Tag Archives: community assisted shared appreciation

CASA program a model

Novato Advance       May 9, 1990


 CASA program a model

        By DWAYNE HUNN

Some interesting things have been happening at Novato Ecumenical Housing recently. Last month NEH was notified by the Federal National Mortgage Association (FANNIE MAE) that our Community Assisted Shared Appreciation (CASA) home ownership program for low and moderate income households will re recognized in FANNIE MAE’S  1990 Blue Book as one of two national models shared equity home ownership programs. FANNIE MAE uses its prestigious annual publication to recognize programs that it believes should be emulated by other cities across the nation.

The national recognition does not come without some irony. For years, NEH  has struggled to obtain additional funds to expand our CASA program in Novato and throughout the county. So many political, environmental, and bureaucratic boulders have been placed in our path that we often feel like Sisyphus, the mythological figure who was compelled to roll a stone to the top of a slope, the stone always escaping him near the top and rolling down again.

Perhaps the uphill fight, taking place among the rolling hills of exclusive Marin, is part of the reason the program has been recognized. CASA has assisted more than 60 low and moderate income families in purchasing their first homes in Novato. Families earning as low as 34% of Marin’s median income have purchased homes through this deferred principal and interest second mortgage home ownership program. Our average second mortgage assistance been $37,000 per family and their average income has been $22,700.

NEH is proud of the award. We are prouder, however, that we have been able to help many starting families obtain the Great American Dream. Our assisted owners are not, as our uninformed opponents like to portray them, low-lifes. They are nurses, sheriff and police department employees, private entrepreneurs, secretaries, hard-working, single moms, etc. They are essential service providers and they have an almost  non-existent mortgage failure rate.

NEH has been able to raise more than $2 million to fund this program. The sources from which we raised the funds might help explain to some who oppose our work why we often argue on behalf of sensible, long-term environmentally sound developments. Source of Affordable Ownership Housing Trust Funds:

  • 53 percent developer contributions. Densities have been cut so drastically in Novato that no new sources of in-lieu fees are foreseen in the near future.
  • 18 percent Community Development Block Grants. We have not received and additional CDBG funds since 1984.
  • 15 percent NEH’s recapture of its equity share and second mortgage. Soon NEH will be the second largest supplier to its own program. Unfortunately, that means the program is not growing to handle the increased need.
  • 11 percent San Francisco Foundation. The San Francisco Foundation was replaced by the Marin Community Foundation.
  • 4 percent Marin Community Foundation.

As you can see, most of our funds which allow us to assist Novato residents in purchasing their own Novato homes come from developer contributions. When reasonable densities are drastically reduced to such a low point  that developers cannot justify the expense of affordable unit development or developers are not required to contribute in-lieu fees, we cannot help balance the jobs/housing imbalance.

The Brookside development is an example of how drastic density reductions hurt Novato’s ability to balance housing with the purchasing power of local residents. Ten years ago Brookside was approved for 120 units, of which 34 were  to be affordable. The Novato City Council then cut the allowed development to 70 units on 59 acres with no affordable units. Now come “concerned” citizens want the density to be cut to 0 units and want to you to assess yourself a parcel tax to purchase the Brookside  land for open space.

This desire for more open space is taking place in a county where more than 84 percent of the land is set aside in open space, agriculture reserve and park land. The petitions are being gathered in a city where, in 1980, the city averaged four units per acre and where today that average has dropped to about 2.4 units per developed acre. Politics, like awards, often has an ironic character to it.

For more information, call 892-8136.




Joe Sixpack And The ESOPs

Coastal Post  April 23, 1991

 Joe Sixpack And The ESOPs


Recently Coastal Post reporter Patrick Holland ana­lyzed the potential benefits and pitfalls of the Marin City development. A couple of friends of mine actually read his pieces at Don Deane’s pub—probably because that was the only paper stocked both in and Out of the johns. After tipping quite a few at the bar, the fellow to my left, Nick Kelso, myself and my buddy Joe Sixpack started exchanging ideas.

