Santa Fe Public School System and Neighborhood Housing Services Provide Benefits to Local Teachers

With one of the highest priced housing markets in the country and some of the lowest teacher salaries in the state, Santa Fe, New Mexico was finding that it could not keep its public school teachers for very long. In fact, according to a 1998 study by the Santa Fe Public Schools, Santa Fe loses about 20 percent of its teachers each year, and 79 percent of all teachers reported that they have considered leaving because of the high cost of living.

In an attempt to reverse this disturbing trend, Neighborhood Services of Santa Fe, Inc. (NHS) began a pilot program in October 1999 specifically designed to provide public school teachers with housing resources that would allow them to remain in the community and continue teaching in the Santa Fe schools. Called the Teacher Home Fund, the program provides downpayment assistance to qualifying teachers as well as low-interest loans for home repairs. The program also provides financial counseling for teachers with an interest in homeownership, but who aren't quite ready to commit to buying a home.

High Housing Costs Compared to Teacher Salaries

The need for such a program in Santa Fe is critical in light of the tight housing market and relatively low teacher salaries in the public school system. New Mexico's homeownership rate increased by 2.5 percent from 1990 to 2000, but the homeownership rate in Santa Fe dropped 1.4 percent during that same period. In the third quarter of 2002, 230 new or existing homes were sold in the city of Sante Fe with a median price of over $241,000¹. In contrast, the average teacher salary in the Santa Fe public schools is $34,635 - far less than the national average. Starting teachers in the Sante Fe district earn just $26,414.

Creating Homeowners

Based on studies showing that employees who own their own homes are less likely to move, NHS piloted the Teacher Home Fund to provide a host of services to assist teachers with their housing needs. The program was originally funded through an $80,000 grant from the Land Title Trust Fund (a fund managed by Title companies in New Mexico). Beginning in October 1999, the Fund offered loans of up to $6,000 per teacher for downpayment, closing cost, and home repair assistance. Participation was restricted to teachers whose combined family income was at or below 80 percent of Santa Fe's median family income.

Through loans provided by the Fund, 25 teachers became homeowners. In addition, seven teachers had their homes repaired, and 26 teachers are completing action plans with NHS counselors to financially prepare for future homeownership. Each of the 25 new homebuyers have remained in the Santa Fe public school system.

Most importantly, however, the Teacher Home Fund led to a collaboration between the Santa Fe Public School administration and the NHS to create the new Teacher Housing Assistance Program (THAP), which was recently funded by the Santa Fe School Board for $600,000. This program provides many of the same services to local public school teachers, but with access to additional resources, it can make funding available to more teachers more often.

The guidelines for THAP have evolved out of the lessons learned from the Teacher Home Fund. It is anticipated that the Assistance Program will be broader than the Home Fund and will encompass three areas of assistance: homeownership, home repair, and rental assistance. The loans will take shape as zero-percent deferred mortgages of up to $15,000, and the salary limit criteria will be higher than that for the Teacher Home Fund. And while program financing has yet to be finalized, NHS is looking into finding other sources of funding beyond that currently provided by the School Board.

Expanding Beyond Teachers

While much has been accomplished so far, much remains to be done. Teachers are not the only population in Santa Fe for whom housing affordability is a major concern. But to keep its school system vibrant and alive, the NHS of Santa Fe has faced up to the challenges at hand by leveraging available resources to build a program that address the community's unique needs.

For more information, contact: Mike Loftin, Executive Director, Neighborhood Housing Services of Santa Fe, New Mexico, mloftin@ix.netcom.com, 1-800-429-5499.

¹ Sante Fe Association of Realtors, "Third Quarter, 2002 MLS Statistics," available at http://www.nmrealtor.com/2001site/NM-stats/santafe-stats.htm.