Northwest suburban mayors, MPC, and Charter One Bank launch Charter One Workforce Housing Initiative

Employers from Arlington Heights, Buffalo Grove, Mt. Prospect , Palatine, and Rolling Meadows attend briefing to learn about first-of-its-kind partnership to help working families purchase homes

May 18, 2007

(Chicago) … Big names like Allstate and Motorola dot the landscape along the north branch of interstate 90, one of the region’s strongest employment corridors. Yet ask workers at these and other nearby companies how far they drive to get to their jobs, and many will tell of one- or two-hour commutes one way. Local employers know the flip side: late arrivals, absenteeism, and high turnover rates, all bad for the bottom line.

New data on workers in Arlington Heights, Buffalo Grove, Mt. Prospect , Palatine and Rolling Meadows show that employees earning less than $25,000 per year make up more than one-third of the workforce, yet only 7 percent of local homes are affordable to those families. Employees earning less than $50,000 per year represent 70 percent of the workforce, yet only 40 percent of existing homes are affordable at that level.

To address this jobs-housing mismatch through a unique public-private collaboration, mayors and employers from these five communities launched the Charter One Workforce Housing Initiative on May 18 in Arlington Heights.

“Through the Charter One Workforce Housing Initiative, local communities and employers will tap new resources to cultivate innovative solutions to help their workers afford homes in the communities in which they work every day,” said Scott C. Swanson, president and CEO, Charter One Bank. “Charter One Bank knows how valuable homeownership is to families and communities, and we are proud to support this important new initiative.”

Employers attended Friday’s briefing to learn not only how they can participate in the initiative, but also why their involvement will benefit workers, employers and local communities alike.

“Across Chicagoland, particularly in areas where there are good job opportunities, the housing market is pricing out working families,” said Mayor Arlene J. Mulder, Village of Arlington Heights. “Employers are having trouble recruiting workers who are reluctant or unable to make long commutes from more affordable towns. Or they hire workers from far-away towns who are often tardy or who quit when they find a job closer to home. Meanwhile, traffic gridlock in our region increases every year. It’s all connected.”

“Local communities are teaming up to address the workforce housing shortage by examining and changing our own policies to encourage the preservation and development of affordable homes,” said Mayor Rita L. Mullins, Village of Palatine. “Collectively, we are making strides. With the help of private sector leaders, like those here today, we can take the next steps.”

Those next steps are critically needed, according to the nonprofit Metropolitan Planning Council (MPC), which along with nonprofit Housing Opportunity Development Corporation is administering the Charter One Workforce Housing Initiative. MPC provided context at the briefing to illustrate how serious the jobs-housing mismatch is in the northwest suburbs: in just the five communities of Arlington Heights, Buffalo Grove, Mt. Prospect, Palatine and Rolling Meadows, an additional 3,500 rentals and 7,900 for-sale homes affordable to households earning less than $75,000 will be needed by 2030, according to projections calculated by Fregonese Calthorpe Associates for Chicago Metropolis 2020 and the Metropolitan Mayors Caucus.

The numbers tell an all-too-familiar story that is playing out in communities across the region, said MPC President MarySue Barrett.

“If we cannot promise employers that their workers will be able to afford quality homes, and if we do not plan carefully to create more live-near-work opportunities that reduce traffic, we are in danger of losing employers to metropolitan regions that can and do,” said Barrett. “Chicago’s continued economic competitiveness depends on guiding growth to create communities in which we can live, work and play.”

To help achieve this goal, the Charter One Workforce Housing Initiative offers local companies a “menu of options” to choose from, outlining market-based strategies they can employ to help workers afford existing homes and/or to help create new homes affordable to working families. An early success of the program is the expansion of locally proven models for addressing the workforce housing shortage, such as employer-assisted housing (EAH).

Through EAH, employers provide qualifying employees with downpayment assistance and free homeownership counseling to help them purchase a home. In 2000, MPC launched its first EAH project in Illinois with System Sensor, now a division of Honeywell, based in St. Charles, Ill. Since then, more than 60 Illinois employers have invested in EAH, helping more than 1,000 workers afford to purchase homes. Illinois Housing Development Authority matches an e mployer’s downpayment assistance for households earning up to 80 percent of Area Median Income (AMI in metropolitan Chicago is $75,400 for a family of four.) And employers can tap t he Illinois Affordable Housing Tax Credit program, which provides a 50-cent tax credit for every $1 invested in EAH. These incentives make EAH very attractive to employers large and small.

To further encourage smaller businesses in the five communities to invest in workforce housing by offering EAH programs, Charter One Bank will cover the cost of providing homeownership counseling to their workers.

While EAH has become more common in Illinois, in large part due to the attractive state incentives, employers also can address the workforce housing shortage through a variety of tested models, according to Michelle Olson, director of community and government affairs, University of Chicago. Olson explained how the university is helping preserve workforce housing in the five community’s surrounding the university’s Hyde Park campus, through a $1 million investment in Community Investment Corporation’s loan pool for rental housing preservation and rehabilitation. (The university also has helped more than 115 employees purchase homes through its successful EAH program.)

For more information on the Charter One Workforce Housing Initiative, contact Mandy Burrell, Metropolitan Planning Council communications associate, at 312.863.6018 or mburrell@metroplanning.org; or Stacey R. Reineking, Charter One Bank vice president, director of public affairs, at 312.777.3628 or stacey.r.reineking@charteronebank.com.

About Charter One Bank, N.A.
Charter One Bank, N.A., is a $46 billion bank operating in Illinois , Indiana , Michigan and Ohio. It has 466 branches and more than 780 ATMs. It has 119 branches and 364 ATMs in Illinois . Charter One is a subsidiary of Citizens Financial Group, Inc., a $161 billion commercial bank holding company headquartered in Providence , R.I. Citizens has more than 1,600 branches, approximately 3,100 ATMs and more than 25,000 employees. It has a 13-state retail branch network plus non-branch retail and commercial offices in about 40 states. Citizens is the eighth-largest commercial banking company in the United States ranked by deposits and ninth in assets as of September 30, 2006. Citizens is owned by RBS (The Royal Bank of Scotland Group plc).The Charter One Web site is charterone.com.