Home-buying program continues

Smart Keys is latest form of grant initiative to help employees live near where they work

A popular state home-buying assistance program that critics complained contributes to suburban sprawl has been renamed and retooled to encourage home shoppers to live closer to where they work.

Smart Keys for Employees is the latest name for the on-again, off-again purchasing assistance program offered in a variety of forms for much of the past 10 years by the Maryland Department of Housing and Community Development.

Unveiled with little fanfare in April, the program offers qualifying home buyers grants of up to $5,000 to help pay settlement costs, if their new residence is within 10 miles of their workplace, or in the same county or municipality.

"It's a good program, and it's working well," said William Ariano Jr., deputy director of community development in the state housing department.

Smart Keys replaced a similar program called Live Near Your Work Plus. Begun last year by the Ehrlich administration, that program drew fire from growth-management advocates because the state aid was available on any existing home within 25 miles of the buyer's workplace.

The Ehrlich administration version offered qualifying buyers grants worth up to 3 percent of their mortgage to help cover closing costs.

That aid proved popular even as the housing market began to slump last year, since the fees and taxes required to purchase a home in Maryland are among the highest in the country.

But growth-management advocates and legislators complained that the 25-mile commute allowed under the Ehrlich program undercut the spirit of the state's Smart Growth policy.

The state began offering aid to home buyers based on where they work a decade ago under Gov. Parris N. Glendening. That program, simply dubbed Live Near Your Work, was part of the Smart Growth policy that Glendening crafted to guide Maryland's development. Under it, nearly 1,000 buyers got grants of up to $3,000 when buying homes in neighborhoods targeted for revitalization.

Ehrlich administration officials defended their more expansive approach, arguing it was intended to help suburban and even rural buyers, and not just the Baltimore City residents, who got the lion's share of the aid under Glendening.

The O'Malley administration's approach reins in the distance a buyer may live from work, but remains more liberal than the original aid program. Ariano said the new program attempts to be faithful to the Smart Growth policy of encouraging more compact development while also being relatively simple to follow.

"How do you incentivize somebody who is working in Salisbury to live where they work?" Ariano asked, "Because it's difficult in some cases to find housing in the immediate area."

Still, the housing official acknowledged that some counties are so large that the allowed commute can exceed 10 miles.

"It can be appreciable," Ariano said, "certainly [for] somebody that works in Dundalk, if they're buying a house up in Maryland Line."

Smart Keys is actually an add-on to another state home-buying assistance program, called House Keys for Employees. That initiative offers to match grants of up to $5,000 that buyers of affordable housing may receive from participating employers.

To get the additional $5,000 grants under Smart Keys, the home being bought must be in a designated growth zone called a "priority funding area." For more information on that and other state housing assistance programs, go to www.morehouse 4less.com.

The Smart Keys program has helped buyers of 60 homes so far, three-fourths of them in Baltimore, according to state figures. Buyers of those homes received a total of $409,000 in state aid, including other loans and grants.

The latest iteration of the home-buying aid program drew a lukewarm reaction from an outspoken critic of the previous effort.

"It's not quite as direct as 'Live Near Your Work,'" said Dru Schmidt-Perkins, executive director of 1000 Friends of Maryland, a growth-management advocacy group. "I'm not entirely excited about that."

But Ariano defended the name change, while acknowledging that the O'Malley administration wanted to put its own stamp on the program

"Another reason, frankly was just marketing," he said.

"You can have the greatest thing in the world, but unless you have something with a little sizzle to it, it won't take off." (By Timothy B. Wheeler |Baltimore Sun)