Connecting to Community Development by Eric Wong

Recently I attended a symposium titled Connecting to Markets: Neighborhoods and Housing Markets at the Federal Reserve Bank of Minneapolis.  The focus of the symposium was to discuss current challenges in community development due to the difficult times in the housing market.  Since the inner economist in me was curious about the causes of the depressed housing market and how the public, private and nonprofit sectors are attempting to revive the housing market, I was excited to attend this event.

The symposium was split between two different panel discussions, one conducted nationally via webcast and another discussion conducted locally with local leaders in community development, including the Metropolitan Council.  The topics and ideas discussed during the symposium were enlightening.  Here are a couple things that were covered:

-          The uniqueness of the current housing market: according to Robert Weissbourd, an expert on urban issues at the Brookings Institution, the current conditions of the housing market are not part of the expected cyclical trend, but a fundamental shift  to a housing market that puts greater emphasis on connecting knowledge and innovations to economic opportunities in the local area;

-          The disconnection between stakeholders: the struggle in collaborating between neighborhoods, cities and regions due to the asymmetric understanding of available resources (economic, legal, institutional, etc.) and political control over community development decisions; and

-          The ineffectiveness of current policy: current policies such as tax credits for development of affordable housing in cities have limited or no effect in the current economic environment due to the inability of developers to make a profit.  Combined with the decreasing availability of public resources at the federal, state and local level, it is clear that the policy tools that have worked in past housing downturns are ineffective in the current housing market.

Despite the difficulties that were discussed during the symposium, I see great opportunities where nonprofits, community development corporations (CDCs), government and private sector can work together to address many difficulties in housing and community development.  For example, public-private partnerships are a concept worth exploring due to the lack of resources available for separate entities in the nonprofit, public and private sector.  Other opportunities worth exploring include CDCs working with private and public partners to assess available assets and opportunities available in a specific neighborhood to create a common understanding of the tools they have available for policy-making and resource allocation.