Money Smart Week®

By Heather Greenwell, Outreach Program Team Lead, Public Affairs, Federal Reserve Bank of Chicago

Individuals active in the financial education field are no doubt familiar with the staggering statistics that characterize consumer financial health in the United States:

  • 28% of non-retired adults have no retirement savings or pensions
  • 44% say that they could not cover a $400 emergency expense or would have to cover it by selling something or borrowing money
  • Just over 25% of all adults are unbanked or underbanked
  • 25% of all adults report forgoing one or more types of health care in the prior year due to cost[1]

Organizations across the country devote their time and resources to understanding and addressing the symptoms and root causes of the financially tenuous situation in which many Americans find themselves. Over the past 16 years, the Federal Reserve Bank of Chicago has strived to connect people in tenuous financial shape with organizations that can help them build financial capability and health by showcasing these resources during the annual Money Smart Week® campaign. While that’s a key purpose of Money Smart, there is valuable information for everyone.

The Money Smart Week® Campaign is a national education effort designed to help consumers of all ages and from all walks of life better manage their personal finances. The campaign is coordinated and supported through the Federal Reserve Bank of Chicago which began the effort in 2002 with 40 Chicago-based organizations who constituted the Money Smart Advisory Council. From this locally oriented beginning, the campaign has grown exponentially to provide thousands of free sessions and events across the country addressing key aspects of household financial health. Money Smart Week® event information is available and searchable by state, zip code, topic or audience at

For organizations who might want to host a Money Smart Week® event, for example organizations that already hold financial counseling related seminars, they can sign up to become a Money Smart Week Partner and list their event via Many groups become partners, offering content, meeting space, facilitators and/or other resources.

This extensive growth owes to the dedicated collaboration of people at thousands of organizations across the country including financial institutions, schools, nonprofits, trade organizations, and government agencies. The Money Smart Week® campaign has also been fortunate to have the support of key National Champions, large organizations that leverage their base of members or content expertise, to increase the footprint of Money Smart Week® across the country. Our 2018 National Champions include the American Library Association (ALA), Consumer Financial Protection Bureau (CFPB), United States Department of Agriculture (USDA) Cooperative Extension, National Consumer Education Foundation (NCEF), Certified Financial Planner Board of Standards, and the Financial Planning Association (FPA).

New efforts for the Money Smart Week® 2018 Campaign focus on engaging youth in building healthy financial habits.

Children as young as three to five years of age are developing the basic skills and attitudes that lay the foundation for later financial well-being.[2]  The Money Smart Week® Kids Read program, piloted this year, was designed to provide a fun way for parents and caregivers to establish the building blocks of saving and goal setting through story time at a local library. Each child attending a Money Smart Week® Kids Read program will be able to take home a free copy of Those Shoes by Maribeth Boelts, an enlightening and pragmatic exploration of needs versus wants; adults receive a free CFPB discussion guide to reinforce the learning.

For youth in the next tier of development, middle childhood (6-12 years old), developing financial habits and norms take center stage. Although it may not always be apparent, youth in this age group form those skills and attitudes by observing how the adults in their lives spend, save, and interact with money.[3]  For the last several years, groups of Money Smart Week® Partner organizations and planning teams have sponsored local Money Smart Week Kid competitions. The goal of these competitions is to engage students in dialogue with parents and guardians, encourage critical thinking, and opportunities to solve real-life financial issues.

Money Smart Week® programs shift to an online format for youth in adolescence and early adulthood in order to meet these young consumers where they are, and to help them practice money skills and decision-making. For high school aged youth, Money Smart Cache! is an online game where players move their avatars through a route of obstacles and learn important financial lessons along the way. College students can engage in GeoCache for College Cash, a virtual scavenger hunt across campus using their mobile device. This virtual quest features personal finance information that every student should know.

[1] Federal Reserve Board. (2017, June 14). Survey of Household Economics and Decision-making.
[2] Consumer Financial Protection Bureau. Resources for Parents and Caregivers.
[3] Consumer Financial Protection Bureau. (2016, September 7). Four Strategies to Help Youth Achieve Financial Capability.
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Workforce Development for Chicago’s Youth

By Emily Engel

The definition of ‘workforce development’ is broad, and there are many programs that focus on the different aspects of the field. Recently, CDPS posted two workforce-focused blogs: (1) Workforce Development for the Next Generation: Early Childhood Education and (2) Investing in America’s Workforce. CDPS will continue to explore the topic from different perspectives. This blog will look at youth unemployment, specifically through the lens of Skills for Chicagoland’s Future (Skills) Beyond the Diploma program. 

With the labor market at what many economists might consider maximum employment (5 percent unemployment is the rule of thumb for ‘full employment’ and the latest data from January 2018 show the nation at 4.1 percent), a close look is warranted at the segments of the working-age population who are unemployed. One such segment is young adults between the ages of 16 and 19. Addressing youth unemployment is especially important given the drastically higher unemployment rate for youth (white 12.4 percent) and black youth in particular (24.3 percent) as compared to the rates for whites and blacks on average (i.e., irrespective of age), which are 3.5 percent and 7.7 percent, respectively.

Table 1: Unemployment rates (Click image to enlarge)

Source: BLS Data,

Looking beyond the unemployment figures, the share of teens in the labor force (employed or looking for employment) has fallen precipitously – just 43 percent of teens had a job in July 2016, compared to 72 percent in 1978. The Brookings Institution recently highlighted the importance of reconnecting youth to employment in its report Employment and disconnection among teens and young adults: The role of place, race, and education. It discusses “disconnected youth,” defined as those neither working nor in school. These youth “are at risk for a host of negative outcomes: long spells of unemployment, poverty, criminal behavior, substance abuse, and incarceration.” While Chicago has a lower share of disconnected youth in both age groups compared to the U.S., a closer look reveals, the share of disconnected black youth is higher in both age groups as compared to the U.S.

