As seen on Spaces4Learning.com.
With a burnout rate 14 percentage points above the national average, it’s little wonder that more than three-quarters of U.S. states are experiencing a shortage of teachers. The lack of affordable housing options in many school districts and resulting hours-long commutes for educators compound the problem. By using excess land to build faculty housing, school districts can help alleviate this serious issue for arguably our most important profession.
School districts which control well-located land can spearhead development deals with the price and terms conducive for affordable housing. But that alone is not sufficient; they must champion these faculty housing projects, including through school board approval and deal negotiation.
Take, for example, the Collier Public School District in Southwest Florida, which boasts a student population of 48,000 and employs 3,200 teachers. They are considering building an affordable housing community on 35 acres of district-owned land near a local elementary school.
“I’m very proud of us for working to solve our own problem instead of waiting for the county to do it,” said Stephanie Lucarelli, Collier County school board member, speaking to a local CBS affiliate.
By adding preparation and advocacy to their power, school officials can take a huge step forward in the all-important goal of hiring and retaining the best teachers possible. Using excess land to build faculty housing is a win-win for all constituencies.
In California alone, school districts had about 75,000 acres of school property parcels conducive to teacher housing development, according to the California School Board Association.
Hiring & Retention Never More Important
A Gallup poll found that 83 percent of superintendents view the hiring and retention of a quality faculty as one of the top three challenges they face. The macro-trends of high teacher attrition and a diminishing pipeline of college students interested in the field certainly don’t make the task any easier. In August 2022, Florida saw a 23.6 percent year-over-year increase in vacancies for teachers and support staff to a statewide total of 10,771, according to the Florida Education Association.
Recognizing the need to develop teacher and staff housing, Tampa’s Pinellas County School District, the seventh-largest school district in Florida, is converting a shuttered vocational school into housing that will include 225 residential units. Approximately half of these units will be priced to individuals earning between 90% and 120% of the local area median income. The project will provide district teachers and staff free access to a variety of amenities, including a common area for teachers and a gym. It is slated for completion in 2026.
“Our goal is to support the housing needs of our dedicated educators and employees,” said Superintendent Kevin Hendrick in a prepared statement. “To attract and retain the best teachers and district employees, we must proactively provide accessible and appealing housing choices.”
Everybody wants and deserves quality of life. If teachers can’t live reasonably close to their schools—the highest-paid teachers across 47 school districts in San Francisco’s Bay Area only earn enough to rent an affordable one-bedroom apartment, according to an EdSource analysis—they’re probably going to look elsewhere for employment opportunities. The result is HR headaches for school administrators and decreasing quality of faculty, which detracts from the wellbeing and development of children. It’s a crucial issue for a critically important profession.
By providing affordable housing for teachers near where they work, districts can also provide another important benefit to its student population.
“It’s important to students to know that their teachers live in the same communities as them, shop at the same stores,” Boston teacher Shirley Jones-Luke told the Associated Press last year. “They realize the teachers aren’t out of touch because we live in the same ’hood. I know what’s going on in the ’hood just as much as they do.”
Challenges Faced by Affordable Housing Developers
School districts can help attract and retain teaching talent through affordable housing offerings, but the downside is that developers increasingly struggle with the rising costs of capital and construction. The only way to mitigate these prohibitive expenses and make development projects pencil out is to control the cost of the land. A school district willing to partner with a developer can position land at an affordable level, controlling the process and product while ultimately sharing in the profits.
Time is money and risk though, as every experienced developer knows. For example, California development projects pushed through the approvals timeline still face the chance of being held up by public hearings, which come at the very end of the process.NIMBYs and other special interests have been known to use the formidable California Environmental Quality Act to snag would-be developers.
Just such a thing happened in the Northern California’s Bay Area where NIMBYs called for a vote by the general public on a Low-Income Housing Tax Credit (LIHTC), teachers-preference project. The public-private partnership (“PPP”) effort could have gotten crushed, but there was enough lobbying, including school board personnel and teachers pointing to two-hour commutes each way and other quality of life issues, to win the day.
Politics are unavoidable when weighing public development, and power struggles don’t all go the way of teacher causes. A school district and the city aren’t always on the same page and willing to work together. And cities with big tax coffers don’t always earmark funds for affordable housing, such as vouchers to help offset the costs of rent.
Teaming Up for Teachers
By entering into Public Private Partnerships (PPP) for affordable housing development, school districts can generate revenue without losing control over their land. A ground lease is typically the easiest way to accomplish this, maximizing control and thereby reducing potential political resistance.
At Alliant Strategic Development, we are proud to have won the RFP for an ex-elementary school site in Silicon Valley to build 85 Low Income Housing units in a PPP with the school district. By using a ground lease structure and recent California laws that benefit housing on school-owned land, we are able to offer a special Teacher/Staff Preference to help retain and attract talent that currently commute as much as two hours each way. Ordinarily such a preference would violate fair housing laws. With creative financial engineering, solutions can be provided to this daunting housing crisis. ASD is working on various RFPs with additional school districts.
The highly regulated affordable housing industry brings security to such partnerships with faculty housing a safer real estate class with healthy risk-adjusted returns. Rents are lower so there’s less risk with lease-up and staying leased (steadier cash flow). In fact, with huge demand for affordable housing, school districts will likely see lengthy residential wait lists, a considerable economic mitigant in a down market. Unlike a market-rate deal, affordable rents never go down, which means the value of the ground lease won’t either.
Recent state legislation designed to alleviate housing shortages makes these types of projects more feasible. For example, in California the Housing Crisis Act of 2019 via SB 330 has been extended and expanded, that would restrict any new regulations that would impede new residential development.
With the approvals process and legal path clearer toward affordable housing development on school property, school administrators can focus on finding experienced, creative, relationship-driven developers. Both sides of the PPP enjoy greater flexibility, while the developer avoids significant upfront land acquisition costs and reduces its tax burden. The school district gets an expert teammate that can effectively navigate the fair housing laws, including the rules and regulations of marketing a project as teacher housing preference, while providing a menu of project and partnership options, including joint venture.
LIHTC funding often comes up short by 10 to 15 percent, adding increased importance to a developer being able to leverage a state agency land partner to open doors to new, more advantageous financing, especially in the current environment of escalating costs. Access to more competitive capital boosts the PPP and ultimately the product delivered in service to the teachers.
Speaking of financing, one of the biggest challenges today for school districts is demographics: the local agencies, which often are losing population, get their state funding based on the number of students. Working families with kids are absolutely critical to keep that pipeline flowing.
Happy teachers bring with them families, which build social communities. Expert affordable housing developers serve families by creating physical communities, which include social amenities but also service ones such as daycare facilities and health and wellness programming. Costing the same as market-rate product, new affordable housing enhances the surrounding environment while strengthening the connection between people and place.
“It’s like a great gift coming from the district,” a Bay Area math teacher told AP News about her family’s new, affordable three-bedroom apartment.
It’s been said that teaching is the profession that teaches all other professions. The hope is that we’ve learned about and appreciate the importance of educators and are ready to devote extra effort to their total wellness. One of the most vulnerable professions to the overall housing crisis, teachers deserve affordable housing options close to where they work. Delivering those on excess school land serves multiple major interests, including the core school district goal of hiring and retaining the best faculty.
Eddie Lorin is Co-Founder and Chief Executive Officer of Alliant Strategic Development. In addition to successfully acquiring and developing more than 200 properties worth over $4.2 billion during his career, Lorin is also an avid proponent and a self-proclaimed “mad scientist of Affordable Housing,” searching for creative solutions to help solve the crisis in combination with the LIHTC program.