The City of Cambridge--as a result of an agreement between Harvard, the City and the Riverside Community Corporation--will provide the Riverside Community Corporation with a $20,000 loan.

The loan money will come from a $200,000 fund that Harvard committed to the City last June for improvements of the Riverside neighborhood, and will be used as seed money for a low income housing development at the River Howard Street site.

Once federal funding for the project is acquired, the Development Corporation expects to repay the loan. The money will pay for architect's preliminary planning fees and other early costs.

Harvard's offer of $200,000 to the Riverside area was first made in 1964 when the City refused to sell the Corporal Burns playground to Harvard even though it was the only piece of non-Harvard owned land left adjacent to the Peabody Terrace Married Student Housing.

Since Harvard could not buy the land, Charles P. Whitlock, then assistant to the president for Civic Affairs, made the University offer of $200,000 to be used to renovate the playground so it could accommodate increased usage by both Harvard and local children.

The actual fiscal committment, however, was not made until last June. The money has recently been earmarked for other projects--including the loan--as well as for improving Corporal Burns.

A letter mailed this month by Donald C. Moulton, assistant to the Vice-President for Community Affairs, to City Manager John Corcoran outlined some of the ways in which the Riverside money will be spent.

Between $100,000 and $125,000 will be spent on the playground. According to Moulton, the amount was set to correspond to the $100,000 that the City recommended for improving Corporal Burns in its 1971-72 Capital Improvement Program.

"We set aside $25,000 more than what they asked for in case there is a change in plans." Moulton said yesterday.

Another $26,000 will be used as matching funds for renovation of the Calendar Street Community Center, and $4,000 will defray operating costs of some of the center's present programs.

The remaining $25,000-$50,000 has not yet been committed to any specific proposals.