Skills is trying to address the gap in employment attainment for youth in Chicago through a new, employer-driven approach. Skills is a public-private partnership working to match businesses that have current, unmet hiring needs with qualified, unemployed and underemployed job seekers. Skills spent time in late 2016 analyzing both primary and secondary research on trends in youth unemployment, which yielded four key findings:

  1. Lack of Exposure – Younger teens (age 16 – 19) are now participating in the labor force at much lower levels than previous decades, with potentially detrimental effects of not gaining early, formative work experiences.
  2. “College for All” Mentality – For high school students the emphasis on college preparation appears in some cases to have crowded out career planning for those not headed to college. As a result, awareness of alternative pathways, or even how to balance both work and post-secondary education, remains low among high school students.
  3. Workplace Conflict Resolution – Young adults experience unique challenges navigating workplace relationships, conflicts and professional norms, creating additional barriers to retaining employment.
  4. A Degree is Not a Silver Bullet – College degrees do not necessarily translate into meaningful careers, especially for low-income and/or first generation college students, and little support is available to help those with limited experience secure employment commensurate with their educational attainment.

The result of the analysis and these findings was a new programmatic approach called “Beyond the Diploma” aimed at youth from high school students through college graduates. Skills based the program on a single guiding hypothesis: an employer-driven approach that results in a real, committed job – coupled with soft skills training, mentorship and support necessary to persist in employment – will create positive impact for both young adults and businesses.[1]

These four findings inform a three-pronged approach that focuses on three distinct groups with different needs: “Jobs 101” for high school students; “Pivot to Success” for high school graduates; and “U 2.0” to serve college graduates.

Jobs 101: Given the push for higher education, even though many students will not attend college, career planning in high school has historically been overlooked. Jobs 101 will create a solution for these issues, bringing career preparation into high schools to complement the college counseling students receive. Juniors and seniors would receive education on job readiness, including how to: apply for a job, write a resume, interview and negotiate an offer. Students would also have the opportunity to engage directly with employers through site visits to learn about different career pathways. Ultimately, Skills will also place students in both part-time/summer jobs while they are in high school, as well as connect them to full-time jobs with career pathways if they choose not to pursue college (immediately).

Pivot to Success: Pivot to Success will target youth ages 18 – 24 with a high school degree or a GED that are neither working nor attending college full-time. Skills is partnering with committed employer partners to place youth adults into entry-level jobs with defined career advancement opportunities. Youth will also have the opportunity to advance their education through college or industry credential training, and receive mentoring support to address barriers they may face in persisting in either work or school.

U 2.0: U 2.0 is aimed at youth that have graduated from college with a two- or four-year degree, but need additional support and preparation in finding and transitioning into a job. Skills will partner closely with both employers and higher education partners to prepare and connect graduates to meaningful first jobs. Graduates with few barriers to entry will be directly connected into employers, while those lacking the necessary soft skills will receive “boot camp” training to prepare them to interview, obtain, and succeed in jobs.

This three-pronged approach has the potential to help more youth in Chicago secure not only a job, but a career that will improve their economic trajectory.




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Investing in America’s Workforce

By Jason Keller

On May 30, 2017, CDPS blogged about the final revisions to the Interagency Questions and Answers regarding Community Reinvestment. That blog focused on changes to the definition of community development, specifically the references to workforce development or other job training programs for low- or moderate-income (LMI) or unemployed persons as qualified activities under the regulation.

Connected to that revision, beginning earlier in 2017, the Board of Governors and the 12 Federal Reserve Banks undertook a multi-year, cross-sectoral endeavor to explore the regional aspects of improving workforce outcomes and investments. This initiative, titled Investing in America’s Workforce, aimed to reimagine and reframe workforce development efforts to create a foundation from which a new era of investment can grow. One component of this effort was to convene regional meetings across the country to identify new approaches, opportunities, and challenges in investing and evaluating outcomes in workforce development.

Participants in these meetings represented training providers, employers, financial institutions, government, philanthropy, policymakers, community development practitioners, as well as researchers. A total of 52 listening sessions were held across 32 states and Puerto Rico throughout the first half of 2017 with close to 1,000 participants. In the Federal Reserve’s Seventh District, which includes Iowa and portions of Illinois, Indiana, Michigan, and Wisconsin, regional meetings were held in Des Moines, Iowa, Springfield, Illinois Fort Wayne, Indiana, and Milwaukee, Wisconsin. Key questions discussed were: 1) what opportunities for investment in workforce development exist, 2) what would make workforce development more investable, and 3) how can workforce development efforts be better evaluated?

