District Offers Teachers Shelter From Housing Costs

If you build a low-rent but upscale enclave for teachers, they will come. Maybe they’ll even stay.

At least that’s what the Santa Clara Unified School District superintendent, Paul Perotti, believes. Desperate to attract and retain teachers, the school leader has pinned his hopes, along with $7 million, on that very idea.

In April, the school district, in a Silicon Valley area where housing costs have soared, became the first in the nation to open a rent-subsidized apartment complex built strictly for public school educators.

In the middle of a sleepy neighborhood of one-story homes and lackluster 1970s apartment buildings, the 40-unit, pastel yellow, two-story complex--complete with two imported palm trees and a recreation center with a big-screen television--sticks out like a new teacher driving a Mercedes-Benz.

Some teachers, Perotti joked, might even be able to afford Mercedes if they live on the 2-acre site called Casa del Maestro, where the rent is $650 for a one-bedroom and $1,090 for a two-bedroom--half the rate for rundown apartments in the area. But the goal for the 800-teacher district, Perotti said, is for educators to save money, buy homes and stay in the city.

Measured against its median income, Santa Clara County has the least affordable housing market in the state, according to a recent survey by the California Assn. of Realtors. The median price of a home there is $575,000, more than double the figure for Los Angeles County, real estate agents say.

New teachers in Santa Clara generally earn $45,000 to $50,000. That mismatch means that some teachers and civil servants must split rental costs with friends or move an hour or more away from work, where they can afford a house.

So it was no surprise that nearly 100 teachers entered a lottery for the 40 apartments. The winners are allowed to stay for as long as five years.

For $1,090 a month, teacher Jennifer Spackman, 25, and her companion, Jamie Steinson, 28, rent a two-bedroom, two-bath apartment with a patio wide enough for a table, four chairs, potted plants and a large barbecue grill.

“It’s an excellent opportunity to save money” for a house, Steinson said. He and Spackman used to pay $1,500 a month for a one-bedroom apartment three blocks away.

Universities long have offered subsidized housing to faculty members. An increasing number of kindergarten-through-12th-grade school districts are now doing the same thing to counter a nationwide teacher shortage. Some have teamed up with apartment companies to offer rent discounts; others have created mortgage assistance programs.

But, according to the American Federation of Teachers, the Santa Clara project is the first built for teachers only.

“The cost of living is out of control, basically, for all school districts,” Perotti said. Teachers “were just walking out of the door and walking into jobs with stock options.”

With about half of all new teachers leaving for other districts or professions within their first four years, the 16,000-student system has had to hire an average of 140 teachers annually.

Perotti has attracted national attention and said he has fielded a “mind-boggling” number of phone calls from districts as far away as Alaska and Massachusetts that are considering the Santa Clara housing plan. Among those that have considered such projects are districts in San Francisco, San Jose and Bellevue, Wash., although San Francisco recently put its plans on hold. Neighbors of a proposed 43-unit project in that city’s Sunset District objected to the idea of subsidized housing in the area.

The opening of Santa Clara’s Casa del Maestro had its glitches.

Nancy Schlink, 27, worried at first that living among co-workers would be like being trapped in a raucous college sorority.

“There have been a couple of parties, but it’s pretty normal living,” she said. Most people keep to themselves, she said.

More troubling have been construction problems. In June, when Schlink moved in, the washer, the dryer and part of the stove didn’t work. The air-conditioning system leaked and some electrical outlets had never been connected. Neighbors’ pipes have exploded, and one resident could get only hot water in the toilet. Most repairs have been completed.

Schlink, who is paid $45,000 a year, said she used to pay $1,000 a month for a one-bedroom apartment in downtown San Jose. Now she pays $650 a month and is chipping away at school loans.

“For all the problems I have had with this apartment, even though they’ve been quite irritating, it’s worth it,” Schlink said. “If other districts want to do this, I think it’s a really good idea.”

But some educators say such programs are only Band-Aid solutions to the real issue, which they say is low teachers salaries.

“These kind of gimmicks that school districts are toying with to provide some sort of housing for a qualified teaching force is simply not going to work,” said Wayne Johnson, president of the California Teachers Assn.

Not everyone wants to live with co-workers in subsidized housing, he said. “Today, people who graduate from college--the best and the brightest--are not willing to go into a profession and stay there for years, if it will not provide them a middle-class lifestyle,” Johnson said.

But the 55 teachers in Santa Clara’s Casa del Maestro don’t seem to be sacrificing their quality of life.

For example, Kevin Keegan, 26, had trouble finding a permanent residence he could afford, and even slept for a while on a friend’s couch. He said he had planned to cope for one or two more years, then to leave the district.

But then, in the lottery, he won a one-bedroom apartment, complete with a garage, washer and dryer, patio and full kitchen, for $650 a month. His initial discomfort about having fellow teachers as neighbors faded as he made good friends in the building. Now, Keegan said, he may stay in Santa Clara forever.

He and all other Santa Clara teachers receive another benefit: Under a program sponsored by Intel Corp. and Linear Technologies Inc., a teacher may receive as much as $30,000 toward a house down payment that would have to be repaid in five years.

The school district began planning Casa del Maestro in 1999, and hired contractors to build it on district-owned land where a school had closed and been demolished. To finance the complex, the district sold $7 million in bonds, which it will pay back over 30 years with tenants’ rent. The rents are fixed by the apartments’ size, not by teachers’ income.

“If you’ve got land, and you have the same problem, it can work anywhere,” Perotti said.

Others have turned to simpler solutions. The Palm Beach County School District in Florida teamed up with apartment companies to offer rent discounts or to waive security deposits for teachers.

The Los Angeles Unified School District offers home-buying programs in conjunction with the Los Angeles Housing Department. The program, called Extra Credit Homes for Teachers, offers a 6.5% fixed interest rate on 30-year loans. It also offers $7,500 down payments and closing-cost assistance in the form of loans forgiven over five years. The home must be purchased in the city of Los Angeles by a credentialed teacher who agrees to work at a low-performing school for five years.

This year, the district introduced $2,000 relocation grants for out-of-state credentialed teachers who agree to teach in certain areas and $1,000 grants for some credentialed teachers who agree to teach in low-performing schools.

Two years ago, the federal government began the Teacher Next Door program, modeled after the Officer Next Door program. The programs allow police officers and teachers across the country to buy homes foreclosed by the Department of Housing and Urban Development in economically depressed areas at half the market rate.

Under the program, HUD will reduce the down payment to just $100 if a teacher purchases the house with an FHA-insured mortgage. The teacher must live in the home for at least three years, and it must be in the school district where the teacher is employed.

Arnold Weiner, a human resources specialist for Los Angeles Unified who works in teacher recruitment, said district-run housing sounds nice in concept but might not work in a district desperate to find land for schools.

“Districts use their funds for the education of children,” he said. “I don’t think an educational institution would want to provide funds for building homes for teachers when we have so many problems in our education system here.”