Recently, several government and philanthropic agencies have rolled out new programs to help the growing number of Chicago-area homeowners facing foreclosure. Last week, the John D. and Catherine T. MacArthur Foundation announced that it will provide $68 million in grants and low-interest loans to help people on the edge of foreclosure. And in mid-September, shortly before Cook County sheriff Tom Dart temporarily halted foreclosure-related evictions because they often victimize innocent renters, Cook County Board president Todd Stroger announced an effort to get the state legislature to enact a yearlong ban on foreclosures.

“I think we need to attack [the foreclosure crisis] through all the avenues we can attack it,” Stroger told me in an interview at his office last week. The statistics back up Stroger’s sense of urgency: In Cook County alone, analysts say, the number of foreclosures this year may exceed 42,000; for the first half of 2008, foreclosures in the county were up 47.8 percent from the first six months of 2007.

While some people worry that lending a hand to struggling homeowners only rewards them for their fiscal irresponsibility, the folks at the MacArthur Foundation feel differently. They have found that many of those same homeowners “got bad [loan] products and very little counseling,” the foundation’s president, Jonathan Fanton, told me Tuesday.

What’s more, abandoned homes and other problems resulting from foreclosures can easily impact unaffected homeowners. “When there are houses empty in a neighborhood, they’re the first place for trouble to happen,” said Stroger. “The only real way to combat that is to have someone living in that home.”

On top of that, empty houses can hurt the value of nearby homes. The Woodstock Institute has estimated that each foreclosed home drags down property values within a one-block radius by 0.9 percent. “If you’ve got three or four houses boarded up on a block, that’s going to add up to a downward push on the value of that block,” Fanton said.

But MacArthur’s $68 million foreclosure program isn’t so much about preserving property values as it’s about fostering community improvement. In the past decade, MacArthur’s New Communities Program has invested $150 million in 16 of what Fanton called Chicago’s “poorest but promising” neighborhoods; the investment was seed money meant to attract business, create jobs, and, said Fanton, “untap the latent potential” within those neighborhoods. And by late 2006, MacArthur was seeing measurable improvement on some specific indicators in those neighborhoods. “You had a picture of real progress being made,” Fanton said. “Then the foreclosure crisis hit, and it puts at risk all that we and the many community organizations have been working so hard on.”

Foreclosures have been hitting everywhere, but they have been densest in low- and middle-income neighborhoods, places where a larger proportion of people were only able to become homeowners via the extremely low-cost mortgages that were popular in the first half of this decade. Not coincidentally, those are some of the same neighborhoods where MacArthur was trying to cultivate improvement, noted Craig Howard, the foundation’s director of community and economic development grant making.

Howard explained that a primary way MacArthur and other groups try to help struggling neighborhoods is by attracting stable, middle-class workers to live there. But many of those same middle-class people are the ones who wound up with unaffordable mortgages after rising interest rates pushed their payments up. “So the stabilizing part of the population, the people who were the backbone and building blocks of these neighborhoods, are now being destabilized,” Howard said.

Foreclosures can also undercut public budgets. A single empty, foreclosed home can cost “as much as $34,000 for police to secure it, for sanitation code enforcement, and [other things] from as many as 10 or 15 city agencies,” said Howard. “That’s a significant cost to the city—read, taxpayers.”

Fanton also encouraged people wary of any foreclosure bailouts to look at the big picture. “The larger issue here is that when we pursue social policy that helps individuals in need, we are often doing the smart thing for all of us,” he said. “Our city and our region are really interconnected economically. So as these [affected] neighborhoods do better, the city and region as a whole do better.”