`Unique' funding sought for housing
TRUST SAYS PLAN WOULD HELP 1,000 FAMILIES A YEAR
Posted on Sun, Feb. 20, 2005
By Sue McAllister
Mercury News
Leaders of the Housing Trust of Santa Clara County are proposing a new funding plan they say will help at least 1,000 families and individuals each year become homeowners, find affordable rental housing or benefit from homeless services in the county.
The Housing Trust has raised about $25 million since 1999, mostly from private donations. It has spent about $16 million so far, and says it has helped more than 4,200 families and individuals since it began disbursing funds in 2001. But it lacks a long-term funding source.
On Tuesday, the group will announce a three-year plan to raise $3 million each year, half from private donors and half from the voluntary participation of local governments.
The Silicon Valley Manufacturing Group, the force behind the creation of the housing trust, is working hard to line up support from both public officials and valley employers. But it's not clear how many jurisdictions -- or companies -- will sign on in these tight-budget times.
``To raise private dollars and ask for a match from cities and the county, it's a unique approach,'' said Mary Brooks of the Center for Community Change in Washington, D.C., who works with housing trust funds across the country. Most of the more than 300 housing trusts in the United States are funded by fees charged to housing developers or by taxes, she said.
Under the proposal, the trust would raise $1.5 million from private donors by May 31, beginning this year. If the group succeeds, city and county governments that opt to participate would chip in a total of $1.5 million. The formula for how much each municipality would contribute has yet to be developed.
David Vossbrink, a spokesman for Mayor Ron Gonzales, said he was not familiar with the details of the proposal, but the city would evaluate it, along with other proposals on how San Jose can best create affordable housing.
`Effective' investment
``We always want to make sure we can invest what really are limited funds in the most effective way we can,'' Vossbrink said.
Mike Wasserman, mayor of Los Gatos, said he assumed the funding match from the city and county governments would be based on each city's population, though he was not familiar with the details.
``It sounds like a very creative and innovative idea,'' he said. ``It's something we would certainly look at.''
The trust has pledges equal to about $625,000 over three years from Adobe Systems, Agilent Technologies, Solectron, Synopsys and Knight Ridder, parent company of the Mercury News. But that's far from the $4.5 million it will need.
Carl Guardino, chief executive of the manufacturing group and chair of the Housing Trust's fundraising committee, said that pursuing the original $20 million fundraising goal in 1999 and establishing the trust involved risk, too, but it paid off.
``This new effort is also a leap of faith,'' he said, ``but one where we have the potential of helping thousands more families, and move a step closer to the original goal'' of having a long-term funding source.
Creating a supply of affordable housing is ``so fundamental to keeping Silicon Valley vibrant and highly relevant,'' said Mike Cannon, chief executive of Solectron and vice chair of the manufacturing group.
The Housing Trust divides its funds equally among programs for first-time home buyers, affordable rental housing construction, and providing shelter and services for homeless residents of the county.
The group's closing-cost loans for first-time home buyers have been very popular, providing $6,500 loans to buyers who meet income requirements and whose homes are priced under $550,000. Those loans were suspended in October, however, while the board of directors evaluates their effectiveness. The loans may be available again this spring.
Anne Corbin got one of the loans when she bought her San Jose condo last year. Corbin, 48, and a single mother who has moved about 18 times in the past 22 years, said buying the condo was a dream come true.
`The same fears'
``A lot of people out there have the same fears I had, that they could never afford to own a home, and I think the Housing Trust has really helped people,'' she said.
Jeff Oberdorfer, executive director of First Community Housing, a San Jose non-profit developer of below-market-rate rental housing, said the trust contributed financing to two of the company's recent projects, one in Morgan Hill and one in San Jose. Affordable housing developers often need loans to fill the last ``gap'' in their complex financing packages, which often include state tax credits, local government funds and other monies.
``Often we find ourselves in situations where we need gap financing to make a project `pencil,' and that's where the Housing Trust really helps,'' Oberdorfer said. ``They're local, they're non-bureaucratic and they're there to help us build the housing.''
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