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Neighborhood Housing Services of Chicago, Inc.

Annual Financial Report FY2016

1279 N. Milwaukee Avenue, 4th Floor

Chicago, Illinois 60622

(773) 329-4111 | nhschicago.org

Rooted in Neighborhoods, Investing in People

Neighborhood Housing Services of Chicago, Inc. | Annual Report 2016 2

Letter from NHS President Kristin Faust 3

2015 – 2016 Impact 4

NHS’ Major Areas of Program Activity 6

Leadership 7

Neighborhood Locations 12

Our Supporters 13

A Note from the President 14

Fiscal Year Ending March 31, 2016 (Financials) 15

Contents


Thanks to the support of our many partners, Neighborhood Housing Services of Chicago has made tremendous strides in advocating for working families and revitalizing communities through community building, real estate development, mortgage lending, homeownership education and housing policy.By working together with corporate leaders and neighborhood leaders, long time partners

and new friends, NHS is eager to build off this year’s success and embark on a new strategic

plan. Our collective efforts will reimagine Chicagoland neighborhoods that continue to feel

the reverberations of an uneven housing recovery.

We know dynamic approaches to neighborhood revitalization are necessary to address the

challenges we face within our neighborhoods. In the past year, we have seen the needs of

our communities and the individuals we serve change. While foreclosure prevention was

once our primary focus, we are now seeing renewed interest in homeownership.

Individuals, community and civic leaders alike recognize that homeownership once again

plays a critical role in strengthening communities and families. We are excited about

the opportunity to return to NHS’ root work, and look forward to sharing our progress

throughout the coming year.

We thank you for joining us on this journey and look forward to continuing our partnership

in the years ahead.

Dear Friends,

Warm wishes,

Kristin FaustPresident Neighborhood Housing Services of Chicago


Neighborhood Housing Services of Chicago, Inc. (NHS) is a nonprofit organization working in partnership

with businesses, government, and neighborhood residents to revitalize Chicago’s low-to moderate-income

neighborhoods. Formed in 1975, NHS is Chicago’s largest neighborhood revitalization organization.

NHS MISSION

NHS creates opportunities for people to live in affordable homes, improve their lives and strengthen their neighborhoods.

2015 – 2016 Impact

Educating &

preparing new

homeowners

for success

Lending to help

people buy, fix &

keep their homes

Sustaining home

ownership through

foreclosure

prevention services

Preserving,

rehabbing &

investing in housing

Building powerful &

enduring community

partnerships

WE DO THIS BY


OUR ACCOMPLISHMENTS FY16* SINCE 1975

Clients Served 4,730 223,778

Number of Loans & Grants Closed 445 22,071

Funds Loaned $16,623,096 $613,809,510

Number of Units Financed, Built or Rehabbed 623 34,980

Participants in Homebuyer Education 1,947 40,816

New Homeowners Created 155 4,861

Vacant Properties Sold 32 743

Rental Units Owned & Managed 312 –

FY16* SINCE 2003

Homeowners at Risk of Foreclosure Counseled / Educated 1,180 32,552

Homeowners Saved from Foreclosure 494 9,630

Troubled Properties Recovered / Stabilized 202 1,424

* April 1, 2015 – March 31, 2016

2015 – 2016 Impact


NEIGHBORHOOD STRATEGY / COMMUNITY BUILDING & ENGAGEMENT

NHS promotes community development through five

neighborhood-based and two regional programs

offering home ownership, lending, rehab services and

resident engagement: Auburn Gresham / Englewood,

Chicago Lawn / Gage Park, North Lawndale, Roseland,

West Humboldt Park, Woodlawn, suburban Elgin and

south suburban Cook County.

LENDING

Neighborhood Lending Services (NLS), a non-profit

affiliate of NHS and an Illinois Residential Mortgage

licensee, administers loan and grant programs

that finance home improvement, home safety

repairs, home purchase, purchase-rehab, and home

rehabilitation for low- and moderate-income families.

To support such activities, NHS has a Construction

Services team that manages repair, upgrade, or

retrofit projects for hundreds of clients each year.

REAL ESTATE DEVELOPMENT & PRESERVATION

The NHS Redevelopment Corporation (NHSRC)

buys and redevelops single- and multi-family

properties and builds and sells new homes.

NHSRC is also responsible for administering the

City of Chicago’s receivership program for 1 – 4

unit buildings, securing distressed properties

and promoting neighborhood stabilization.

