2012 ANNUAL REPORT 2012 ANNUAL REPORT
Leviticus 25:23 Alternative Fund, Inc. LEVITICUS BOARD OF DIRECTORS PRESIDENT
Derrick A. Lovett Executive Director, MBD Housing Corporation, Inc.
VICE PRESIDENT Catherine Rowan Social Responsibility Consultant, Tri-State Coalition for Responsible Investment SECRETARY
Mary Heyser, RSHM Eastern American Province of the Religious of the Sacred Heart of Mary
Linda Hincken Chief Financial Officer, Sisters of St. Dominic, Amityville
Joseph H. Cruickshank Retired, former Executive Director, Clark Foundation, New York, NY Salvatore Del Bene Retired, former Vice President, JPMorgan Chase Richard O’Brien Vice President, Apple Bank for Savings Kathleen Phelan, OP, CFRE Councillor, Sinsinawa Dominicans
LOAN COMMITTEE Salvatore Del Bene* Derrick A. Lovett* Richard O’Brien* Alvaro Ortiz, Vice President, Morgan Stanley John Wilson* FINANCE COMMITTEE Carmel Caputo, CND, Missionaries of La Salette Linda Hincken* Dennis M. McDermott, JPMorgan Chase Maryann Summa, OP, Dominican Sisters of Sparkill Michael Sena* Justin Towey * HUMAN RESOURCES COMMITTEE Joseph Cruickshank* Catherine Moran, OP, Dominican Sisters of Sparkill Kathleen Phelan, OP* DEVELOPMENT COMMITTEE Mary Heyser, RSHM* Peggy Scarano, OP, Dominican Sisters of Sparkill Kathleen Walsh Murnion, KW Murnion Associates
John Wilson Director, Corporate Governance, TIAA-CREF
AUDIT COMMITTEE Carmel Caputo, CND, Missionaries of La Salette Linda Hincken* Dennis M. McDermott, JPMorgan Chase Maryann Summa, OP, Dominican Sisters of Sparkill Michael Sena* Justin Towey *
David Raynor, Executive Director Kenneth Gold, Senior Loan Officer Margaret Murphy, OP, Finance Officer Maryann Sorese, Business Development Officer
Bernadette Kenny, RSHM Christine McGuinness, Schiff Hardin LLP William J. Robb, Jr.
Michael Sena Director of External Reporting & Compliance, Readers Digest Association Justin Towey Vice President, UBS Financial Services, Inc.
*Committee members who also serve on the Board of Directors Cover photos: (top) One of the homes in Marilla Country Village, Alden, New York (bottom) Newark Mayor Cory Booker (seventh from left) helps La Casa de Don Pedro’s Executive Director Raymond Ocasio (third from left) break ground for a new home on Victoria Avenue in Newark, New Jersey.
From the President and Executive Director Spring, 2013
Dear Leviticus Members and Friends, The vision statement adopted by the congregations that founded the Leviticus Fund declared that participants in the Fund “have agreed to place their resources at the service of the economically poor.” It is now 30 years and $42,000,000 since that vision statement was written. Clearly the words of the Leviticus Founders have been realized. In our 30th anniversary year we are proud to say that every one of those 42 million dollars has been invested in affordable housing, early childhood education centers, community facilities, and most recently, cooperative ownership of manufactured home communities – all serving the needs of low-income families and communities. The newest of our lending efforts, cooperative manufactured home parks, is highlighted in this year’s annual report. By providing financing for people in manufactured home communities to purchase the land under their homes, Leviticus is helping to preserve and improve an important source of unsubsidized affordable housing. At the same time, residents of these co-op communities realize longterm impact on their net worth – the American dream of homeownership. We have been working in this area for some time. It has become a significant part of our work and a significant portion of our portfolio. We hope you enjoy reading about it in the feature story. During October 2012, Dave Raynor announced his planned retirement in the fall of 2013. The Board of Directors immediately began a transition process. A plan was put in place, important Leviticus stakeholders consulted, and an executive search firm hired. All indications are that this will be a smooth transition for your Fund. The Board fully expects that the next Executive Director will continue the highly regarded work and leadership of the Leviticus Fund which, for 30 years, has been ably led by Br. George Schmitz CSC and his successor, Dave Raynor. The Founders’ Vision Statement concludes with these words, “In the final analysis, we want to be faithful to the Gospel in a down-to-earth way.” After 30 years, these words still guide us as we go about the very practical, day-to-day work of community development finance – putting our resources at the service of low-income people and communities.
