06-08-2016 Workshop Packet - Laserfiche WebLink

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Do Housing Rehabs Pay Their Way ? 4 5 1 in these communities were constrained by the absence of applicable property taxes, (a local tax policy), rather than by program costs. The economic benefits resulting trom program activity were substantial. One-time effects such as construction jobs and minority contractors used are tangible benefits. Longer-term contributions to the urban fabric through reduction of blighted (vacant) property and creation of new homeownership opportunities are also impressive, but could be Improved. Increases in property value of hoth subjects and nearby hones were important. The data gathering effort for this research was surprisingly difficult. The research method required extensive detail (e.g., project -specific data and instructions, coupled with interviews of CDC executive directors) in order to be defensible. As a result, eliciting timely responses from the NWOs for this study was problematic, indicating that the data were not readily available. In addition, the variability of the experiences of the ten CDCs was substantial. Except for a few line items (administrative support, loan repayment, property taxes), the programs were often unique, with widely varying costs, benefits and return on municipal investment. Economic returns were more consistent, but still had substantial variation. The benefit side of the fiscal equation is substantially enhanced by property value increases to neighboring property, which generate property tax revenues. Likewise, economic benefits also feature property value increases. This positive externality, the neighborhood effect of housing rehab activity, was readily evident in Cleveland. However, this topic should be studied in other markets to determine if the effect can be detected and under what conditions these impacts can be seen to vary with investment size and neighborhood demographics. Using the results from the ten NWOs, the study makes some recommendations for community development corporations involved in housing rehab activities. The conclusions noted below are from the perspective of maximizing the CDCs' operational efficiency and fiscal and economic benefit -cost ratios, which, if documented, should facilitate fundraising at the local government level on efficiency grounds. One of the main problems in studying CDCs is the availability of reliable and relevant data. Not unlike many other studies in this field, there were a number of difficulties obtaining the data. The research method required extensive quantitative data. Given the fact that many CDCs do not have sophisticated management information systems, eliciting timely responses from the sample group was problematic, indicating that the data were not readily available. If the CDC movement, its funding institutions, government partners and supporters desire to promote quantitative research along with a rigorous methodology in the field, there is a dire need to enhance and promote CDCs' electronic management information systems and train and retain personnel familiar with these systems. As the sources of funding increasingly demand quantitative measures of CDC effectiveness and J 3 1 R E R I V o I. 2 5 1 N o. 4- 2 0 0 3