Charlotte Observer----
N.C. Commerce Secretary Keith Crisco said Tuesday the state will honor its commitment to provide $3.5 million in incentives to a nonprofit group that helps struggling homeowners, settling a mix-up that emerged last week.
Neighborhood Assistance Corporation of America (NACA) chief executive Bruce Marks also announced plans to double the number of workers he expects to hire in Charlotte to about 2,000 by the end of next year.
Marks met with Crisco in Charlotte to resolve a dispute over how much on-the-job training assistance Boston-based NACA was eligible for as it ramps up its work force. Marks said he didn't leverage the 1,000 extra jobs to get higher incentives, saying he sprang the news at the end of his meeting with Crisco, an account confirmed by state officials.
Crisco called Marks' additional hiring plans “wonderful news” and an affirmation that the incentives were a good investment. “There will be a great return on that investment,” he said.
The hiring gives a boost to Charlotte's beleaguered financial sector and highlights a continued growth spurt for NACA. The nonprofit, founded in 1988, helps low-income homeowners prevent foreclosures and get new loans.
The $3.5 million incentives package is far higher than what the Commerce Department announced June 11, when it issued a news release saying the nonprofit could receive $1 million over five years from the One North Carolina Fund. That's a program controlled by the governor that requires companies to meet certain job creation requirements before receiving any money. That grant was “contingent upon local matches,” the news release said without providing any dollar amount.
The local match turned out to be on-the-job training assistance, which subsidizes the wages of unemployed workers hired by companies during a training period. The program is administered here by the Charlotte-Mecklenburg Workforce Development Board, but the money comes from the federal government through the state. In this case, the state could pay NACA $2,560 per eligible worker – half of their average $16-per-hour wage over two months.
The Observer reported last week that the state had promised NACA a total of $2.5 million in on-the-job training assistance in June, but last week officials said $1 million was the appropriate amount. At the time, Crisco said he had mistakenly extrapolated an early estimate of the grant amount.
On Tuesday, Crisco said the mechanics for the grant were still being worked out last week. At the time, the state didn't have the funding figured out, but now it does, he said. “We live up to our word,” he said.
NACA still needs to finalize details with the Charlotte-Mecklenburg work force board, but Crisco said he expects the group to qualify for the $2.5 million over three years. “Everything is great,” Marks said of the talks with the state.
NACA is growing as the nation struggles with a rise in Foreclosures following the subprime boom in the 1990s and early this decade that left homeowners with unaffordable mortgages. In the recession, homeowners are also struggling with job losses.
According to a 2007 filing with the IRS, NACA had revenues of about $9.4 million, and expenses of $6.7 million. Now Marks says the group has a budget of around $45 million, which includes government funding for its counseling.
The nonprofit has about 1,100 workers nationwide, with about half of those in Charlotte. Marks said the nonprofit has added about 450 workers here since it announced in June plans to hire 1,014 here over the next five years. He now expects to reach that total by the end of this year. Marks said the newly announced 1,000 could be on board by the end of 2010.
Many of the Charlotte workers are helping with NACA's “Save the Dream” tour, where homeowners can get loans modified at events around the country in one stop. As the tour heads to New York and the West Coast, NACA needs at least another 150 workers in coming weeks, Marks said. Prospective employees should apply at www.naca.com.
His goal is to have employees on the road with the tour for a month at a time before being relieved by another wave. So far, NACA says about 180,000 homeowners have come to events and thousands have had their loans modified.
The hiring binge comes as Charlotte's big banks and other mortgage lenders have been laying off workers. The Charlotte area had about 56,300 finance and insurance workers in July, down 2,800 from December but up 1,200 from April, according to Labor Department statistics.
NACA said in June that its new hires would make about $36,000 annually. The average wage for a finance and insurance worker in Mecklenburg County in 2008 was $100,169.
Marks acknowledged the foreclosure boom won't continue forever, but he said NACA can sustain the added 2,000 positions in Charlotte by transitioning workers to its home-purchase lending business, which offers borrowers low-interest, no down-payment loans. That business declined when subprime lenders offered low teaser rates, but he still has commitments from major banks to fund new loans, he said.
“We've always been conservative in our estimates for the project,” Marks said. “We definitely have exceeded them.”
Davetta Davis is one of the new hires. She joined NACA in July as she faced the loss of a teaching job. She has already counseled borrowers at a Save the Dream event in Atlanta, where she said the work included a lot of crying with struggling homeowners and long hours.
“It's well worth it,” she said, “when you know someone saved their home.”
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Sources: NACA, Charlotte Observer, Red Tape Chronicles, MSNBC, Washington Post, Huffington Post, Newsweek, AJC.com, Google Maps
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