These regional meetings revealed similar challenges facing both employers and potential job seekers across the country. However, several promising strategies were identified for expanding and diversifying the pipeline of skilled workers and connecting those workers to employers. The purpose of this blog is twofold: one is to describe the nature and purpose of the regional meetings as well as the full report. Consider sharing the report with your constituents or others that have a vested interest in furthering workforce development efforts. The second is to share some potentially helpful resources and opportunities to learn more about this topic:

  • Engaging Workforce Development: A Framework for Meeting CRA Obligations. In December 2016, the Federal Reserve Banks of Dallas and Kansas City released a publication designed to give banks, and organizations interested in partnering with them, tools and information to engage in workforce development activities in ways that may help fulfill obligations under the Community Reinvestment Act (CRA). The full Framework document can be found here.
  • Investing in America’s Workforce Capstone Conference and Publication. In October 2017, over 325 individuals attended a national conference in Austin, Texas, to discuss opportunities and challenges for investment in workforce development. Over 40 workforce, industry, philanthropic, and community experts spoke during the convening and highlighted encouraging areas for greater investments to benefit both businesses and workers. Recordings of the plenary sessions can be found here. In 2018, the Federal Reserve System will release a book exploring how to improve workforce outcomes for workers and employers.
  • Center for Workforce and Economic Opportunity. The Federal Reserve Bank of Atlanta recently announced the launch of the Center for Workforce and Economic Opportunity (CWEO). CWEO acts as a bridge between research and practice, connecting researchers, businesses, and policymakers with innovative approaches to creating economic opportunity through education and employment. We encourage you to visit the new site.
  • Three Part Webinar Series. The Federal Reserve Bank of Kansas City is hosting a three-part webinar series on strategies to promote and improve quality jobs for lower-wage workers. This series is hosted in partnership with the National Fund for Workforce Solutions, the Aspen Institute, and the Good Companies, Good Jobs Initiative at the Sloan School of Management in connection with the Federal Reserve System initiative Investing in America’s Workforce.  The sessions will explore strategies for improving job quality and outcomes for workers and businesses through the perspectives of employers, workers and the research community. The intended audience for these webinars is employers, workforce development intermediaries, chambers of commerce, business support organizations and community development practitioners. Information on the webinars is as follows:
Webinar I: How Employers Create Good Jobs to Maintain Their Competitive Advantage

  • Lead Partner: National Fund for Workforce Solutions
  • Date and Time: February 22, 2018: 2:00-3:00 pm CT
  • Registration link: Here
Webinar II: Engaging Workers in Creating Good Jobs

  • Lead Partner: Aspen Institute
  • Date and Time: March 22, 2018: 2:00-3:00 pm CT
  • Registration link: Here
Webinar III: In Search of the Employment “High Road”:  A Research Perspective on Developing Good Jobs

  • Lead Partner: National Fund for Workforce Solutions
  • Date and Time: April 26, 2018: 2:00-3:00 pm CT
  • Registration link: Here
  • 2018 National Interagency Community Reinvestment Conference. The Federal Reserve System, in conjunction with the Federal Deposit Insurance Corporation and the Office of the Comptroller of the Currency, will be hosting the 2018 National Interagency Community Reinvestment Conference (NICRC) at the Hyatt Regency Miami March 18 through March 21. The event will bring together a diverse group of public, nonprofit, and private sector practitioners and leaders to discuss emerging ideas and best practices in community development from around the country, one of which will be workforce development. Registration is open, and more details can be found here.
  • CDPS Publications. If you subscribe to this Blog, but want to learn more about current economic development news, trends, policy, and research within the Federal Reserve’s Seventh District, subscribe to our signature publication, ProfitWise News and Views. To learn more about trends nationally, visit Fedcommunities.

We continue to explore opportunities to further engage in community development challenges, including workforce development. If you have any comments or questions about any of the resources listed above, please let us know. Questions or comments can be sent to

Check back often for updates on the initiative and new research on employment, workforce development, education, and training from around the Federal Reserve System.

Join the conversation on Twitter: @InvestInWork; #InvestInWork.

For more information on this initiative and other workforce development and human capital topics, please contact Jason Keller, economic development director within CDPS, at

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CDPS Stakeholder Survey: How can we better serve you?

In accordance with our five-year strategic plan, the Community Development and Policy Studies (CDPS) division of the Federal Reserve Bank of Chicago has been working to expand our reach within the Seventh District and to advance our mission of improving conditions in low- and moderate-income communities.

Toward this end, we are conducting a survey of community development partners and stakeholders to learn how to better communicate with our audience. As a valued stakeholder, the responses you provide in this brief, one-time, survey will help us improve our communications as we work together to bring development and opportunities to underserved communities. The survey will take most users about five minutes to complete.

Please help us and take the survey:

If you have any questions on the survey, please do not hesitate to reach out to us at

Thank you in advance for your time and valuable input.

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Seventh District Representation on the Fed’s Community Advisory Council (CAC)

Recently, we profiled Seventh District CAC member Bethany Sanchez in the CDPS blog. The other sitting member of the CAC from the Seventh District is Rodrick Miller, who represents Ascendant Global Consulting. We asked him about his role, responsibilities, and outlook.

Q: What do you do for Ascendant Global and how does your work relate to community and economic development?

Ascendant Global (AG) is a consultancy that builds efficient, sustainable, measurable economic growth solutions for municipalities, foundations, universities, and private enterprises. From developing comprehensive workforce development strategies and designing small business ecosystem solutions to refining value propositions and driving external investments for communities, AG is singularly focused on strengthening economies through inclusive strategic growth.

AG recognizes that economies are regional, anchored by cities, and must compete globally. Through that lens, we work with an array of clients who seek to fundamentally strengthen their competitive position; increase coordination between the private, public, and nonprofit actors; and chart a clear path forward. This work results in increased access to jobs and income; encourages smart public and private investment in infrastructure, education, and facilities; and, increases the latent capacity of communities to produce value-added goods and services and contribute to the global marketplace; all of these components are essential to the long-term health of communities.

