CMC mulls housing fund for employees
January 29, 2007
GLENWOOD SPRINGS ” Colorado Mountain College is looking into creating what could turn into a multi-million-dollar fund to help its employees obtain housing.
The college plans to work with a bank, mortgage lender or other partner on developing a plan to aid staff members who are dealing with the high cost of housing in the region it serves.
College president Bob Spuhler said the board will consider a proposal in June to set aside $100,000 next year as the foundation of a revolving loan fund.
The fund could be tapped by those buying homes or trying to come up with the up-front money required to rent.
He said the idea is still in its infancy and the participating financial institution will be asked to play a large role in recommending the fund’s size and the program’s guidelines. But he believes the fund will end up growing to as much as $2 million over two years to be able to make a significant impact.
“Within two or three years I think we’ll have a good feeling whether that’s sufficient or whether we’ll need to provide more,” he said.
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He envisions an employee being able to borrow tens of thousands of dollars toward the purchase of a home.
The fund would apply to CMC’s entire nine-county district, which extends roughly from Breckenridge to Rifle, and Steamboat Springs to Salida.
It would be available to full-time faculty and staff members only. The college has about 360 full-time employees. It also employs some 500 part-time teachers, but Spuhler said that’s too many for the college to try to help with the new fund, and it wants to focus on its more permanent work force.
Spuhler foresees the fund being used to provide low- or no-interest loans to help people make down payments on homes, or come up with the first and last month’s rent and security deposit often required to secure a rental unit.
He said the particulars of the program may depend on things such as what Internal Revenue Service regulations may apply.
The college is hoping that its eventual private-sector partner can provide expert advice on such questions. It also is hoping not to have to pay for that advice. Rather, Spuhler expects that the payoffs for the financial institution could come in such forms as increased lending business and interest earned by holding the revolving loan funds. He hopes the institution also might be willing to offer discount rates on its loans to employees.
Spuhler said many issues will have to be considered in creating the program. Among them is how much funding should be made available to each participant, and how it should be paid back.
Another issue is how to deal with situations in which employees leave the college within a few years of participating in the program. “That’s tying up a lot of money that could be used possibly for other employees,” Spuhler said.
Yet another consideration is how to avoid foreclosure situations in which property has decreased in value and the college may not be able to recover all the money it has loaned. Spuhler expects that concern can be mitigated by still requiring borrowers to come up with some down payment of their own on a home.
The concern for now isn’t falling property values, but rising ones. He said CMC doesn’t currently face a widespread problem of being unable to recruit and retain employees because of high housing costs, but he’s worried about the future.
“We’re trying to deal more with what we see as an upcoming problem that’s going to get worse,” he said. “I see the (housing) market going only in one direction as I look around the college district.”
He credited the efforts of area communities in trying to provide more affordable housing, but thinks a shortage of developable land promises to continue driving up prices.
The problem has concerned the college for years. Cynthia Heelan, who served as CMC’s president until 2002, had looked at the college building housing itself, on land it owned. But Spuhler said the idea turned out not to be practical for an education institution.
“It wouldn’t have made sense. We’re not in the construction business or the landlord business,” he said.
He said when CMC looked at building near its Spring Valley campus near Glenwood Springs, some people didn’t want to see the college’s open spaces developed. Creating a housing assistance fund would avoid such controversies, he said.