Tony Overman/The Olympian
In order to save money to pay for her home, single mother Diana Olegre rides a bicycle to her job with the state of Washington.

Study suggests housing plight for many low-income workers

MICHAEL BURNHAM, THE OLYMPIAN

Originally published October 15

OLYMPIA -- Washington families must earn $29,117 annually -- more than twice the minimum wage -- to afford rent on a two-bedroom apartment, a new study by a national affordable housing advocacy group contends.

The National Low Income Housing Coalition's report also indicates that the income needed to afford the two-bedroom unit grew about 11 percent during the past year.

The federal minimum wage of $5.15 per hour hasn't increased since September 1997. Washington's state-set minimum wage is $6.72, and it will increase to $6.90 on Jan. 1. Still, even with the state's higher rate, the housing cost is more than double what a minimum-wage job will bring in.

"Low-income workers in Thurston County are faced with an impossible task when they search for decent, affordable housing," said Monica Peabody of the Welfare Rights Organizing Coalition.

"The report suggests the need for increased housing assistance to minimum-wage workers and those with even lower incomes."

Diana Olegre didn't need a report to tell her that.

The single mother now rents a two-bedroom home for $625 per month.

She's a full-time college student, a state Department of Ecology intern and collects unemployment. But rent is still $9 a month more than her income. She has so far been able to offset the shortfall with her savings.

Money was just as tight when she wasn't in school and supported herself with restaurant and other service jobs.

"I knew I had to get back into school to be able to earn a living-wage job," Olegre said.

Wage gap

Thurston County was home to 27,254 renters in 2000, accord to Census data. County renters paid an average of $588 for an apartment in April 2001, according to Dupree+Scott Apartment Advisors, a Seattle-based consulting firm.

There were 21,924 Thurston County renters in 1990, when median rent was $382 per month.

Thurston County workers now earn an annual median household income of $52,214, compared with the state's median household income of $57,114, according to data provided by the Thurston Regional Planning Council.

There are a variety of factors behind the state's increase in rental prices, regional planners say.

"The major driver for the cost of housing is the level of income," TRPC Senior Planner Pete Swensson said.

When income goes up, so do housing prices. The same happens when the population increases.

"We've had higher incomes in Washington during the 1990s," said Swensson, noting the state's unprecedented technology boom. "That's not the case at the moment."

The county's population shot up more than 45,000 during the 1990s to about 207,000 people, according to Census data.

If there's a low vacancy rate and the demand is high, rent goes up, said city of Olympia Community Development Coordinator Ken Black.

And while the creation of state jobs has increased at a slower pace than other sectors during the past decade, traditionally low-paying service jobs have been among the fastest growing.

"We don't have an affordable housing crisis for the average income," Swensson said, "but we do for low-income people."

The housing coalition report also notes that 44 percent of Washington renters use more than 30 percent of their incomes for rent.

The Washington Low Income Housing Network's Jota Borgman points to a variety of ways to shrink the gap between wages and housing costs.

Minimum wage needs to increase to a level where those making the wage spend only 30 percent of their incomes on housing. Additionally, the state needs to increase its investment in low-interest and deferred loans for housing, Borgman said.

The state's housing trust fund allows nonprofit agencies to compete for the loans. The legislative appropriation for the 2001-03 cycle is $78 million.

Borgman said her housing network and others want the funding increased to $100 million during the next two-year funding cycle. The added money would pay for the preservation or creation of about 1,375 homes statewide, she estimates.

"Currently, the housing trust fund gets twice as many applicants than it can fund," Borgman said.

In addition to providing more housing funds, the state needs to make higher education more accessible to adults in minimum-wage jobs, Olegre said.

State tuition assistance is available to working parents receiving Temporary Assistance for Needy Families (TANF). Working parents with incomes below 175 percent of the federal poverty level qualify. To receive the tuition assistance, students need to work at least 20 hours a week.

A bill that would eliminate the work requirement for students died during the last legislative session. The bill needs to be given another look next year, Olegre said.

"Once you're into that first job," she said, "there's no time and energy to try to work toward a better job."

Michael Burnham covers Olympia for The Olympian. He can be reached at 360-704-6869.

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