Lawmakers hope bills ease stresses on workforce
Quality housing seen as part of path to solution
As employers struggle to find enough workers, many companies, municipalities and economic development organizations are focusing on recruiting employees from outside the state and keeping workers in Wisconsin.
But as they seek to fill open jobs and build the state’s workforce, communities often lack a key recruitment tool: quality housing that workers can afford. In an effort to combat the issue, Wisconsin Republicans are sponsoring a package of bills aimed at making workforce housing easier and cheaper to build across the state.
Workforce housing is defined as housing that is affordable to households earning between 60% and 120% of an area’s median income. It targets middle-income employees, those who often work in fields such as law enforcement, manufacturing, education, health care and retail.
“There’s a worker shortage in many of our communities and businesses are trying to attract people to their communities; they’re trying to find more workers,” said Rep. Dave Murphy, R-Greenville, who cosponsored many of the bills. “And many times, it comes back to the fact that there’s not enough moderately priced housing. So we’re trying to help increase the stock of homes that would fit into the budget of the average workforce.”
The package of bills was approved by the state Assembly in October and was sent to the Senate, which has not yet taken up the measures. The Senate will reconvene for its next session on Jan. 18.
Their sponsors say the bills look to encourage development of new workforce housing by lowering costs, making it easier to build, and reducing government red tape by:
Creating a $42 million per year workforce housing income tax credit for multi-family housing projects.
Creating a certified workforce housing development site program that would pre-qualify properties for residential development that have a clean title, proper zoning, adequate utilities and infrastructure and no wetlands, and that the developer can attest to limited per-unit development fees and that all required permits can be in place within 60 days of certification.
Requiring larger municipalities to use a portion of their federal pandemic relief funds on one of the following workforce housing projects: new infrastructure, such as streets, sewer,
water and sidewalks; establishing a low-interest or no-interest loan program for rehabilitating older workforce housing; establishing a low-interest or no-interest loan program for building new workforce housing; redeveloping idle commercial property sites of at least 40,000 square feet to workforce housing.
Creating a sales tax exemption for materials used to build workforce housing developments or to conduct workforce housing rehabilitation projects.
Creating a low-interest or no-interest loan program for homeowners to pay for structural improvements or the removal of lead paint from homes built before 1980.
Allowing local governments to create housing investment fund programs that would use increased property tax revenue from new housing developments to help fund additional workforce housing.
The majority of the bills were passed by the Assembly by unanimous consent, although lawmakers split along party lines on one bill, Assembly Bill 605, which requires municipalities to use a portion of their federal pandemic relief dollars to help fund housing development.
In an emailed statement, Assembly Minority Leader Gordon Hintz, D-Oshkosh, said the bills do not adequately address the state’s housing challenges and could in some instances make the problem worse.
“Governor Evers’ original budget proposed $70 million to fight homelessness, including $50 million for grants for municipalities to offer affordable housing, and I was deeply disappointed when Republicans voted to cut these funds,” Hintz said in the statement.
However Republican Rep. Rob Summerfield, who spearheaded the package, said the bills look at the housing issue from a “holistic approach.”
“We knew from the get-go you’re not gonna be able to pass one bill to take care of this issue,” Summerfield said. “You’re not gonna have a silver bullet saying, ‘we do this one thing and all our problems are alleviated.’ This is where talking to the industry, talking to community groups, talking to everybody who’s got a stake in this and taking their idea, saying, ‘we can do a little here, a little here, a little there.’ And after a while, you start to get a bigger stack of bills that hopefully will make a difference in in this issue.”
Rep. David Armstrong, R-Rice Lake, who authored several of the bills, also works as the executive director of the Barron County Economic Development Corp. He said he’s seen firsthand how businesses struggle to find employees,
“We knew from the get-go you’re not gonna be able to pass one bill to take care of this issue. You’re not gonna have a silver bullet saying, ‘we do this one thing and all our problems are alleviated.’” GOP Rep. Rob Summerfield
which “goes hand-in-hand with the housing shortage.”
Armstrong sees the bills as the state Legislature’s way of giving municipalities tools they need to help developers build in their communities, he said.
What many of the bills aim to do is cut down on government regulations that drive up the cost of housing. According to a 2021 study from the National Association of Homebuilders, government regulations account for nearly 24% of the current average sales price ($397,300) of a new single-family home.
“As a government, we can’t affect supply and demand, we can’t affect supply chain really, but what we can affect is the cost of what government does and how it impacts the cost of housing,” said Assembly Majority Leader Jim Steinke, R-Kaukauna.
The Wisconsin Economic Development Association, a statewide trade association for economic development professionals, supports several of the bills included in the package.
“I think they certainly can have a significant impact on making Wisconsin a more desirable place to live,” said Michael Welsh, WEDA’s vice president of legislative affairs. “I think it’s good public public policy.”
If thr bills are passed into law, the average Wisconsinite likely won’t notice any immediate impacts, Welsh said. But over time, these bills could help small businesses thrive through employee retention and attraction, grow communities and increase tax bases.
“This is part of an overall effort to address Wisconsin’s workforce shortage crisis,” Welsh said. “And I think that no one can deny that we’re experiencing that. I don’t think we’re unique in Wisconsin. I think other states are also feeling that pinch. But I think these bills represent an effort to address some of the underlying issues that, that speak to our our workforce shortage. Hopefully, in the new year, there’ll be some action in the Senate and get these bills to the governor’s desk.”
The bills face an uphill battle in the Senate, as numerous Republcan senators have concerns, according to a WEDA news release.