ARLINGTON, Va. – Many credit unions have become aware of the Woodstock Institute primarily because of the organization's study critical of mainstream credit unions' service to low-income people in Chicago and the provocative stands the organization has taken in the ongoing debate over how credit unions serve the underserved. Marva Williams, the Institute's senior vice president, said those CUs who have become familiar with the organization only recently may be unaware of its long history of advocacy on behalf of those considered economically disadvantaged in Chicago and nationwide. The Institute dates back to 1973, when Aaron Scheinfeld, a Chicago, Illinois entrepreneur, and his wife Sylvia began contacting local Chicago area leaders interested in fair housing and economic justice. Those interested included lecturers and academics from Chicago area universities and business schools, co-founders of the Southern Christian Leadership Conference, a prominent civil rights group, and former directors of the U.S. Civil Rights Commission. Those interested founded the Woodstock Institute as the policy arm for a study center they set up in Woodstock, Illinois, a Chicago suburb. The Institute's founding mission was "to explore and pursue the most effective strategies for dealing with discriminatory housing and investment policies in lower income communities," a mission that it says has remained largely intact throughout the organization's 30-year history. Given that many Chicago area leaders were among Woodstock's founders, the organization began its work primarily confronting and researching Chicago area housing and economic issues, but gradually branched out as the effort to confront unfair lending and housing policies became more national in focus, primarily through efforts to support the implementation of the Community Reinvestment Act (CRA) and to network with other local groups. But the Institute has kept its local focus too, regularly publishing, for example, the Community Lending Fact Book, an annual compilation of detailed home lending data for each of Chicago's neighborhoods. The organization has also carried its local focus nationwide, working primarily to help other communities confront their economic problems around the country. The organization claims to have coined the term "community development financial institutions" (CDFIs) after noting how many banks, loan funds, credit unions, micro-loan programs and venture capital projects specifically created to help low-income communities were springing up around the country in the late 1980′s. "The importance of Woodstock's work," said Liz Hollander, former Woodstock Board Member and Chicago Planning Commissioner, "is that they understand that communities are built by a combination of public and private forces. Neighborhoods need private investment, and private businesses need good neighborhoods in which to do business," she said. Banks nationally began to become more aware of, and nettled by, the Institute's work and criticism in the early 1990′s, when the Institute began to vigorously weigh in on CRA related regulatory issues, said Paul Smith, senior federal administrative counsel for the American Banker's Association (ABA). Smith chuckled when he learned that more credit unions had become aware of the Institute, observing, "Now credit unions have to deal with what we have dealt with for years." Smith said the Institute has a reputation for being among the more "thoughtful" of the CRA advocacy groups, and for rooting its positions on legislation and regulation in researched economics. Other banking observers confirmed Smith's general impression but also echoed the comments of Navy Federal Credit Union, President/CEO Brian McDonnell, in his observation that the Institute was not above manipulating numbers to make its points, something McDonnell said he found "very disappointing." "I would agree that they definitely have an agenda and sometimes work to make the facts fit," said one long-time banking observer who preferred not to speak for the record. "But" he added, "pro-banker groups have shared that tendency as well." Credit unions felt the Institute's initial study of who joined Chicago area credit unions definitely lacked balance when it concluded that credit unions do not serve low-income people. Mike Schenk, vice president of CUNA's economics and statistics department, stipulated that he was not familiar enough with the study to challenge its figures, but added that conclusions the Institute drew were definitely flawed. "Even if you accept their numbers at face value," Schenk noted, "they still don't add up to the conclusion they drew – there are alternative conclusions that could be drawn from those numbers." Schenk argued a more balanced study would have taken into account that credit unions historically served single employer groups and had limited access to the very people who make up the lowest poverty tier. "We definitely see credit unions helping lower income people, but by definition people with a job," he said. "The Woodstock Institute should do the same study five or 10 years from now and I believe they would get a much different result," he added. The Institute's work with smaller, low-income credit unions dates back almost to the group's founding, according to the group's Web site, but its particular interest in mainstream credit unions' work with low-income and the underserved dates at least to the term of former NCUA Chairman Norm D'Amours, Williams said. In January 1999, the Institute sent then Chairman D'Amours a letter suggesting three "simple impact measures" that the NCUA could look at to better understand credit unions' work with the underserved. The measures included the number of loans made to low- and moderate-income members and to middle- and upper- income members by NCUA loan category; the amount of those loans by type and income category and the number of those borrowers by income category that have share draft, regular share and/share certificate accounts with the credit union. Even if the NCUA did not require credit unions to report this data, Williams said, these three categories might be a good place for the credit union industry to consider disclosing how credit unions work with low-income people. Bankers say they aren't behind the Institute's focus on CUs. "If we are funding the Woodstock Institute, nobody told me," Smith said, "and I wish they had." As part of his duties with the ABA, Smith often conflicts with the Institute over different federal regulations. "Anybody who thinks we have Woodstock in our pockets need only compare their comments to our comments," on certain regulatory proposals, he said. Indeed, an analysis of Woodstock funding and activity seems to bear that out. Although it would not give Credit Union Times a list of its organizations that give it funds, it did break down its 2001 income by category. Of the Institute's $750,155 2001 income, financial institutions gave only $12,500, or 2%, for its general operating support, according to Williams. The organization got $42,450 from Chicago area financial institutions as part of its effort to fund its Community Lending Fact Book, Williams said, but even including that figure means the organization got only 7.3% of its funding from financial institutions she added. According to the data Williams provided, the bulk of the Institute's 2001 funding, $642,083, came from charitable foundations. Just over $24,000 came from contracts and just over $29,000 came from other sources that were not specified, although Williams denied any financial institutions were among them. Independent research appears to bear this out, with Woodstock listed among the grantees in the last two years of the Chicago Community Trust ($40,000), the Annie E. Casey Foundation ($90,000) and the National Credit Union Foundation (part of a $345,000 grant from the Ford Foundation). The NCUF/Ford grant funded Woodstock's "studies of asset building programs at five community development credit unions" according to a May 2002 CUNA press release. [email protected]