Employer Assisted Housing: Providing Tax Incentives for Employers
Congressional Briefing - February 21, 2006
EAH Case Study
Neighborhood Housing Services of New Orleans - Employer Assisted Housing Program
OUTCOME: Neighborhood Housing Services of New Orleans is participating in an employer-assisted housing program that helps police officers and fire fighters purchase their first home.
BACKGROUND
Neighborhood Housing Services (NHS) of New Orleans opened in 1976 to provide affordable housing solutions in New Orleans. It is a NeighborWorks HomeOwnership Center® and offers homebuyer counseling and education, affordable financing, and housing rehabilitation services. Agency services are available throughout the city of New Orleans.
Plans for the employer-assisted housing (EAH) program emerged from a discussion between NHS staff and board members on ways to increase and improve outreach strategies for their homebuyer program. The EAH program began early in 2004.
COMPONENTS
Purpose. With a goal of reaching out to major employers in the area, NHS of New Orleans first approached the city and the police department to create a home-purchase partnership. The program appealed to the city because it complemented its employee-residency requirements (city employees are required to live within the city limits). Shortly after the partnership began, the city’s fire department joined the program.
Partners. Primary partners include NHS of New Orleans, Consumer Credit Counseling Services (CCCS), the Finance Authority of New Orleans, the city of New Orleans and Hibernia National Bank. Both NHS of New Orleans and CCCS provide homebuyer education and counseling to city employees participating in the program. The finance authority administers the city’s subsidy, and all loans are originated through Hibernia National Bank.
If needed, the city also provides up to $27,200 in grants toward the down-payment and principal reduction. The subsidy depends on the household income and whether the family purchases a home in a designated target area.
In the beginning, partners met regularly to determine their roles and responsibilities. But they met less often as the program got underway. Although partners mostly work independently to fulfill their obligations, they still meet every few months to discuss program progress.
Requirements. All first-time homebuyers employed by the fire or police departments are eligible. Loan funds are available for households both above and below 80 percent of the area median income. Most funds, however, are for lower-income households. Employees must purchase a home within the city limits and remain in it for at least five years.
Buyers can also apply for home repair loans through Hibernia National Bank or NHS of New Orleans as part of their loan package, if needed. All customers must complete an approved homebuyer education and counseling program before closing on their loans.
Marketing. Both the police and fire departments provide program information to their employees through agency news briefs and ads in payroll envelopes. Partners also conducted program orientations for interested employees at the fire department in fire stations around the city. In addition to direct marketing, partners also regularly refer potential customers to one another.
Costs. For NHS of New Orleans, there are no additional costs associated with this program; participants are simply connected with existing NHS programs. Staff time increased only minimally during the development phase, when partners met regularly to formulate program goals and structures.
RESULTS
As of January 2005, three police officers and four fire fighters had received education and counseling through NHS. Ten police officers and fire fighters had purchased homes through the partnership, and several others were in the pipeline.
At least eight orientations have been held at the fire department to promote the program. The fire department also includes program information in its orientation for new recruits.
Contact information:
Lauren Anderson
NHS of New Orleans
4700 Freret Street
New Orleans, LA 70115
(504) 899-5900
Fax: (504) 899-6190
Web:
www.nhsnola.org