Derrick Lovett Board President
2012 Annual Report
David C. Raynor Executive Director
BEYOND BRICKS AND MORTAR
Affordable Housing: Made Possible A stretch of land on Long Island’s east end in New York sits nestled near woodlands adjacent to Three Mile Harbor, one of the area’s most popular ports. Sixteen homes are clustered on the property and the homeowners know their neighbor on a first-name basis. The community is quiet; it is safe; and best of all, affordable in the highly priced real estate market of East Hampton. “This was a treasure find when I moved in. I knew I had a great place,” explained Stephen Agudo, who has lived in the community of Three Mile Harbor Mobile Home Park since 1996. “It is a nice little community,” added Mae Bushman, another longtime resident. “In Three Mile Harbor Mobile Home Park you have a house; you have a roof over your head. It may not be a big house, but it is a comfortable place. You feel safe.” Mae Bushman and Stephen Agudo are not only residents of the Three Mile Harbor manufactured home community, they are also President and Secretary respectively for the resident-controlled cooperative that owns the 2.1 acre parcel. As Board members they are responsible for the overall wellbeing of the residents, and must ensure that both the park and the co-op remain viable and intact. That mandate was certainly put to the test over the last several years when the park’s septic system, which had been upgraded as a condition of the resident purchase in December of 2001, began to fail a few months after the park sale. Over the course of 10 years, the park community battled relentlessly with East Hampton town officials to complete the necessary repairs to a system the municipality had actually installed.
Repairs underway on the septic system at Three Mile Harbor park.
2012 Annual Report
Stop-gap measures provided only temporary solutions and short-term relief for the homeowners, and also financially strained the park’s maintenance budget. “That is why we have been fighting since the beginning to not lose the park. This community is basically some place that you can afford in East Hampton because it is just so expensive to live here,” explained Mr. Agudo. A $390,000 loan from the Leviticus Fund to the Three Mile Harbor co-op finally corrected the park’s failing septic system. It was just one of 10 projects financed by Leviticus, which realized over $4.6 million in closed loans in 2012. Homeownership opportunities for low-income families in Essex County, New Jersey and Hartford County, Connecticut also factored strongly in 2012’s lending, as did support for a new early education center in Newark, New Jersey. “Without a doubt, the demand for affordable housing looms very large for families and individuals within our service area,” explained David Raynor, Leviticus’ Executive Director. “This situation places a tremendously stressful burden on individual households. It is also taking a toll on local communities that are not only losing long-time residents, but seeing a decline in their workforce.” “The scarcity of affordable housing is one of the reasons that Leviticus provides financing for resident purchases of manufactured home parks and infrastructure improvements in existing communities,” he added. “This type of housing is very, very affordable and many of these park communities have existed in the area for decades.” Leviticus’ first loan for a resident purchase of a manufactured home park actually dates back to 1991. At that time, Leviticus provided predevelopment financing to two New York-based park communities for senior citizens, both of which are still functioning co-ops to this day. A strong proponent of resident purchases of manufactured home parks in New York State is the Division of Homes and Community Renewal (HCR). HCR operates the Manufactured Home Cooperative Fund program and has provided over $19 million in financing for resident park purchases throughout the state. Leviticus has been a co-lender in five of the 17
by Resident-Owned Communities resident purchases that HCR has completed in New York. Leviticus provided financing in two additional resident purchases – one in Connecticut and the other in Massachusetts – which were co-lending opportunities with ROC USA, a nonprofit promoting resident ownership in manufactured home parks on a national scale. Similar financing by Leviticus and New Jersey Community Capital to a nonprofit affordable housing agency preserved 133 units of affordable housing in a New Jersey-based manufactured home park. “Leviticus has provided over $3.1 million in financing for resident purchases and most of these deals have involved collaboration among lenders because of the significant costs for these manufactured home parks,” explained Mr. Raynor. “Work is also underway to expand Leviticus’ services to include not only the financing for resident purchases and infrastructure improvements, but also technical assistance that supports the residents in the process toward park ownership.” In the case of Three Mile Harbor, the path to resident ownership took a slightly different route. The Town of East Hampton actually purchased the community in 2000 from a private owner with the intent of selling it to the resident homeowners once upgrades to the park’s utilities, water and septic systems were completed. The Town reduced the park’s size from 22 units to 16 and also its acreage to create a buffer to the adjoining wetlands. With technical assistance and financing from the state’s manufactured home park program, park residents then formed a co-op and purchased the park from East Hampton Town for $385,000 in 2002. According to the residents, all of those upgrades were functioning correctly at the time of the resident purchase – including the septic system. However the septic system malfunctions started four or five months after the park sale was completed and escalated to the point of requiring frequent and expensive pump-outs over the last three years. Residents recognize that Town officials made attempts to correct the problem of overflow and seepage, but that those efforts never provided a solution. 2012 Annual Report
Mae Bushman and Stephen Agudo, President and Secretary of the co-op board.
