predominantly Mexican-American community, and the East Bay Asian
Local Development Corporation in Oakland have received loans.
Neighborhood Housing Services
A familiar
pattern shows in inner-city neighborhoods that are beginning to
deteriorate. Residents who can move do so, leaving those who cannot
to face the erosion of what is usually their only equity, their
homes. Banks and other lending institutions, anticipating losses
from further decline, discontinue mortgage and home improvement
loans-the practice called redlining. City services, such as garbage
collection and street repairs, shrink. And local businesses that
once were viable wither.
This was the
situation in the Central Northside of Pittsburgh in 1968 when the
residents organized to break the pattern. What they devised was
Neighborhood Housing Services (NHS), which in a few years went from
a model in Pittsburgh, to a few counterparts elsewhere, to a
national demonstration in several dozen cities, and finally to a
continuing federal program.
The elements
of the NHS program were simple, but in combination they had a
powerful effect on reversing the process of deterioration. They
were: 1) a group of residents who wanted to improve their homes and
neighborhood; 2) a commitment by the city to make a systematic code
inspection of every home to determine what repairs were necessary
and to provide services to improve the general area; 3) agreement
by local lending institutions to make regular loans to every
resident who met their lending criteria; 4) establishment of a
high-risk loan pool for home owners who could not meet those
criteria, with flexible terms and interest rates-down to
interest-free loans if necessary-that they could handle; and 5) a
skilled staff that helped residents apply for loans, select
contractors, check that the work was being properly done, and act
as a liaison among residents, city officials, and lending
institutions.
In
Pittsburgh, the high-risk loan funds were provided by the Sarah
Mellon Scaife Foundation. In 1973, building on the success of the
Pittsburgh model, the Ford Foundation, working with the Federal
Home Loan Bank Board, helped to establish pilot projects in
Baltimore, Dallas, Oakland, San Antonio, and Washington, D.C. Other
foundations assisted NHSs in other cities.
The promise
shown by these pilot programs persuaded the Federal Home Loan Bank
Board and the U.S. Department of Housing and Urban Development to
create a national Urban Reinvestment Task Force the