Corporations invest $410 million in affordable housing development in strugging neighborhoods nationwide.

CLEVELAND--(BUSINESS WIRE)--June 24, 1996--Corporate leaders from across the country today came to the U.S. Conference of Mayors meeting in Cleveland to present the nation's leading mayors with a check for $410 million in equity to invest in the affordable housing development intitiaves of nonprofit neighborhood-based developers.

"In Cleveland and cities across the country, corporations are joining in dynamic partnerships with city agencies and the community to rebuild neighborhoods and transform lives," Cleveland Mayor Michael R. White said. "These partnerships stretch scarce public resources and work because they are following the lead of the community. The Housing Credit has been critical in stimulating corporate investment and creating these partnerships. This $410 million investment demonstrates that the credit works, and works well."

The check was presented to Mayors White, Richard M. Daley and Norman B. Rice at a ceremony in Cleveland's Hough neighborhood by Local Initiatives Support Corp. (LISC), the nation's leading community development support organization. It represents the record-setting 1995 raise of LISC's affiliate, the National Equity Fund (NEF), which uses the federal Low Income Housing Tax Credit to channel corporate investment into affordable rental housing development.

"This is a great day for our cities," Chicago Mayor Daley said, "As mayors, we know first hand the challenges we face in rebuilding and reviving our cities. But we also know the potential that exists in our neighborhoods -- potential that this corporate investment through LISC's NEF helps to bring to fruition."

Cities where nonprofit developers will receive NEF 1995 funds include: Cleveland, Toledo and Youngstown, Ohio; Guilford, Hartford and New Haven, Conn.; Atlanta; Chicago; Detroit; Minneapolis, Coon Rapids and Worthington, Minn.; Omaha; Monroe, N.Y.; Newell Creek, Ore.; Providence; Lynnwood and Everett, Wash.; and Los Angeles, San Jose, North Hollywood, Sylmar and Oceanside, Calif. Other cities and states where funding commitments are expected include: Little Rock; Arizona; Colorado; Indianapolis; Kansas City; Durham and Rhode Island.

Daley and Seattle Mayor Rice -- respectively the incoming and outgoing U.S. Conference presidents -- and White were joined by Ohio Gov. George Voinovich, LISC President Paul S. Grogan, NEF CEO George Latimer and corporate and community leaders. The ceremony was held in front of the historic Crawford-Tilden Apartments, a landmark 19-unit building in Hough being rehabilitated as affordable housing for low-income families by Famicos Foundation using a combination of Historic Preservation and Housing credits.

Hough, a community devastated in the riots of the 1960s, has seen significant reinvestment spurred by these and other federal incentives. In addition to Crawford-Tilden, dozens of new and rehabilitated homes and apartments are being built, some 60 market-rate for-sale homes are bringing middle-class families back to the neighborhood and the Church Square retail development is thriving.

NEF is the nation's leading nonprofit syndicator of Housing Credits. The Housing Credit, enacted in 1987, has become the country's principle generator of affordable housing, responsible for stimulating $12 billion in private investment, creating some 800,000 affordable homes and apartments and generating annually 90,000 jobs and $1.3 billion in tax revenues.

The 1995 raise is $100 million more than NEF has raised in any previous year and demonstrates both corporate America's growing social consciousness and recognition that investing in community-based renewal initiatives is good business, and the importance of the permanent Housing Credit. Since the credit was made permanent in 1993, corporate investment in NEF has more than doubled.

"These investments, in cities large and small across the country, demonstrate the enormous diversity and vitality of the community-based development movement," Rice said. "These groups represent the future for our communities. It is why we as mayors have worked so hard to support them, and why we rallied behind the Housing Credit when its permanent status was threatened in Washington."

"Here, with this construction and other reinvestment in Hough taking place around us, we see what is possible when dedicated community leaders, supported by a powerful partnership of city officials, local corporations and national foundations, are able to leverage scarce public dollars and gain access to the financial and technical resources they need to realize their dreams for their neighborhoods," Grogan said. "At a time of diminishing resources, the Housing Credit has brought corporate America to the table, and shown corporate leaders that community-based development is a worthy investment."

Congress last year voted to terminate the House Credit's permanent status by the end of next year. However, an unprecedented bipartisan coalition of mayors, governors, senators and representatives, joined by some 1,600 business and civic associations, rallied in support of the credit, and President Clinton vetoed the bill and referred specifically to the Housing Credit provision as one reason for his veto.

"What Crawford-Tilden illustrates is the potential of the Housing Credit to create these partnerships and channel critical private resources to community-based renewal initiatives that have transformed neighborhoods across the country," Latimer said.

"I commend LISC and NEF for their ongoing dedication to working to rebuild communities in Ohio and across the nation and to provide affordable housing," Voinovich said. "They are a key element in our efforts to create public/private partnerships. We in Ohio state government will continue to work with mayors across the state in federal-state-local partnerships to revitalize our cities."

"This development would not have been possible without the Housing and Historic Preservation Tax Credits," Famicos Executive Director James Williams said. "We know the pride and commitment that exists in Hough and other Cleveland communities. But that commitment needs resources, and the Housing Credit provides those resources."

Famicos is a 26-year-old countrywide organization that created the innovative lease/purchase model that has enabled low-income Cleveland families to first rent and then purchase their homes.

New York City-based LISC, established by the Ford Foundation in 1979, operates in 35 cities and regions across the country and provides financing and technical assistance to nonprofit community-based developers. LISC and its affiliates have raised more than $2.1 billion from more than 1,400 donors and investors to help some 1,400 neighborhood-based developers expand their efforts to reclaim and rebuild their communities. These nonprofit developers have used LISC investment and support to produce more than 64,000 affordable homes and apartments and 9.6 million square feet of commercial and industrial space.

NEF, LISC's equity fund affiliate, was created in 1987 to syndicate Tax Credits. NEF has raised and invested more than $1.7 billion in corporate equity and helped community development corporations produce more than 27,000 affordable homes and apartments. NEF comprises three funds -- the California Equity Fund, which makes investments in California, the New York Equity Fund, which is administered jointly by LISC and The Enterprise Foundation and makes investments in New York City, and the National Equity Fund, which makes investments nationwide.

CONTACT: National Equity Fund

Marilyn Katz or Tom Warnke, 312/822-0505

Local Initiatives Support Corp., New York

Mike Patterson, 212/455-9849

National Equity Fund

Sheryl Larson, 312/697-6136

or after June 21: 216/696-1359