“We knew we were in trouble on that day when the septic system failed because we knew that it should not have failed,” said Mr. Agudo, who works as a licensed contractor. “From that day, until Leviticus gave us the money to fix it, we had been fighting with the Town and they had been promising that they would repair it.” “I totaled it up and it was about $30,000 to $36,000 in pumping fees each year. That is why maintenance fees in the park went up,” explained Mrs. Bushman. “It actually has taken a financial toll on a few people in here. We started out at $375 a month in rent, and now we are up to $700 over the 10 years it has taken to fix it. And it all had to do with the improper septic system.” As Mr. Agudo explained, the eventual infrastructure improvements in the Three Mile Harbor park were far less complex then the 10 year debate implied. Work on the park’s septic system started in the fall of 2012 and were completed within six weeks. “The new system is the way the septic system should be made for low-lying areas. We are only three feet from ground water, so the higher wall is the way that it should be done,” he explained. “And the contractor that did the work here does the same work for hotels on Shelter Island and all areas along the beach line that require it. He would not do the job if he didn’t think it would work.” “We want to just say a great big thank you to Leviticus,” said Mrs. Bushman.
Three Mile Harbor Mobile Home Park is a resident-owned 16-unit manufactured housing cooperative in East Hampton, New York. The Leviticus loan financed improvements to the communityâ€™s septic system. LOAN AMOUNT
Marilla Country Village is a resident-owned 155-unit manufactured housing cooperative in Alden, New York. The Leviticus loan is a participation in a $2.4 million loan made by Resident Ownership Capital for the cooperative purchase of the community by its residents. LOAN AMOUNT
Ridley Acres Corporation is a resident-owned 8-unit manufactured housing cooperative in Phelps, New York. The Leviticus loan partially financed the purchase of the community by its residents. LOAN AMOUNT
Interfaith Council for Action, Inc. is a housing and supportive services provider in Ossining, New York. The Leviticus loan will be used for construction and permanent financing of a building that will provide six units of affordable rental housing. Five of the units will be rented to households with incomes at or below 50% of Area Median Income and one of the units will be rented to a homeless household with an income at or below 30% AMI. Leviticus sold a 50% participation in this loan to Partners for the Common Good. This is Leviticusâ€™ fifth loan to IFCA. LOAN AMOUNT
Unified Vailsburg Services Organization provides multiple social services including early childhood education to the Vailsburg community of Newark, New Jersey. The Leviticus loan is a participation in a $272,160 loan made by New Jersey Community Capital to finance predevelopment costs associated with the development of an infant/toddler preschool center that will serve 76 children. This is the fourth early childhood education facility that Leviticus has financed for UVSO. LOAN AMOUNT
2012 Annual Report
Don Pedro Development Corporation is an affordable housing development company affiliated with La Casa de Don Pedro, Inc. in Newark, New Jersey. The Leviticus loan provided acquisition and construction financing on a for-sale affordable housing project consisting of five two-family houses with an ownerâ€™s unit and an accessory rental apartment and one singlefamily house. This is Leviticus sixth loan to La Casa de Don Pedro and Don Pedro Development. LOAN AMOUNT
