Recently, the Federal Reserve Bank hosted two gatherings of financial institutions and municipal leaders from the Collaboratives for a discussion organized thanks to the Metropolitan Planning Council, Regional HOPI, and the Metropolitan Mayors Caucus. At both the morning session with the larger financial institutions and the afternoon session with smaller regional and community banks, the topic at hand was the value of working collaboratively to solve our region’s housing challenges and build toward a more stable future.
The existence of the professionally-staffed housing collaboratives offer many opportunities to private investors looking to work on community stabilization in the Chicago suburbs. Pat Holden of Bank of America noted that working with the collaboratives vastly improved the bank’s communication with municipalities because the collaborative offered a single point of contact, a point echoed by several bank representatives. John Manos of Bank Financial appreciated that the collaboratives helped his institution think proactively about the future in tough economic times by identifying and disseminating information about regional priorities that are based on smart planning principles and have community support. The collaboratives have tools at their disposal that can help reduce private investors’ risks, such as transit-oriented development funds, revolving loan funds, and land banks. Results from a post-discussion survey showed that 90 percent of the participants agreed that working with the collaboratives helps promote efficiencies in community development.
Financial institutions have already found success in working with the housing collaboratives. Bank Financial faced a troubling situation when a landlord who had loans on 86 single-family homes inhabited by Section 8 tenants in several municipalities in the south suburbs went into default. Bank Financial wanted to preserve stability for the tenants and avoid eviction, so, in partnership with the Chicago Southland Housing and Community Development Collaborative’s Janice Morrissy, the bank was able to arrange a sale of all 86 properties to the Chicago Metropolitan Housing Development Corporation (CMHDC). The sale allowed the homes to remain occupied, which promotes stability for both families and their neighborhoods.
The collaboratives have also made it easier for financial institutions to resolve vacant property issues in accordance with community needs. Bank of America and Wells Fargo have developed partnerships to gift bank-owned property to collaborative municipalities and nonprofit developers and contribute to demolition costs. Municipalities can then stabilize and strategically redevelop hard-hit areas more easily. A representative from the Village of Park Forest noted that a combination of initiatives—land donations from Wells Fargo, demolition assistance from Bank of America, and more than a dozen CMHDC homes—had helped to stabilize targeted distressed areas in their village.