I N D E X
T H E F E D E R A L R E S E R V E B A N K o f S T . L O U I S | C E N T R A L T O A M E R I C A ' S E C O N O M Y
S U M M E R 2 0 1 7
Community-Based System
Dynamics: An Essential Tool in the
Community Development Toolbox
5
8
9
Opportunity Knocks:
Socially Underwriting the
Small-Dollar Mortgage
Communities and Capital:
A Foundation for Success
A N D M O R E > >
Redlining Louisville Project:
Early Lessons Learned
By Jeana E. Dunlap and Joshua Poe
I
magine if all your hard work and aspira-
tions were crippled by a small handful of
individuals with low expectations for your
future success, credibility or worth. Redlin-
ing practices in America did just that. In the
latter months of 1937, the city of Louisville,
Ky., had recently recovered from the Great
Flood of 1937, the single most significant
natural disaster in its history. At the same
time, the federal government was embarking
on a new mechanism to support homeowner-
ship opportunities for millions of Americans.
e Home Owners' Loan Corp. (HOLC)
was also attempting to mitigate risk for the
financial institutions that would help deploy
billions of dollars in mortgage capital across
the country.
e Office of Redevelopment Strategies
of Louisville Metro Government launched
Redlining Louisville: e History of Race,
Class, and Real Estate. is interactive map
allows investigation of some of the ways
redlining and the HOLC has affected hous-
ing, development, disinvestment and lending
patterns in Louisville since the 1930s.
HOLC residential security maps provided
snapshots of nearly every major American
city in the 1930s before urban sprawl moved
into greenfield sites (an area of land, usually
in the countryside, that has never had build-
ings on it before). e colors in a typical map
represented a four-point classification system
devised by the HOLC to indicate where local
lenders were encouraged to make loans and
where loan requests should be denied. Green
("A Grade") was an indicator for the very best
borrowers, followed by blue ("B Grade") and
yellow ("C Grade"). Red ("D Grade") was
the color reserved for areas of the city where
access to capital would be withheld.
In describing how neighborhoods were
graded in the 1937 Louisville residential
property survey, the HOLC, along with local
realtors, lenders and other real estate profes-
sionals, offered the following explanation:
SOURCE:
Redlining
Louisville:
The
History
of
Race,
Class
and
Real
Estate.
>> continued on Page 3
