investment in underserved areas. a number of methods have been derived for evaluating the effectiveness of community development projects. the one with which i am most familiar, through my work on the board of neighborworks america, is the success measures data system. this system uses more than forty indicators and a variety of data - collection tools - - including surveys, interviews, and focus groups - - to quantify the effects of housing, economic development, and community building programs at the personal, organizational, and community levels. this array of tools allows neighborworks to measure success not just quantitatively but qualitatively, looking beyond the numbers to detect sustainable positive change. the underlying philosophy is that a community development initiative cannot be judged successful just because it puts a family in a home ; rather, it must be able to say that, by doing so, it has improved the community, the family ’ s quality of life, and the family ’ s economic potential. these data are also useful to corporate partners insofar as they demonstrate business performance against internal goals and commitment to the community. businesses recognize that demonstrable success enhances their reputation, increases brand recognition, and improves their ability to compete successfully for future partnership opportunities. thus, being able to determine the return on a business ’ investment in a community development initiative in both quantitative and qualitative terms is the next logical step in attracting further private investment. but the social and economic needs of our inner - city neighborhoods extend beyond business investment. effective partnerships with local officials and community leaders are another key element of the revitalization process. at the state and local levels, public officials contribute to the attractiveness of investment conditions by maintaining sound fiscal policies. these policies allow local officials to take the lead from social compact and begin to market local neighborhoods using the analysis that demonstrates the buying - power residing within these more challenging neighborhoods. their willingness to address other neighborhood needs, such as housing, infrastructure, education, health care, and other social supports will also be important to investors. in general, when community development is a cooperative effort, it can lead to more sustainable outcomes along both economic and social dimensions. while the return on investment can be a sufficient gauge of their economic success, success in broader terms can be viewed by assessing the commitment of all segments of the community to the goal of revitalization. moreover, the benefits of such cooperative actions are not always readily measurable in dollars and cents. greater opportunities in local neighborhoods evidence themselves through better schools and stronger

years, and their balance sheets are strong. the reports on first - quarter earnings have been quite positive, and available measures of credit quality, such as credit ratings and loan defaults, show few signs of stress. financing costs have moved up since last fall, but the federal reserve ’ s most recent survey of bank lending practices, which was conducted in april, indicates that domestic banks are noticing increases in requests for business loans. they also indicated an increased willingness to supply business loans in an environment of brisk competition from other lenders, a liquid secondary market for business loans, and an increased tolerance for risk. in that regard, research conducted by federal reserve economists notes that more banks are offering loans to businesses in markets where the banks do not have branch offices ; the research suggests that new technology has spurred competition for some types of small business lending in recent years. more broadly, businesses currently have access to plentiful debt and equity financing from a variety of sources in addition to banks. the challenge that community development practitioners face in working with businesses looking for new investment opportunities is to demonstrate through careful analysis that promising inner - city neighborhoods can be good investments. that the current overall conditions for business investment are positive is thus good news for the work of social compact and its partners. the importance of data to investment decisions community development has come a long way since i first began following it as a young congressional staffer thirty - five years ago. whereas government programs once funded the bulk of inner - city development, public - private partnerships now dominate. in many places, community - based organizations have been able to " jump start " markets by facilitating private investment. the focus of neighborhood revitalization has shifted increasingly toward market - based approaches. in that regard, organizations that seek to promote neighborhood revitalization must focus on what makes their projects competitive. social compact is perhaps best known for its focus on one important input into the investment process - - information. timely and accurate information is what project planners need to bring entrepreneurs, investors, and lenders together to objectively assess the proposed undertaking. having been a banker, i know very well how much more efficient the process can be when decisionmakers are presented with a clear assessment of the projected returns and a balanced analysis of risk. another related feature of market - based investment decisions is the importance of built - in measures of accountability. hard data on results are important in establishing the credibility of projects. with data, and results, such investments can also serve as catalysts for additional private