insights (2007-11)

Rogero's Community Development Mission

Four years ago, Madeline Rogero was immersed in planning her campaign for mayor against Bill Haslam, the man who narrowly defeated her. Today, she is just as immersed in giving direction to the city department that Haslam recently tapped her to head, following revelations that made it the biggest embarrassment of his first term in office.

Since her appointment as director of Community Development in late December, Rogero is frank to say that "my biggest challenge has been getting my arms around the myriad programs that we have, the opportunities that we have with the dollars and the staff and partners that we have." As of now, she adds, "I really feel great about the department, and we've gotten to the point where we can really start looking toward the future. What do we want to be and how do we best utilize our federal dollars? How can we revitalize low-income communities which is really what our goal is.... Thinking this through is the part I'm really excited about."

In the recent past, the $27 million federal funds awarded to Knoxville through its 1998 designation as an Empowerment Zone (EZ) city had almost become an embarrassment of riches. Allocations of these funds and oversight of their use had been vested in a hybrid entity, the Partnership for Neighborhood Improvement (PNI), whose board was comprised partly of representative of low-income neighborhoods and partly of business leaders.

By last fall, squabbling over the EZ money had come to center on the conduct of a small-business loan program to which $4 million had been allocated. High default rates on initial loans resulted in a clampdown that left PNI's staff, which had assumed administration of the program, caught in a dammed-if-you-do and dammed-if-you-don't controversy over the $3 million in that loan pool that remained uncommitted.

In January, the city administration terminated PNI's involvement, except in an advisory capacity, and contracted instead with the Knoxville Area Urban League to run the program under the oversight of Rogero's department. The Urban League's point person is Sherman Jones, who is a Harvard MBA with extensive experience as a management consultant and financial advisor as well as a college teacher and administrator.  

Rogero voices confidence that the loan program can be successful in providing financing to otherwise unbankable, job-creating enterprises within the Empowerment Zone's center-city boundaries. But, despite pressure to act quickly on a backlog of more than $1 million in new loan applications, she's proceeding methodically. "We want to get the money out there as soon as possible, but we won't put a penny on the street until we have the structure set up to make sure we have a program that works properly," Rogero says. That includes a set of performance criteria, including realistic default rates, derived in part from standards set by a national Association of Enterprise Opportunity.

She's also working with Jones on tapping into other counseling resources such as the UT Business School and a Small Business Development Center as well as setting up a loan committee. "By May 1 we ought to have the infrastructure all in place, and I think people will be happy with the product."

Prior to Rogero's arrival, the city administration had also fallen down on implementing other EZ programs for which $3 million had been earmarked. Those include $1.9 million for blighted property development and $1.1million for home repair, which the EZ governing body, PNI, had long since allocated to the city. "I know that the Community Development staff had been working on a potential way of implementing it, but I don't know whether it fell between the cracks or fell of its own weight," Rogers is frank to say.

One reason for the confusion may have been disarray within the department during the period leading up to the resignation of its former director, Renee Kesler, last fall amid allegations of misconduct.

"For a while after Renee left and before I came in, we didn't have knowledge of what was intended by the two task forces within PNI that met for months to identify what the needs were and how they should be addressed. So I'm going back to them to make sure we're utilizing the dollars in the way it was intended," Rogero says, adding that "in a short time we'll be able to move on that."

Another reason the one-time EZ allocations may have gotten lost in the shuffle is that they seemingly overlap with programs for which the city receives about $3.5 million in Community Development Block Grants (CDBG) and what are known as HOME grants. Those account for about 90 percent of the department's budget.

Last year, about $2.1 million of that money went for rehabilitation of substandard residences, primarily in the Empowerment Zone, under a loan program that has forgiveness features. Another $460,000 went to acquire blighted properties, primarily as sites for new home construction, and $725,000 went to non-profit Community Housing Development Organizations that specialize in building affordable housing on those and other sites. Additional funding went for sidewalks and other infrastructure improvements in run-down neighborhoods, minor home repairs and other assistance for people with disabilities, plus a host other lesser allocations. (The total exceeds $3.5 million because considerable CDBG and HOME funding was carried over from the prior year.)

Making optimum use of those ongoing sources of funding is Rogero's top priority looking ahead. But the needs to be addressed and her plans for doing so will have to be subject of a separate column.

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