Redevelopment activity is strategically targeted

to support the work of the neighborhood-based

programs and promote neighborhood development.

NHSRC owns and manages 295 multi-family and 17

single-family units of low-income rental housing.

HOME OWNERSHIP EDUCATION & FORECLOSURE PREVENTION

As the State of Illinois’ largest HUD-approved

housing counseling agency, NHS offers Homebuyer

Education classes monthly at across its service area

including Chicago Lawn, North Lawndale, Roseland,

Wicker Park, East Hazel Crest, and Elgin. The classes

are an innovative approach to providing all the

services and training customers need to purchase,

rehabilitate, insure, and maintain a home. NHS’

Homebuyer Education classes are offered in English

and Spanish, and are also available online. NHS also

provides extensive foreclosure prevention services

at all of its office locations through the Home

Ownership Preservation Initiative.

INNOVATION & PUBLIC POLICY

NHS’ Innovation Department is responsible for

spearheading new solutions to the evolving

challenges in NHS’ target neighborhoods. NHS

partners and staff are pioneering efforts to respond

to revitalization issues and anticipate future needs.

NHS converts the knowledge and experience it gains

through its day-to-day work in the neighborhoods to

new programs and policy initiatives that can directly

benefit those communities. In addition to its major

activity areas, NHS manages and participates in a

number of special programs and initiatives, two of

which include: The Chicago Greystone & Vintage

Home Program® and the Micro-Market Recovery

Program (MMRP).

NHS’ Major Areas of Program Activity

7

Leadership

Neighborhood Housing Services of Chicago, Inc. | Annual Report 2016


Kristin FaustPresident

Joel BoschChief Operating Officer

Anjanette BrownChief Financial Officer

Robin CoffeyChief Credit Officer

Mary CarlsonDirector, Resource Development & Public Affairs

Linda GreenDirector, Redevelopment Corporation

David KottmannDirector, Lending

Deborah MooreDirector, Neighborhood Strategy & Planning

Karen WoodsDirector, Homeownership Services

John YiDirector, Construction Services

Wendell WilliamsHuman Resources Manager

OFFICERS

President

Beth Witczak Managing Director, CRA & Fair Lending Officer, The PrivateBank

V.P. – Neighborhood Strategy

Robert V. McGhee V.P. – Community Development Manager, Citi

V.P. – Resource Development

Allen A. Rodriguez

Secretary

Betty Jo Swanson Community Representative, Auburn Gresham

Treasurer

Matthew Roth COO, IFF

Vicky Arroyo President, Community Development Corporation, MB Financial Bank

Dr. Michael Burnside Community Representative, South Suburbs, New Name Missionary Baptist Church

James Carr Senior Fellow, Center for American Progress

Steven J. Casey Manager – Grants & Budget, MacArthur Foundation

Ramon Cepeda Senior V.P. – Managing Director, Northern Trust Bank

Angela Hurlock Executive Director, Claretian Associates, Inc.

Abraham Lacy Executive Director, Far South Community Development Corporation

Bruce Martin Sr. V.P., Community Development Group JPMorgan Chase Bank

Don Meyer Executive V.P. – Head of Commercial Banking, Byline Bank

Andy Mooney Community Representative

Stephanie Seweryn Metro Board Representative, Latin School of Chicago

Tony Smith Community Development Banking Market Manager, The PNC Financial Services Group

William W. Towns Executive Director, Benefit Chicago

NHS of Chicago Executive Staff

NHS of Chicago Board of Directors


The Trustee Committee provides NHS with an organized network of recognized leaders familiar with economic,

community development, and housing issues within their respective industry and geographic areas. Members

of the Trustee Committee are leaders who have demonstrated active support for community development and

housing issues and whose interest, leadership, and resources may be mobilized to provide ongoing support for

both NHS and the community development movement.

