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February 05, 2004

The Leviticus Fund Helps Shelter the Homeless and Provide Care for Children
    by William Baue

In its third decade, the Leviticus 25:23 Alternative Fund lending program continues to grow and now offers a return for social investors.

SocialFunds.com -- "Your land must not be sold on a permanent basis, because you do not own it, it belongs to God and you are like foreigners who are allowed to make use of it." So reads Verse 23 in Chapter 25 of the Biblical book of Leviticus, which posits Divine land ownership and human land stewardship. The Leviticus 25:23 Alternative Fund, named after this passage, enacts such stewardship by providing funding through revolving loans for affordable housing, community facilities, and child care centers for children of low-income families.

Leviticus Fund loans are indeed making a difference. For example, in late 2003, the fund closed a $357,420 secured loan to Westhab, an Elmsford, New York-based nonprofit homeless housing and social service organization. The loan allowed Westhab to rebuild a fire-damaged apartment building in Yonkers, New York. The Leviticus loan provided 18 percent of financing for the $2 million construction project, with the remaining 82 percent covered by Fleet Bank (ticker: FBF).

The fund has grown considerably since its 1983 founding by members of the Tri-State Coalition for Responsible Investment, a consortium of church groups from New York, New Jersey, and Connecticut.

"While the essence of what we do and why we do it is the same, we are a larger and more sophisticated fund," said Executive Director David Raynor. "We now have total capital of $6.5 million and have made over 150 loans for a total of just under $11 million."

The fund has financed 848 affordable housing units, 30 nonprofit social service facilities, and 8 community health care facilities in low-income neighborhoods. As well, it has financed 9 minority and woman-owned small businesses. Recently, the fund has been ramping up its commitment to childcare, and has financed 28 childcare facilities serving almost 2,500 children from low-income families. Childcare facility lending represented 43 percent of the fund's total 2003 lending. The fund has raised $2.5 million in grants and zero interest loans to support child care facility lending.

"We even have established our own grant program for childcare centers," Mr. Raynor told SocialFunds.com. "Should a center become accredited by the National Association for the Education of Young Children [NAEYC] during the term of their loan, Leviticus will grant $5,000 toward the repayment of that loan."

This program made its first grant to the Greyston Child Care Center in Yonkers, serves 72 children between the ages of 6 weeks and 5 years old, after it had achieved NAEYC accreditation in February 2003.

This grant-making program is supported by the F. B. Heron Foundation and the CDFI Fund, a fund with a Congressional mandate to provide public capital to community development financial institutions (CDFIs) in underserved and distressed communities.

The fund is currently beginning a campaign to increase its permanent capital by $500,000 so that it can request a matching grant from the CDFI Fund.

"We are planning to make a significant push for an increase in investments and gifts by individuals," said Mr. Raynor. "We currently have a limited number of individual investors but are looking to increase that number."

"We offer 2 percent interest on a minimum $1,000 investment for a term of at least one year," Mr. Raynor explained.

Social investors can thus support the fund's work while also earning a return on par with some other community investment options.

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