CIL Affordable Housing, Inc., an affiliate of the Corporation for Independent Living in Hartford, Connecticut is a developer of affordable housing. In 2012, Leviticus made two loans to CIL Affordable Housing for the purchase, rehab and resale of two 2family houses, each with an ownerâ€™s unit and an accessory rental apartment. These are the fourth and fifth loans Leviticus has made to CIL and its affiliates. LOAN AMOUNT
Mercy Haven, Inc. provides both temporary and permanent housing and supportive services to individuals and families in Suffolk County, Long Island. The Leviticus loan provided bridge financing for the acquisition of one single-family house and three two-family houses which will be rehabilitated and used to provide affordable permanent rental housing along with supportive services to five families with histories of chronic homelessness and incomes at or below 60% of Area Median Income. This is Leviticus second loan to Mercy Haven. LOAN AMOUNT
Regional Economic Community Action Program, Inc. provides multiple social services, including housing, to low-income individuals and families in Orange County, New York. The Leviticus loan provided partial financing for three two-family houses that will provide a total of six units of permanent affordable rental housing for formerly homeless households with incomes at or below 50% of Area Median Income. LOAN AMOUNT
2012 Annual Report
Statement of Financial Position
2012 Annual Report
Statement of Activities
Photos left: Supportive Housing, Mercy Haven Inc. in Long Island, New York Photo below: Affordable rental units, RECAP in Hudson Valley, New York
2012 Annual Report
Contributors & Investors NEW INVESTMENTS Georgian Court University, Lakewood, New Jersey John Brennan and Frances Sullivan Edward and Elaine Chanda Thomas Conlon Carole Kakos Trust Marta Santiago Michael Sena Robert Strittmatter and Norine R. DiCarlo Richard and Charline Watts Charles and Frances† Wiggins The New England Conference of Diocesan Directors of Religious Education Bank of America Community Development Corporation Bon Secours Health System, Inc. Capital One Bank The CDFI Fund Mercy Investment Services Signature Bank
GRANTS Apple Bank for Savings Capital One Catholic Charities of the Archdiocese of New York Create Jobs for USA: Starbucks, Opportunity Finance Network JPMorgan Chase Foundation Morgan Stanley TD Charitable Foundation The CDFI Fund Vote, Give, Grow: Starbucks, Opportunity Finance Network Webster Bank Wells Fargo Foundation Wells Fargo Regional Foundation
Kathleen Phelan, OP Catherine and Tom Rowan Peggy Scarano, OP Illinois Prairie Community Foundation – Richard and Charline Watts Donor Advised Fund Franciscan Sisters of Peace
INTEREST DONORS Congregation of Infant Jesus Franciscan Brothers of Brooklyn Franciscan Sisters of Peace Franciscan Sisters of the Atonement Religious of the Sacred Heart of Mary Sisters of Charity of Halifax Sisters of Our Lady of Christian Doctrine Society of Jesus New York Province Sisters of St. Francis of the Neumann Communities Ursuline Convent, Wilmington Jonathan D. Beard and Rachel Theilheimer Jan and Jim Carroll Bernadette Cronin-Geller Victoria DiLucia Katherine Elsner Patricia M. Kenny Alan J. Kidder Ann W. LaValle Francis R. Lewis Eifiona L. Main and Charles J. Engel Kathleen Murnion James & Susan O’Shea Carmelite Sisters for the Aged and Infirm Sisters of St. Joseph of Northwestern Pennsylvania St. John’s Church Ursuline Community, Liberty Avenue Ursuline Community, Linden Avenue Ursuline Community, Longstreet Avenue
Bernadette Cronin-Geller Joseph & Nancy Cruickshank Salvatore Del Bene Sondra Ford Kenneth Gold Alice and Steven Greenwald Mary Heyser, RSHM Linda Hincken Carole Kakos Francis Lewis R. Gabriel Moran Charles and Geri Mulligan Patricia Mulryan, SC Kathleen Murnion Richard and Susan O’Brien
