February 1, 2003 - From the February, 2003 issue

L.A. Neighborhood Housing Services' Lori Gay Champions Stabilizing Role Of Home Ownership

Too few neighborhood advocates point to home ownership as a key in creating the personal investment necessary for people to foster a strong and vibrant community. TPR is pleased therefore to present this interview with one who does: Lori Gay, President of Los Angeles Neighborhood Housing Services. Here she outlines NHS' integrated approach to strengthening three targeted Los Angeles neighborhoods by promoting home ownership among low-to-moderate income households.

Lori, why don't you begin by taking a moment to inform our readers of the central mission of Neighborhood Housing Services Corporation. What's the approach? What's the driving goal?

NHS is available nationwide to help people improve their lives, and we're in the business of building stronger neighborhoods using a partnership of residents, business, and government to get that done.

And what defines the agenda for the Los Angeles NHS?

L.A. has that same basic agenda but is focused in three targeted neighborhoods: Pacoima and the east San Fernando Valley, Crenshaw and metro Los Angeles, and San Pedro/Wilmington and the South Bay. We provide all of our products and services in those three targeted neighborhoods, and we provide affordable lending products and consumer financial education throughout the county of Los Angeles.

What are some of the outcomes that have resulted from the work that you've been engaged with in L.A.?

In terms of history, our accomplishments include providing financial education to more than 25,000 families per year on average. We've now assisted over a million households with financial information, and we see that as a core tool to our million work, to assist people in becoming homeowners. Our real goal is to get people into homes and to keep them in homes. As we look at it, we see financial information as the best tool to protect and serve families who are of modest means in a high rent area like Los Angeles.

The other things that we see as critical are part of what we call our full cycle lending model. Once they receive financial education, we look to put them in an affordable loan, and we may or may not provide construction services and real estate services as a part of the tool box to help revitalize the neighborhood that they're moving into. We've helped 6,400 families move into homes in the last decade, and we helped at least double that many keep their homes by providing an array of services. So, over time, you start to see really big numbers because we're helping so many people in this one line of business. We don't have 20 lines of business, we have two. That's helped NHS stay very focused in Los Angeles on serving families in a way that we've found to be viable.

NHSs are all over the country. Some of our readers might argue that the city ought to provide such services. What's the unique value added of any NHS to revitalization efforts within a neighborhood?

The addition that an NHS makes is that we're dealing with clients on a one-on-one basis, a group basis, and most importantly on an employer-assisted basis, to facilitate, as a front end effort, financial education. That's not something the city of Los Angeles provides as far as I'm aware. Also, we serve families who are of low-to-moderate income with services that the city of L.A. will only provide to people who are below 80 percent of median, and perhaps only to people who are 120 percent of median or below. What we say, is if you want to move into the target neighborhood and you make well above those means, we're here to help you because we want to create economic integration wherever possible in the targeted areas. So we've got a pretty specific target, but also enough flexibility that it gives us more tools to help a broader array of families.

We're also committed to bringing partners to the table. We're going to target major employers, small business owners, corporate America, the foundation community, and government-whoever has a check that they can put into building stronger communities as a part of our work effort. We don't have the constraints that government has because we don't have the same regulatory issues. Our value added is to help create economic opportunity and to leverage economic impact and revitalization in under-served communities.

Lori, a lot has happened over the last few years to impact the environment in which you work: the inauguration of neighborhood councils,the passage of housingbonds, school bonds, park bonds, library bonds, health care and child care initiatives. How does NHS leverage these opportunities?


We try to use them all and work through the maze that they create. Our neighborhood resource coordinators, in particular, try their best to work with every single local government program that touches the neighborhood in some way, particularly if it's related to community development. We are participating with the bond issues-anything that touches home ownership or home maintenance and we are trying our best to use those resources locally. As an example, with Prop 46 just passing, there's a small set-aside as a part of that bond that will touch NeighborWorks organizations throughout the state of California. We will also be working closely with the state through a variety of programs, including CalHome, to bring more local resources that involve home ownership promotion and preservation to neighborhoods.

