Assessing the Roles of Faith-Based Organizations in Community Development

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Faith-based organizations (FBOs) historically have provided food, clothing, and shelter to people in need. They have also sponsored affordable housing, enhanced neighborhood cohesion, and assisted with community development activities. Some 14 percent of community development corporations (CDCs) and one-half of all sponsors of HUD-funded housing for the elderly are faith-based. In recent years, policymakers have begun to look to FBOs to play a greater role in strengthening communities. Yet, little research exists on the current and potential role of FBOs in community development.

Faith-Based Organizations in Community Development, a new report from HUD's Office of Policy Development and Research, uses a literature review and interviews of key activists to summarize current knowledge about FBOs' community development activities and raises policy questions about their future role. The report defines community development as asset building. It centers on housing and community development but also includes efforts, such as job training, to prepare residents for more productive lives.

According to the report, FBOs are of three types: (1) congregations; (2) national networks, which include national denominations, their social service arms (for example, Catholic Charities and Lutheran Social Services), and networks of related organizations (such as YMCA and YWCA); and (3) freestanding religious organizations, which are incorporated separately from national networks and congregations.

Few FBOs Now Involved in Community Development

More than one-half of congregations and many other FBOs provide human services. Congregational participation in providing human services is greater among worship communities that are larger (and therefore have more resources), located in low-income neighborhoods, theologically liberal, and African American. Supportive pastoral leadership is central.

Although many FBOs provide human services, few currently participate in community development activities. The most common participants are faith-based CDCs, some national denominations and their affiliates, and Habitat for Humanity. FBO participation in community development is limited for several reasons:

• Community development activities require regular and sustained involvement in a range of complex tasks. By contrast, congregations have two preferred approaches to service: Donating small amounts of cash or in-kind goods to other services delivery groups or providing small groups of volunteers to conduct relatively well-defined, periodic activities.

• Independently incorporated organizations have had the greatest success in completing community development initiatives. Establishing affiliated organizations is the least common strategy for congregations to provide services, and it poses numerous challenges.

• Congregational staff and volunteers typically lack the skills, knowledge, and time required to successfully sponsor community development projects.

• Most congregations have not applied for government grants or undertaken the legal and financial responsibilities required to sponsor community development projects, and many FBOs lack the management capacity to do so.

No existing research compares the outcomes of community development efforts sponsored by FBOs with those of secular organizations. Some information is available about the challenges facing organizations that have tried to enter community development. However, little is known about the impediments faced by the minority of FBOs interested in obtaining public funds for community development activities.

Based on HUD's research, the report makes the following recommendations:

• FBOs in community development will need significant technical assistance to ensure that public funds are spent responsibly, given the small size and inexperience of many such organizations.

• FBOs interested in community development may increase their effectiveness by partnering with existing CDCs and other experienced nonprofit groups rather than by sponsoring projects independently.

• Only a fraction of the organizations studied currently have the resources to successfully engage in community development activities; however, those that do can have a significant impact beyond simply sponsoring community development projects. Congregations can increase public support for affordable housing and other community development initiatives in their communities by engaging in public dialogue and joining coalitions that support social justice.

Faith-Based Organizations in Community Development is available for $5 from HUD USER. Use the order form.