This report summarizes the preliminary results of Phase II of an evaluation of the Local Initiatives Support Corporation (LISC), a national nonprofit lending and grantmaking institution founded in 1980 to draw private sector financial and technical resources into the development of deteriorated communities and neighborhoods. In this second phase of the evaluation, expansion of the field work to new areas of concentration permitted both validation of the Phase I findings about projects and organizations, and the development of preliminary insights about community impacts. The study relied heavily on data obtained from personal interviews. The report is divided into the following sections: (1) introduction and description of LISC; (2) outcomes of LISC-supported projects; (3) description of how assisted groups have enhanced their organizational capacity; (4) discussion of effects of LISC on the communities in which it works; and (5) an appendix listing all organizations and projects included in the evaluation. (PS)