Rent relief – in the form of a $ 500 monthly stipend – is on the horizon for St. Petersburg’s lowest-paid employees, whose residency within city limits is a requirement for employment.
About 250 employees representing over 20 positions fall within the residency requirement, with 246 making less than $ 48,000 annually. The average salary for those positions, including sanitation workers, mail clerks and library assistants, is $ 36,702. The policy, instituted by the SEIU Florida Public Services Union, applies to employees hired on or after Oct. 1, 1997, and was meant to provide more opportunities for minorities living within the country boundaries.
However, soaring rents are now pricing St. Petersburg’s employees out of the city they serve while also impeding recruitment and retention efforts.
In light of St. Petersburg expanding its down payment assistance program and with the inception of the state’s Hometown Heroes initiative providing relief for those seeking homeownership, city officials are turning their attention to tenants.
“We feel like our resources are best focused on the employee rental assistance,” said James Corbett, neighborhood affairs administrator.
During Thursday’s Housing, Land Use and Transportation Committee meeting, Corbett led an update on how the city could best provide relief for cost-burdened employees. The Department of Housing and Urban Development (HUD) classifies households spending over 30% of their income on housing expenses as cost-burdened.
With an average salary of $ 36,702, city employees should spend less than $ 917.55 of their monthly income on housing costs – which, according to HUD, includes utilities – to avoid the cost-burdened status.
Corbett told the committee that the median rent in the city is around $ 1,500.
To fill that gap, city officials are moving forward with an initiative to provide city employees with a monthly stipend of $ 500. Following previous discussions, the city will now provide the bonus directly to workers through their paychecks instead of their landlords. City Administrator Rob Gerdes said those eligible could receive the money by Oct. 1, with an application portal opening before that date.
“It’s exactly what I hoped it would be,” said Council Chair Gina Driscoll. “And it would create some really meaningful assistance for a lot of employees that are not quite at the point where they can purchase a home right now.
“This helps them get into that position through training while providing an opportunity to get some rent relief.”
The program’s requirements stipulate that city employees must make less than $ 48,000 with a household income under 120% of the area median income (AMI). The assistance applies to new hires and takes effect after a probationary period.
Employees must also complete financial training, and Councilmember Richie Floyd expressed his desire for the program not to encumber applicants.
“I’m big on avoiding paternalism as much as possible,” Floyd said. “I think people are smart – just as smart as the people sitting in this room – and that they can make their own decisions.”
Corbett said aspect of financial training would benefit people in varying ways and said he “could learn something right now about better ways to manage or handle money.”
Floyd also noted that employees would receive about $ 400 after taxes, leaving them in the cost-burdened territory, and asked what the administration’s hope was after the two-year eligibility period.
The hope, said Corbett, is that employees would increase their credit rating through financial training and bolster their savings. He also expects employees to see their salary increase over two years and said the city would steer them towards the down payment assistance programs.
“My hope is that coming out of the two years, they’re in a better financial place to make whatever decision it is – that they want to do,” said Corbett.
Corbett explained that if every eligible employee received the $ 500 maximum, the program would cost the city $ 1.47 million annually, although he expects that number to be closer to $ 1.1 million. He said the city could fund the program through ad valorem taxes resulting from increasing property values.
“Certainly, this program’s funding is under consideration for the mayor’s recommended budget based on that increase,” added Gerdes.
Councilmember Brandi Gabbard noted that the State Legislature only funded the Hometown Heroes program for one year and expressed her concern for “the people who will get left out when it comes to the down payment piece.”
While she “wholeheartedly” supports the rental assistance, Gabbard expressed her intention to continue discussing down payment assistance that includes every city employee earning under a certain percentage of the AMI.
The administration will bring the proposal before the full city council in July, and Gerdes said he would immediately begin the implementation process with his team and the local human resources department.
“Nothing is ever 100%, but I feel like we’re moving in the right direction on this program,” said Gerdes.