Capacity Building & Leadership

As important as federal resources are, they are only a part of the solution when it comes to rebuilding under-resourced communities. We rely as well on the knowledge and hard work of change agents at the local level, including local governments and community-based nonprofits. The federal government must do more than provide resources to support local programs and project-level investments. It must also invest directly in the capacity of organizations, strengthening their ability to deliver critical services and develop innovative approaches that can then be disseminated and replicated in other communities.

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Strengthening Local Capacity

The needs of local governments and community-based organizations are as varied as the communities they serve. Although local organizations’ long-term capacity for housing and community development is critical for stable and affordable communities, the small size and lean budgets of such entities often mean that they lack the ability to implement some critical components of development strategies. This is true even for well-resourced city government agencies and larger nonprofits, as the structure and financing of development transactions have become increasingly complicated in recent years. We need additional resources for capacity-building and technical-assistance programs to ensure that community-based organizations and localities have the necessary talent and skill sets to support their work.

Policy Asks

Invest in HUD’s Section 4 Capacity Building for Community Development and Affordable Housing Program

The U.S. Department of Housing and Urban Development (HUD) Section 4 program strengthens the nation’s lower-income urban, rural, and Native communities by bolstering nonprofits that build and invest in their neighborhoods. The program provides grants on a competitive basis to national intermediary community development organizations, which provide training, education, financial support, and development assistance to local community development corporations (CDCs). These funds are matched on a three-to-one basis and then used to leverage additional private capital. Total aggregate leverage has consistently been in the range of $20 or more for each dollar of Section 4 funding. From 2020 to 2024, Section 4 has been utilized by over 1,000 CDCs and helped create or preserve more than 40,000 homes and attract over $11 billion in investment for lower-income neighborhoods and communities across the country.

The Section 4 program is the sole source of funding at HUD that provides financial support and development assistance to CDCs to support their housing and community revitalization efforts. Unfortunately, funding for the program has been relatively flat in recent years, straining its ability to build the capacity of CDCs to respond to local needs. LISC recommends that the program receive robust appropriations to scale CDCs’ affordable housing and community development activities and that HUD continue to administer the program as required by law.

Enhance the USDA’s Rural Community Development Initiative

Rural communities experience distinct capacity challenges in responding to local affordable housing and economic development needs. It is often difficult for these communities to apply for and receive public and private resources due to capacity constraints, which typically include small, under-resourced local governments and fewer community development organizations. The Rural Community Development Initiative (RCDI) program of the U.S. Department of Agriculture (USDA) is an important resource for funding nonprofit housing and community development organizations that invest in housing, community facilities, and community and economic development projects in rural areas. The RCDI program is the only specific capacity-building resource provided through USDA’s Rural Development programs, and it helps scale the ability of nonprofits to further their community development work in rural areas. LISC supports increased appropriations for the RCDI program to build the capacity of rural communities to respond to local needs.

Increase HUD’s Technical Assistance Resources

Community development projects are often complex undertakings, requiring an understanding of how to layer multiple financing programs while staying in compliance with requirements related to the use of federal resources. HUD supports the technical-assistance needs of HUD funding recipients and local communities through the Community Compass (CC) and Distressed Cities and Persistent Poverty Technical Assistance (DCTA) programs. The CC program brings all of HUD’s technical-assistance resources together in one program so applicants can indicate the particular topics or programs for which they would like to provide HUD-funded technical assistance to local communities. Activities funded under CC can include needs assessments, direct technical assistance, development of resources, and other supports. The DCTA program fills an important niche by building the capacity of small municipalities and Tribal governments and assisting them with their affordable housing, economic development, disaster recovery, and financial management needs.

LISC supports sufficient appropriations for the Community Compass and Distressed Cities Technical Assistance programs, so HUD grantees and local communities have the support they need to utilize federal funding to meet their local needs, and recommends that HUD continue to administer the program as required by law.

Continue the Rural Partners Network

The U.S. Department of Agriculture’s Rural Partners Network (RPN) is the first all-of-government initiative to help rural communities access federal government resources and funding to create jobs, build infrastructure, and support long-term economic stability. The RPN program provides on-the-ground technical assistance and helps local stakeholders identify key issues, build local capacity, and navigate federal programs. LISC supports continued appropriations for the RPN program so rural areas have the necessary resources and expertise to meet their local needs.

Promoting National Service

National service programs like AmeriCorps bolster the capacity of local nonprofit, faith-based, and community organizations to deliver services and make a difference in local communities. Each year, roughly 75,000 AmeriCorps members and 140,000 AmeriCorps Seniors are deployed to address locally determined needs in rural and urban communities across all 50 states. Participants in national service programs gain essential job skills and education opportunities, enabling them to continue contributing to local economic growth beyond their time in service. More than 90% of AmeriCorps members are employed or are pursuing higher education in the six months following their service.

Policy Asks

Robustly Fund the AmeriCorps Program

AmeriCorps continues to demonstrate exceptional efficiency, strong private-sector collaboration, and high-impact results. For every federal dollar invested, AmeriCorps generates $17 in U.S.-wide economic value through private matching funds and the services its members provide to communities. Since 1994, LISC’s AmeriCorps program has placed more than 3,500 members in more than 30 states, serving community-based organizations in more than 100 cities and rural areas. LISC AmeriCorps members, who typically live in the community they serve, have been instrumental in helping to develop nearly 14,000 affordable housing units, providing homeownership counseling and foreclosure prevention counseling to more than 53,000 people, and helping nearly 40,000 clients with employment services and financial coaching. A number of external evaluations have underscored the value of the LISC AmeriCorps programs in not only expanding the capacity of local organizations to serve their communities, but also boosting career and educational prospects for LISC AmeriCorps members. A study by the Urban Institute found that LISC AmeriCorps members were employed at a rate of 93% six months after program completion, while 86% claimed the education award made it possible for them to continue their education.

Reauthorize and Strengthen AmeriCorps Programs

LISC supports passage of the bipartisan Promoting Service Through AmeriCorps (PSA) Act. In addition to reauthorizing national service laws through 2029, this legislation would: 1) increase the flexibility of AmeriCorps education benefits to expand workforce development opportunities through service and improve the pathway from AmeriCorps to post-secondary education, 2) create more opportunities to serve by authorizing positions with shorter terms of service and codifying an expanded age eligibility range for the AmeriCorps National Civilian Community Corps, and 3) and establish an Office of Alumni Engagement to strengthen recruitment and foster a shared identity among current and former AmeriCorps members.

200,000+ AmeriCorps participants deployed across all 50 states each year

Continue to Fund the Economic Mobility Corps

Launched in 2021, the Economic Mobility Corps is an interagency partnership between AmeriCorps and the Department of the Treasury’s Community Development Financial Institutions (CDFI) Fund. The program placed 156 AmeriCorps service members at certified CDFIs for two years beginning in August 2021, expanding national service opportunities and bolstering the capacity of CDFIs to provide critically needed financial services in under-invested communities. To date, LISC has established two cohorts of EMC members, placing 62 members at 53 different CDFIs located in 20 states and Puerto Rico. As a public-private partnership, LISC has leveraged nearly $2.4 million in private funding to support matching funds to help smaller, rural CDFIs to participate as Economic Mobility Corps sponsors. Two thirds of participating CDFI partners serve people from rural communities. Through September of 2023, LISC Economic Mobility Corps members have provided financial counseling services to 5,046 clients and housing counseling to an additional 360 clients.