July 14, 2014
The Tri-Bank Partnership with the Appalachia Funders Network

On April 1, the Federal Reserve Banks of Atlanta, Cleveland, and Richmond—the members of Tri-Bank—met in Athens, Ohio, with the Appalachia Funders Network (AFN), an umbrella organization that includes more than 200 national and regional funding organizations from the public, private, and government sectors. This was the second year our Reserve Banks have partnered with AFN; in March 2013, we held a joint event in Asheville, NC.

The occasion this April was the AFN’s annual conference, whose theme was “The Power of Partnerships.” Working together, participants identified shared approaches for accelerating the recovery in the Central Appalachia region; we then presented them with ways to align their efforts with the AFN’s agenda to jointly impact the sectors of food systems, health, entrepreneurship, and information technology.

The conference was held in Athens, Ohio, in the southeastern part of the state, where shale extraction has recently become a key economic activity. Conference sessions explored how rural communities can retain wealth from shale extraction in their region, as well as the policy implications of boom–bust cycles in energy extraction.

The conference also covered business development through a case study of Ohio’s Third Frontier initiative, launched in 2002 as a $1.6 billion, 10-year investment in technology-based economic development. The goal of this discussion was to learn how shale extraction and business development opportunities through the Third Frontier initiative have affected rural areas and the policy implications surrounding both topics.

The Tri-Bank partnership has proven to be a valuable connection for the AFN. In addition to continuing to support their annual gatherings, our three banks can connect the funders’ group with subject matter experts in their areas of interest; currently, these interests are food systems, health, entrepreneurship, and information technology. We are also able to connect AFN members to other, larger funders through our Federal Reserve Philanthropy Initiative. Finally, we can coordinate our efforts with those of other federal agencies, such as the Appalachian Regional Commission, the USDA, the FDIC, and the OCC.

Our next step is to connect directly with representatives of the AFN’s steering committee to explore new ways of collaborating. These new endeavors may be audioconferences or webinars on specific areas of interest to the group. Further, each Reserve Bank will participate in one of the working groups on the AFN’s interests. The Tri-Bank partnership may help expand the AFN’s strategic interests to include workforce issues and healthy communities. It may also be useful to communicate applied research findings produced by the Federal Reserve System on topics that are relevant to the AFN.

More information about the Appalachia Funders Network and our partnership with the group is available here.

Bonnie Blankenship
Bonnie Blankenship
Senior Policy Analyst
Bonnie, working from the Cincinnati office, conducts outreach and policy analysis on current and emerging issues. She provides information and technical assistance to financial institutions, community-based organizations, and government entities relevant to the Fourth District. (bio)
June 17, 2014
The Face of a Policy Issue

As community developers, we grapple with policy issues that are multifaceted and complex. Often, several distinct problems intertwine with one another under the umbrella of a larger, more broadly defined policy concern. As my colleague, Tom Fitzpatrick, and I were putting together the agenda for a recent public program, “Getting Back in Gear: Better Ways to Move Stalled and Vacant Foreclosures Forward,” we were careful to include multiple perspectives in order to address the array of interrelated problems associated with our subject and give our attendees a beneficial learning opportunity. However, the program also proved a learning opportunity for me.

Following the mortgage servicing panel discussion, a local building inspector asked the panel what he should do to address a problem condo after the related lien had been charged off but for which the owner could not be found. This relatively pragmatic question went to the heart of the abandoned foreclosures issue, and seemed to encapsulate the reasons why abandoned foreclosures deserve policymakers’ attention.

As the audience learned, because the lien holder for the property in question does not wish to take possession of the property, the property is stuck in foreclosure "limbo" and has become, by default, a problem local government is now forced to address. At considerable expense, the city secured the property and remediated it of mold posing health concerns to proximate homeowners.The question posed by our attendee—what to do next with a property that nobody, including the lien holder, wants—puts a real face on policy issues that, from a practical standpoint, leave many sometimes underfunded and generally ill-equipped municipalities and other stakeholders scrambling to identify solutions. How can we prevent properties from falling into non-productive status? And are there ways to more easily move these properties forward to productive reuse?