As the Founder and CEO of Ascendant Global, I partner with markets confronted with deep challenges to long-term economic security, help them identify solutions and deliver results that are appropriate for their economic, demographic, and political realities. I enjoy being the quarterback for an incredibly talented team and work side by side with them to craft solutions that are thoughtful and effective. Some of the solutions that we have developed for specific clients include:

  • Identifying the support resources and tools available to help small businesses start up, stay up, and scale up over time and increased coordination between diverse small business support entities. (Detroit)
  • Developed a five-year strategic plan to increase the likelihood of long-term career and life success for “at-risk youth” by coordinating, tracking and aggressively pursuing workforce development, career counseling, and job access goals.
  • Created a sustainable development plan for downtown and underserved corridors in a mid-sized city including recommendations on appropriate incentives, refinement of zoning and planning policies, marketing strategies, and leveraging local small business capacity.
  • Assisted various municipalities and diverse nonprofit organizations in launching economic development agencies that manage incentives and provide real estate and site selection support. (Detroit, Atlanta, New Orleans)

Q: Please give an overview of why you wanted to join the Community Advisory Council?

Involvement in the Community Advisory Council (CAC) was an ideal way to elevate issues confronting low- to moderate-income (LMI) communities to the Federal Reserve Board. Having led economic recovery efforts in New Orleans and Detroit, I have seen first-hand that LMI communities tend to have less access to information, resources, and opportunity. It often seems as if the challenging realities of these communities are a footnote to broader national policy discussions. The ability to inform, promote, and encourage Fed policy to increase access to startup capital, encourage homeownership, and drive job creation through involvement in this meaningful action-oriented forum is an incredible honor and an invaluable opportunity to give voice to marginalized populations. Learning more about how the Fed works and impacts economic opportunity has been enlightening.

Q: Tell us one thing that would help us to get to know you.

I am the son of a noncommissioned US Army officer. As a result, I grew up in many places around the US and abroad. One of the most impactful experiences was living in West Germany during the height of the Cold War from 1987-1990. I watched the Berlin Wall come down and witnessed the fall of the USSR up close. This provided me with a unique vantage point of the process people navigate to change their circumstances, redefine their lives, and learn to survive in dramatically different economic and social contexts. It was painful at times, and incredibly inspiring at others, to see families learn how to work differently, become entrepreneurs and, in many cases, thrive. While the world watched this shift on a macro level, I got to see it play out in person. This experience awakened my interest in political economy and is one of the biggest factors that led me to become an economic developer.

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Seventh District Representation on the Fed’s Community Advisory Council

“The Community Advisory Council (CAC) was formed by the Federal Reserve Board in 2015 to offer diverse perspectives on the economic circumstances and financial services needs of consumers and communities, with a particular focus on the concerns of low- and moderate-income populations. The CAC complements two of the Board’s other advisory councils–the Federal Advisory Council and the Community Depository Institutions Advisory Council–whose members represent depository institutions. The CAC meets semiannually with members of the Board of Governors in Washington, D.C.”

The Fed’s Seventh District comprises parts of Illinois, Indiana, Michigan, and Wisconsin, plus the state of Iowa. Two members of the CAC hale from the Seventh District, one of whom was recently appointed. During this month we will publish a blog about each, in their own words, to give our readers some additional insight on our representatives to the CAC, and their points of view on community development policy priorities.

The newest CAC member from our district is Bethany Sanchez, who represents the Metropolitan Milwaukee Fair Housing Council. We asked her some straightforward questions about her role, responsibilities, and outlook.

Q: What do you do for Metropolitan Milwaukee Fair Housing Council and why is your work important to the community?

I direct the Fair Lending program at the Metropolitan Milwaukee Fair Housing Council, partnering with local, state and national groups to create programs and policies to increase fair lending and housing choice, and promote fair and affordable housing and equitable community development.

In that role, I monitor the lending records of banks serving the Milwaukee area and convene the Milwaukee CRA Coalition. I’m a member of the Board of Directors of the National Community Reinvestment Coalition (NCRC), a leader in Milwaukee’s homeownership consortium called Take Root Milwaukee, and an active participant in the Wisconsin Consumer Roundtable, Milwaukee’s Alliance for Economic Inclusion, the Financial Equity Coalition, and the Wisconsin Affordable Housing Coalition. Another big part of my work is providing a wide variety of community groups with outreach and education on fair housing, fair lending and the Community Reinvestment Act.

These interactions and relationships reinforce my understanding of the barriers to our goal of ensuring that every credit-worthy borrower has equal access to fairly-priced credit. Fair housing and fair lending laws are incredibly important. However, much more work is needed to ensure that all borrowers understand their rights and responsibilities, avoid predatory loans, and obtain home loans and small business loans that will help build wealth and secure a healthy, equitable future for their families and communities.

Q: Why was it important for you to get involved with the Chicago Fed and become a part of our Community Advisory Council?

I have been fortunate to be a Beige Book Survey participant for the Chicago Fed for a number of years. I hope my input has helped the Fed gain a deeper understanding of local trends in the Milwaukee region, especially as they relate to housing, jobs and community development. I expect that the national opportunity to serve on the Federal Reserve Board’s Community Advisory Council will take that to the next level, informing the Federal Reserve Board and their staff about the financial concerns of Milwaukee area low- and moderate-income communities, and of opportunities to increase equal access to fairly-priced credit and capital.

Q: Tell us one thing that would help us to get to know you.

I am a strong believer in the importance of balance. The balance and interconnections between my professional, personal and spiritual life keep me engaged and motivated. Meditation helps me remember to seek understanding of the perspectives and motivations of those with whom I interact, striving to engage with others from a calm, balanced place of love.

