Where the Heart Is
Can you help employees become homeowners?
Bennett Rosenthal, 52, understands it's financially
difficult for many of his 25 employees to afford to live near his
insurance company in Deerfield, Illinois, a suburb north of Chicago
with a median household income of $112,000 and a 2005 median home
price just shy of $413,000. The neighboring suburbs are also
upscale. So a number of Rosenthal Bros. employees live outside the
area and battle Chicago traffic to get to work on time. During
heavy snowfalls, they may not make it in at all.
To cut down on absenteeism and improve morale, Rosenthal Bros.
has gone the way of a growing number of U.S. businesses--it offers
employees up to $15,000 as part of an employer-assisted housing
program. Once a perk for high-power execs, these programs let even
the lowest-level wage earners reap benefits by offering forgivable
or deferred-payment loans, a grant, a matched savings plan or
home-buyer education.
The Housing America's Workforce Act, introduced in the
Senate, would give companies that help eligible employees buy homes
a tax credit of 50 cents for every dollar they provide up to
$10,000 or 6 percent of the purchase price of the employee's
home, whichever is less.
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For now, Fannie Mae helps employers set up EAH programs, while
nonprofits such as the Metropolitan Housing Council, which
Rosenthal uses, handle the administrative aspects.
So far, two Rosenthal Bros. employees have bought homes through
the program. And in Illinois, the state matches down-payment
assistance dollar-for-dollar up to $5,000 for income-eligible
participants and gives a 50-cents-per-dollar tax credit to the
employer. "For fairly nominal costs," says Rosenthal,
"the program helps retain loyal and dedicated
employees."