Nonprofit housing developers: a breed apart
A recent Washington Post report on mismanagement at the Department of Housing & Urban Development described several instances in which nonprofit housing development organizations failed to complete projects for which they had received federal funding, at considerable cost to taxpayers.While the article cited projects in many states, none were in New Hampshire.That didn’t surprise me. I have worked closely with New Hampshire’s nonprofit developers for more than 20 years as director of the New Hampshire Community Loan Fund’s Community Housing Program. Our state’s community-based based nonprofit developers have a spotless record of delivering what HUD and many other public and private funders pay for.Developing affordable housing is not for the faint-hearted. These projects typically involve many layers of financing, each with its own complex set of regulations and deadlines. Local politics – a constant in this business – can stymie even the best of projects.As a result, projects are often roller-coaster rides of successes and setbacks that can take years to complete. Even after the housing is built, market conditions and the economy can hamper a project’s ability to break even. Despite this, New Hampshire’s community-based nonprofit developers have given their communities more than 3,000 well-constructed, well-managed and permanently affordable apartments worth more than $240 million.Community-based developers play an important role in our housing market by filling the gap between government-funded public housing and privately financed housing built for profit. They emerged in the late 1980s and early 1990s from local citizen initiatives responding to the disappearance of affordable rental housing across New Hampshire.What began as a scattering of independent “mom-and-pop” organizations has matured into a statewide network of technically competent and well-respected housing developers.The long list of awards they have received, including The Corporate Fund’s Nonprofit Management Award and awards for project design and energy efficiency, is a good measure of how far they have come.These organizations also contribute in other ways to local economic development. They often locate projects in declining neighborhoods or on sites that are economically unattractive to investors. Such targeting can often change the complexion of an entire neighborhood. In some parts of the state, like the North Country and in small communities, nonprofit developers are virtually the only ones building affordable housing.By far the most characteristic feature of nonprofit housing – and the one that has the longest-lasting impact – is the heavy investment these landlords make in their residents’ well-being. This takes many forms, including budgeting and consumer education courses, homebuyer education and foreclosure counseling, and second- and reverse-mortgage lending. Many nonprofit developers also sponsor successful wealth-building savings programs, even for the poorest families. In a state that has not always welcomed it, they are also strong and consistent advocates for affordable housing.Today’s community-based nonprofit housing developers are the product of a great many visionary individuals, community leaders, state agencies and community-minded banks. They all recognized the crucial importance of affordable housing to New Hampshire’s working people and families and to the economic and social vitality of our cities and towns. And they had faith that people who were not professional developers could, with commitment and hard work, master this complex discipline.Several decades and thousands of well-housed families later, the state’s community-based nonprofit developers have demonstrated that this faith was well founded.Mike LaFontaine is director of community housing at the New Hampshire Community Loan Fund.