Henrico plan would help county employees buy homes

Henrico County officials are considering a plan that would provide loans of up to $20,000 to first-time homebuyers who work for the county.

If eventually adopted as envisioned, the Henrico County Home Purchase Assistance Plan would provide loans of between $10,000 and $20,000 for as many as 120 county employees, to be used toward down payments on the purchase of an attached or detached single-family house or condominium in the county.

One-fifth of the loan amount would be forgiven each year that the recipient continued to work for the county and made the home his or her primary residence, according to Henrico Director of Community Revitalization Eric Leabough, who presented the concept to the county’s board of supervisors during a retreat Friday morning at the Henrico Theatre in Highland Springs. The loan would be fully forgiven after five years if both criteria were met during that time, he said.

The conceptual plan calls for the county to donate $2 million to a nonprofit, which then would administer it – likely on a first-come, first-served basis, according to Henrico County Manager John Vithoulkas. Eligible employees would have to have been employed by the county for at least four months and in good standing with their departments, Leabough said.

County officials envision the plan as a way to assist with employee recruitment and retention efforts. Similar efforts are in place in Arlington and Loudoun counties in Northern Virginia, Vithoulkas told the board.

The Henrico plan envisions a sliding scale of loan values, based upon the number of people in a household and its maximum household income.

For example, an employee whose household earns only 80% of the area’s median income or less would be eligible for the maximum $20,000 loan. (For single-person households, the maximum allowable annual household income would be $56,400, while for a five-person household, that total would be $87,000.)

Households eligible for loans of up to $15,000 would include those earning between $70,700 (one person) and $108,800 (five people) annually. Those with annual income levels between $84,840 (one person) and $130,560 (five people) would qualify or loans of as much as $10,000.

A study by the Partnership for Housing Affordability showed that in 2018, there was a shortage of more than 12,000 rental units for Henrico citizens whose annual earnings were 80% or less of the area’s median income.

“This is just one attempt” to help some citizens from that group acquire permanent housing, Vithoulkas said. “It’s a different approach, but it absolutely will work if you match public employees to workforce housing.”

A similar effort later could be implemented to assist senior citizens, Vithoulkas suggested.

Supervisors generally seemed to approve of the concept, though Board Chair Pat O’Bannon (of the Tuckahoe District) wondered whether the loans would be enough to help some workers purchase homes in the county. Though 1,000-square-foot homes in some adjacent localities might range between $150,000 and $175,000, O’Bannon said, similar homes in Henrico might cost as much as $250,000.

Supervisors are likely to consider the loan plan at some point in 2023.