Federal Legislation Would Boost Nationwide Employer-Assisted Housing Programs, Aid Housing Affordability and Stability - Metropolitan Planning Council

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Federal Legislation Would Boost Nationwide Employer-Assisted Housing Programs, Aid Housing Affordability and Stability

Housing America’s Workforce Act gives incentives to employers who help employees buy homes

(Washington D.C.)….. The Housing America’s Workforce Act of 2005, introduced today in the Senate by Sen. Hillary Rodham Clinton (D-N.Y.), Sen. Gordon Smith (R-OR) and Sen. Mel Martinez (R-FL), aims to alleviate the nationwide workforce housing shortage by providing economic incentives to employers investing in housing solutions through employer-assisted housing (EAH) programs.

Inspired in great part by lessons learned in Illinois, this legislation has garnered bipartisan support – including from Sen. Dick Durbin (D-IL), Minority Whip – as a constructive response to the decrease in homeownership rates among moderate-income working families. Nationwide, resurgent housing markets are pricing out low and moderate-income families, while the production of affordable homes fails to keep pace. The American dream of homeownership is far beyond the reach of thousands of working families, many of whom cannot even afford the rising cost of rent, especially in communities near jobs and transportation. Through EAH programs, the private sector becomes part of the solution, investing in housing assistance to employees while reaping bottom line benefits.

“Employer-assisted housing programs support working families, while also reducing turnover costs for employers. Our proposal will expand EAH by offering tax credits to participating employers, excluding as taxable income the assistance received by employees, and supporting start-up counseling work essential to the success of the program,” said Sen. Clinton. “This is clearly a public-private partnership that is proven and makes sense.”

To support private sector investment in housing solutions, the Housing America’s Workforce Act offers a tax credit of $.50 for every dollar that an employer provides to eligible employees, up to $10,000 or six percent of the employee’s home purchase price (whichever is less) or up to $2,000 for rental assistance. In addition, to ensure that employees receive the full value of employers’ contributions, the act defines housing assistance as a nontaxable benefit, similar to health, dental and life insurance. Finally, the act establishes a competitive grant program available to nonprofit housing organizations that provide technical assistance, program administration, and outreach support to employers undertaking EAH initiatives.

“Our employer-assisted housing program in Lake County, Ill., improved stability and morale among our workers, yielded tremendous appreciation from the broader community, and enhanced our bottom line,” said Edward Liddy, president and CEO of Allstate Insurance Company. “This program really is a winning proposition.”

In the Chicago area, the Metropolitan Planning Council (MPC) introduced its EAH model in 2000. With tremendous support from the state, suburban policymakers and the City of Chicago, the Council has nurtured a program that has become a national model and an important influence in the creation of the Housing America’s Workforce Act.

“Federal, state and municipal leaders have backed employer-assisted housing both as a strategy for helping workers afford housing in expensive, job rich markets and as a tool for promoting reinvestment. EAH also supports a competitive workforce, while reducing the time people spend in traffic so they can spend more time with family,” said Robin Snyderman, MPC housing director. “By making it even more attractive for employers to help employees afford a home, the Housing America’s Workforce Act steps up federal leadership on housing at a point in time when such attention is desperately needed.”

In less than five years, 40 Illinois employers have “signed on” to EAH, many of which have programs up and running that are helping hundreds of families afford homes near their jobs. In Illinois, other employers engaged or committed to EAH programs include Bank of America, Chicago Public Schools, Honeywell’s System Sensor plant, Illinois Institute of Technology, MB Financial Bank, MB Real Estate, Mercy Hospital, Rush University Medical Center, and University of Chicago.In Illinois and across the country, new employers launch EAH programs each month, indicating a growing understanding among the private sector that it pays to invest in workforce housing.

“We are extremely pleased with the success the Charter One Home Buyer Assistance Program,” said Tom Hollister, president and CEO of Charter One Bank. “Many employees have written to tell me what a tremendous difference this program has made in their lives. Good companies offer solid benefits to attract and retain employees, but great companies design innovative benefits that make a difference in people's lives. This is one of them.”

To learn more about employer-assisted housing in Illinois, visit www.reachillinois.org.

Founded in 1934, the Metropolitan Planning Council (MPC) is a nonprofit, nonpartisan group of business and civic leaders committed to serving the public interest through the promotion and implementation of sensible planning and development policies necessary for an economically competitive Chicago region. MPC researches and develops policy recommendations and conducts outreach and advocacy in partnership with public officials and community leaders to enhance equity of opportunity and quality of life throughout metropolitan Chicago.

For more information about the Housing America’s Workforce Act or about employer-assisted housing initiatives, contact Mandy Burrell , MPC’s communications associate, at 312.863.6018 or mburrell@metroplanning.org; or Robin Snyderman , MPC housing director, at 312.863.6007 or rsnyderman@metroplanning.org .

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