News & Events > Update on $2 million economic stimulus award

February 11, 2011 –  February marks the two-year anniversary of Congress’ passage of the Recovery Act, which pumped $787 billion in funding to jumpstart the country’s weak economy. Included in that appropriation were grant dollars for low-income communities nationwide; specifically $700 million in direct funding for affordable housing projects, plus $90 million in financial assistance awards supporting small business lending, and affordable housing and community facility development.  

CDFI Fund Director Donna Gambrell offers congratulations to David Raynor, Leviticus' Executive Director, on $2 million federal stimulus award

The Leviticus Fund was one of ten New York-based community development financial institutions (CDFIs) to receive a Recovery Act grant, and our Fund received the maximum financial assistance award of $2 million. Like all Recovery Act awardees, Leviticus was required to file quarterly reports that tracked how our organization was using the federal dollars. This information was posted to an official government website www.recovery.gov that allowed taxpayers to track allocations nationwide, and to drill-down for more specific spending by state, county, congressional districts – even zip codes.

Leviticus received its Recovery grant award on July 1, 2009, practically on the heels of a June 29 press conference with U.S. Treasury Secretary Timothy Geithner in the Bronx. During the award announcement, Secretary Geithner recognized the essential work of CDFIs within the most vulnerable and economically abandoned communities in the country.

“The Recovery Act awards announced today build on the Administration’s efforts to get lenders lending again,” he said at that time. “These awards will help generate capital for small businesses, mortgage loans for homebuyers, and funding for affordable housing projects and other facilities in communities across the country.”

The $2 million Recovery grant was the single largest federal award Leviticus received in its 27 year history, so there were high expectations about the impact that the funds could have within the low-income communities we serve. The Recovery funds also came at a crucial time for our organization because for the first time in our history, demand for Leviticus’ financing exceeded our lending capacity.

U.S. Treasury Secretary Timothy Geithner announces $90 million in financial assistance awards during press conference in the South Bronx, NY

Beginning in October 2009, Recovery Act awardees were required to post quarterly updates to the federal website about how they used their stimulus grant for that specific reporting period. By Leviticus’ first quarter report, our Fund had already disbursed $1,045,000, which was used to finance the purchase of a multi-unit building for permanent affordable rental housing. The project, sponsored by the non-profit affordable housing agency A-HOME Inc., is located in Katonah, in the Town of Bedford and preserved seven-units of affordable housing that would otherwise have converted to market-rate in the high rental area of Westchester County, New York.  When A-HOME purchased the Katonah property the building was fully occupied with tenants, and most were earning less than 50% of area median income.

By year-end of 2009, Leviticus disbursed an additional $955,000 in stimulus funds – plus $155,100 in other loan capital – to provide permanent financing for a newly constructed early education center in Newark, New Jersey. The $5.1 million facility, the Vailsburg Child Development Center at Ivy Hill, opened its doors on September 9, 2009 with full enrollment of 210 children between the ages of three and four years old. The 14-classroom school is the newest early childhood education facility sponsored by Unified Vailsburg Services Organization (UVSO), a human services and community development agency based in Newark.

Leviticus was one of three community-based lenders that provided construction financing during the start-up phase of this same project. Leviticus opted to then co-lend with New Jersey Community Capital for the permanent financing phase of the early education center because it allowed UVSO to take advantage of more favorable lending terms.

In Leviticus’ case, these federal funds provide a long-term value beyond the benefit of the first center-based early education center in the Ivy Hill section of Newark and much needed affordable housing in Westchester County.

In Leviticus’ application for the federal grant, we stipulated that the funds would only be used for permanent, revolving loan capital. So as these two loans are repaid, that money will be re-circulated again and again as financing for future affordable housing and community facility projects serving low-income communities.

“These Recovery Act funds came at a critical time for Leviticus because back in 2009 demand for our type of flexible financing exceeded our available loan capital,” explained David Raynor, Leviticus’ Executive Director. “We were able to finance two very important projects in our service area with these federal resources. Now going forward, these same resources can finance additional community development projects in high need areas, as well as help our Fund leverage new investments to increase our overall loan pool.”