Community Development Corporations

Over the past 20 years, considerable attention has focused on community development and revitalization, largely in response to the economic problems of our nation’s older, industrialized cities. Although urban revitalization and reinvestment traditionally have come under the purview of federal agencies such as the Department of Housing and Urban Development and the Economic Development Administration, there is a growing trend toward encou raging greater private-sector involvement in such efforts. In particular, legislation such as the Community Reinvestment Act of 1977 places affirmative responsibility on financial institutions to undertake the promotion of community development. The stagnation and decline of many large urban areas have prompted financial institutions to search for methods to arrest these unfavorable trends. To be successful, efforts to revitalize urban areas must rely on the initiative, creativity, and capital investments of the private sector. Financial institutions, like community residents, have a vested interest in the economic vitality of their communities- a fact that has sharpened their interest in community development projects.