State to Help 460 Educators Purchase Homes

A state finance agency Tuesday set aside $64 million for home mortgage assistance to credentialed public school teachers and principals who agree to work in low-performing schools.

State officials said they expect the Extra Credit Teacher Home Purchase Program to help about 460 teachers in six counties, including Los Angeles, Orange and San Bernardino.

In exchange for a five-year commitment, a teacher or principal would receive interest reductions or tax credits worth $37,000 over the life of a 30-year loan as well as $7,500 for a down payment.

To receive assistance, a teacher or principal cannot have owned a home within the last three years and must meet income limits set by the federal government, said Lisa Presta, a spokeswoman for state Treasurer Philip Angelides.

The maximum income is $70,331 for a family of three, or $72,940 in the city of Los Angeles.

There also is a maximum home price of $223,246 for existing homes and $291,232 for new homes.

The program is one of an array of assistance initiatives for new buyers, designed to attract better teachers to chronically underperforming schools that often are in poor school districts. Others have been launched by banks, the state teachers’ retirement system, the U.S. Department of Housing and Urban Development, and some cities and school districts.

The new state program takes advantage of federal laws that allow tax-exempt financing of private projects that offer a public benefit, such as affordable housing, environmental cleanup, student lending and industrial development. The state’s annual allocation of $1.6 billion is disbursed by a committee consisting of the state treasurer, controller and finance director. The committee approved the Extra Credit program in April and funded it Tuesday.

A similar proposal that was part of Gov. Gray Davis’ package of inducements to make teaching a more attractive profession died in the Legislature this spring.

Presta said the Extra Credit program will provide financing for about 150 applicants in Los Angeles County, 134 in San Bernardino County, 50 in Sacramento County, 47 in San Francisco County, 45 in Orange County and 35 in Santa Clara County.

Although the allotments are scarce, state officials are not sure what response to expect, partly because of strict eligibility limits.

“We hope it will go quickly and that we will be able to get another allocation out next year,” Presta said.

The income limit would eliminate most principals in the Los Angeles Unified School District, where starting pay is $61,250 for a principal at a traditional elementary school and $72,613 at a multitrack school, said district Personnel Director Irene Yamahara.

Average pay for credentialed teachers in the Los Angeles district is $51,110. Pay for teachers in other districts in the region tends to be higher.

Teachers will apply for the program through their own lenders, which will work with county or city housing agencies. The Los Angeles Unified School District has assigned a counselor in its downtown headquarters to guide applicants through the maze of programs, which are listed on the district Web site at:

https://www.lausd.k12.ca.us/orgs/latmap/teacher--mortgage--programs.htm.

“It’s just going like gangbusters,” said Tom Killeen, the district’s administrator for personnel services and research.