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Chicago: Employers use housing as a perk for workers

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  • Robert J. Matter
    http://www.chicagotribune.com/news/printedition/chi-0305060316may06,1,3504382.story?coll=chi%2Dprintmetro%2Dhed Employers use housing as a perk for workers U.
    Message 1 of 1 , May 6, 2003

      Employers use housing as a perk for workers
      U. of C., others offer loans that are `forgivable'

      By Celeste Garrett
      Tribune staff reporter
      Published May 6, 2003

      The University of Chicago has launched a
      $675,000 housing assistance plan aimed at moving
      faculty members, administrators, nurses and even
      doctors who haven't been able to keep up with Chicago's escalating home
      prices closer to work.

      "Only about 30 percent of our staff lives near campus right now, and this is an
      opportunity for our moderate- and middle-income employees to purchase a
      home in the area," said Sonya Malunda, assistant vice president of community
      affairs at U. of C.

      Starting this week, she said, employees of the university and affiliated hospital
      can apply for one of the 90 "forgivable" home loans of $7,500 each over the
      next two years. The loan is at zero interest and doesn't have to be paid back,
      as long as the employee stays with the company, and in the home, for five

      The U. of C. joins 14 other companies in the Chicago area that have recently
      offered about $1.5 million in housing incentives to about 200 employees after
      their bosses got a nudge from the Metropolitan Planning Council. The council
      is among several organizations across the country encouraging employers to
      dangle housing perks to cut commutes, recruit and retain workers and offset a
      real estate market moving out of the reach of middle-income professionals.

      "There was a time when health care and child care were not employers' issues
      and now they are," said Robin Snyderman, housing director with the council, a
      non-profit that promotes government and business policies in the six-county
      area. "We're hoping housing will become central to an employer's operation
      and benefits."

      The U. of C. program will target buyers with family incomes of up to
      $105,560 who want to move to the improving South Side neighborhoods of
      Kenwood, Oakland, Washington Park or Woodlawn or Hyde Park, where
      the university is based. Eligible home prices range from $223,200 to
      $307,172, officials said.

      Eligible families with incomes as high as $105,560 will be those whose
      household size is three or more persons.An estimated 8,400 of the 12,000
      people who work at the university could be eligible to apply for the 90 slots.
      Employees will be selected on a first-come, first-served basis, Malunda said.
      Some doctors at the hospital and other faculty members earn as little as
      $40,000 and may qualify for aid, depending on household income, officials

      The university's 2-year pilot program will be funded by general revenue. Hank
      Webber, vice president for community and government at U. of C., said
      officials hope to pay much of the tab from new state tax credits offered by the
      Illinois Housing Development Authority, which provides a 50-cent write-off
      for every dollar given to workers toward housing.

      On the national level, companies are getting the same nudge from the Federal
      National Mortgage Association, or Fannie Mae. The financial services
      corporation launched a campaign in 2000 to get 1,000 employers to start
      affordable employee housing programs by 2010, said Beth Marcus, a director
      in Fannie Mae's Washington, D.C., office.

      Already, 335 employers across the country have signed up, she said.

      The planning council is partnering with companies and housing advocates to fill
      a void in the state, which has no policy for developing affordable housing,
      Snyderman said. Last fall, an Illinois House committee declared a housing
      crisis for five socioeconomic groups, among them middle-income workers
      who couldn't afford to live near their jobs, said state Rep. Julie Hamos

      The planning council's employer-assisted housing initiative began in 2000, with
      a pilot project that gave $5,000 forgivable loans to 36 employees at St.
      Charles-based System Sensor to move into homes within 15 miles of work.
      Doug Anderson, a mechanical engineer at System Sensor, was able to move
      from Elgin to St. Charles, where homes were priced up to 25 percent higher.

      "That move cut my commute down from 30 minutes to less than 10," he said.
      "I can come home for lunch now and I gain an extra hour a day to spend with
      my family."

      Since then, Chicago-based Bank One has committed to providing $2,500 in
      housing aid to 25 employees locally, and Northwest Community Healthcare,
      in Arlington Heights, has offered $5,000 to employees who earn less than
      $75,400 and want to buy a home within 10 miles of the hospital, officials said.

      After the economy softened in late 2000, a couple of companies pulled back
      on their commitment to assist employees to buy homes.

      Mt. Sinai Hospital in Chicago's Lawndale neighborhood was to launch a
      program to help nurses purchase homes in the West Side neighborhood and
      to help stimulate community reinvestment. But the hospital, which provides
      more than $50 million in uncompensated care a year--three times the amount
      provided by the average Chicago hospital--had to shift priorities, said Steve
      Hulsh, vice president of human resources.

      Here's how most plans work: The planning council first pairs the company
      with a non-profit agency to administer the program, such as Neighborhood
      Housing Services of Chicago Inc. The employer refers employees to the
      non-profit, which provides counselingand determines whether the employee
      qualifies for more funds from city, state or private lenders.

      By the time the company cuts the employee a check for $4,000 to $7,500,
      the employee may have secured $10,000 or more in other grants to help with
      down payment and closing costs. In March, the Illinois Institute of Technology
      announced it is offering $7,500 in forgivable loans to encourage faculty and
      staff members to buy yet-to-be-constructed homes as the former Stateway
      Gardens is redeveloped. Planned are 1,310 units, equally divided into
      affordable, public and market-rate housing. It will be the second time IIT has
      used affordable housing to lure workers closer. The first time was in 1999.

      Philip Nash, an IIT professor of metallurgical and materials engineering, once
      drove to work from Gurnee. "Then they tore up the Kennedy Expressway and
      I gave up on that idea," said Nash, who bought his Michigan Place condo two
      years ago. "My commute takes about 5 minutes now. I just walk across

      "I think that employers are an important new voice for affordable housing at
      the exact time we have a housing crisis," said Hamos, who has a bill pending
      that would create an umbrella agency to oversee affordable-housing issues.

      "Ultimately, it's going to be employers that make municipalities understand
      why it is important to have a stable workforce nearby."

      - - -

      Area employers offering assistance

      Fifteen Chicago-area employers have adopted the Metropolitan Planning
      Council's prototype for employer-assisted housing:

      1. System Sensor, a St. Charles-based subsidiary of Honeywell International

      2. Medela Inc., a McHenry County maker of breast pumps.

      3. Seaquist Perfect, a Crystal Lake manufacturer of spray-dispensing systems.

      4. Chroma Corp., a McHenry County firm that makes colors for plastics.

      5. Bank One, a national bank holding company based in Chicago.

      6. Northwest Community Healthcare, which owns Northwest Community
      Hospital in Arlington Heights.

      7. Sinai Health Systems, which owns Chicago's Mt. Sinai Hospital.

      8. Illinois Institute of Technology, a technological university based in Chicago.

      9. Village of Riverdale, a south suburban Cook County municipality.

      10. Bethany Hospital, of Chicago.

      11. City of St. Charles, a Kane County municipality.

      12. National Interfaith Committee for Worker Justice, a Chicago non-profit

      13. City of Evanston, a north suburban Cook County municipality.

      14. First Midwest Bank, a financial services company headquartered in Itasca.

      15. University of Chicago, a university and hospital based in Chicago.

      Source: Metropolitan Planning Council

      Copyright © 2003, Chicago Tribune
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