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Addressing Housing Affordability in Wisconsin

Initiatives in eastern Wisconsin help to provide workforce housing

By Hannah Flanders

In July 2023, Governor Tony Evers signed into law Wisconsin’s largest ever investment into affordable housing. The historic $525 million investment helps to bolster the state’s affordable housing initiatives and establish loan programs that aid builders and developers to expand infrastructure, spur new construction, and prompt existing home improvements.

Already, bankers across the state are committed to fostering strong communities. With Wisconsin’s recent legislation, opportunities to support unique initiatives and help ensure equitable access to housing have only expanded. Housing supply and affordability have long been a concern across the state. While rental prices and the median cost of homes steadily rise, inventory continues to be a major issue. Throughout Q3 2023, Wisconsin hovered around only 7,600 active listings. As individuals and families in Wisconsin struggle to afford what limited property is available, many — including bankers — are concerned about the impact the housing market will have on Wisconsin’s workforce.

Supporting Housing Initiatives

In a report published by Forward Analytics in September 2022, it is estimated that 130,000 individuals representing the state’s working population will leave Wisconsin by 2030. Aiding in expanding affordable housing programs across Wisconsin is not only a significant way for banks to demonstrate their commitment to their communities; banks play a critical role in stabilizing communities, attracting and retaining talent, fostering economic growth, and helping local families to begin building their generational wealth.

Workforce housing, as defined by the Wisconsin Legislative Council, is housing that requires households to spend no more than 30% of 140% of the local area’s median income. These homes are intended for individuals or families whose household earnings do not surpass 140% of the area’s median income.

Already, several banks — including Cleveland State Bank, Collins State Bank, Oostburg State Bank, and Waldo State Bank — have partnered with the Sheboygan County Economic Development Corporation (SCEDC) to aid in actualizing the Forward Fund, a three-phase workforce housing project aiming to establish 600 entry-level homes in the county.

The Forward Fund was initially a $10 million investment in workforce housing spearheaded by Johnsonville LLC, Kohler Co., Masters Gallery Foods Inc., Sargento Foods Inc., and Sheboygan County. Working alongside the partnering Wisconsin-chartered banks in the area, developers are ensuring its future residents are able to access mortgages and loans that allow families to take the first step toward owning a home in Sheboygan County.

“It was in the best interest of our communities that we worked together,” notes Ben Becker, president of Collins State Bank, on the collaboration with Cleveland State Bank, Oostburg State Bank, and Waldo State Bank. “When people spend less on housing, they have more disposable income to spend on other goods and services, which can stimulate the local economies. When our community benefits, we benefit.”

With construction underway, the first project — Founders’ Pointe in Sheboygan Falls — is expected to be completed by the end of 2024 and feature 54 single-family units available for under $250,000.

“Upon completion of the project, there will be opportunities for permanent financing, and other financial institutions could get involved,” says Becker. “Several other communities are currently exploring similar projects for affordable housing, which will create additional opportunities for involvement throughout Wisconsin.”

In Washington County, leaders, employers, and workers have also expressed concern over the state of the county’s quality and stock of houses. As such, the Washington County Community Development Department established the Next Generation Housing Initiative in 2021.

With a mission to bring 1,000 new owner-occupied housing units under $420,000 by 2032, the initiative has already broken ground on two pilot developments — The Oaks of Jackson subdivision and lots 67–73 in the Skyway Park subdivision (Hartford). Between the two developments, the initiative will make 108 single- and mixed-family homes available to area residents.

Brian Heckendorf, senior vice president – director of community banking at Westbury Bank and village president of Jackson, Wisconsin, has a hand in the project not just from a banking standpoint, but as a community leader as well.

“I see this development helping various demographics from first-time homebuyers all the way to empty nesters that are looking to downsize,” Heckendorf notes. “This housing initiative will also help our local businesses fill their staffing needs better by keeping more people working and living in Washington County.”

Through Westbury Bank’s involvement in the program, several bankers helped to provide expertise as the County worked to establish guidelines for the initiative. “Working alongside a team of realtors, lenders, title companies, attorneys, and Washington County employees, our goal is to ensure that new homeowners looking to buy are able to obtain conventional loans,” adds Heckendorf.

In addition to the Forward Fund and Next Generation Housing Initiative, the Northeastern Wisconsin Housing Community Development Block Grant (CDBG) Loan Program helps to address the affordable housing as well as community and economic development needs of non-urban areas of Brown, Calumet, Door, Fond du Lac, Kewaunee, Manitowoc, Marinette, Outagamie, Sheboygan, and Winnebago counties.

Since 2014, the state CDBG-funded program has been administered by Brown County in order to provide 0% deferred loan payment housing rehabilitation loans to low- and moderate- income (LMI) owner-occupied households and small-scale neighborhood-oriented public facilities improvements, among other activities, to residents. Larger cities, including Appleton, Fond du Lac, and Sheboygan, receive CDBG funds directly from the U.S. Department of Housing and Urban Development (HUD).

Housing Provisions

While several preexisting initiatives continue to make investments in affordable housing across the state, Wisconsin’s 2023–2025 state budget also included several supplemental items in support of local workers, families, and communities that are predicted to make a historic impact across the state.

In the spring of 2023, the Workforce Housing Package was first introduced by Assembly Housing Chair Robert Brooks (R–Saukville) and Senate Housing Chair Romaine Quinn (R–Cameron) after a year of discussions between a coalition made up of the League of Wisconsin Municipalities, Wisconsin Builders Association, Wisconsin Counties Association, Wisconsin Housing and Economic Development Authority (WHEDA), Wisconsin REALTORS® Association, and Wisconsin Towns Association. The package garnered bipartisan support in both the State Assembly and Senate before being signed into law. The programs then received funding as part of the 2023– 2025 state budget.

“With this package, the coalition was most concerned with spurring the development of workforce housing,” notes Brad Boycks, executive director of the Wisconsin Builders Association. “The first step in making housing in Wisconsin more accessible is providing developers with the resources to both build and remodel single- and multifamily homes.”

The 2023 Wisconsin Housing Package encompasses the following five laws:

  • Act 14: Residential Housing Infrastructure Loan Fund

Creates a residential housing infrastructure revolving loan fund and loan fund program. Both programs are administered by WHEDA and awarded to developers for the purpose of workforce or senior housing. Loans may also be awarded to the governmental unit having jurisdiction over the development.

  • Act 15: Main Street Housing Rehabilitation Loan Fund

Creates a main street housing rehabilitation revolving loan fund and loan fund program. Both programs are administered by WHEDA and awarded to the owner of single-family or multifamily rental housing for the purpose of housing rehabilitation.

  • Act 16: Local Regulation of Property Development

Addresses the judicial review of local residential development decisions; approval of permits for residential housing developments; the procedure for amending a zoning ordinance; appeal of county conditional use permit decisions; and planned development district zoning.

  • Act 17: Workforce Housing Rehabilitation Loan Program

Modifies certain parameters of the workforce housing rehabilitation loan program to expand upon the specifics — including type of rehabilitation and type of home — that are eligible for a loan. Additionally, the Act allows WHEDA to establish an interest rate (at or below market rate) for a workforce housing rehabilitation loan.

  • Act 18: Commercial-to-Housing Conversion Loan Fund

Creates a commercial-to-housing conversion revolving loan fund and loan fund program. Both programs are administered by WHEDA and awarded to the developer to cover construction costs for the conversion of a vacant commercial building to a new residential housing development that consists of workforce or senior housing.

For bankers, the 2023 Wisconsin Housing Package encourages banks to foster partnerships with WHEDA that significantly enhance the banks’ ability to assist customers in accessing these housing programs tailored to their specific needs. This collaboration not only helps banks to extend their traditional financial services by ensuring their customers are aware of the resources available to them, but bankers are also able to understand the nuances of each program and guide their customers effectively.

“While the loans provided by WHEDA are not meant to be the primary source of funding, it is important for bankers to know and understand what is included in the 2023 Housing Package in order to share the affordable opportunities with their customers,” notes Tom Larson, president and CEO of the Wisconsin REALTORS® Association. “By bridging financial gaps and offering support beyond conventional services, banks reinforce their dedication to the well-being of their customers and the communities they serve.”

Taking the Lead

As initiatives and opportunities for affordable housing emerge across the state, bankers have the unique opportunity to invest in their existing and future neighbors.

“In the last several years, many of us have experienced a very tight workforce environment while housing costs, whether renting or owning, continued to increase significantly,” says Becker. “Affordable housing directly contributes to the overall well-being and prosperity of a community, and we, as community bankers, have the opportunity and responsibility to support strategies that align with our mission to serve the needs of our communities.”

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Grow and Thrive… Expanding Your Opportunities

Make the most of your WBA membership

By Daryll Lund

For 130 years, the Wisconsin Bankers Association (WBA) has strived to offer member banks expansive opportunities to grow and thrive within our industry. In being a member-led organization, the WBA highly encourages bankers of all levels to engage with educational and advocacy-related events, programs, and groups.

As part of its mission to support every member, WBA annually offers hundreds of educational opportunities — from one-hour webinars to five-day schools. While the main objective of all WBA programming is of course professional development, one significant benefit many of us have sincerely missed over the last several years is our ability to connect with one another.

The team at WBA regularly expresses to me how special it is to witness our member bankers — there are over 35,000 of them — meet and foster connections through WBA conferences, outings, and groups. As events continually return in person, I am excited to serve witness once again to the all the new ideas created and connections formed as many Wisconsin bankers reconvene for the first time since the onset of the pandemic.

Since WBA’s inception, the development — both professionally and personally — of bankers has been a focal point in our mission to support Wisconsin’s banking industry.

In addition to the training and educational programs WBA offers throughout the year, there are many other volunteer opportunities that individual bankers of all levels may engage in.

These opportunities not only allow for bankers to gain further insight into a specific area of the bank from their peers but encourage them to ask questions and assist WBA staff members in creating meaningful and relevant programs, resources, and content for other bankers throughout the state. Volunteering as a WBA Advocacy Officer, attending the Building Our Leaders of Tomorrow (BOLT) Summit, or engaging with one of WBA’s Connect Peer Groups — to name just a few of the opportunities WBA offers to members — allows bankers the ability to make their voices heard throughout the industry.

As your bank looks ahead to all the programs, classes, and events that WBA will be hosting for the remainder of the year, we look forward to welcoming many of you back in person as well as assisting you and your teams in enhancing your connections to your industry and peers across the state.

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BankWork$ Turns Passions into Careers

A Graduate Profile of Tionne Riley, Bank Five Nine
By Hannah Flanders

Tionne Riley leads life with ambition for anything she sets her mind to. A former customer service representative at a local grocery store, Riley was ready for a change. When her stepmother gave her a Wisconsin Department of Workforce Development flyer for BankWork$, it was meant to be.

Riley graduated from Primavera Online High School with a passion for math, networking, and finances but wasn’t entirely sure where her path would take her. However, her dedication and persistence allowed her to develop even more skills, such as customer service and cash handling, that would make her the ideal candidate for the BankWork$ program and ultimately a career in retail banking.

After completing two interviews and allowing program directors to get to know her, she was accepted to participate in the eight-week program which covered topics ranging from customer relationships and the fundamentals of finances to preparing for employment. Riley described the program as “extremely hands–on” and the small class sizes allowed for one-on-one learning within a team-oriented environment.

“I was looking for a career rather than a job” said Riley, who graduated from BankWork$ in June 2021. After the graduation ceremony, a hiring event is held for banks to connect with qualified talent. “We have been incredibly impressed with the program, its leaders, its instructors, and of course, the students!” said Ann Knutson, senior vice president, human resources director at Bank Five Nine. At this event, Riley was recruited by Bank Five Nine’s Brookfield branch as a universal banker. With her interests in finance and service to her community, she was a wonderful fit for their team.

“Tionne has been a great addition to the team,” said Bank Five Nine branch manager Michelle Kurth. “I feel the BankWork$ program has allowed her to adapt very quickly to her surroundings, which allows her to accurately process her transactions, assist our customers in a professional convenient manner, and even assist her peers!”

“Bank Five Nine has been involved with the BankWork$ program since its inception in 2018,” told Knutson. Alongside fellow advisory committee members from around the U.S., Knutson has been able to offer guidance and input into the program and offerings at BankWork$ to help create graduates that are ready to succeed at any bank.

Riley spoke of both BankWork$ and Bank Five Nine with pride, “Everybody here wants to see you win.” She has gained mentors throughout the industry, even in a short time, and has enjoyed working with like-minded, focused individuals who encourage her to consider the possibilities of her future in banking.

Riley perfectly exemplifies quality talent that needed the right opportunity, as offered by BankWork$ and Bank Five Nine, to help turn their interests into something more. “Completing the BankWork$ program really gave [Tionne] a sense of pride and accomplishment in a work environment that maybe she would not have otherwise explored or realized she would be successful in,” said Kurth. For banks looking to recruit talented, young individuals to join their organizations or even those looking into connecting with BankWork$, Riley offered some words of advice from her experience in completing the interview process.

“My advice for banks would be to make sure the people you hire are dedicated,” she said. “This job is not for everyone, and we are changing people’s lives, make sure you have a team to execute the goals of the industry.”

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Employee Engagement: Tangible Benefits and Best Practices From Banks Who Are Doing It Best

undefinedAccording to 2017 research from Dale Carnegie, two-thirds of American employees are not fully engaged at work. In addition, after internal meta-analysis of their employee engagement surveys of hundreds of companies (both large and small), Gallup reported recently that "business or work units that score in the top quartile of their organization in employee engagement have nearly double the odds of success… when compared with those in the bottom quartile. Those at the 99th percentile have four times the success rate of those in the first percentile."

Setting an Example: The Best Banks to Work For
The WBA member banks interviewed for this article each were named to the most recent American Bankers Association list of Best Banks to Work for. Congratulations to these institutions for going above and beyond in demonstrating the power of employee engagement. 

What does that research mean for Wisconsin banks? Dedicating energy, time, and resources to improving employee engagement will yield dividends. Banks who make engagement a priority will enjoy a competitive advantage over not only other financial institutions but also other employers with whom they compete for top talent. In order to achieve that advantage, however, bank leadership need to understand what "engagement" truly means. "Engagement isn't about being happy and satisfied at work. You can be happy and satisfied and still coasting," explained Dave Furlan, senior HR business partner at The Payroll Company (TPC) HR. "It's about making sure employees are invested in the company's mission and success." 

Benefits of Engagement

The advantage companies with more engaged employees enjoy over their competitors surfaces in three main areas: customer service, productivity, and talent management. "Community banking is all about taking care of our customers and being responsive, and that starts with being engaged," said Mike Molepske, CEO at Bank First, Manitowoc. "We can't deliver good customer service unless we have an engaged workforce." Ann Knutson, HR director at First Bank Financial Centre, Oconomowoc stressed the importance of considering the employee experience just as much as the customer experience. "A positive employee experience will translate to a positive customer experience and higher levels of customer satisfaction," she explained. This concept also applies to internal customers. "When you have engaged employees, they're always thinking about the betterment of the customer and their peers," said Dennis Vogel, president and CEO at Citizens State Bank of La Crosse. Employees who are invested in the bank's success also tend to be advocates for the bank by serving the community. "We're being successful at engaging employees, customers, and communities," said Bill Sennholz, president/CEO at Forward Bank, Marshfield. "We've had multiple communities ask us to open locations in their area because they see what we're doing."

When it comes to productivity, numerous studies and countless hours of research have proven the positive impact of engaged employees. "The productivity of the organization improves and will be at a high level when you have people who believe in your company," said David Fritz, managing partner at Executive Benefits Network (EBN). "Engaged employees can more easily help push the organization's agenda forward." Understanding what the bank's goals are helps employees understand how their work affects the outcome, which leads to higher productivity. "Invested employees really care about what they do and have higher levels of productivity," said Knutson. "They become ambassadors for your organization, whether it's referring others to bank with you or work for you." 

Which leads to the final key advantage of employee engagement: "It's easier to recruit when you have an engaged and supportive workforce," said Fritz. "When you're trying to recruit younger employees to an organization, they're looking for culture and a sense of fulfillment as much as compensation. An engaged employee culture will be easier to recruit to." When engagement becomes ingrained at the cultural level, it shrinks some of the recruitment hurdles businesses face in tight labor markets. "When I started here 14 years ago, I told the employees I wanted to make this place the envy of all other places in town to work," said Sennholz. "When it comes time to go out into the market and find skilled employees, our reputation precedes us. In the end, it's paid dividends as we compete for employees in the marketplace."

Getting Started

With all the significant benefits of an engaged workforce, why do so few companies make it a priority? Simply, because it is a difficult challenge to create and sustain high levels of employee engagement. "It can be a painful process for management to go through because they'll find out where their warts are in some cases," Fritz explained. For bank leaders who are up for the challenge, the first step is to collect direct input from employees. One of the most popular tools for accomplishing this is employee surveys, which can take a lot of work, but are worth it for the insight they provide. "You need objective data to work with, rather than guessing," Furlan explained. "You can do it through large consulting firms or create your own, but you need a baseline."

Next, diagnose any issues raised by the employee input and then classifying them. "Identify which issues are fixable and which are non-negotiable," Fritz recommended. In a banking context, examples of non-negotiable pain-points could be compliance-driven processes or certain response time requirements. It is imperative to follow this step with clear communication about what can't be changed and why. "For issues that non-negotiable, leadership need to communicate passionately and honestly why that is the case," Fritz advised. 

Finally, implement what changes you can based on employee feedback, and ensure that those changes penetrate the entire organization. "It's not just the relationship managers and CSRs," said Molepske. "It's also the operations folks. We all have customers, whether they're internal or external, and we need to make their experience as positive as it can be." For example, Vogel says that everyone at the bank goes through sales training as part of their development. "It doesn't matter if you're in IT or operations, you're part of the customer experience," he explained.

Incentivizing Engagement
Consider one of the following rewards/incentives recommended or utilized by the experts interview for this article:

  • Enhanced onboarding process: make sure all new employees feel welcomed
  • Paid time for volunteering/flexibility to leave and volunteer during work hours 
  • Different options for on-the-spot awards with the same perceived value
  • Bank-wide award for engagement presented at the annual meeting
  • Bring in real baristas to make specialty coffees and beverages for staff
  • Hand employees physical "thank you" cards for jobs well done.

Best Practices

While employee engagement will look different at each bank—varying by factors including strategic goals, geographic market, and size—there are four common engagement practices that are effective for most organizations: regular feedback and recognition, education and development, diversity, and communication. 

Feedback and Recognition
"Recognition is a huge part of employee engagement," said Knutson. "It's become part of our culture at the bank to say, 'thank you.'" In fact, First Bank Financial Centre recently created and launched a peer-to-peer recognition program to complement their existing executive- or manager-to-employee programs. Regular performance feedback also helps foster employee interaction and confidence. "When people don't get that feedback, they start to get more insular and don't interact as well with others because they don't know if they're doing a good job," Furlan explained.

Education and Development
"If you can help people grow, they will provide excellent customer service," said Molepske. Building a culture that supports employee growth and development requires investment, but yields invested employees. "We have a culture surrounding learning and development," said Knutson. "We find that we've been able to increase engagement because of that." Furlan advises looking beyond training to overall education for employees. "We spend most of our waking hours during the week at work, so employers can teach their employees how to be healthier, for example," he said. Another example, and one that is growing in popularity, is financial wellness. "When workers are stressed about their finances and we can teach them strategies to deal with that, they're able to be less distracted at work," said Furlan.

Diversity
"Diversity plays a big role in engagement," said Molepske. "We pride ourselves on having age diversity, and it's also having people who think differently or have different geographic backgrounds. Whenever you can put differences together, they're more engaged and they perform better." A diverse group of employees will also respond differently to engagement incentives. "We've definitely tried to come up with engagement strategies that will impact employees at various stages in their career," said Gwen Schnitzler, HR director at Forward Bank. "The things that motivate new college graduates are very different from motivations for someone who is approaching retirement." Vogel says Citizens State Bank utilizes a combination of tailored and universal incentives, guided by a software program that helps managers identify what motivates each employee. 

Communication 
Sennholz says Forward Bank focuses on having strong internal communication practices. "Part of our marketing team's job is internal marketing, so employees know how important their position is and their impact on the community," he explained. As with most communication, these internal practices must be ongoing in order to be effective. "Engagement is part of our discussion from day one, and it's part of our monthly coaching sessions," said Vogel. "We define what 'engaged' means." They even print it on the bank's mousepads to keep it top-of-mind for all staff.

Ultimately, building employee engagement is about fostering a sense of ownership among employees. When bank employees understand how their actions and work impact the institution as a whole, it's more likely they will become invested in the bank's success. "Engaged employees go the extra mile for customers without being asked because they see engagement as ownership," explained Jennifer Sobotta, VP marketing director at Forward Bank. "The ownership and responsibility they provide our customers cannot be replicated by others."

Executive Benefits Network (EBN) is a WBA Bronze Associate Member.
The Payroll Company (TPC) is a WBA Bronze Associate Member.

 

By, Amber Seitz

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