On the national stage, abandoned foreclosures, especially as they relate to local governments and community developers, is a seldom-discussed policy issue. This lack of dialogue may be due, in part, to the fact that abandoned foreclosures are the exception, not the norm (the GAO estimated abandoned foreclosures represented less than 1% of vacant homes between January 2008 and March 2010). However, this small number belies the disproportionately larger negative impact of these properties on local governments, community developers, and surrounding neighborhoods, which is forcing many policymakers to give abandoned property issues a second look.

One of the most significant concerns is that, even if abandoned foreclosures are relatively rare and thus represent only a fraction of the distressed housing market, these properties have an outsized impact on their surrounding communities and, compounding the problem, are often concentrated in already distressed communities that are less well equipped to effectively manage them. When a servicer opts to not foreclose on a property (generally because its market value does not justify the expense associated with completing the foreclosure, coupled with the potential liability associated with holding title), the result can be a higher instance of properties in disrepair and tangled title issues that make these properties far more difficult and expensive to reclaim.

In essence, an abandoned foreclosure often dooms a property—and sometimes, the surrounding homes and neighborhood—to blight. This is particularly true, and especially troublesome to community developers, in low- and moderate-income communities that may have higher concentrations of vacant and abandoned property already.

Throughout our event, each of the panelists shed some light on how foreclosures become stalled or abandoned and discussed possible solutions. Clearly, stakeholders approach this issue in very different ways and from a variety of perspectives—including how they define stalled and vacant foreclosures!

Some early steps taken to alleviate the impacts of abandoned foreclosures include the Federal Reserve issuing guidance in 2012 to covered financial institutions on how to deal with the decision to abandon a foreclosure. But many believe more can be done.

Hopefully, this post has provided you with enough of a teaser that you will check out the archived program. You can check out the agenda, review presentations, and watch video of any or all of the panels on YouTube. The program includes lots of great information that provides an excellent primer on a topic that is gaining attention.

Joseph Ott
Joseph Ott
Senior Policy Analyst
Joseph, with 14 years of experience in community development, directs programming and outreach activities in western Pa., southeast Ohio, and the panhandle of West Virginia. He provides technical assistance to organizations about, for instance, credit availability and housing. (bio)
March 25, 2014
Expanding My Horizons, Right Here in Cincinnati

This past year I’ve been part of Leadership Cincinnati, a 10-month community leadership program sponsored by the Cincinnati Chamber of Commerce that focuses on exposing professionals like me to various sectors of our economy (or community), including government, education, health, economic development, diversity, justice, and the arts. By concentrating on how leadership plays a role in these sectors, Leadership Cincinnati helps us develop the knowledge, skills, and confidence to assume greater responsibility for leading the Cincinnati region in the future. The experience so far has been extraordinary.

Through “deep dives,” we learn about local issues through more active engagement, rather than simply reading about them.  This experiential learning includes everything from a ride-along with a Cincinnati Police Department officer and walking through an economic development site with business owners and the developer to having dinner with a working-class Hispanic family and visiting a public daycare program in an impoverished neighborhood.

Another facet of the program partners us with a small team of our classmates on a specific project to help the community. My team’s project is The 2014 Teen Week and Teen Summit, scheduled for this October. In partnership with Cincinnati City Council, we will present Cincinnati’s 1st Annual Teen Week, designed to give our city’s future leaders the opportunity to experience what it feels like to be in charge of the day-to-day operations of our city.

Along with exposing students to many of the possibilities our region has to offer in government, we give them a chance to view some of the businesses and corporations that help our region to thrive. Because workforce development is a key focus of my work in the Community Development Department, I thought this project was a perfect fit with my role at the Fed.

Here’s how: From outreach the Cleveland Fed’s Community Development team has conducted, we learned that students, teachers, guidance counselors, and parents need better, more specific information and data about careers and different pathways to embark on these careers—and that info needs to be disseminated earlier. In fact, we have discovered that career discussions should begin earlier than high school age. I plan to apply this finding in our Leadership Cincinnati project, in which we are hoping to reach younger students about possible career choices for their future success.

Leadership Cincinnati is a highly competitive program. Each year city leaders strive to assemble a class that reflects the diversity in the community. Each class comprises 54 members, 27 men and 27 women, who represent large corporations, mid-sized companies, and entrepreneurs, as well as not-for-profits and government. I was honored to be chosen for Class 37.

