ST. LOUIS • The apartment building was one nobody wanted.
The police were called 117 times in one year to the four-unit building at 3600 Bamberger Avenue. Drug deals went down out front. A woman was strangled on the porch. It got so bad, the city had all its tenants kicked out.
Last year, the Tower Grove Neighborhoods Community Development Corporation bought the empty building, cleaned it up and renovated it. After somebody broke in and destroyed all its work, it spent another $50,000 to redo the whole place.
Three of those units are now leased at $450 a month. The group turned the fourth into a police substation and is asking the community to help fund it.
Community development corporations, like Tower Grove Neighborhoods, are nonprofits established to rescue specific neighborhoods from urban decay and pay attention to neighborhoods that others won’t.
But they are declining in number, getting less money from the government and struggling to establish themselves as a major force in St. Louis. The situation has led nonprofit leaders to start a new, private funding pool and support network for these groups, called InvestSTL.
‘Not a profitable enterprise’
Community development corporations work against the laws of economics, trying to create good affordable housing in areas that people have deserted for richer areas.
“This is not a profitable enterprise for for-profit folks to get into,” said Reginald Scott, executive director of the Lemay Housing Partnership. “There’s nobody else running around town trying to get into Lemay to build in these areas.”
Community development corporations buy abandoned lots or buildings and turn them into things people want and can use. That can mean affordable apartments and homes, or it can mean a movie theater or supermarket, in the case of Beyond Housing, perhaps St. Louis’ most recognized community development corporation.
They also repair seniors’ homes, paint crosswalks, get streets fixed and hold workshops on property management, gardening and fitness, anything to teach a neighborhood’s residents how to be better citizens.
Tower Grove Neighborhoods even runs its own tenant screening service, checking employment histories, rental histories and whether a tenant has lived at a property on the city’s “nuisance” list.
St. Louis has a lot of “individual-based” nonprofits, which give services to people in a wide area who meet some qualification of need. But there aren’t as many “place-based” nonprofits, organizations that serve neighborhoods as a whole rather than individual people.
Todd Swanstrom, a University of Missouri-St. Louis professor who has long studied how and why cities decline and rebound, says there are benefits to focusing on place. If your neighborhood has lots of vacant buildings, or properties rife with nuisances like noise and litter, it’s more likely that it also has higher crime rates, worse schools, poorer health and more poverty, he said.
“Without strong places that buttress people and give them strong places to succeed, you’re not going to succeed,” Swanstrom said.
There are fewer community development corporations than there once were, and they’re not in all the places that need them.
Swanstrom estimates St. Louis has 19, down from about 30 when they first formed in the ’70s. St. Louis County has just five.
Community development corporations are often small — a 2011 study Swanstrom co-wrote found that more than half of them had fewer than four employees.
They’re also facing a shrinking pool of federal funding, which used to be their predominant revenue source.
St. Louis got about $16 million in community development block grant funding last year, which was divided among all kinds of nonprofits and local governments, not just community development corporations. That’s down from $29 million two decades ago.
St. Louis County got only about $5 million. The county always gets less than the city, partly because older regions get more funding priority. The long history behind community development corporations, which can be traced to settlement houses, just isn’t there for the more recently developed, more suburban county, Swanstrom said.
This funding reality is putting strain on community development corporations.
The Riverview West Florissant Development Corporation, which provides home repairs, a youth program and affordable housing for 5,000 people, has seen its budget shrink about 30 percent in the past three years, ever since federal funding became more competitive to acquire in St. Louis and the organization stopped applying for it, said Antoinette Cousins, executive director.
The funding decreases are forcing some groups to consolidate, scale back or turn to other money sources. Three smaller housing corporations in Tower Grove, for example, banded together two years ago to make Tower Grove Neighborhoods, tripling their budget. The group has also started to rely more on revenue from its screening service.
Swanstrom and his colleagues are rolling out a new, alternative private funding source for community development corporations called InvestSTL, which will provide private grants and loans. It’s a collaboration between the Community Builder’s Network, a coalition of community development corporations and other nonprofits, and the Greater Community Foundation of St. Louis.
It’s meant to be St. Louis’ first comprehensive structure for funding community development. The idea is to catch St. Louis up to cities such as Baltimore, Cincinnati and Cleveland that already have big foundations giving millions of dollars to community development corporations on top of federal funding.
“We want to stay competitive, we want people to want to come here,” said Karl Guenther, a member of the Community Builder’s Network. “This is hopefully going to be a mechanism to align philanthropic and loan dollars.”