Cuts stall homeownership effort

Urban Chronicle

Budget: Ehrlich's plan withholds funds from a popular program.

January 23, 2003|By Eric Siegel | Eric Siegel,SUN STAFF

IT HAS BEEN that rarity among government programs -- efficient, effective and, above all, inexpensive.

But now Live Near Your Work -- the 5-year-old, city-state-private effort to help employees buy homes near their jobs, revitalizing older neighborhoods and cutting commuting times -- is reeling under a double body blow.

First, the state late last year used up the money allocated to the city for the program, cutting aid to homebuyers from $3,000 to $2,000.

Then, the state budget unveiled late last week by Gov. Robert L. Ehrlich Jr. included no funds in the new fiscal year that begins July 1 for the program, which was funded at $150,000 for this fiscal year.

"I don't think it's a death knell, but it's a very significant setback," said Kenneth Strong, who directs the office of homeownership in the city housing department. "I hope that it's not too late to make some changes in the budget to reinvest in a program that works."

Tracy Gosson, head of the nonprofit Live Baltimore Marketing Center, is less diplomatic.

"It's so shortsighted," said Gosson, whose organization heavily promoted the program under a recently expired grant from the Abell Foundation. "In the big scheme of things, it's such a small amount of money but it has such big paybacks."

A state housing official said the program was a victim of the state's monetary woes.

"I think a lot of good programs got sacrificed because of the budget problems," said Edward J. McDonough, spokesman for the Maryland Department of Housing and Community Development.

Conceived in the late 1990s as an element of former Gov. Parris N. Glendening's Smart Growth strategy, Live Near Your Work was a true example of the public-private partnerships that officials are so fond of talking about. Employers who agreed to provide their workers with $1,000 toward the purchase of a home would have that money matched by the state and local jurisdictions, for a total of $3,000. Homebuyers had to put up a minimum of $1,000.

Though Live Near Your Work includes Anne Arundel, Baltimore, Montgomery and Prince George's counties and the cities of College Park, Hagerstown, Salisbury and Westminster, Baltimore has always been the focal point. Two-thirds of the state money has been earmarked for the city, where more than 500 homebuyers have been helped since the program's inception.

As more and more employers have signed up to participate, the program has grown steadily. In 1998, 74 people settled on homes in the city through the program, according to Live Baltimore. Last year, 270 people did, among them 110 state workers whose grants were funded in part by unused state funds from previous years. The soaring popularity caused state funds earmarked for the program to become depleted last year.

And Live Near Your Work -- which excludes such upscale neighborhoods as Homeland -- has been a boon for young and/or low-income buyers looking for first homes in marginal or improving neighborhoods.

In June, for example, Demeturis Jones, a lab technician at Johns Hopkins Hospital who makes $11.75 an hour, used the $3,000 grant to help buy her first house in Johnston Square. "It was very important to me," said Jones, 40, who has two children and whose previous address was the Somerset Homes public housing complex.

Hopkins Health Systems, which is often accused of not doing enough to help the area around its East Baltimore medical complex, has had 86 employees buy homes through Live Near Your Work in the past five years, second only to the Johns Hopkins University, which has had 132 employees do so.

Eileen Kerr, a benefits specialist with the Health Systems, said even without the state's participation the program should be useful for employees. But she acknowledged she has stopped promoting it as heavily since the state's money ran out.

Another company,, which has had a dozen employees buy homes through the program in the past two years, said it didn't budget any money this year after getting word that the state money had dried up.

Strong said the city has transferred money from other housing programs to Live Near Your Work and is committed to funding the initiative. But he acknowledges the initiative will not be as appealing without state support. "Three thousand dollars is more of an incentive than $2,000," he said.

To Gosson, the lack of state support couldn't come at a worse time, with the bill collection firm NCO Group Inc. scheduled to bring several hundred jobs to Southwest Baltimore and financial services giant Morgan Stanley & Co. Inc. scheduled to bring several hundred more to southeast -- two areas ripe for the kind of further revitalization new homeowners can provide. But with only the city's $1,000 match as an incentive, "we can't really reach out to those people," she said.

"That's part of what stinks," she said.

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