Guide offers blueprint for community development

Community development advocates are always looking for sources of money for projects.

A new self-study guide by the Federal Reserve Bank of St. Louis provides the answer of where to find the money.

The guide, "Coming up with the Money: Community Development Financing," is designed primarily for people with little or no experience in community development

The guide offers a step-by-step approach to help identify projects that meet community needs, create a budget and a business plan, and put together a project team.

Glenda Wilson, community affairs officer for the Federal Reserve Bank of St. Louis, said the expected users of the guide include development groups, community-based organizations, state and local governments and financial institutions.

"As the guide's introduction emphasizes, community development consists of three important elements: people, process and money," said Wilson. "The guide takes care of all three whom you need to work with, how to do it, and where to find the funds. "

Wilson said that publication of the guide is timely since several recent trends are making obtaining funds for community projects more challenging than just a few years ago.

"Handouts" with no strings attached whether from the government or a foundation are evaporating. "As subsidies decline, community development projects will rely increasingly on loans and equity financing," said Wilson.

Investors have raised their expectations for a return, whether that return is in the form of dollars or in social benefits. "That return has to be measurable," said Wilson, "not a promise or a hope."

Funding will likely come from several sources, not one, as was the case in the past. "Seven to 10 sources for one project are becoming the norm," said Wilson. "And whereas the layering of different kinds of government aid on a single project was once banned, now it's often encouraged."

Another feature of the guide is a collection of case studies, which provide hard numbers and a questionnaire to help the reader find parallels with his or her own project's needs and goals, as well as practical ways to finance them. There's also a glossary of terms and a list of useful Web sites.

"To date, we've had almost 800 requests for it," Wilson said.

One organization that has used the guide is Cooper Young Development Corp. in Memphis, Tenn., which has developed almost 35 homes in mid-town Memphis in the last 10 years.

"We're considering getting into commercial development and this guide is very relevant in helping our board to evaluate what projects would make sense for us and how to develop a business plan to achieve that," said Michelle Cowan, executive director of Cooper Young.

For more information, go to www.stls. frb.org/caffairs/selfstudy/index.html.

With branches in Little Rock, Louisville and Memphis, the Federal Reserve Bank of St. Louis serves the Eighth Federal Reserve District, which includes all of Arkansas, eastern Missouri, southern Indiana, southern Illinois, western Kentucky, western Tennessee and northern Mississippi.

In addition to serving as a bank for depository institutions and the U.S. government, each Reserve Bank monitors economic conditions in the district, participates in formulating monetary policy, and supervises state-chartered member banks and bank holding companies to foster safety and soundness of the district's banking and financial institutions and to protect the credit rights of consumers.