Citation URL: http://www.urban.org/MeganGallagher

This report addresses two questions about outcomes for firms receiving assistance through SBA's 7(a), CDC 504, or SBIC programs between 1999 and 2001: 1) what happens to sales, employment, and survival before and after firms receive SBA financing; and 2) what explains the changes observed in sales or employment after firms receive SBA financing? Descriptive analyses found that prior to financing and each year thereafter, average sales increased over time, as did average employment. Multivariate analyses found that firm age, industry, and region of the country were significantly related to percent change in sales and employment for all three programs.

This report synthesizes the findings, conclusions, and policy recommendations derived from six reports generated by our evaluation of SBA's 7(a) Loan Guaranty, CDC 504 Loan, MicroLoan, and SBIC programs. The various studies were conducted to address three key research questions of particular interest to SBA and its constituents: 1) Does SBA assistance help the firms that receive it? 2) To what extent does SBA assistance serve its market? 3) Do SBA programs duplicate or overlap with other public sector programs?

The Chicago Process Study was initiated in 2001 to document and assess the early implementation of the HOPE VI redevelopment at the Madden and Wells public housing developments and the changes occurring in the surrounding neighborhoods. Through the study, Urban Institute researchers have provided feedback to the Chicago Housing Authority on HOPE VI-related activities with the idea that findings might inform later stages of redevelopment as well as other public housing redevelopment efforts. This final report examines the status of site development of Oakwood Shores, the breadth of neighborhood change surrounding the HOPE VI site, public housing resident relocation, and supportive services available to current and former residents of the Madden and Wells public housing developments as of autumn 2005.

Most former HOPE VI residents have received Housing Choice Vouchers; these residents, who are now living in private-market housing are doing well in many ways. Compared with those who moved to traditional public housing developments, those who moved with vouchers are living in significantly better quality housing in neighborhoods that are lower poverty and dramatically safer. On most measures, they are substantially better off than those who have moved to other traditional public housing developments, particularly on the those outcomes directly affected by HOPE VI relocation: the quality of their housing, their neighborhoods, and their perceptions of safety. But while the story is generally positive, it is also clear that many voucher holders are struggling to cope with the financial challenges of living in the private market. Moving out of public housing presents new financial management challenges, such as paying rent on time and being responsible for separate utility payments, which are usually included in the rent in public housing. Relocation assistance and updated utility allowances could ease the burden of these challenges for those moving to the private market with Housing Choice Vouchers.

Children are particularly vulnerable to the effects of HOPE VI relocation. While they are the most likely to benefit in important ways from improved housing quality—and reduced exposure to risks like lead paint or mold—and from safer, less distressed neighborhoods, moving can disrupt their education and friendships and even put older youth at risk for conflict with local gangs. Where they moved was also significant. Children whose families moved to the private market with vouchers are doing better, while those whose families moved to other traditional public housing are not faring as well. Girls, in particular, are suffering from the ill effects of being left behind in developments that are becoming increasingly dangerous and chaotic as vacancies increase.

Data from the 2002 National Survey of America's Families shows that school engagement declined from 43 percent in 1997 to 35 percent in 2002 among 6- to 11-year-olds. School engagement also declined for 12- to 17-year-olds from 38 to 31 percent. The share of young children whose parents read or told stories to them infrequently dropped from 17 to 14 percent. Higher-income children showed some small setbacks in their behavioral and emotional health.

States with the greatest gaps between rich and poor generally have a larger proportion of their children living in poverty. Of the 13 states studied, California, Mississippi, New York, and Texas have the most inequality in family income available to children. The authors combine six common measures of inequality into a composite inequality index. They conclude that states with the most poor children may have resources available in their state to increase the material well being of poor children.

This paper creates an "inequality index" which finds that the states with the greatest gaps between rich and poor generally have a larger proportion of their children living in poverty. Of the 13 states studied, California, Mississippi, New York, and Texas have the most inequality in family income available to children. The inequality index looks at how well off children in each of the 13 states studied are relative to others in the same state. The income available to children varies widely by state.

In 1776, Adam Smith defined poverty as the lack of those necessities that "the custom of the country renders it indecent for creditable people, even of the lowest order, to be without." Today, the federal poverty level represents the amount of cash income people require to meet their basic economic needs. For a single parent with two children, the poverty level was $12,641 in 1996. People living in families with incomes below the poverty level are deemed poor; those in families with incomes below 200 percent of the poverty level are considered low-income. Adults' reports of family income during the previous year were used to determine the share of people under the age of 65 living in poor and low-income families.

Children living with one parent were much more likely to be poor than children living with two parents--44 percent compared to 11 percent---ecause one-parent families typically rely on a lone adult for economic support. Even with support from the noncustodial parent, some children in one-parent families remain poor.

Return to list of authors