"What Harvard University has done today is step up to the plate to help us and give us the tools to provide affordability," he added.

Both Menino and Cambridge Mayor Francis H. Duehay '55 said creating more affordable housing was their highest priority. They blamed escalating rents on a shortage of housing stock, the end of rent control in 1996 and the area's booming economy.

Prices of homes in Massachusetts have risen 233 percent since 1980, more than twice the national average, and Cambridge and Boston have lost over 20,000 units of affordable housing over the past five years, creating what Menino termed a "crisis in housing."

And while local politicians and activists said Harvard's contribution will not resolve this crisis, all agreed that it is a major step in the right direction.

Money Making Money

Combined with funds generated by "revolving," Harvard's commitment to providing a $20 million loan--over 20 years at 2 percent interest--will provide housing developers upward of 20 times that amount. Intermediaries will use University money to encourage additional giving from public and private institutions.

Three nonprofit institutions selected by Harvard--LISC, Boston Community Capital (BCC) and Cambridge Affordable Housing Trust (CAHT)--will dispense the loans to development groups building new units and renovating existing housing to increase affordability.

Thall predicted that the $10 million Harvard loaned LISC will attract $150 million more. Overall, Harvard's loan will allow LISC to create about 4,000 new units of affordable housing over 20 years, he said.