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Changing the Narrative of Communities: Highlights from a Symposium on Business Growth and Employment in Chicago’s African American Neighborhoods

By Robin Newberger and Maude Toussaint-Comeau

Narratives about place – the stories that surface in the news and in popular culture – have implications not only for the perceptions and impressions that circulate about neighborhoods, but for the economic potential of the residents who live there. Decisions about where to invest, how to allocate public resources, whether a home can be financed and so much more are affected by the impressions that people (and society) have about a community. The consequences for asset-ownership, wealth, and economic well-being can be devastating when the messages are overwhelmingly negative.

Shedding light on the assets and opportunities in Chicago’s Chatham neighborhood, and presenting alternative narratives about place, was the goal of a symposium on “Business Growth and Employment in Chicago’s African American Neighborhoods” organized by the Federal Reserve Bank of Chicago, The Greater Chatham Initiative and World Business Chicago in June 2017.[1] The meeting brought together academics, journalists, funders, and business people to share perspectives on the programs and strategies that attract capital, support businesses, and strengthen communities.[2]

In this blog we highlight some of the insights and recommendations that were discussed during the symposium for how the Greater Chatham area may be able to enhance its success as a “community of choice” where people want to live and shop, and as a “community of opportunity” where residents are connected to jobs, businesses, and broader networks throughout the region.[3]

Figure 1: Greater Chatham

greater-chatham-map-1Source: The Greater Chatham Initiative
Greater Chatham is a 15-square miles area including the communities of Avalon Park, Auburn Gresham, Greater Grand Crossing and Chatham.

Video Highlights: Opening Remarks

Alicia Williams, Vice President, Community Development Officer and Director of Community Development and Policy Studies, Federal Reserve Bank of Chicago  >>

Nedra Sims Fears, Executive Director, Greater Chatham Initiative  >>

Session 1: Reflections on community change in south side neighborhoods

It’s the aggregated energy that helps to make a place great. – Theaster Gates, Director,  Arts + Public Life at the University of Chicago and Executive Director, Rebuild Foundation

The Greater Chatham area and other south side neighborhoods possess many of the assets that comprise the building-blocks for economic development. The far south side of Chicago, from 79th Street to the Cook County line, is unique not only for its large tracts of industrial-zoned land, but for having the highest concentration of transportation assets in North America. South side neighborhoods also boast an array of local food and arts establishments, as well as corridors that include the highest retail census tract for African American shoppers in the city of Chicago. Some of the most popular cultural attractions, like The Chosen Few House Picnic, have long remained under the radar of mainstream media. Others, like the planned Obama Presidential Center in Jackson Park, are attracting widespread attention, and will likely bring additional arts, food, and hospitality investments in the coming years. In some cases the benefits of these community institutions extend beyond the amenities they provide. While the formerly- abandoned Stoney Island Arts Bank has been repurposed as a destination space for hospitality and culture, it has also sparked the re-development of adjacent properties and created an energy for people “to imagine a new kind of south side” in which artists, entrepreneurs, and “creatives” invest in African-American places.

Video Highlights: Session 1

 Jane Rhodes, Department Head, Professor of African American Studies, University of Illinois at Chicago >>

Alden Loury, Director of Research and Evaluation, Metropolitan Planning Council >>

Natalie Moore, WBEZ-Radio Reporter and Author, The South Side: A Portrait of Chicago and American Segregation >>

Theaster Gates, Director, Arts + Public Life at the University of Chicago, Rebuild Foundation >>

David Doig, President, Chicago Neighborhood Initiatives >>

Session 2 (part A): Accelerating business growth and employment in minority neighborhoods

There are new jobs and new ways of working. We have to prepare people for the new ways. – Karen Norington Reaves, CEO, Chicago Cook Workforce Partnership

Figure 2

A relatively high proportion of workers in Greater Chatham are employed in education, health services, transportation, and warehousing (Figure 2). A great many of Chicago’s manufacturing employers are located on the South Side, including a Ford Motor plant that employs more than 4,000 people and other Tier-1 automotive suppliers. These are the companies where employees can often start at entry level, earn their way up to a six figure income, and have no college debt. Yet many of these positions go unfilled by potentially qualified south side residents. Employers too are often unaware that public workforce system, represented at the symposium by organizations like the Chicago Cook Workforce Partnership, and Calumet Industrial Commission offers resources for training and job placement at no charge to the hiring firm.

Video Highlights: Session 2 (part A)

Karin Norington Reaves, CEO, Chicago Cook Workforce Partnership >>

Ted Stalnos, President, Calumet Area Industrial Commission >>

Session 2 (part B ): Accelerating business growth and employment in minority neighborhoods

We have some wonderful African-American owned businesses on the south side. – Jackie Dyess, Owner, Inter City Supply

Small businesses are another component of economic activity in Chatham and other south side neighborhoods. About 600 of the 3,000 members of the University of Chicago’s business incubator, The Polsky Exchange, hail from the neighboring community and have no previous affiliation with the university. Many of these start-ups are tech and product design businesses. Through its work with Chicago Anchors for a Strong Economy (CASE), the University of Chicago’s Office of Civic Engagement reaches other neighborhood-based businesses as well, about 300 thus far, to align the university’s purchasing and hiring with the needs of the community. As one company represented at the symposium noted, this program not only doubled her business with the university, it enabled her to hire more workers from the surrounding neighborhoods. While getting capital and financing remains a challenge for many small businesses in the area, one of the few remaining black-owned banks in Illinois, Illinois Service Federal Bank, continues to operate in Chatham and surrounding neighborhoods, and provides business customers, at no cost, with technical assistance for preparing social security taxes, financial statements, and quarterly employment taxes. Loan funds and micro-finance groups including the Chicago Neighborhood Initiatives, The Chicago Community Loan Fund and others are also lending to small businesses in Chatham, Auburn Gresham and other south side neighborhoods.