Albany Area Housing Opportunities, Albany, NY Brothers of the Christian Schools, District of Eastern North America Catholic Biblical Association, Washington, DC Church of St. Raymond, Bronx, NY Congregation of Christian Brothers, New Rochelle, NY Congregation of Holy Cross, Moreau Province, TX Congregation of Holy Cross, US Province, IN Congregation of Infant Jesus, Rockville Centre, NY
2012 Annual Report
Congregation of Notre Dame, Wilton, CT Congregation of the Blessed Sacrament, Highland Heights, OH Congregation of the Mission, Philadelphia, PA Daughters of Divine Charity, Staten Island, NY Daughters of the Holy Spirit, Putnam, CT Daughters of Wisdom, Islip, NY Discalced Carmelite Nuns, Beacon, NY Dominican Fathers and Brothers, Province of St. Joseph, NY Dominican Sisters of Hope, NY Dominican Sisters of Peace, Columbus, OH Dominican Sisters of Sparkill, NY Episcopal Diocese of Hartford, CT Franciscan Brothers of Brooklyn, NY Franciscan Sisters of Allegany, St. Bonaventure, NY Franciscan Sisters of Peace, Haverstraw, NY Franciscan Sisters of Peekskill, NY Franciscan Sisters of the Atonement, Garrison, NY Georgian Court University, Lakewood, NJ Leadership Conference of Women Religious, Region 2, NY Marist Brothers of the Schools, Bayonne, NJ Maryknoll Fathers and Brothers, NY Maryknoll Sisters, NY Missionary Sisters of Immaculate Heart of Mary, New York, NY Montfort Missionaries, Ozone Park, NY Paulist Fathers, Jamaica Estates, NY Province of St. Mary of the Capuchin Order, White Plains, NY Redemptoristine Nuns, Esopus, NY Religious of the Sacred Heart of Mary, Tarrytown, NY School Sisters of Notre Dame, Atlantic-Midwest Province School Sisters of St. Francis, Milwaukee, WI Sisters of Charity of Halifax, Nova Scotia, Canada Sisters of Charity of New York Sisters of Mary Reparatrix, Riverview, MI Sisters of Mercy, Mid Atlantic Community Sisters of Mercy, Northeast Community Sisters of Mercy, New York, Pennsylvania, Pacific West Community Sisters of Our Lady of Christian Doctrine, Nyack, NY LEVITICUS FUND
Sisters of St. Dominic, Blauvelt, NY Sisters of St. Dominic, Caldwell, NJ Sisters of St. Dominic, Tacoma, WA Sisters of St. Francis of the Neumann Communities Sisters of St. Francis of Philadelphia, PA Sisters of St. John the Baptist, Bronx, NY Sisters of St. Joseph of Carondelet, Albany Province Sisters of St. Joseph of Peace Sisters of St. Ursula, Rhinebeck, NY Sisters of the Divine Compassion, White Plains, NY Sisters of the Good Shepherd, Jamaica, NY Sisters of the Holy Cross, Notre Dame, IN Sisters of the Order of St. Dominic, Amityville, NY Sisters of the Presentation, New Windsor, NY Sisters of the Resurrection, Castleton-on-Hudson, NY Sisters Servants of the Immaculate Heart of Mary, Immaculata, PA Sisters Servants of the Immaculate Heart of Mary, Scranton, PA Society of Jesus, New York Province, NY Society of the Holy Child Jesus, American Province, Rosemont, PA The Crusade for Family Prayer, Inc., North Easton, MA The Reformed Church of Bronxville, NY The Sinsinawa Dominicans, Sinsinawa, WI Ursuline Convent, Wilmington, DE Ursuline Convent of St. Teresa, New Rochelle, NY Ursuline Sisters of Roman Union, Eastern Province Ursuline Sisters of Tildonk, Jamaica, NY
ASSOCIATE INVESTORS Jonathan D. Beard & Rachel Theilheimer John Brennan and Frances Sullivan Anne Marie Bucher OP James and Janice Carroll Edward and Elaine Chanda Quincy E. Chanda Thomas Conlon Bernadette Cronin-Geller Nancy & Joe Cruickshank Paul T. Dermody Victoria DiLucia Rose DiMartino Lawrence and Marjorie Donahue 2012 Annual Report
