The City of Bloomington has canceled a $3 million pilot program to help city police officers and firefighters buy homes in city limits.
Deputy Mayor Gretchen Knapp made the announcement Wednesday; it was explained further in a Thursday news release from Mayor Kerry Thomson.
Knapp cited high cost per participant and lack of criteria to evaluate the program’s success as reasons for canceling it.
“We’ve determined that’s not a program we want to continue, and we have the support of both (police and fire) unions, fire and police leadership, HR, and the Office of the Comptroller,” Knapp told the city council.
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Former Mayor John Hamilton announced the 10-year pilot last February. It was intended to boost public safety recruitment and retention, which has been a struggle for the city.
The program would have offered $100,000 in down payment assistance for 10 officers and 10 firefighters after they reached one year of service. Those entering the force with three years at another department also would have been eligible.
Knapp added the program had raised questions about equitability.
“It’s a very expensive program for not very many people,” Knapp said. “It has already caused a lot of discussion among public safety officers and employees of the city who are not in public safety. ‘Why would they get this benefit, and I don’t?’”
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After spending several months last year trying to find the right lender for the program, the city signed with Fahe to facilitate it.
Last year, the city council approved $500,000 in American Rescue Plan Act funds for the program. The city said rules do not allow these funds to be used for this purpose.
“The $500,000 would have come from the general fund instead to get the program started, and an additional $500,000 would have been due once Fahe had accepted eight loans,” a city news release states. “At the time of the cancellation, no payments had been made yet.”
The program would have required the council to appropriate $200,000 each year — $10,000 for each of the 20 participants — in addition to $1 million the city would put into a nonrefundable reserve at Fahe, according to the release.
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Participants would have had to pay loan interest and additional payroll tax each year on the annual $10,000 appropriation.
A written statement from Thomson calls the program “not an equitable or cost-effective use of city funds” and adds the city will instead seek scalable and sustainable solutions to attract and retain public safety employees.
Since the program was announced last year, seven people have expressed interest, according to the city. No one relocated or transferred based on the offer or applied for Fahe eligibility.
The city is instead directing those interested in housing assistance to an existing program that offers one-time $18,000 down payment assistance to police officers who purchase a home within the city after a probationary year.
