You’ve probably heard it before, but the very first Resident Owned Community came about as the result of a graduate student project. Today, we’re joined by the professor of that class, Michael Swack! Michael is a professor at the University of New Hampshire and directs the Center for Impact Finance and the master’s program in community development, which he designed for adult practitioners. Michael has also been involved in the design, implementation, and management of a number of Community Development Financial Institutions (CDFIs), including the New Hampshire Community Loan Fund! He’s a proud member of the ROC USA Board of Directors, and he joins us on Ownership Matters to talk about the history and importance of CDFIs, and why the resident ownership movement is so important.
Episode: A Brief History of CDFIs with Michael Swack
Welcome to the Ownership Matters podcast, where hosts Paul Bradley and Mike Bullard of ROC USA highlight the stories of people at the heart of the manufactured housing and resident-ownership movements! In this episode, Paul and Mike welcome guest Michael Swack.
0:24 – Today’s episode and guest introduced
Michael Swack serves on the ROC USA Board of Directors and is the first board member to join us on Ownership Matters. He is a Professor at the University of New Hampshire, where he has appointments at the Carsey School of Public Policy and the Peter T. Paul College of Business and Economics. He directs the Center for Impact Finance and the master’s program in community development, which he designed for adult practitioners. He has been involved in the design, implementation, and management of a number of community development lending institutions.
2:35 – The early days of community development finance in the U.S.
Michael walks us through how he met Chuck Matthei, the genesis of the New Hampshire Community Loan Fund and what later became the Reinvestment Fund. The idea was taking the concepts they had developed at the Institute for Community Economics (ICE) and implementing them on a regional basis with people that they knew.
7:26 – The role of organized religion on capitalizing on these loan funds
Chuck had friendships with the Sisters of Mercy, who were involved in the trust because of the social justice viewpoint and because they wanted a place to invest some of their own money. They were also one of the early investors in the ICE loan fund and the New Hampshire Community Loan Fund.
11:40 – The growth of community loan funds over the last 40 years.
The National Association of Community Loan Funds brought together 7-8 people to form a new organization with the mission of providing financing to projects and communities who don’t meet the requirements of mainstream financial markets. At the time, there were not many other non-profit mission-oriented loan funds focusing on economic justice issues. Michael shares that the organization played a major role in influencing the outcome of CDFI legislation.
17:14 – What spurred people to think about statewide loan funds in New Hampshire with ICE so close?
Part of this was a decision at ICE, who didn’t necessarily want to become national. Their original idea was to build institutions that engaged people locally and had local ownership and control. Rather, they wanted to help interested people in other places develop their own similar program. The formation of the New Hampshire Community Loan Fund was a community organizing event which got people involved and engaged. The first loan was to the very first resident owned community, which came about because of a student project.
22:37 – Michael highlights other impactful student projects
Many of the student programs Michael has seen over his career have involved starting community loan funds and projects for lending. Others address public health initiatives, affordable housing and small business. The idea is to get students to develop project development skills, engage their communities and organize outreach. Good community development is a function of community organizing blended with the technical skill about making long term stable projects.
24:30 – Michael reflects on ROC USA’s engagements nationwide
The importance of ROC, Michael shares, is the idea of maintaining ownership and control. The worst thing is to feel instability about where you live. This is true of both renting and ownership, when rent could be randomly increased, or you could be forced to move out. Housing stability is one of the most important factors in having a decent life. ROC offers stability and is a model institution in terms of putting into practice the true principles of community development.
29:34 – Michael’s role with the Community Development Advisory Board
This is an advisory board which works directly with the director of the CDFI Fund to review how it can enhance the performance in the field and be more effective. They don’t have much say on how funds can be allocated. The CDFI Fund of the Department of Treasury is a critical investor in funds country-wide, including ROC USA. It is designed to invest very flexible money into CDFIs to allow them to determine how to use the money to suit their own needs.
32:48 – Opportunities for resident-owned communities
The Board shares the concern that hedge funds and private equity funds are increasing prices and making it unaffordable for many resident-owned communities to buy their land. We are seeing many people being priced out over hedge funds, who are willing to raise rent enormously to make as much profit as possible. He sees the opportunities in the idea of ROC as a network system that can take advantage of building an organization which can more efficiently employ funds and organize people.
36:18 – What should co-op leaders be thinking about for the future?
Once you have a network together and people to work together in a collaborative way, there are opportunities to look beyond what initially brought them together. The collective goal is to improve the quality of life for everyone involved.
38:30 – Michael’s closing thoughts
Michael ends today’s conversation with a story about one of his first visits to a resident-owned community. In the process of making and contributing to democratic decision making, he learned the importance of being deeply engaged with neighbors and fellow members. This isn’t always an easy feat, but the positives vastly outweigh the negatives.
Learn more about ROC USA through our website.
Thoughts? Questions? Stories? Send them to firstname.lastname@example.org.