The numerous layoffs of low-income workers that occurred when the nation's economy slowed in 2001 have created numerous challenges for local Temporary Assistance for Needy Families (TANF) programs. By increasing collaboration between community economic development and workforce development efforts to serve low-income residents, states and communities may become better prepared to meet the challenges created by the economic slowdown. In their capacity as major local-level organizations involved in community economic development, community action agencies (CAAs) and community development corporations (CDCs) can work cooperatively with local and state economic development agencies. In addition to tax incentives, CAAs and CDCs can use funds from multiple federal agencies to support economic development efforts, including sectoral development and public-private ventures. A 1999 U.S. Department of Health and Human Services guide specifically mentions community development as an appropriate use of TANF funds. Other resources that can support local economic development include foundation and corporate intermediaries, individual development accounts, and faith-based organizations. Examples of creative resource leveraging by states, community organizations, and CDCs to develop successful work opportunities for low-income residents in conjunction with community economic development efforts can be found in Vermont, New York, Massachusetts, Wisconsin, and New Jersey. (Contains 19 resource contacts and 11 publications.) (MN)