Video Highlights: Session 2 (part B)

Alyssa Berman-Cutler, Director of Business and Workforce Development, Office of Civic Engagement at the University of Chicago >>

Jackie Dyess, President, Inner City Supply Co. Inc. >>

Robert Klamp, CEO, Illinois Service Federal Savings & Loan >>

Session 3: Challenging inequality, driving economic growth

Good neighborhoods require a strong middle class, decent schools, good quality housing and a strong small business base. – Andrea Zopp, Deputy Mayor City of Chicago

While acknowledging the scope of the challenges before them, civic leaders have been working on a series of initiatives for increasing investment in south side neighborhoods.  These include The Neighborhood Opportunity Fund to which businesses along designated (underinvested) corridors can apply for money to promote commercial and cultural projects; The Chicago Community Catalyst Fund (also called Fund 77), a “fund-of-funds” administered by a board of trustees acting as investment managers, that uses $35 million in public money to leverage investment dollars from the private sector; and Benefit Chicago, a vehicle for providing loans and investments to mission-oriented businesses and social enterprises funded by foundations and social impact investors. The Chicago Community Trust (CCT) and other philanthropies provide capital to alternative and higher-risk projects aimed at stimulating revitalization. This includes CCT’s On the Table project that facilitates conversations between people who do not typically meet each other in their everyday lives, and thereby draws in the voices of community members who are often left-out of economic development planning. More than ever, these projects are taking into consideration their effects on inclusiveness and marginalization; and they are taking place at a time when decision-makers increasingly recognize that social capital – relationships and networks with business leaders and policymakers – can be as powerful as the financial capital that advocates seek for Chatham and the surrounding communities.

Video Highlights: Session 3

Congressman Bobby Rush, U.S. Representative, 1st Congressional District Illinois >>

Rick Mattoon, Senior Economist and Economic Advisor, Federal Reserve Bank of Chicago >>

Andrea Zopp, Deputy Mayor and Chicago Neighborhood Development Officer, City of Chicago >>

Terry Mazany, President and CEO, Chicago Community Trust >>

Michael Sacks, Vice Chairman, World Business Chicago >>



[1] The Community Development and Policy Studies department of the Federal Reserve Bank of Chicago has long been interested in understanding the utilization of financial services and credit access in black Neighborhoods of Chicago and the Seventh Districts. See for example Bond and Townsend (1996) Formal and Informal Financing in a Chicago Ethnic Neighborhood, Economic Perspectives, July/August.
[2] For additional analyses of data on key themes related to neighborhood demographics, employment, business and credit conditions in Greater Chatham, see Newberger, Robin and Maude Toussaint-Comeau, “Reinvesting in the Greater Chatham African American neighborhoods in Chicago: New data and Insights from Practitioners,” ProfitWise News and Views, Issue 3, 2017, forthcoming.
[3] See “Economic Opportunity in Greater Chatham,” presentation by Gretchen Kosarko, RW Ventures.
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2017 NHS Community Banks Partnership Meeting Summary

By Kelly Pearson and Jason Keller

2017 CBP Meeting Speaker Photo

The Community Development and Policy Studies (CDPS) division at the Federal Reserve Bank of Chicago has a longstanding interest in community banks, current regulatory developments, and the ways smaller banks adapt to environmental changes, such as the high rates of vacant properties in Chicago’s low- and moderate-income neighborhoods. As the landscape of community reinvestment and revitalization evolves, community banks and their partners must work together to respond to the needs of the neighborhoods they serve.

Neighborhood Housing Services of Chicago (NHS) held its annual Community Banks Partnership Meeting (the Partnership) earlier this year at the Federal Reserve Bank of Chicago. The meeting brought together over 70 community bankers, regulators, housing experts and industry partners to discuss current trends in housing, specifically how to convert vacant properties into neighborhood assets. NHS is a nonprofit organization driven by the belief that homeownership is essential to strengthening households and communities.[1]  Established in 2007, the Partnership is an innovative collaboration that supports NHS’ community reinvestment programs and services through financial support, lending capital, and consultation.

This year’s meeting coincided with the 40th anniversary of the Community Reinvestment Act (CRA) and the recent release of the July 2016 Interagency CRA Questions and Answers (Q&A’s).  During his opening remarks, Jason Keller, economic development director for CDPS explained that the revised guidance reflects consideration of comments from bankers, community organizations, and others and offers technical corrections in light of an evolving financial regulatory landscape. The new guidance supersedes the 2010 and 2013 Q&A’s and provides for new and revised examples of economic development, community development loans, and activities that are considered to revitalize or stabilize underserved middle-income geographies.[2]

With this context in mind, Kristin Faust, president of NHS, described the Partnership as a key group of NHS supporters who promote revitalization in neighborhoods that need it most. Faust described that sustained recovery in home values has yet to realize in some neighborhoods on the south and west sides of Chicago.[3]  Despite tough market conditions, however, NHS has seen some positive developments. Through the City of Chicago’s Micro-Market Recovery Program in the Chicago Lawn neighborhood, NHS turned 54 vacant buildings into owner-occupied housing from 2012 to 2015.[4]  In 2016, NHS started an effort to take 20 vacant properties and match them with 20 homebuyers in the Woodlawn neighborhood on the south side of Chicago. To date, NHS has surpassed its initial goal, transforming 25 vacant properties into owner-occupied homes thus far.

