Faced with high turnover and a shortage of qualified teachers, California school districts are aggressively adopting new strategies to recruit and retain teachers and staff. A prominent and ambitious strategy is employee housing assistance – particularly direct creation of new rental housing.
Employee housing strategies by school districts have emerged as a direct response to the housing affordability crisis in California (for both rental and ownership). The housing affordability crunch is most acute in employment-rich coastal urban areas like Los Angeles and the Bay Area. Across California, school districts, local governments, state governments, private developers, nonprofits, and foundations have taken up the cause of providing affordable housing for school district employees.
Yet these are largely untested waters. As school districts begin to wade in and consider the possibility of providing employee housing, school district leaders – along with their development partners – are looking for answers to critical questions:
Do our district employees need housing assistance and would they be interested in living in district-owned employee housing?
How do we finance and develop a school district employee housing project?
What are the most pressing technical hurdles for implementation – from legality and employee eligibility to operations and management?
Recently, the Center for Cities + Schools released my study on school district employee housing in California. In this report I review the current school district employee housing landscape and present findings from a study for Berkeley Unified School District (BUSD), which specifically addresses the first overarching question above. I also consider approaches to the other two questions, focusing on the challenges in financing and implementing this emerging typology of school district employee housing. The findings and implications offer insights to school districts across California and the country.
Key Findings from BUSD Study
Employing a survey that we designed and administered to all BUSD employees, as well as an internal employee data set, my analysis shows that BUSD employees do need assistance with rental housing and that employees are interested in the prospect of living in district-owned rental housing. Specifically, I identified the following key points:
1. BUSD renter employees are experiencing financial pressures due to high housing costs
More than half of BUSD renters (53%) are cost burdened (spend more than 30% of their income on housing), while 21% are severely cost burdened (spend more than 50% of their income on housing). To further understand the potential pressures associated with high housing costs, we asked employees a series of questions about their housing experiences. As seen in the responses below, renters are experiencing financial pressures due to the cost of housing – greater pressures than those facing owners – which may affect their ability to remain with the district long-term.
2. Most BUSD employees do not live in Berkeley, and their travel to work compounds the pressures they are experiencing from their housing situation
Additionally, I found that most BUSD employees do not actually live where they work – only 30% of all employees, and only 26% of renters, live in Berkeley. Renters tend to have longer commutes than owners and are on the whole less happy with their commute situations: 59% of renters would like to live closer to work, compared to 39% of owners. As one renter stated: “I don’t want to have to commute from great distances (i.e., Fairfield, Moraga) for cheaper housing only to have to spend that extra money on transportation or a car.” This double bind is typical of the housing challenges confronting many lower and middle income residents in California’s high-cost urban areas. But living where you work is especially critical for teachers and other school staff, as another employee detailed: “If I lived in Berkeley, it would cut down the cost of commuting. It would also save time in my daily commute to and from work. I would likely participate in more evening/weekend events at my school if I lived closer.”
3. There is significant interest in BUSD-owned employee rental housing among current renters
In addition to finding a clear need for housing assistance among BUSD renters, my analysis shows that nearly three-quarters of renters (74%) would be interested in living in BUSD-owned employee rental housing. Additionally, two-thirds of renters (67%) think the option of district housing would increase the likelihood that they continue to work in the district, a direct link to the overarching strategy of increasing retention and recruitment through housing assistance. I also found that employees did not see BUSD housing as an alternative to homeownership, but rather as a potential avenue to homeownership. One employee noted: “I’m interested in affordable housing options because that would allow me the opportunity to save up money towards buying a home close to where I work.”
An Emerging Typology
While not all districts have the same underlying conditions as those found in Berkeley, the BUSD case is emblematic of the situation in high-cost districts throughout California and offers takeaways for other districts looking to finance, develop, and implement their own employee housing programs.
School district employee housing continues to gain momentum in California, and with few precedent projects but increasingly fervent interest from districts whose employees are feeling the pinch of the affordable housing crisis, district leaders can draw lessons from BUSD. This report provides a series of key recommendations for those districts pursuing their own employee housing plans and offers important context for this emerging – and urgent – new typology:
Listen to Employees: Districts must begin by listening to employees and learning about their housing needs and interests to make sure a housing program is necessary and has broad support.
Understand Scale: It is crucial for districts to determine the scale that will make their project pencil given available funding resources, and that will best suit their goals.
Critically Assess Surplus Properties: Districts now have more incentive to leverage their own property where possible, which means undertaking a comprehensive assessment of all potential surplus properties.
Consider the Positive Non-Housing Effects: District leaders should emphasize the positive spillover benefits of school district employee housing such as the environmental impact of reducing commutes.
Get Creative with Financing: Think Beyond LIHTC: Housing for school district employees is not traditional affordable housing, and as such cannot be financed in quite the same way. It’s time to think outside the box.
Combine with Ownership Assistance: Affordable rental housing offers tenants a prime opportunity to save for a down payment – districts should offer a homeownership assistance program as a complement to rental housing.
Account for Evaluation: As more school district employee housing projects emerge, districts need to invest in robust, longitudinal evaluation programs.