, packaging, and
administration for a number of state
and federal programs. Key Bank
was already quite familiar with
EMDC, having worked with it to
provided financial assistance to other
businesses in the area.
After having met with the bank and
Rybarczyk to discuss the company's
financing needs, a business financing specialist from EMDC suggested
that Rybarczyk apply for a Development Fund loan through the Maine
Department of Economic and Community Development. The Development Fund is part of the Community
Development Block Grant Small Cities Program, under which the state
distributes federal funds to local governments for programs that are part
of a long-range community strategy.
As part of the CDBG program, the
state sets aside $750,000 yearly for
grants to communities to help finance
development projects. The primary
objectives of the Development Fund
are to help stimulate private investment that will result in job creation,
job retention, and housing opportunities for low- and moderate-income
people, and to promote local economic growth and stability.
The Development Fund's loan review
committee received Rybarczyk' sapplication in the spring of 1988. In
order to be approved, the application had to meet three primary criteria: the majority of new jobs created
or retained must go to people from
low- or moderate-income backgrounds, some private financing must
be obtained, and the applicant must
show that additional financing cannot be obtained from other sources.
The application passed on all accounts. Rybarczyk' s company, now
called J&P Apparel, had the financing it needed to expand.
Any doubts about the potential of
J&P Apparel were soon laid to rest.
In early 1989, the company joined
Continued an page 8
Continued from poge 2
JOBS FOR
f ALL
technology that builds on Fall River's
textile industry base.
RIVER
cash flow. A working capital loan
would not be available from a bank
until the facility was in production.
This was an interim use of available
but unspent Community Development
Funds that the city of Fall River intends to use later for public services
and public works. The manufacturer's
bank issued th~ city an irrevocable
letter of credit for the amount of the
loan, ensuring that funds would be
available so the already approved
city project could proceed on schedule. The
loan's interest rate was
set at 3 percent based
on what a city review
showed the company
could afford. The public
benefits were 200 new
manufacturing jobs
within the city, the majority to be held by
people from low- and
moderate-income families, and diversification
of the city's economic
base.
@
expanding businesses, the city of
Fall River provided subordinated financing to complete financing for
the purchase of used machinery and
equipment by a local printer. Because of the age and specialized
nature of the equipment, a local
bank could not provide more than
60 percent of the funds needed. The
term of the city's loan was the same
as the bank's loan and the rate was
set at 6 .7 5 percent based on what a
city review showed the company
could afford. The public benefits
were an 80 percent
increase in jobs at the
company, primarily
for people from lowand moderate-income families, and
expanded printing
services
to the
underserved local
market.
• Eou1TY FINANCING
Fall River is
using its future annual entitlement to
CDBG funds as collateral for bonds
issued by the city on behalf of a
private developer, to be used for site
acquisition and some of the soft costs
of a 1 83-bed nursing home facility.
This procedure makes the bonds AAA
rated and, with fees and issuance
costs, provides funds to the developer at a fixed rateof90 basis points
El
OF A PUBLIC ECONOMIC
DEVELOPMENT PROJECT
SUBSTITUTE WORKING
The city
provided another shortterm loan of $250,000
CAPITAL LOAN
CONSTRUCTION OF A CAROUSEL PAVILION AT FALL RIVER'S WATERFRONT
IN PART BY CITY COMMUNITY DEVELOPMENT FUNDS.
in working capital to an
existing manufacturer who had recently begun to manufacture fiber
optic cable from special yarns. Because of market conditions, a local
bank had been forced to reduce the
company's line of credit. The city's
loan enabled the company to maintain existing production and also to
continue an expansion program until either the bank is able to restore
the company's full line of credit or the
company obtains additional funds
from other sources. The city set the
interest rate at 4 percent, based on
what a city review showed the company could afford. The public benefits include local retained jobs plus
an estimated 26 new jobs, primarily
for people from low- and moderateincome families, and the retention of
PRIVATE FINANCING
over the federal funds rate. The bond
proceeds serve to complete a l 0
percent equity requirement, necessary to leverage a federally insured
conventional mortgage for the remain i ng project costs provided
through the banking community. The
term of the city loan is six years,
during which time the developer will
arrange sufficient additional equity
to take out the city's loan. The public
benefits are 150 jobs created, the
majority to be held by people from
low- and moderate-income families,
and the fact that 70 percent of the
beds will be set aside for local Medicaid recipients.