       “So wha da ya do?” said Joe to Nick.

       “I do up ESOPs,” replied Nick.

       Joe stared hard at the guy, leaned over to me and asked, “Did dat punk say he’d do me up because I’m an SOB?”

       “No, Joe, he said he does ESOPS—Employee Stock Ownership Programs. It allows employees to invest in their companies and reap the benefits of being a stock holder.”

    “Yes, that’s what I do. My father Louis Kelso felt that every American should be a capitalist. Owning capital allows one to become a two-income household— from wages and from return on your ownership of capital.”

    “It was one of the means by which Mr. Kelso felt you could eradicate the need for poverty programs and get people to work better and harder at their jobs which then increases profits,” I added.

    “If you own part of where you work, you’ll take care of it, make it work better and doing so will allow you to accumulate capital just like rich people.”

    “Yeah, well dis guy in the Coastal Post says dees rich people are about to come to Marin City and in time they may drive the poor people out of their homes. Can you do an ESOP for dem?”

    “Come on, Joe. Think about what Northbay Ecumeni­cal Housing (NEH) does. Think about NEH’s CASA (Community Assisted Shared Appreciation) and how that’s like an ESOP.”

    “The reporter says after that spanking new Marin City development is built someone will come in and want to “condomize” those not so pretty apartments on the hillside. Then all the poor people won’t be able to afford dem and be moved out.”

“They won’t be able to own because they have never been capitalists—have never owned cai3ital and partici­pated in its appreciation and tax benefits and been able to accumulate wealth by doing so,” chimed in Nick. “Yeah, in other words, der poor,” clarified Joe. “And der ain’t many ways to get capital when yen poor.”

   “Your friend is right. If you don’t own capital, it is almost impossible to accumulate wealth,” said Nick. “Little disagreement, Nick. But Joe, when his forehead isn’t bleeding from crushing 13 beer cans against it and glugging its contents down his throat, knows there are other sources of capital other than one’s business. He knows our CASA program gets people out of welfare dependency by assisting people gain that capital foothold. Come on Joe, explain CASA to Nick.”

   After slapping the side of his head a couple time and washing his eyes with my glass of water, Joe said, “Dees guys at NEH raise, or maybe steal is the better word, money mostly from developers. Then they beg founda­tions and dis County, who some years ago gave them a few pennies and put it into der Affordable Housing Frust Tund. Dey den take dat money and fill the gap between what these low/moderate income households can afford to pay for a home.”

“What do you mean ‘fill the gap’?” Nick said.

       “Hey, ain’t you an economist type” Ain’t you ever heard of second mortgages? Silent or sleeping second mortgages? Dees guys at NEH have the poor come up with the largest down payment they can, get the highest first mortgage they can, and they pay the difference with their silent second money. Dey don’t even collect on the sleeping second until and unless dose folks sell da home. Den dey each share propotionately in da appreciation.”

   Well, in Marin I expect that if those families hold onto their unit for a few years it will appreciate substantially and they will become ‘capitalists.’ They will have accumulated wealth and never again need to depend on government assistance. That is a fine example of an ESOP for people shut out of home ownership! It must a wonderful, exciting program!”

       “Yeah, well if my friend were smarter, he’d work less hard at it and drink more wid me. Developers are the only ones who seem to understand it in a reasonably quick manner—and they can’t develop projects to do it in Marin. Ya know, like 65 percent of the units at Hamilton could’ve been CASA ESOPs. But some environmental lady said they didn’t want those low lifes out der. Foundations and the government say they have no money for helping poor own their homes, they prefer to give der money to keep them rentin’.

“And da poor people are so busy trying to make ends meet that they don’t have time to learn about the CASA program and raise hell to get it happening…  I keep tellin’ dem, get more people off that rental beast.  Drinking the yeast, barley, and hops ofownership is better than eating rental crow for ever. Too much crow ain’t good for anyone.”

       “Let’s get outta here before we have to pay for dis last round. I feel like the CASA second—I oughta (hiccup) be sleeping,” said Joe.