Turing to the morning’s panel discussion, Art Neville, vice president and chief lending officer from Community Savings Bank and past chair of the Partnership invited Allen Rodriguez, vice president of resource development, NHS Board of Directors, to the podium to moderate a panel discussion. Rodriguez introduced the panel, which included: Sarah Duda, associate director, Institute for Housing Studies at DePaul University; Rob Rose, executive director, Cook County Land Bank Authority; and John Groene, West Humboldt Park neighborhood director, NHS.

Sarah Duda shared current housing market conditions in Cook County in light of trends over the past 20 years. Using data from the IHS Clearinghouse (and other sources), she highlighted a variation in recovery across markets, with wide-ranging rates of vacancy, mortgage activity, and property values throughout Chicagoland.[5] Residential vacancy remains a legacy of the housing crisis, with 64.3 percent of long-term vacant properties being in low- and moderate-income (LMI) census tracts. Furthermore, vacancies are roughly five times more concentrated in LMI neighborhoods than in upper-income neighborhoods. In many neighborhoods on Chicago’s south and west sides and south suburban Cook County, there are clusters of home sales of $50,000 and below. Figure 1 illustrates the geographic pattern of low-value sales in Cook County in 2016. It shows that these types of sales make up a substantial portion of total sales activity in neighborhoods on the west and south sides of the City of Chicago and in the south suburban Cook County. These are typically investor sales because there are limited mortgage products available to owner-occupants to rehab them.

Figure 1: Low-value sales in Cook County (2016) [6]


Duda went on to describe how there is weak demand in some areas for housing and an increased demand in communities like Humboldt Park, East Garfield, Logan Square, and Pilsen. According to Duda, these communities have seen rapidly increasing home values since 2013 likely due to nearby amenities and available transit.

In light of stagnant housing markets with low values, low turnover rates, and high rates of vacant properties in certain neighborhoods, Rob Rose described one role of the Cook County Land Bank Authority (CCLBA) as being to generate activity in these markets.  Land banks are public or nonprofit entities that acquire, hold, develop, and dispose of vacant properties.  The mission of the CCLBA is to reduce and return vacant land and abandoned buildings back into reliable and sustainable community assets.[7]  The CCLBA was founded in 2013 and operates in Chicago and south suburban Cook County. Illinois has a lengthy foreclosure process averaging 900 days, but due to a new, expedited process, the CCLBA can sometimes clear title in 8-12 months. CCLBA has the ability to eliminate back taxes, remove fines, and liens. The CCLBA also works with local developers and organizations like NHS to build a pipeline of prepared homebuyers. Through its Vacant Lot Program, the CCLBA sells lots to residents, developers, and community groups. [8]  Uses for these lots include side yards, solar banks, and community gardens. Rose noted that community banks can support the work of the CCLBA by creating more consumer purchase/rehab loan products and more developer acquisition/rehab loan products; donating hard-to-move inventory; and by structuring deed-in-lieu transactions, discounted payoffs, short sales, and distressed note sales.

John Groene shared how NHS helps homeowners stay in their homes and prepares new homebuyers to reoccupy vacant properties in targeted neighborhood areas.  For example, in the West Humboldt Park neighborhood on Chicago’s west side, NHS organizes a network of volunteer “Block Ambassadors”: residents who canvass their blocks to identify vacant properties and reach out to homeowners at risk of foreclosure to let them know about NHS foreclosure prevention services. NHS has multiple success stories of working with partners to curb vacancies. In 2015, a family of ten in West Humboldt Park faced eviction when their landlord fell into foreclosure. Community Investment Corporation (CIC) acquired the property, and after a period of time renting from CIC and preparing for homeownership with NHS, the family purchased their longtime home, and the property never became vacant. [9]  In 2016, after a decade of a vacant property being a magnet for criminal activity, a second property was acquired by CIC then transferred to the CCLBA.  A first-time homebuyer working with NHS purchased the property in March 2017, utilizing NHS purchase rehab financing and leveraging the City of Chicago’s Tax Increment Financing (TIF) program, which provides up to $25,000 to owner-occupants purchasing vacant buildings in targeted areas.[10]  Groene closed by stating that in order to support NHS’ strategies, community banks can be patient sellers to first-time homebuyers and partner with entities such as the CCLBA and CIC when disposing of vacant properties.


By providing this annual forum, the Partnership offers lenders, intermediaries, and other interested constituents an opportunity to discuss issues central to improving lives and strengthening neighborhoods in the Chicago region. As a result of this meeting, partners are better equipped with innovative solutions that can be leveraged to address issues of vacant buildings in their communities.  By working together with nonprofits such as NHS and the Cook County Land Bank Authority, community banks can help generate renewed interest in communities that have yet to fully recover from the housing crisis.

Kelly Pearson is a senior associate, Foundation and Corporate Relations, of Neighborhood Housing Services of Chicago. She manages corporate and foundation funding partnerships for NHS, as well as the Community Banks Partnership.

Jason Keller is the economic development and Illinois state director in the Community Development and Policy Studies Division of the Federal Reserve Bank of Chicago.