Seven local banks are
participating in a
$1 .75 million loan to
a local nonprofit corporation to complete
PARK IS SUPPORTED
construction of a carousel pavilion at Fall
River's waterfront
park, as part of the city's effort to
increase tourist traffic at the Battleship Cove and Heritage State Park.
This will build on efforts already
supported by $700,000 in private
contributions but stalled by lack of
appropriated state funds, now frozen because of the state's fiscal
crisis. Since the banks would not rely
on 'frozen' state funds for collateral,
the city put up as collateral the payment stream from three prior major
development loans in order to ensure time loan can be taken out with
the approved state grant.
To find out more about Jobs for
Fall River Inc., contact Steve Parr,
Director of Finance, at (508) 6751497 .CB
• REVOLVING LOAN FUNDS As part of
its ongoing program of supporting
5
PUBLICATIONS
E. Adams St., Springfield, IL 62701.
Or call (217) 785-6193. Free.
Affordable Housing
* Reclaiming Capital: Democratic
* Constructing Local Solutions: Affordable Housing, National Conference
Initiatives and Community Development, Christopher Gunn and Hazel Dayton Gunn ( 1991 ). Focuses
on the difficulty of retaining capital
in lower-income communities and
explores alternative institutions that
attract and retain resources, such as
credit unions and nonprofit corporations. Write to Cornell University
Press, 124 Roberts Place, P.O. Box
250, Ithaca, N.Y. 14851-0250.
$9.95 paperback, $24.95 cloth.
of State Legislatures ( 1991).
Discusses the need to link
federal, state, and local programs, qnd the importance
of community participation
in affordable housing
projects. Also focuses on
the importance of working
with nonprofit community
development organizations.
Call the National Conference of State Legislatures,
Book Orders Department at
(303) 830-2200. $15.00.
*Growth Factors in the Development of Community Foundations:
A Study Guide for rechnical Assistance, Steven Mayer ( 1988). This
guide is based on the experience of
15 emerging community foundations,
and is organized around 5 growth
areas: self-understanding, board
commitment, organizational capacity, asset development, and community role. Write to Publications, Rainbow Research, Inc., 1406 W. Lake
Street, Minneapolis, MN 55408.
Or call (612) 824-0724. $15.00.
* Affordable Housing Evaluation
Toolbox, Rainbow Research, Inc.
(l 990). A two-part kit designed to help
affordable housing operators develop,
document, and assess effectiveness of
(1) residents I self-sufficiency and quality of life, and (2) board capacity.
Write to Publications, Rainbow Research, Inc., 1406 W. Lake Street,
Minneapolis, MN 55408. Or call
(612) 824-0724. Each Toolbox costs
$17.50, $30.00 for both.
* Banking in the Public's Interest:
Promoting Community Development with the Public Deposits of
Cities and States, Woodstock Insti-
* Tax Credits for I.ow Income
Housing: New Opportunities for
Developers, Nonprofits, and Communities Under the 1986, 1988,
1989 and 1990 Tax Acts, Joseph
tute, National League of Cities, and
National Association of State Auditors, Comptrollers, and Treasurers
( 1991). Describes a number of city
and state programs that use public
deposits to increase private financial
institution investment in community
development. Identifies successful
techniques and common problems.
Includes recommendations for structuring a public deposit program.
Call the Woodstock Institute at (312)
427-8070. $20.00 for-profit,
$ l 0.00 government/university/nonprofit.
Guggenheim (1991 ). An updated
version of the 1990 guidebook.
Covers statutory amendments and
IRS and HUD rulings of the last 14
months. Call Simon Publications at
(301) 320-5771. $53.95 soft cover,
$145 for loose leaf binder with three
quarterly supplements.
Community Development
* Proposal Writing: A Basic Primer,
Illinois Department of Commerce and
Community Affairs (1991). A guide
for nonprofits on writing a successful
grant proposal. Write to IDCCA, 620
* Community Economic Development in Puerto Rican Neighbor·
hoods, National Puerto Rican Coalition ( 1991). Describes examples of
6
successful affordable housing and
economic development projects produced by Puerto Rican organizations. Outlines ways in which groups
can build staff capacity, access funding sources, and develop incomegenerating activities. Send payment
to National Puerto Rican Coalition,
Inc., 1700 K Street, N.W., Suite
500, Washington, D.C. 20006. Or
call (202) 223-3915. $10.00.