NHS of Chicago Trustees

MEMBERS

Dane Cleven President & Chairman, Community Savings Bank

Marsha Cruzan Chicago Market President, U.S. Bank

Charles L. EvansPresident & CEO, Federal Reserve Bank of Chicago

William M. Farrow III President & CEO, Urban Partnership Bank

Mitchell FeigerPresident & CEO, MB Financial Bank

Philip B. Flynn President & CEO, Associated Bank

Peter Gillespie President & CEO – Chicago Region, FirstMerit Bank

Steve ‘Mac’ MacLellan Executive V.P., Wealth Management Business, The Northern Trust Company

Alberto Paracchini CEO, Byline Bank

Larry Richman President and CEO, The PrivateBank

Andrew Salk President, First Eagle

Peter Sticker CEO, Inland Bank

Robert Sullivan President & CEO, Fifth Third Bank

Scott Swanson Regional President Illinois, PNC

Ed Wehmer CEO, Wintrust Financial Corporation


Helen Alexopoulos MB Financial Bank

Jeff Allen BMO Harris Bank

Edward Beavers COUNTRY Financial

Dustin Bernstein Silverman Consulting

Rachel Evans Deloitte

Edgar Flagg Baker Tilly Virchow Krause

Erica Frazier BBVA Compass

John Gholar JP Morgan Chase

Sarah Greenberg EZRA Multi-Service Center

Damion Heron JP Morgan Chase

Chelsea Huzsar Sinai Health System

Brad Jaffe HomeScout Realty

Karl Riley II US Bank

Alonzo Rushing American Family Insurance

Dan Ruzich The PrivateBank

Marlon Sanders Citibank

Stephanie Seweryn Latin School of Chicago

Bobby Thapar Anchor Tree Development, LLC

Alexandria Willis Truven Health Analytics

The Metro Board of Neighborhood Housing Services of Chicago (NHS) is comprised of emerging civic and

business leaders who assist NHS by raising funds and awareness of NHS and its commitment to affordable

housing and to promoting Chicago’s great neighborhoods.

OFFICERS

President

Manuel Jimenez Marquette Bank

Vice President

Thomas FitzGibbon

Secretary / Treasurer

Robert Tucker

BOARD MEMBERS

Sheila Barber Associated Bank

Faruk Daudbasic First Eagle Bank

Bruce Martin JP Morgan Chase

Karen Thomas MB Financial Bank

Robert Tucker Chicago Community Loan Fund

Terry Young Urban Partnership Bank

NHS Metro Board

Neighborhood Lending Services Board of Directors


OFFICERS

President

Kristine Jurmu Illinois Housing Development Authority

Secretary

Christine Kolb Focus Development

Treasurer

Paul Vlamis JP Morgan Chase

BOARD MEMBERS

Molly Ekerdt Preservation of Affordable Housing (POAH)

Allison Porter-Bell BMO Harris Bank

Daniel Siadak Bank of America

Adrienne Whitney

Paul Wilkowski Equity Lifestyle Properties

Matt Williams JP Partners

OFFICERS

President

Allen Rodriguez

Vice President

Carl Pietraszewski Bank of America

Chair of Finance

Tuan Nguyen First Midwest Bank

Chair of NeighborWorks Day

Stephanie Burks

BOARD MEMBERS

Frank Binetti Inland Home Mortgage

Laura Ann Spencer Perma-Seal Community Foundation

Rick M. Zonts Elgin State Bank

NHS Redevelopment Corporation Board

Fox Valley Board


CENTRAL OFFICE* 1279 N. Milwaukee Avenue

4th Floor

Chicago, IL 60622

AUBURN GRESHAM /ENGLEWOOD

449 W. 79th Street

Chicago, IL 60620

CHICAGO LAWN / GAGE PARK*

2609 W. 63rd Street

Chicago, IL 60629

ROSELAND

11001 S. Michigan Avenue

Chicago, IL 60628

WEST HUMBOLDT PARK*

3601 W. Chicago Avenue

Chicago, IL 60651

NHS OF THE FOX VALLEY*

One American Way

Elgin, IL 60120

NORTH LAWNDALE

906 S. Homan Avenue

4th Floor

Chicago, IL 60624

NHS OF THE SOUTH SUBURBS

1920 W. 174th Street

East Hazel Crest, IL 60429

WOODLAWN RESOURCE CENTER

6144 S. Cottage Grove Avenue

Chicago, IL 60637

* El personal habla espanol en estas localizaciones.

Neighborhood Locations

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Thank you to our supporters!

NHS deeply appreciates the many individuals, community bank, corporate, foundation and government partners whose generosity strengthens our neighborhoods.

For a full list of supporters, visit nhschicago.org/support/supporters

Neighborhood Housing Services of Chicago, Inc. | Annual Report 2016


Fiscal Year 2016 (ending March 31, 2016) provided Neighborhood Housing Services of Chicago (NHS) with the opportunity to begin laying the framework for our FY 2017 – 2020 strategic plan. Thanks to the generosity of our supporters we served 4,730 clients. We are proud to

have created 155 new home owners, which is a 70% increase from our previous fiscal year.

