Henrico officials advance plans to help some employees pay for first homes

In an effort to improve access to affordable housing and employee retention, Henrico officials are advancing plans to help some county employees pay for their first home purchases.

Officials anticipate that $2 million in the proposed Fiscal Year 2023-24 budget will be earmarked for down-payment and closing cost assistance, which could help about 120 employees, Varina District Supervisor Tyrone Nelson told the Citizen. The median price of a house in the area – about $350,000 – is not affordable for many entry-level county employees such as teachers, firefighters and police officers, he said.

Henrico general government or Henrico County Public Schools’ entry-level employees who have worked as county employees for at least 12 months will be able to apply for forgivable loans of up to $20,000. Eligible employees must have household incomes of less than 120% the Area Median Income, adjusted to family size. They also must live in the county for five years for the full balance to be paid off, Nelson said.

Advancement of the plan, which county officials first discussed during a December retreat with the board of supervisors, comes after the board’s unanimous approval of the Arcadia development in Varina during a Jan. 24 meeting. That decision followed weeks of debate about whether the project was the right fit in a still-mostly-rural part of Varina. At the meeting, Nelson said he struggled with the decision to endorse the community, whose developers (East West Communities) have committed to build a minimum of 20 affordable housing units ($200,000 in today’s prices) there.

“I thought [the cost-assistance] was a pretty exciting program, when we first heard about it during our board retreat,” Nelson said. “And then that day, my mind clicked that this development, if we approved it [Arcadia], could be a launching place for this program.”

Program funding will be donated toward a suitable non-profit organization that will administer the program for the Henrico general government and Henrico County Public Schools, officials said. The program likely will start to come to fruition in June following the county budget’s approval, Nelson said. The development itself likely won’t be built for at least another 18 months, he said.

In the meantime, county officials are discussing subsidizing housing costs with some of the largest companies in the region, said County Manager John Vithoulkas, noting that “employees are a scarce commodity right now.”

If the plan is successful, with large numbers of employees applying for loans, Nelson sees the program continuing and possibly even receiving more funding, he said. It’s the first time the county is undertaking such a program, Vithoulkas said.

“Having three firsts [the community farm, housing assistance and affordable housing] in one zoning case. . I mean, that's significant for the county,” he said. “It may establish . . . [that] this is the way that this is what developers need to think about coming forward.”

Creation of the program shows that Henrico County has gifted people on staff who care about people in the community, Nelson said.