Published September 29, 2015
By Bill Wichert

NEWARK — In their mission to provide affordable housing, commercial space and related services, New Jersey's community development corporations have been faced with limited financial resources, sometimes relying on volunteers and donations to complete their projects.

But according to a new study by a network of such organizations, the non-profit groups have packed an economic punch over the past 25 years to the tune of $12 billion.

"That's $12 billion with a B," said Staci Berger, president and chief executive officer of the Housing and Community Development Network of New Jersey, which produced the recent study on the economic impact of CDCs in New Jersey.

Berger joined with elected officials and other members of the state's community development sector at an event on Tuesday to share the results of that study and highlight the local impact of CDCs in Essex and Union counties.

The event was held at the Newark headquarters of New Community Corporation, one of the CDCs in the network.

According to the "Stronger Together" report, New Jersey CDCs have contributed about $12 billion to the state's economy since 1989. CDCs directly invested $6.5 billion and those investments created another $5.7 billion of economic activity, the report states.

With that economic impact over the past 25 years, CDCs have added 82,000 jobs through investments in real estate development and rehabilitation and contributed $5.5 billion in workers' wages and contracts with businesses, according to the report.

Since 1989, CDCs have undertaken more than 1,500 developments in New Jersey, including building and rehabilitating more than 21,000 affordable homes and building more than 2.5 million square feet of commercial space, the report states.

On the local level, CDCs in Essex and Union counties have contributed $1.241 billion and $487 million, respectively, to New Jersey's economy over the past 25 years, network officials said.

In Essex County, CDCs have completed 313 developments, which have spurred 8,300 jobs and $590 million in labor income, officials said.

CDCs in Union County have completed 115 developments, spurring 3,100 jobs and $229 million in labor income, officials said.

Pointing to the various projects undertaken in Elizabeth — including the building of commercial space, senior housing and apartments for individuals with special needs — City Mayor Christian Bollwage said "these community development corporations have built better communities for our city."

Richard Rohrman, chief executive officer of New Community Corporation, noted during Tuesday's event that his organization plans to revitalize its properties throughout Newark. The corporation also provides job training, early childhood education and other services, Rohrman said.

"By committing to help the most vulnerable residents, including low-income seniors and the disabled, we aim to ensure that Newark's economic progress is sustainable, but it also includes all members of the community," Rohrman said.

Newark Mayor Ras Baraka said "these CDCs have believed and invested in the city when other folks have not."

"When other people were afraid to invest in the City of Newark, CDCs have always stepped up to the plate," Baraka said.

But the mayor added that more work remains to be done.

Although there has been investment in Newark's downtown area, Baraka said other areas have been neglected for decades and some buildings have been abandoned since he was a child.

"While we celebrate our victories today, we don't want to claim no easy victories," said Baraka, adding that "there's a long way to go and that we have a lot of work to do."

The latest report on the economic impact of CDCs comes at a time when such non-profit groups continue to face funding cuts from state and federal sources, officials said.

As one example, Berger noted after Tuesday's event that, over the past five years, the state has not provided direct funding to CDCs through realty transfer fees deposited into the state's Affordable Housing Trust Fund.

The fund was used in part to assist community developers to build affordable housing, but the state has been using the money for other housing programs and not housing development, according to Berger.

Without that investment on the state level, Berger said "it means that CDCs have to go out and borrow that money or they have to put important developments that communities need on hold until the resources become available."

Given such funding cuts, Bill O'Dea, executive director of the Elizabeth Development Company, which works with CDCs, told attendees at Tuesday's event that there is "a crisis in the not-for-profit world."

O'Dea's organization, which is a public, non-profit economic development corporation, has worked closely with non-profit groups "that are fighting to survive, that are fighting to keep their doors open, O'Dea said.

After Tuesday's event, O'Dea said funding cuts have caused non-profit groups to have trouble with maintaining staffing levels and undertaking new initiatives. Many non-profit organizations have depleted their reserve funds in order to maintain their programs, O'Dea said.

While providing nearly the same level of services, Elizabeth Development Company has been forced to reduce its staff by about 40 percent over the past seven years, in large part because of funding cuts, O'Dea said.

"Sometimes you just have to do more with less, and non-profits are really good at that, because people that work for the non-profits really believe in the causes...that they're working on," O'Dea said.