* Report of the 1991 Needs As·
sessment Task Force, United Way
of Mid Coast Maine (l 991 ). Provides results of needs assessment
survey done in the Mid Coast area.
Covers issues such as housing, health
care, and employment training. Offers recommendations and resources
for meeting local needs. Write to
United Way of Mid Coast Maine,
7 46 High Street, Bath, ME 04530.
Or call (207) 443-9752. Enclose
$1.33 postage.
* Religious Institutions as Part·
ners in Community Based Development, Rainbow Research Inc.
( 1991). An evaluation of 2 8 churchlinked housing and economic development projects from around the
country. Write to Publications, Rainbow Research, Inc., 1406 W. Lake
Street, Minneapolis, MN 55408.
Or call (612) 824-0724. First copy
free. Additional copies $8.00.
The National Council for Urban Economic Development offers a variety
of publications on topics ranging
from minority enterprise development
to revolving loan funds to business
incubators. For a publications list,
call (202) 223-4735.
Fair Housing
* Fair Housing Amendments Act
of 1988: A Selected Resource
Guide, HUD User (1991). Reviews
the FHAA and lists sources that deal
with the various issues in the Act.
Write to HUD User, P.O. Box 6091,
Rockville, MD 20850. Or call (800)
245-2691. $3.00.
Compliance
Compliance OfficersManagement
Manual, Sheshunoff Information Services ( 1991). Covers managerial
and technical aspects of developing
a comprehensive and effective compliance program. Call (800) 4562340. $265.00.
Rural Development
* Rural Community Economic Development, Norman Walzer, ed.
(1991 ). Examines economic trends
affecting rural development, local
government responses, and the longterm effects of the reduction in federal support. Offers development
strategies for local governments to
undertake. Write to Greenwood Publishing Group, Inc., 88 Post Road
West, P.O. Box 5007, Westport, CT
06881. Or call (203) 226-3571.
$43.00.
• Denotes publications available for review in the
Community Affairs Department resource library.
CONFERENCES
November 8a9
"Third Annual Northeast Regional
Conference for Community Development Credit Unions," Vermont Development Credit Union. Burlington,
VT. For credit unions, banks, and
foundations. Session topics include
obtaining bank support for community development credit unions, reg ulatory issues, and rural credit unions.
For more information, contact VDCU
at (802) 865-3404.
November 12a 16
vestment Training Institute at (202)
376-2642.
EMERGENCY LOAN
FUND PROGRAM
November 19
"Financing Affordable Housing in
New Hampshire," New Hampshire
Bankers Association, New Hampshire Housing Finance Authority,
New Hampshire Community Loan
Fund, New Hampshire Community
Development Finance Authority, Federal Home Loan Bank of Boston, and
Federal Reserve Bank of Boston.
Manchester, N.H. For lenders, funding and community lending specialists, and representatives of affordable housing agencies. Workshops
will focus on finding equity sources
and developing lending consortia,
with an overview of available resources for affordable housing finance. For more information, contact David Parish of the Federal Home
Loan Bank at (617) 330-9892.
S
ince 1981, The Emergency Loan
Fund (ELF), a special program of
Associated Grantmakers of Massachusetts, has provided short-term,
low-interest loans to stable nonprofit
organizations experiencing cash
flow difficulties. Its guiding principles have been to allow needed
services to continue, to help organizations achieve greater financial stability, and to increase the impact of
philanthropic dollars. Its success can
be measured by a default rate of just
over l percent- much lower than that
of more traditional lending institutions.
Applicants to the Emergency Loan
Fund must be 501 (c)(3) nonprofits
that are experiencing a cash deficiency of such a magnitude to prevent the organization from continuing normal operations and whose
receivables would be acknowledged
by a credit-worthy source (often a
governmental agency). You must
have first approached a bank and
been turned down for the financing
you are requesting, and your board
of directors must have voted and
approved submitting a loan application to the Emergency Loan Fund.
