Bank extends housing help to employees

GREELEY — Employee retention “has not really been an issue” for Union Colony Bank, according to Kathy Kersgard, the bank’s human resources director.

Still, in light of Northern Colorado’s notoriously competitive banking business, the bank’s management isn’t about to wait for another labor shortage — as Northern Colorado experienced through the 1990s — before advancing worker-friendly policies.

Greeley-based Union Colony is the region’s first company to adopt the Employee Home Ownership Program as a worker benefit.

Under terms of the EHOP, orchestrated by Fort Collins-based Funding Partners for Housing Solutions, Union Colony employees who are first-time homebuyers can receive up to $10,000 from the bank toward their home purchase.

“Basically, it’s a loan to them that is forgiven 20 percent a year,” Kersgard said. “So, if they remain with the bank an additional five years after closing, it would be totally forgiven.”

The EHOP benefit is tailored to solve the primary obstacle to home ownership. According to the 1998 Fannie Mae National Housing Survey, 29 percent of respondents cited down payment and closing costs as the No. 1 impediment to purchasing a home, ahead of finding an affordable home (26 percent).

Joe Rowan, loan program manager for Funding Partners, believes more Northern Colorado employers will follow Union Colony’s lead as they fight the employee-retention wars.

“We think it’s going to become as prevalent as ESOPs (employee stock ownership plans) were in the 1980s,” Rowan said.

Funding Partners, a non-profit support agency for affordable housing causes, introduced EHOP last year and recently received a federal service mark — the equivalent of a corporate trademark — for the EHOP system.

On that basis, Funding Partners plans to license the EHOP system nationwide to companies seeking to add employer-assisted housing as a benefit. EHOP licensees like Union Colony receive management software, an operating manual and loan policy guidance from Funding Partners.

EHOP-style benefits were made popular by home loan giant Fannie Mae, which introduced the benefit to its workers in 1991 and since then has championed employer-assisted housing to other companies.

The program’s success is underlined by the fact that 76 percent of Fannie Mae staff have home mortgages, compared to 66 percent of the overall American population.

Employer-assisted housing is more mature in the Denver area, where 25 employers offer the benefit in consultation with Fannie Mae, said Tony Hernandez, director of the Colorado Partnership office of Fannie Mae.

Rowan figures the EHOP program is prime for Northern Colorado because of the growing demand for health care and education workers here. “They remain constantly hard-to-fill positions and also, you just can’t always raise wages to attract them,” Rowan said.

According to Fannie Mae, 25 percent of the employers it’s helped to launch employer-assisted housing programs are in the health care arena. Municipalities and universities are also among the top users of the plans.

“It just seemed to make good business sense,” Kersgard said. “We have a fairly low turnover, but we are a recognized leader in Colorado for our family-friendly policies,” which includes child-care assistance for Union Colony workers.

In its October 2003 edition, Colorado Parent magazine ranked Union Colony among the state’s top family-friendly companies.

Union Colony makes the benefit available to full-time workers with at least six months on the job. Eligibility requirements also include that the worker is a first-time homebuyer or hasn’t owned a home in the last three years. Single heads-of-households are also eligible.

The benefit is greater for low-income workers — those who earn 80 percent or less of the area median income. Such borrowers can receive up to $10,000 as an EHOP benefit. Workers making above the 80 percent AMI threshold can receive $5,000.

Kersgard estimates up to 20 of the bank’s 150 employees are eligible. The first employee applicant for an EHOP loan is expected to close on a house this spring.

And as word gets out, Kersgard thinks EHOP will boost the bank’s effort to bring in new employees.

“Down the road, besides retention, it’s also a great recruiting tool for us,” she said

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