On the preservation side, we're one of the largest users in the lead abatement and toxic mold remediation business. Now, we're starting to do job training along those lines so that local residents can become abatement specialists. LANHS is a resource for that business because again, in the neighborhoods we're serving, so many of the homes were developed pre-1978, so they're going to have lead in them. If it's a direct ancillary service that we can provide, we'll do it. If it's something way out of our scope then we try to refer it out to other partners of ours who will serve the families well. We don't want to be in conflict with government, we want to try to use whatever resources they have available to better serve the community.

Do NHS's priorities in the three L.A. targeted neighborhoods differ in any way? Does each neighborhood offer a unique challenge for NHS?

Yes, they do. It would be an easy world if they were the same, but that's just not the nature of neighborhoods. The South Bay community, particularly San Pedro/ Wilmington, where we're focused, is a high rent area in Los Angeles. There are ownership opportunities available, but there are also a whole lot of folks who own their homes or their multiple units already and they want to preserve them and fix them up. So in an area like that, we're doing a lot more home improvement training, financial counseling, and ultimately lending. Now, the opportunities for ownership might be available for a moderate-income clientele like a longshoremen's union worker, who might make $85-100 thousand a year and is not a homeowner. We are now teaming up with the unions in the area, with the port and other major employers, such as Kaiser, and saying "How do we get your workforce into housing and as owners?" They're not necessarily all low income by any stretch, but they aren't buying property, they're renting. So, how do we get them to think differently about building assets and wealth?

In metro Los Angeles, and particularly Crenshaw, you have an interesting dynamic which has gone on since the riots and earthquakes impacted a number of the smaller neighborhoods in the area. You have an influx of Hispanics, Caucasians, and Asians while the black middle class is leaving. There has been a worry for more than a decade that gentrification might happen in an area like Crenshaw, where, after the earthquake, you had a number of people who had either paid off their mortgages or who did not have earthquake insurance and who were living in homes that had been red-tagged. They didn't walk away from their mortgages, as some did who lived closer to the epicenter in Northridge. Over the last decade, we've seen how ownership has helped stabilize neighborhoods despite two major events that could have caused a lot of people to think twice about staying put. They've stayed, and they've worked hard to make it a better community.

Pacoima is probably the most unique of the three neighborhoods we're serving. There are no major financial services domiciled in the neighborhood except for one bank branch. And, that branch wasn't typically providing loans in the area. Also, there are no insurance agents domiciled in Pacoima that we're aware of. So this was a community being serviced by brokers: loan brokers and insurance brokers. This is a powerful statement considering that this is a neighborhood with many long-term homeowners and renters. A lot of the families have lived in Pacoima their whole life-why were financial services missing? Clearly the Valley has a wealth of employers who just may not have thought of the notion of making sure their workers became homeowners to create a more stable work force. We've spent some time now with local government officials there, sending out letters to these employers, encouraging them to allow what we call ‘Lunch and Learn'-on-site financial education for their workers so that they can become a more stable community.

Lori, if whomever you wanted to be mayor was mayor of L.A., and whomever you wanted to be on the majority of the council was the majority of the council, and if you had the total attention of the business community, and the financial community, what would be different in L.A. Would our neighborhoods be healthier?

No matter how long all of us have been at this work, neighborhoods still do best when they build from the inside out, and when everyone's vote counts, and people are voting for representation that they think will reflect their value systems. We continue to find that in neighborhoods people have the same basic common values: good schools, good places to eat, good grocery stores, basic economic services and feeling safe in their community. We've been through a lot of variations of certain themes with our governance system. But, in the end, every neighborhood has its own center and its own way that it operates.

The real issue for all of us to continue to focus on is how do we protect and serve families. From our perspective, we would say one of the ways we help protect and serve families is to create opportunities for them to start to build assets and to improve their financial health by adding a home to their portfolio. Then, we talk about providing education and other services that help them sustain the value of their home and build equity, so that they have something to pass on to their children and their children's children.

We spend a lot of timeat NHS looking at data. The fact is, that no matter who's in office, there is a huge amount of inequity when you look at who's owning what and who's controlling resources. We're trying to provide some more equity through our work and trying to spend as much time as we need to spend creating more equitable distribution through fair lending processes and eliminating discrimination, predatory lending and redlining. These are going to continue to be core issues that impact neighborhoods, and local politicians, and government in general. No matter their background, people get this stuff-they want to be treated in a way that's respectful. They undersxtand that to protect their families, we have to be about the business of creating healthy communities and healthy neighborhoods, with equal access for all families.


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