In recent years, policymakers have begun looking to churches, synagogues, mosques, and other faith-based organizations to play a greater role in strengthening communities. Yet little research exists on the role of faith-based organizations in community development. This report summarizes the current state of knowledge and identifies the policy conclusions and major questions that follow from what is known. Because the research is limited this report also draws on interviews with knowledgeable scholars and practitioners in community development.

This report uses two key terms—community development and faith-based organization—in specific ways:

• Community development is asset building. It centers around housing and community economic development but also includes developmental efforts, such as job training, to prepare residents for more productive lives.
• Faith-based organizations are of three types: (1) congregations; (2) national networks, which include national denominations, their social service arms (for example, Catholic Charities, Lutheran Social Services), and networks of related organizations (such as YMCA and YWCA); and (3) freestanding religious organizations, which are incorporated separately from congregations and national networks.

More than half of all congregations and many other faith-based organizations provide some form of human services. Congregational participation in providing human services is greater among worship communities that are larger (and hence have more resources), are located in low-income neighborhoods, are theologically liberal, and are African American. Supportive pastoral leadership is central.

A key finding of this report is that relatively few faith-based organizations participate in community development activities. The most common participants are faith-based community development corporations (CDCs), some national denominations and their affiliates, and Habitat for Humanity.

Faith-based participation in community development is limited for several reasons:

• Congregations have two preferred approaches to service: they donate small amounts of cash or in-kind goods to other service delivery groups, or they provide small groups of volunteers to conduct relatively well-defined, periodic. By contrast, community development activities require regular and sustained involvement in a range of complex processes and tasks.
• Community development is best done by independently incorporated organizations. Establishing and fostering the growth of such affiliated organizations are the least common mode of congregational engagement in services, and poses numerous challenges.
• Congregational staff and volunteers typically lack the skills, knowledge, and time required to successfully sponsor community development projects.
• Most congregations have not applied for government grants or undertaken the legal and financial responsibilities required to sponsor community development projects, and many lack the management capacity to do so.

No existing research compares how the outcomes of community development efforts sponsored by faith-based organizations with those of secular organizations. Some information is available about the challenges facing organizations that have tried to enter community development, but little is known about the impediments faced by the minority of faith-based organizations interested in obtaining government funds to sponsor community development. These are among the questions requiring new research.

The implications of the report's findings include the following:

• The field needs significant technical assistance to ensure that faith-based organizations in community development spend government funds responsibly, given the small size and inexperience of many such organizations. This is especially the case for new entrants to the field.
• Faith-based organizations interested in community development may increase their effectiveness by partnering with existing CDCs and other experienced nonprofit organizations (even though such collaborations present known challenges) rather than by sponsoring projects independently. These collaborations might be facilitated by Federal technical assistance. Other forms of participation, such as securing new vehicles for social investing, should be explored.
• Only a fraction of the organizations studied currently have the resources to successfully engage in community development activities. However, when they do have such resources, faith-based organizations are uniquely positioned to have a significant impact beyond simply sponsoring community development projects. Congregations can increase public support for affordable housing and other community development initiatives in their communities by engaging in public dialogue and joining coalitions that support social justice.

It is important to note, however, while this report suggests possible roles that faith -based organizations can play in community development, it is built on limited research and programmatic experience. There is still a great deal about this topic that is unknown or uncertain; much more research and exploration is needed to built the base of useful knowledge.

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