Mary-Cabrini Durkin Katherine M. Elsner Gadfly Trust Lynne M. Gerber Trust David Gustafson John and RoseMary Hunt Carole Kakos Trust Brian Kaminer Patricia M. Kenny Alan J. Kidder Ann W. LaValle Elizabeth M. Leddy Trust Francis R. Lewis Eifiona Main and Charles J. Engel Margaret A. Mariani William M. and Miriam F. Meehan Foundation Kathleen Murnion James and Susan O’Shea Mary C. Oberc Marilyn Olin Carla Padilla Dr. Frances M. Poggioli Catherine and Thomas Rowan Marta Santiago Michael Sena Elizabeth V. Sorese Robert Strittmatter and Norine R. DiCarlo Rev. John B. Sullivan Mary A. Sullivan and Brian F. Kelly† Richard and Charlene Watts Charles and Frances† Wiggins Woodlands Investment Management Account Kathleen M. Worthington Adorers of the Blood of Christ, Wichita, KS Bend the Arc: A Jewish Partnership for Justice, Philadelphia, PA Carmelite Communities Associated Carmelite Srs. for the Aged and Infirm, Germantown, NY Carmelite Sisters of Charity, Washington, DC Catholic Health East, Newtown Square, PA Holy Spirit Missionary Sisters, Techny, IL Institute for Public Architecture, New York, NY Leadership Conference of Women Religious Region 2, NY Loretto Literary and Benevolent Institution, KY The New England Conf. of Diocesan Directors of Religious Education St. John’s Church, Larchmont, NY PAGE 9
School Sisters of Notre Dame, Atlantic-Midwest Province School Sisters of Notre Dame, Central-Pacific Province School Sisters of St. Francis, Milwaukee, WI Sisters of Charity of St. Elizabeth, Convent Station, NJ Sisters of Charity of the BVM, Dubuque, IA Sisters of Charity, Nazareth, KY Sisters of St. Joseph of Carondelet, Albany Province Sisters of St. Joseph of Carondelet, St. Paul Province Sisters of St. Joseph of Northwestern Pennsylvania Sisters, Servants of the Immaculate Heart of Mary, Scranton, PA Society of the Divine Word, Techny, IL Sustainability Group, Boston, MA United Methodist Church, General Board of Global Ministries, New York, NY Ursuline Community, Liberty Avenue, New Rochelle, NY Ursuline Community, Linden Avenue, New Rochelle, NY Ursuline Community, Longstreet Avenue, Bronx, NY
OTHER INVESTORS Apple Bank for Savings Bank of America Basilian Fathers of Toronto Bon Secours Health System, Inc. CDFI Fund Capital One Bank Catholic Health Initiatives, Denver, CO Mercantil Commercebank Mercy Investment Services Ridgewood Savings Bank Seton Enablement Fund Signature Bank Trinity Health Corporation Wells Fargo Regional Foundation TD Bank
NON PROFIT ORG US POSTAGE PAID OSSINING, NY PERMIT NO. 6229 Leviticus 25:23 Alternative Fund, Inc. 33 W. Main Street, Room 205 Elmsford, NY 10523
How You Can Participate W hen we ask Leviticus Fund investors about their motivation to invest in our Fund, we typically get two responses. The first is that their investment balances a need for a financial return while helping local communities. The second common response is that they heard about Leviticus from a friend or acquaintance who is already an investor. In either case, both answers reflect the tremendous impact of community development investing: it generates flexible capital for those projects valued as much by their human outcomes as their financial soundness; and satisfied investors encourage others to strengthen opportunities in economically poor communities. As Leviticus approaches its 30th anniversary, we celebrate the cumulative dollar impact of our investments that now stands at more than $42 million. That amount translates into first-time homebuyers setting down roots in a community; eager preschool children awaiting a new learning day; and affordable rental and supportive housing that is both high quality and safe.
To learn more about investing with the Leviticus Fund, please visit our website at www.leviticusfund.org/invest_overview.htm or call our office at 914-606-9003 x201