Worcester Business Journal: Report: Majority of Greater Worcester PPP loans went to wealthy, white neighborhoods

Worcester Business Journal, December 11, Report: Majority of Greater Worcester PPP loans went to wealthy, white neighborhoods

The vast majority of federal Paycheck Protection Program loans in the Worcester metropolitan area went to upper- and middle-income White neighborhoods.

According to geocoded data released by Washington nonprofit National Community Reinvestment Coalition, which focuses its work on fighting discrimination in lending, housing and business, a little over 8,000 PPP loans were given to Worcester area businesses in upper and medium income census tracts where less than 30% of residents are people of color. In turn, on the other end of the spectrum, only seven PPP loans were issued in census tracts considered low-income and where more than 80% of residents are people of color.

The organization compiled local and national data by geocoding the addresses listed on PPP applications, after the U.S. Small Business Administration released detailed data about the $523-billion loan program, which was designed to help small businesses survive an economic crisis brought on by the coronavirus pandemic.

The NCRC findings jibe with WBJ’s own research into PPP lending for businesses own by people of color: of the PPP recipients in Central Massachusetts who identified their race, 84% were white, 8% were Asian, 6% were Hispanic & 2% were Black.

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Redlining and Neighborhood Health

Before the pandemic devastated minority communities, banks and government officials starved them of capital.

Lower-income and minority neighborhoods that were intentionally cut off from lending and investment decades ago today suffer not only from reduced wealth and greater poverty, but from lower life expectancy and higher prevalence of chronic diseases that are risk factors for poor outcomes from COVID-19, a new study shows.

The new study, from the National Community Reinvestment Coalition (NCRC) with researchers from the University of Wisconsin–Milwaukee Joseph J. Zilber School of Public Health and the University of Richmond’s Digital Scholarship Lab, compared 1930’s maps of government-sanctioned lending discrimination zones with current census and public health data.

Table of Content

  • Executive Summary
  • Introduction
  • Redlining, the HOLC Maps and Segregation
  • Segregation, Public Health and COVID-19
  • Methods
  • Results
  • Discussion
  • Conclusion and Policy Recommendations
  • Citations
  • Appendix

Complete the form to download the full report: