This story appears in the 2015 Summer Edition of Rural Voices

by Tom Vilsak, Secretary of Agriculture

USDA Secretary Tom Vilsack discusses USDA’s Self-Help Housing Program

As Secretary of Agriculture I’ve had the opportunity to visit hundreds of small towns all across America. I’ve seen firsthand the strength and resilience of rural business and families, and the positive impact of USDA employees and programs to help rural communities thrive.

Still, too many of our fellow citizens are being left behind. Too many of our small towns are struggling. Although they are some of the hardest working folks I know, rural Americans earn, on average, $11,000 less than their urban counterparts each year. They are more likely to live in poverty.

I have a specific memory of rural poverty from a long time ago that has left an indelible mark on me. My son and I volunteered to help build homes for migrant farmworkers in McAllen, Texas. That experience exposed us to the tough lives these families live.

Despite their circumstances, they are extraordinary, hardworking and humble people. They deserve to live in safe houses. They deserve the opportunity to turn those houses into homes for their families. I know the Housing Assistance Council and other housing advocates feel the same way.

That experience made me proud to serve at a Department that provides programs and services that help rural families climb out of poverty and move into the middle class. For example, our nutrition programs help hardworking moms and dads as they search for good paying jobs that will allow them to put healthy food on the table for their kids without assistance.

Another example is our self-help housing program, which for the past fifty years has helped low- and very low-income families build their own homes. For many of these families, their self-help house is the first time in their lives they’ve lived in a real house.

Hard work and dedication reduces construction costs and, paired with an affordable USDA mortgage, makes homeownership possible for families that would not otherwise be able. Working with local support organizations, families spend long hours in the evenings and on weekends working on their homes. The families frame the houses, install roofs, put up windows and siding, and paint. Each of the 870 families that participated in the program last year built about $27,500 in sweat equity in their brand-new homes.

This program also helps increase homeownership among women and minorities living in rural communities. Over half of agency-financed self-help homes are built by minorities. Since 2008, 41 percent of self-help homes have been built and bought by women-led households, many of whom are single mothers.

For example, in the span of just three years, Christy Milburn and her two young children lived in fifty-five different places. A couple weeks on a couch here, stay in a spare room there, and by 2006 she had run out of friends and couches. As a homeless single mother in Montana, Christy came to Missoula to once again try to get her life back on track. A string of bad luck and regrettable personal decisions had put her in a position she didn’t want to face, yet didn’t know how to escape.

“I would take my kids out for a walk, just for something to do,” said Christy. “We’d be walking down a street and I’d see a family inside their home – behind that picture window – and I’d wonder if I could ever get my life straightened out, and find that stability to just live in the same place for more than a few weeks.”

USDA and partners in Montana, including the Missoula Housing Authority and NeighborWorks Montana, teamed up to help Christy and her kids build and move into one of ten affordable homes in a subdivision just west of Missoula. Today, Christy is able to provide the stability for her children that she had dreamed about for so long.

Recently, the first successful self-help project in Indian Country has provided homeownership to three women-headed families, the first of twelve planned homes in the Zuni Pueblo of New Mexico. These families have never owned a home and many have been renting for 15 years or more. Kay, one of the participants in the program, described her motivation for putting in the long hours and hard work needed: “I live for my kids, so, what I do is practically just for them.”

Stories like Kay’s and Christy’s make me proud of the work that USDA does in rural communities. I am proud to say that we will soon celebrate a new milestone-our 50,000th self-help home-this summer. Together with dedicated partners like the Housing Assistance Council, we are helping rural families achieve the American dream of homeownership. Thank you for your partnership and keep up the good work.

Tom Vilsack serves as the Nation’s 30th Secretary of Agriculture. As leader of the U.S. Department of Agriculture (USDA), Vilsack is working hard to strengthen the American agricultural economy, build vibrant rural communities and create new markets for the tremendous innovation of rural America. In six years at the Department, Vilsack has worked to implement President Obama’s agenda to put Americans back to work and create an economy built to last. USDA has supported America’s farmers, ranchers and growers who are driving the rural economy forward, providing food assistance to millions of Americans, carrying out record conservation efforts, making record investments in our rural communities and helped provide a safe, sufficient and nutritious food supply for the American people.

This story appears in the 2015 Summer Edition of Rural Voices

by U.S. Representative Sam Farr

A program that helped create the real American Dream for over 50 years.

The American dream is built on homeownership. For generations, American families have benefited from investing in their first home. It gives them a sense of community, it is a source of pride and for most homeowners it is their most valuable asset.

Unfortunately, the door to homeownership is too often closed for many individuals. That is why the U.S. Department of Agriculture’s Self-Help Housing program is so valuable. For 50 years, self-help housing has given low-income Americans in rural areas the chance to own their first home – not through a hand-out but instead through a hand-up.

I was a Peace Corps volunteer in Colombia where I saw the culture of poverty first hand. I watched it hold down entire barrios; preventing whole communities from building a better life for themselves. Breaking that cycle of poverty requires access to things like health care, food and an education. But before any of those needs can be met, you first need a safe place to sleep at night, not just a roof over your head but a home that serves as foundation for everything else.

That same cycle of poverty still exists in rural America. It prevents our communities from reaching their full potential. If we want to break that cycle of poverty, we need to invest in building more affordable housing. That means lowering the cost to construct new homes and lowering the income threshold for home financing.

Self-help housing achieves both of those goals. On average, self-help homes cost $120,000 less than a typical new home to build. And participants gain financing despite earning $20,000 less than the U.S. median income. Self-help housing achieves these dual goals by literally giving people the tools necessary to build and own their first home.

Participants in self-help housing aren’t just handed the keys to a new home. They help build it from the ground up. About 65 percent of the labor is provided by homeowners, allowing folks to start out with equity in their home – sweat equity. Imagine the pride a homeowner feels when they first cross the threshold into their new home. Now imagine how overwhelming that pride must be if they knew, not only did they build that home but they now have the skills to maintain it for life.

That new found knowledge is why self-help housing participants are more likely to remain in their home. In fact, some of the first families to benefit from the program still live in their original homes 50 years later. What they started in Goshen, California five decades ago has now helped families all across rural America realize their own slice of the American dream.

That historical connection to California is one of the many reasons I support this wonderful program. In my district on the Central Coast of California, organizations like South County Housing and Community Housing Improvement Systems and Planning Association, Inc. (CHISPA) work with new homeowners to finance and build their first home through this program. They fill a niche in our rural counties that desperately need access to more affordable housing.

Self-help housing is doing more than just building homes…it is building whole communities. Participants do not just build their home on their own. They work side-by-side with their neighbors. Families work together to build safe, affordable housing for each other to enjoy.

And isn’t that what rural America is all about? Neighbors helping their neighbors build a better life for each other. That is the foundation of a community. That is the real American dream. A dream that USDA’s Self-Help Housing Program has helped come true for 50 years.

Congressman Sam Farr has represented California’s Central Coast for 23 years. His district, known as the Salad Bowl of the World, encompasses the Monterey Bay region and the Salinas Valley. He currently serves on the House Committee on Appropriations and is the Ranking Member on the Subcommittee on Agriculture Appropriations. Prior to serving in Congress, Farr served twelve years in the California State Assembly and six years as Monterey County Supervisor. He began his career in public service in 1964 serving in the Peace Corps in Colombia.

This story appears in the 2015 Summer Edition of Rural Voices

by Mike Shimon

A local Habitat for Humanity provider reaches more families using the USDA Mutual Self-Help program

The Marquette County Habitat for Humanity (MCHFH) affiliate, serving Marquette County, Michigan, was established in 1992 as a nonprofit organization with the core mission of eliminating substandard housing. MCHFH works with tenant families living in poor housing conditions and provides them an avenue to realize the dream of homeownership. The families must be low-income and willing to work sweat equity hours to help build their home.

During the first seven years, MCHFH provided homeownership to 16 families but there was a need to serve more families. In 2000, we started working with USDA Rural Development and NCALL Research, a regional Self-Help Technical Assistance (TA) provider. It took many months of work to apply for funding under the USDA Mutual Self-Help program. When it was done, though, we began serving many more families.

In general, self-help housing is a great system because the family partner groups gain marketable construction skills and have a real pride of ownership in the home that they helped construct.

Prior to collaborating with the USDA and NCALL, MCHFH worked with one family at a time and built one house at a time. Under the USDA model, partner family groups work together on each other’s homes until all homes in that group are complete. No family moves in until all homes in that group are complete. At that time, a group dedication ceremony is held and all families move into their homes at the same time.

In general, self-help housing is a great system because the family partner groups gain marketable construction skills and have a real pride of ownership in the home that they helped construct. Through required education programs, they also learn about budgeting, finance, insurance, and home maintenance.

MCHFH funds the construction and other expenses to build each home. The family receives a zero-interest mortgage equal to the total of these costs. MCHFH originates and services all mortgages. In addition, we require the families to make monthly escrow payments for taxes and insurance. Typically, a family will receive a 25- or 30-year, zero-interest mortgage based on the family’s ability to pay.

Loan payments go into a revolving fund referred to as “Funds for Humanity.” The proceeds from the revolving fund support approximately two houses per year. The net-profit from our Habitat ReStore,where we sell donated new and gently used furniture, home accessories, building materials, and appliances at a low-cost to the public, provides enough revenue to fund an additional house annually. We have several other funding sources that help us to build one or two additional homes. Funding is a big challenge for us and we are looking into using the USDA Section 502 program in the future.

Of the 94 homes built in Marquette County since 1993, 66 families are still living in their homes. Twenty-eight families moved out of their homes. The homeowners sold about 80 percent of these homes on their own. The remaining families deeded their home back to Habitat in lieu of foreclosure. These homes were either sold to a low-income family using a USDA Section 502 loan or sold on the open market.

Of the families recently served, 77 percent are very low-income, 7 percent are a racial or ethnic minority, and approximately 60 percent are female-headed households. Most of the families have steady employment income and all seem to be committed to improving their lives.
One of the challenges MCHFH faces with the group system is the size of our county. MCHFH is located in the city of Marquette, a community in the Upper Peninsula of Michigan. The service area for MCHFH is 3,425 square miles. It is the largest geographical county east of the Mississippi in the United States and has a population of over 60,000 residents. This rural county provides lots of challenges because of its size, the weather, and the fact that nearly all of our homes are built on scattered sites in multiple cities. This requires substantial time and travel needs for the families.

It was a relatively easy transition from serving one family at a time to adopting the self-help model that required all of the families to work together until all of the houses in a particular group were completed. The biggest challenge in our program is keeping the families motivated because we build on scattered sites and in different communities.

There are some very basic similarities between the Habitat for Humanity and the USDA Mutual Self-Help Housing programs. Family selection, the family commitment to partner with sweat equity, and their ability to pay a mortgage are critical factors to both organizations.
The Marquette County community has benefitted significantly since we have partnered with USDA. Since our inception in 1993, we have built 94 homes. During the past 15 years, 78 of those homes have been USDA-backed self-help houses. This has made a major impact on improving the low-income homeownership opportunities.

Mike Shimon is the Executive Director of Marquette County Habitat for Humanity in Marquette, Michigan. Marquette County Habitat for Humanity is a nonprofit, ecumenical Christian housing ministry seeking to eliminate poverty housing, and to make decent shelter a matter of conscience and action.

This story appears in the 2015 Summer Edition of Rural Voices

by Bob Marshall

Early efforts in rural California became a Self-Help Housing model for the nation

In 1937, the American Friends Service Committee (AFSC) helped 50 coal mining families build their own homes in western Pennsylvania. This was the beginning of a movement that crystallized in 1963 when the first self-help housing homeowner loans were made to families through the USDA’s Farmers Home Administration (FmHA).

Bard McAllister, working for the AFSC in Tulare County, Calif., pushed the concept of self-help housing on behalf of farmworkers. Until 1961, the FmHA could make housing loans to farmers, but not to farmworkers. Bard McAllister worked with the Secretary of the Commission on Agricultural Life and Labor in Washington, D.C. to draft legislation making agricultural workers eligible for housing loans. Congress included this provision in the Housing Act of 1961.

The first “official” self-help housing loans under this Act were made to three families in Goshen, Calif. in January 1963. With Howard Washburn as supervisor, the AFSC operated this initial program. At first, loans could be made only for the houses, not for the land. To work around that stipulation, the AFSC purchased the land with other loans and used a grant from the Rosenberg Foundation for technical assistance. By 1965, Congress removed the restriction against including land in the FmHA loans.

Also, in 1964, the federal Office of Economic Opportunity (OEO) was created. In 1965, Bard McAllister, Howard Washburn, and Everett Krackov, Director of the OEO-funded Tulare County Community Action Agency (TCCAA), applied for a grant from the Migrant Division of the OEO to administer a self-help housing program. Self-Help Enterprises (SHE) was created as a nonprofit corporation and, initially as a delegate agency of the TCCAA, received OEO funds.

In August 1966, I was hired to assist Howard Washburn and others to administer SHE. The day my family and I arrived in California from Pennsylvania, Howard, his wife, and two of their four daughters were killed in a head-on auto accident. Such a tragedy. Three months later, the Board of SHE asked me to be the executive director. I continued in that role until my retirement in 1989. This was a great and challenging opportunity for me and I am most thankful for it.

Photo by George Ballis

In the early years, it seemed like the most difficult task was getting family loans approved by FmHA. Every family’s loan application had to be approved by both the FmHA county supervisor and the FmHA county committee. The latter was composed of three persons, usually farmers. In some counties it seemed like the primary rule was to reject families. The committees were concerned with repayment ability and rightfully so. But OEO was concerned with getting people out of poverty and so were we. The marriage between OEO and FmHA was never a smooth one. In 1970, the FmHA county committee was eliminated, making things a bit easier.

OEO staff liked our program and wanted SHE to work statewide in California. However, SHE board and staff decided that the San Joaquin Valley was a more manageable service area and that SHE would offer technical assistance and support to other agencies wishing to start self-help housing programs.

This we did, and soon several other self-help housing nonprofits cropped up in California. We were also asked for help from agencies in other states. In a sense, SHE was the self-help housing model for the nation.

In 1967, Clay Cochran created the International Self-Help Housing Association (ASHHA), later renamed Rural America, with the purpose of spreading the concept of self-help housing and providing training and expertise to organizations beginning their own self-help programs. SHE supported and worked closely with ISHHA in these endeavors.

In 1973, various self-help organizations came together to create the California Self-Help Housing Association (CSHHA), which met periodically for mutual support. At that time, housing programs for the poor were getting squeezed for funds. CSHHA held a statewide
“Self-Help Housing Day” in Galt, a town near Sacramento, where the Rural California Housing Corporation was building self-help houses. Approximately 500 people attended the event. The state Senate and the state Assembly designated a “Self-Help Housing Week” in March 1973, commending self-help programs for their valuable contributions to community life.

In a sense, SHE was the self-help housing model for the nation.

SHE has also played an active role in the National Self-Help Housing Association, working closely with the National Rural Housing Coalition, and helping support the housing lobbying work carried out for both groups by Bob Rapoza and Rapoza Associates.

SHE recognized that the OEO was not a permanent agency and that one day it would be dismantled. So, by 1971 or 1972, SHE began working with other agencies to identify and support a permanent home for the technical assistance (administrative) grants. FmHA seemed like the logical choice, and by 1972 legislation was approved to accommodate this transition. Thus in 1973, SHE wrote a grant proposal to FmHA for an eight-county, one-year plan to provide technical assistance support for self-help housing. This was approved and thus began the program, which continues nationwide today as Section 523.

Over the years, SHE has developed a solid working relationship with staff at FmHA, now the Rural Housing Service and USDA Rural Development. We felt that we were partners in a valuable home-building and family-building program, and the relationship has become a mutually supportive one. Certainly there are differences, and SHE stands up for the families when it seems they are not getting a fair shake. However, the evolution of the relationship between these two agencies since 1966 has been great.

Additionally, in 1971, the Housing Assistance Council was created, again with Clay Cochran as a major contributor. HAC had a technical assistance staff and a substantial land loan fund. SHE became an early and frequent borrower from that fund.

Since the inception of SHE, volunteerism has been a major factor for the organization. For a period of four or five years, Franciscan Brothers assisted in construction roles. They helped with land development, carpentry, plumbing, and electrical work. They lived with building families and helped kids with their homework in the evenings, a great service. In a six- or eight-year period, 120 VISTA volunteers provided critical assistance to the program. Their roles included providing family education and training, helping to start a housing rehabilitation program, giving social service support, donating construction assistance to supervisors, and much more. Several of these contributors have continued in the field and are directing self-help housing programs today. My successor, Peter Carey, directed the program for 24 years, retiring in 2014. Tom Collishaw was appointed to the role upon Peter’s retirement. Both men were one-time VISTA Volunteers at SHE.

SHE also encourages work camps of young people spending a week or more working with the families. Many years ago when our daughter, Gwyn, was 15, she was in a seven-week AFSC work camp held with a building group in Planada, Calif. These young high school students were housed in a partially completed self-help home. They worked along with the families on their homes. I’m not sure who benefitted most, but I think it was the young people.

A statement from Mrs. Salvador Gutierrez, a SHE participant, stays with me to this day. She said, “It is difficult to express in words what it means to me and my family to be able to see our own home being built. It is beyond any dreams. The problems have been many and the hours long, but the feeling of having something of our own helps to make me forget the years of helplessness and depressed feelings. I believe that with faith in God and by people working together hand in hand, we can accomplish whatever we want. We don’t want anything handed to us; we just want an opportunity to work with our hands and pull ourselves out of the situation we are in.” This is the essence of the self-help movement.

As I look back upon that experience today, I realize how fortunate I was to have been part of it. Seeing families working together and then gathering with them at their move-in ceremony are highlights. Getting to know and work with the many fine people at SHE, HAC and related endeavors have been my great privilege. May the work throughout this nation continue well into the future!

Bob Marshall became Executive Director of Self-Help Enterprises (SHE)in 1966, a position he held until 1990. Under his leadership, SHE became the largest mutual self-help housing organization in the nation. Marshall’s influence reached far beyond California’s San Joaquin Valley, and he was active in the growth of mutual self-help programs across rural America. He was a founder of the National Rural Self-Help Housing Association, a member of the Housing Assistance Council board of directors and a respected mentor and encouraging voice for rural housing. Bob and his wife Joy are still active in the community of Visalia, California.

This story appears in the 2015 Summer Edition of Rural Voices

by Suzy Huard

USDA’S Section 523 Technical Assistance Grants make Mutual Self-Help housing possible

Community Concepts, Inc. (CCI) based in South Paris, Maine, has been helping families reach their goal of homeownership through the Mutual Self-Help Housing program since 1993. To date, families have built 237 homes with six more under construction. An additional 35 families have purchased and rehabilitated homes through an innovative approach to the program. CCI’s Self-Help Housing program would not exist without the Section 523 Mutual Self-Help Technical Assistance Grant, commonly referred to as the Self-Help Grant program, funding provided by USDA Rural Development. This two-year grant allows organizations like CCI to provide homeownership opportunities to very low- and low-income families.

The Self-Help Grant program funding is critical in order to hire skilled employees, pay for office and administrative expenses, purchase tools for the families to use during construction, and pay for any training needed to assist the families such as construction and credit counseling.

The Self-Help grant funding can be used to recruit families to participate in the program. CCI does this through radio, newspaper articles, informational meetings, and social media. We have an agency website with a page devoted to the Self-Help program. Our web page includes information about our program, a link to our brochure, and coming soon, an electronically fillable pre-application. If the public does not know that the Self-Help program exists, then there is no program to help the families achieve homeownership.

CCI’s Self-Help Housing program would not exist without the Section 523 Mutual Self-Help Technical Assistance Grant

CCI assists families with obtaining long-term mortgage funding through USDA’s Rural Development agency. USDA Rural Development offers financing with interest rates as low as 1 percent for qualifying families and no down payment. CCI’s Self-Help Group Worker guides the families through the mortgage application process and works with families who need credit counseling.

Training is an important component of the self-help process. CCI used some of its Self-Help Grant program funds for homebuyer education certification training for our Group Worker. This allows the Group Worker to teach families about topics such as mortgages, credit, budgeting, membership agreement and teamwork. The Self-Help Manger and the Site Supervisor also provide pre-construction training about construction safety, basic construction skills, construction contracts, house plans and hands-on tool training. This training typically lasts about
10 weeks.

Other uses of the Section 523 grant funds include the purchase of the power tools used in the construction of the homes and vans to carry the tools between building sites.

After completion of the preconstruction training, the homeowners close on their USDA Rural Development-funded mortgages. The Self-Help Group Worker attends these closings with the families to help with any questions and to be a friendly face in a new situation. Rural Development sets up a supervised bank account to pay for construction materials and related costs. CCI’s Self-Help Bookkeeper assures that construction-related expenses are paid.

Families start construction together under the supervision of the Self-Help Construction Site Supervisor when the lot has been cleared and the foundation has been poured. The Site Supervisor is always on site with the families guiding them and teaching them skills as they go along through the construction process. The families and Site Supervisor work one night a week and both Saturday and Sunday, eight hours each day. The families work through all four seasons. They build through the hot and humid summers, the freezing blowing snow in the winter and everything else in between.

Each month the families meet at the CCI office with the Site Supervisor and the Self-Help Group Worker. They go over any issues that might arise, talk about their progress and what comes next. The Group Worker discusses homeownership issues, such as maintaining a septic system and other house maintenance.

Over the course of construction, the families fill out and sign their weekly time sheets. The Self-Help Bookkeeper keeps track of all the hours to assure that the families are getting their required hours in.

It takes about 10-12 months to complete the six homes. Once the construction is complete, the families, the Site Supervisor, Group Worker and Rural Development employee meet to conduct a final inspection of each individual home. The Rural Development employee completes the final inspection of the homes and the new homeowners receive the keys. There is usually a ceremony congratulating the families on their great accomplishment. The next group of six families also attends the ceremony and the “golden shovel” passes to them to start their journey through the Self-Help program.

The Self-Help Program would not be able to help the families it does without the Section 523 Mutual Self-Help Technical Assistance grant. The grant funding allows CCI to provide a valuable service at no cost to our families. With this funding CCI has a group of technically-educated self-help employees, such as the Group Worker, Bookkeeper, Site Supervisors and Program Manager.

Suzy Huard is the Housing Improvement Services Bookkeeper at Community Concepts, Inc. in South Paris, Maine. CCI offers a variety of housing, economic development and social services for Maine’s communities of Androscoggin and Oxford Counties. CCI’s self-help program also serves Franklin, Cumberland,and Kennebec counties. CCI’s services support both the basic needs of low-income families and promote self-sufficiency.