What is a CDC?
The term CDC refers to a type of non-profit entity known as a "community development corporation". Although there is no established legal definition for CDCs, they are characterized by their community based leadership and their work primarily in housing production and/or job creation. This is what differentiates them from other types of non-profit groups.
CDCs are formed by residents, small business owners, congregations and other local stakeholders to revitalize a low and/or moderate income community. CDCs typically produce affordable housing and create jobs for community residents. Jobs are often created through small or micro business lending or commercial development projects. Some CDCs also provide a variety of social services to their target area.
According to a national census of CDCs conducted by NCCED in 1998, there are an estimated 3,600 such groups across the United States. Since the emergence of the first CDCs in the late 1960s, they have produced 247,000 private sector jobs and 550,000 units of affordable housing.
How do we become a CDC?
A CDC is legally the same as any other non-profit entity organized under section 501 (c) (3) of the Internal Revenue Code. Local residents that are interested in forming a CDC should get together and develop a set of by-laws, file for incorporation with their state government and once that is completed apply to the federal Internal Revenue Service for designation as a tax exempt non-profit organization. The IRS designation is necessary in order for your organization to obtain grants and gifts from any government, corporate, foundation sources or from individuals.
There is no national entity that certifies an organization as a CDC. In some states, Massachusetts and Minnesota for example, an organization must meet certain requirements in order to receive state funding as a CDC. Federal programs that fund CDCs are scattered among many different agencies and each program has its own eligibility criteria.
