neighborhood streets, parks, bridges, etc.). То analyze NeighborWorks® service impact derived from city funding, we have excluded capital improvement investment from the percentage distribution of the funds.

In 1991 and 1992, a large share of city funds (56% and 49% respectively) were allocated to the rehabilitation of singlefamily, owner-occupied units. Allocations to home-ownership promotion services constituted another 25% and 21% during the same years. However in 1993, funding for home-ownership promotion services increased dramatically, from $4 million to $6 million dollars in previous years to $15.6 million (41% of the total programmatic investment). It may be recalled that home-ownership promotion is the most staff-intensive program. Allocations to NeighborWorks® single-family rehabilitation services in 1993 amounted to $9.8 million (26% of the total). This represents a significant decrease from 1992 funding of $14.4 million.

Funding for special projects showed a significant increase, from less than $2 million in 1991-92 to $4.4 million in 1993. These projects are targeted to specific populations such as the homeless, older people, youth, renters with a home-purchase option, etc. City funds directed to mutual housing associations also increased, from $1.3 million in 1991 to $4.9 million in 1993.

Table VI shows the total 1992 programmatic services from all sources and reflects that city funding of $43.4 million leveraged a total investment of close to $200 million from all partnership

sources.

B. NeighborWorks® Organizations' Operating Expenses

Table VII.A shows the amount and the percentage distribution of NeighborWorks® operating expenses by the source of contribution during 1990-1992. Table VII.B shows a breakdown of sources of contributions to NeighborWorks® organizations' operating expenses for 1992, in a pie chart.

NeighborWorks® organizations' operating expenses increased, from $33.7 million in 1990 to $43.2 million in 1992. Contributions from city funds in 1990 and 1991 amounted to $9.3 million (28% of the total operating expenses) and $11.9 million (28%) respectively. In 1992, however, the corresponding figure declined to $8 million, or 19% of total operating expenses.

Similarly, state funding of NeighborWorks® operating expenses during the same period declined, from $4.1 million in 1990 to $3.6 million in 1992. Altogether, the public sector's (city/state/federal governments) contribution declined, from more than 40% of the total in 1990-91 to 31% in 1992. Contributions made by the private sector during this period remained stable, at around 25% of the total NeighborWorks operating expenses.

Source: 1993 Quarterly Surveys, Neighborhood Reinvestment Corporation Research and Information Services Department. Production date: 12/93

9/93

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All others including NeighborWorks Organization's program income and interest earnings constitute 15-20% of this source line.

Neighborhood Reinvestment's 1992 expendable grants to NeighborWorks Organizations amounted to $3.3 million(7.5% of the total).

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Neighborhood Reinvestment Corp.

The main sources of funding to compensate for the declining contribution by the public sector have been NeighborWorks® organizations' program income, individual contributions generated through fund-raising activity, and grants from Neighborhood Reinvestment.

a

The most pertinent trend in the last three years has been dramatic increase in city (CDBG) funding to NeighborWorks® programmatic investment on the one hand, and an equally dramatic decrease in CDBG funds for NeighborWorks® operating expenses on the other hand. And among various programmatic strategies, homeownership promotion, which is the most staff-intensive service, has increased more dramatically than others.

Section 2.

Preliminary Evaluation of the HOME Program

The following evaluation reflects comments solicited from NeighborWorks organizations and other nonprofit organizations, participating jurisdictions, and our own staff, based upon their direct experience with the HOME program.

Since its implementation in December 1991, the Home Investment Partnerships Program (HOME program) has become one of the nation's most important vehicles for stimulating the production and rehabilitation of affordable housing and assisting low-income families to attain the American dream of home ownership.

Although the program got off to a very sluggish start, subsequent legislative amendments and major regulatory revisions have. significantly improved the HOME program. However, community-based nonprofit organizations and participating jurisdictions continue to express frustration and exasperation with the HOME program, which continues to suffer from negative attitudes and perceptions developed during its slow and difficult start-up'phase.

Neighborhood Reinvestment continues to hear complaints that the HOME program attempts to define in minute detail, and micro-manage, every aspect of program operations. One obvious problem is the sheer mass of the regulations. Neighborhood Reinvestment recognizes that some of the problems associated with the HOME program have to do with both the regulations or the statute, and

with the choices being made by states and participating

jurisdictions.

In addition to the usual problems associated with the start up of a major new federal housing initiative, the HOME program presents further challenges to community-based nonprofit organizations and participating jurisdictions due to the distinction between nonprofit organizations functioning as community housing development organizations (CHDOS), and those functioning as HOME subrecipients. To review: