Poverty is not always defined by homelessness or unemployment –– sometimes, poverty is defined by the mental and physical stress of living paycheck to paycheck, or living in constant fear that one outlier or an incident will send a family’s budget into financial turmoil. The non-profit organization Frey Foundation
refers to this group of people as the ALICE population: Asset-Limited, Income Constrained, Employed.
“...our ALICE population, which makes up almost 30 percent of our population in Grand Rapids, are really our lowest paid workers,” says Frey Foundation President Holly Johnson. “So these are people who are employed, they’re working, they’re supporting their families –– they’re just not making enough money to really live well in our community. They’re above the poverty level, so that also means that they aren’t able to get a lot of public assistance. They’re above that national poverty level ratio, so they’re really the ones that are struggling.”
As a continuation of the foundation’s efforts to assist this population, they awarded the $150,000 Housing Innovation Award to the Inner City Christian Federation (ICCF)
in late November to push forward the agenda of affordable housing. The ICCF will use a Community Homes Land Trust model, allowing qualified applicants to purchase homes sold to them at below-market prices, as opposed to buying directly from the open market. Additionally, the structure will preserve housing affordability for future years, rather than skyrocketing with the growth of the economy.
“I think we initially see it as a good thing when the cost of housing goes up because it indicates economic growth, but when wages don’t keep up with the cost of housing, we get a wider and wider gap of people who are unable to afford [housing],” Johnson says.
“We think that people shouldn’t pay more than 30 to 35 percent of their annual gross income in housing expenses, so when that starts creeping up to 40 or 50 or 60 percent of your gross pay, it starts to make every other aspect of your life go out of whack. You’re not able to pay for health care, pay for education, pay for transportation, and all those other things that we have to do.”
Johnson notes that “This is the long game,” that this is an issue requiring more than grant-making, and instead, requires all the moving parts of the city government implementing policy change and higher working wages, and philanthropists who support these causes.
As a result, the ICCF was the chosen as the recipient of the grant, based on the organization’s approach to this issue and, drawing from previous work they have carried out, their capacity to achieve what goals they have in store.
Images courtesy of the Frey Foundation.