Since September, when we began the program, I have:

  • Learned about local city, county, and regional governments.
  • Spent a day at a hospital learning about issues in the health care field through the eyes of patients with diabetes.
  • Ridden along with a Cincinnati police officer in the Evanston community. I also toured the jail and watched a court proceeding.
  • Visited Clifton, a neighborhood going through revitalization, and met with small business owners there to learn about the challenges they face.
  • Visited a mosque to learn more about diversity and inclusion from a variety of groups and people.

These experiences have been eye opening; they have allowed me to see topics and issues from a different perspective.

There are three months left in the program; we graduate in June. The experience has meant a lot of extra work, but I will be sad when it is completed. I have been exposed to new ideas and concepts and my horizons have expanded. This broadening of my world view was a goal of mine in entering the program. The extra bonus is the new friends and relationships I now have by being a member of Class 37.

Bonnie Blankenship
Bonnie Blankenship
Senior Policy Analyst
Bonnie, working from the Cincinnati office, conducts outreach and policy analysis on current and emerging issues. She provides information and technical assistance to financial institutions, community-based organizations, and government entities relevant to the Fourth District. (bio)
January 31, 2014
Wealth Building - Keeping it Local

“Redefining Rust Belt” is a four-part videoconference series that was conceived by the Cleveland Fed, in partnership with the Federal Reserve Banks of Chicago, Philadelphia, and Richmond.  Each videoconference is an opportunity for community leaders in Baltimore, Cleveland, Detroit, and Philadelphia to talk with each other about their experiences developing and implementing strategies to attract new residents and new investment.

The first videoconference, which took place in June of last year, covered an array of strategies being deployed today to grow the four cities.  Many topics and themes emerged from the introductory discussion, and the second videoconference delved into a blend of two topics — anchor institutions and the arts.  This episode of the series featured Ted Howard, founder and Executive Director of the Democracy Collaborative at the University of Maryland and Steve Minter, fellow at the Cleveland Foundation.  Ted introduced to the group assembled in four locations the Collaborative’s “Anchor Dashboard: Aligning Institutional Practice to Meet Low-Income Community Needs,” a paper that proposes a framework of metrics for anchor institutions to assess their impact on their surrounding communities.

The paper defines anchor institutions as “place-based entities such as universities and hospitals that are tied to their surroundings by mission, invested capital, or relationships to customers, employees, and vendors.”  Anchor institution strategies are driven by missions to “address tenacious community challenges, and implemented to permeate an institution’s culture and change the way it does business.”  Strategies to benefit communities involve redevelopment of physical places as well as people-based efforts to build wealth.  Because the focus is on the surrounding community, particularly its low-income residents, there is an emphasis on keeping wealth local, for example, by institutions hiring and buying local.  The University Circle initiative in Cleveland takes this a step further and features employee-owned cooperatives that employ neighborhood residents.

Anchor institution strategies seem to be particularly relevant in cities that enjoy the presence of so-called “eds and meds”—universities and medical centers. What about communities that lack such anchor institutions, particularly rural communities?  The Cleveland Fed’s district includes a significant amount of rural Appalachian territory, much of it now impacted by natural gas extraction.  How can local and regional economic development efforts successfully keep wealth local for the long term?  I recently attended a forum convened by the Aspen Institute Community Strategies Group and the Delta Regional Authority in Little Rock, Arkansas, called “Rooting Wealth that Sticks: Emerging Partnerships for 21st Century Regional and Rural Prosperity.”  It featured a wealth-building model, “WealthWorks,” that I would like to learn more about.  From the examples given — a biofuel sector in the Arkansas Delta that brings together family farmers, town leaders, and university resources, and a group of African American farmers in Mississippi and Alabama working together to market, sell, and produce more to make farming pay off — the model, through its emphasis on creating partnerships and supply-demand chains, seems to be a way for communities to create their own anchors tapping underutilized community assets.

Would an anchor institution or “WealthWorks”approach work to further the prosperity of your community or region?  We’d love to hear your thoughts on what works, what doesn’t, and why.

Mary Helen Petrus
Mary Helen Petrus
Outreach Manager
Mary Helen conducts outreach throughout Ohio. With her policy expertise, she assists organizations in understanding how the Federal Reserve Bank can partner with them to tackle key issues in community development. (bio)