The increase in lending contributed to a large balance in loans held for sale at the end of

the fiscal year.

We made important progress on setting the foundation to strengthen our organizational

position. Our annual financial statement demonstrates how we sought to position the

organization for future stability. We began by making accounting adjustments to generate

a more accurate balance sheet that reflects assets that generate a yield, a result of

thorough analysis of allowance variations, receivable collectability and the recording of

the related adjustments.

This upward trend continued into fiscal year 2017. We were awarded $1.15 million in federal

funding from the Community Development Financial Institutions (CDFI) Fund. In addition,

we were a grantee of $1.5M from a Department of Justice settlement with a large bank, and

will be receiving the release of $1M as the sub-recipient of an older foundation grant. These

grant funds combined with an increasing demand for NLS’ mortgage products and a slight

increase in the average loan size to $125k (up from $117k last year) will position us to reach

our goal of returning to a solid financial position.

We thank you for your continued support and look forward to an exciting year ahead.

A Note from the President


Fiscal Year Ending March 31, 2016(Parent Company Financial Statement Information)

NEIGHBORHOOD REDEVELOPMENT

COMMUNITY LENDING

PROGRAM

COMMUNITY CONSULTATION

& ASSISTANCE

MANAGEMENT& RESOURCE

DEVELOPMENTTOTAL

REVENUE

SUPPORT & REVENUE

Contributions, Private

& Public Grants $ 66,075 $ 514,885 $ 344,265 $ 1,726,527 $ 2,651,752

Contractual Services 761,162 1,986,916 2,335,422 – 5,083,500

Lending Revenue – 1,241,038 – – 1,241,038

Interest on Loans Receivable 116,989 711,647 – – 828,636

Rental Income 283,551 – – – 283,551

Development & Property

Preservation Fees 557,997 – – – 557,997

Other 9,429 – 41,688 – 51,117

TOTAL 1,795,203 4,454,486 2,721,375 1,726,527 10,697,591

STATEMENT OF FUNCTIONAL EXPENSES

Personnel & Staff Expenses 568,126 2,190,581 2,188,193 2,385,702 7,332,602

Program Expenses 102,274 800,388 134,893 597,643 1,635,198

Marketing, Fundraising

& Special Events 7,582 68,054 65,079 268,177 408,892

Occupancy & Supplies 39,102 222,171 465,092 443,574 1,169,939

Insurance & Financial Expenses 15,982 45,186 22,794 125,464 209,426

TOTAL 733,066 3,326,380 2,876,051 3,820,560 10,756,057

OTHER EXPENSES

Forgivable Grants & Loans

(to homebuyers)– 587,899 – – 587,899

Bad Debt Expense 180,729 1,063,803 35,461 – 1,279,993

Direct Costs of Property

Rented or Sold 200,450 – 13,075 – 213,525

Interest 95,101 294,200 10 146,373 535,684

Depreciation 74,327 1,118 – 53,522 128,967

TOTAL $ 550,607 $ 1,947,020 $ 48,546 $ 199,895 $ 2,746,068


Neighborhood Housing Services of Chicago, Inc. | Annual Report 2016 16Neighborhood Housing Services of Chicago, Inc. | Annual Report 2016 16

ASSETS

Cash & Cash Equivalents $ 7,087,815

Accounts, Fees, & Contracts Receivable 4,018,413

Accounts & Loans Receivable – Partnerships 2,737,437

Loans Held For Sale 8,071,983

Loans & Deferred Loans Receivable – Net 5,202,919

Property Held For Rental & Development 1,462,381

Other Assets 845,943

TOTAL 29,426,891

LIABILITIES

Accounts & Program Receipts Payable 3,644,582

Deferred Revenue & Funds Held For Agency Transfer 1,400,586

Notes Payable 12,053,088

TOTAL 17,098,256

NET ASSETS

Unrestricted 1,256,535

Temporarily Restricted 6,053,439

Permanently Restricted 5,018,661

TOTAL NET ASSETS 12,328,635

TOTAL LIABILITIES & NET ASSETS $ 29,426,891

Fiscal Year Ending March 31, 2016(Parent Company Financial Statement Information)

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