The Fund makes loans of up to
$25,000, and interest on the ELF
loans corresponds to the interest
earned on the Emergency Loan Fund
account (average is 8 percent). The
average term of loans made is anywhere from two to three months. For
more information, please contact
Tucker Eckl in at (617) 426-2606.cs
November 26
"Connecticut Conference on Affordable Housing," The Banks' Association of Connecticut, Bank Compliance Association of Connecticut,
Connecticut Association of Housing
Development Corporations, Federal
Home Loan Bank of Boston, and
Federal Reserve Bank of Boston. For
lenders, developers, and representatives of affordable housing agencies. Workshop topics include firsttime homebuyer programs, technical assistance options, and equity
sources for low-income housing tax
credit projects. For more information, contact Tom Mongellow of The
Banks' Association of Connecticut at
(203) 527-5161 .
11
Neighborhood Reinvestment Training Institute, 11 Neighborhood Reinvestment Corporation. Los Angeles,
CA This program offers over 40
one, two, and three-day courses for
community development practitioners in four subject areas: management skills, community development
strategies, affordable housing, and
computer skills. For more information, call the Neighborhood Rein-
December 1Oa 12
" ... And Miles to Go," Housing Assistance Council. Arlington, VA For
organizations involved in rural housing development. Session topics include affordable housing finance
options, technical workshops (programs of FmHA, HUD, and other
agencies), and serving special
populations. For more information,
contact HAC at (202) 842-8600.
1
Continued from page 5
COMMUNITIES &BANKING
HMDA
erating in that MSA as well as disclosure statements that aggregate the
HMDA data for all lenders in that
MSA. Depositories may charge a
reasonable fee for copying services.
0
The FFIEC will also provide, for a
fee, the edited data contained in the
loan application registers submitted
by lenders to their regulators. This is
useful for researchers who may wish
to tabulate the data in a different
manner than is provided in the disclosure statements. Other data available from the FFIEC include disclosure statements in hardcopy and on
0
°'N
°'
0
'--l
print image tapes. For more information, call Barbara Kenlaw of the
FFIEC at ((202) 357-0177.
The Federal Reserve Bank of Boston
has produced summary tables for all of
the MSAs in New England. These
tables show the disposition of loan
applications based on the race and
income of the applicant and the location of the property. To receive these
tables or to request additional information on HMDA, call the Community
Affairs Department at (617) 973-3097
or the Research Library at (617) 9733397.
0
Continued from page 5
MAINE DEVELOPMENT
f UND
with the Passamaquoddy Tribe and
formed a partnership known as
Creative Apparel Associates.
Rybarczyk, with the assistance of the
Tribe, EMDC, the U.S Economic
Development Administration, the U.S.
Small Business Administration, and
Key Bank, obtained additional financing to construct a new plant at
Indian Township and purchase
equipment for its extended operations. Further, with the help of the
Maine Procurement Assistance Center staffed by the Eastern Maine
Development Corporation, Creative
Apparel Associates obtained a major renewable government contract
from the Department of Defense.
In l 99 l, Rybarczyk received the
Blue Chip Enterprise Initiative Award,
established to identify outstanding
examples of small business
management's ability to overcome
adversity. The award is sponsored
by the U.S. Chamber of Commerce
and Connecticut Mutual Life Insurance Company, and made to one
company in each state.
In the last three years, George
Rybarczyk has built the company
8
into a successful, well-respected operation that has achieved a 400
percent increase in sales. Creative
Apparel Associates currently employs
46 people in the Belmont facility and
an
additional
21
in
the
Passamaquoddy plant.
The Development Fund has helped
many businesses like Rybarczyk's.
Since l 984, the partnership among
the state, municipalities, businesses,
and private lenders has helped create and retain over 1, 152 jobs in 47
businesses. An investment of $4 million in CDBG funds has leveraged in
excess of $34 million of private capital. As Leonard A Dow, Director of
the Office of Community Development, noted, "We are not in competition with lending institutions, but
rather provide gap financing to make
deals viable. The program is willing
and able to take more risks than the
typical lending institution is allowed
to take."
Anyone interested in finding out more
about the Development Fund program can contact Linda Shapleigh,
Development Fund Coordinator, at
(207) 624-6800.
@FedFRASER