[1] See
[2] To review the full Questions and Answers, visit the Federal Financial Institutions Examination Council web-site[2].
[3] See
[4] See
[5] See
[6] IHS Data Clearinghouse: Calculations of Data from Cook County Recorder of Deeds via Property Insight, Record Information Services, Cook County Assessor.
[7] See
[8] See
[9] See
[10] See


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Detroit Renter Housing Analysis: Challenges of Income and Affordability

By Taz George and Sara Cooper

Amid new efforts to preserve and expand Detroit’s affordable housing stock, policymakers and community development practitioners should continue to note the unique demographic and economic trends underlying the city’s rental housing challenges. A recent analysis of Detroit’s rental housing trends by the Community Development and Policy Studies (CDPS) division of the Federal Reserve Bank of Chicago compares the city’s rental housing market to some of its peers in the region. This analysis also shows that very low-income households with high housing cost burdens comprise the majority of the city’s renters, and suggests mixed evidence on whether household financial health is improving based on credit score data. These trends have important implications for programs and policies to improve the supply of affordable housing for Detroit’s low- and moderate-income communities.

In the city of Detroit, 66.1 percent of renter households experience high housing cost burden, meaning they spend at least 30 percent of their income on gross rent. A high housing cost burden can stretch a household’s budget for other necessities like food, transportation, and health care, and can make it challenging to save for the future.

Perhaps not surprising, due to the city’s large population loss, Detroit’s rental cost burden has been driven primarily by declining renter household income rather than mounting rental costs, compared to some other large cities in the region. Adjusted for inflation, median gross rent in Detroit increased by 15.4 percent from 1980 to 2015, a similar rate to Cleveland (11.8 percent) and Milwaukee (10.1 percent), and far less than Chicago (39.2 percent) (Chart 1). Detroit’s median renter household income, however, declined more steeply over this period than its peers, and is lower than all of them as of 2015, at just $17,239 (Chart 2). As a result, Detroit’s rate of housing cost burden is remarkably high: 66.1 percent of rental household pay 30 percent or more of their income towards rent, and 42.6 percent pay at least 50 percent or more of their income towards rent. The problem affects all ages, with over 60 percent of both working-age and senior households facing high rates of rent burden.

Chart 1


Chart 2


While it is not surprising that low-income renters are most affected by rental affordability challenges, the extent of this population’s needs in Detroit is noteworthy. Of the over 80,000 rental households in Detroit experience high cost burden, 74.5 percent have an income of less than $20,000 per year. Of this group, 7,400 households reported zero or negative income in 2015. Actions to ensure access to quality affordable housing must go alongside policies to spur economic opportunities for these households.

Chart 3


Finally, the CDPS analysis examined consumer credit conditions in Detroit for signs of changes in households’ financial health. Risk Scores, a measure of creditworthiness akin to a credit score in the Federal Reserve Bank of New York Consumer Credit Panel data from Equifax, painted a mixed picture in this regard. While the share of individuals with a strong Risk Score of 660 or greater has increased in recent years, the share with no Risk Score also grew. This suggests that while more households are gaining stronger financial footing and the ability to potentially qualify for a mortgage, another growing group of households has very limited access to mainstream financial products, and may struggle qualifying for rental housing or employment opportunities because of weak credit (Chart 4).

Chart 4


Taken together, this analysis shows the degree of need among Detroit’s low-income renters for affordable quality housing. CDPS will continue to partner with policymakers and practitioners in Detroit and across the 7th District to identify and promote strategies to address these needs.

Taz George is a research analyst in the Community Development and Policy Studies Division at the Federal Reserve Bank of Chicago. Sara Cooper was the CDPS summer 2017 intern.

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Four Videos Help Explain the Community Reinvestment Act


By Jason Keller

A series of four recently released videos commemorate the 40th anniversary of the Community Reinvestment Act (CRA). Passed in 1977, CRA “is intended to encourage depository institutions to help meet the credit needs of the communities in which they operate, including low- and moderate-income neighborhoods, consistent with safe and sound operations.”[1]

The first video,Getting to Know the Community Reinvestment Act,” explains in practical, understandable terms the basic elements of the CRA and how regulators evaluate a financial institution’s CRA performance. It is essential viewing for anyone interested in learning about the Act. The video is also extremely helpful for those who are interested in collaborating with financial institutions to make their communities better places to live and work.



Next, Small and Intermediate Small Bank CRA Examinations,focuses on the role financial institutions of all sizes play in ensuring fair and equal access to credit throughout the country by discussing the different performance criteria applied to smaller financial institutions under the CRA.






The third video in the series, Community Development Defined in the Community Reinvestment Act,” demonstrates how partnerships between financial institutions and federal, state, and local entities can foster revitalization and stronger economic futures for families. In this episode, a fictitious institution applies the CRA definition of community development to meet local community credit and service needs.

The fourth and final video, entitled “Leading Practices for Effective CRA Programs,” highlights some of the leading CRA practices observed by members of the Federal Reserve’s community development departments. This video seeks to inform community groups, community development practitioners, researchers, educators, government officials, and others about the issues that financial institutions consider from a CRA perspective.


Together, these four videos demonstrate how the CRA brings much-needed capital into low- and moderate-income communities.

Community Development and Policy Studies (CDPS) at the Federal Reserve Bank of Chicago has a team of professionals with expertise in urban planning, public policy, finance, and law, who engage financial institutions and community stakeholders in conversations about CRA requirements, community development issues, and best practices. We serve as a conduit between financial institutions and the communities they serve throughout the 7th District by convening meetings, roundtables, and conferences, as well as publishing targeted research to engage local and regional partners in addressing community needs. To learn more about the work we do or to review other CRA-related content, visit:, the Community Development Data Guidebook, Understanding Community Development Needs through the CRA Performance Context, and A Banker’s Quick Reference Guide to CRA.

[1] See

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