Couple Copes With California Budget Crisis California's budget crisis has had an impact on funding for a program that helped low-income farmworkers become first-time homeowners. One couple's story underlines the difficulties the program has encountered.
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Couple Copes With California Budget Crisis

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Couple Copes With California Budget Crisis

Couple Copes With California Budget Crisis

Couple Copes With California Budget Crisis

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California's budget crisis has had an impact on funding for a program that helped low-income farmworkers become first-time homeowners. One couple's story underlines the difficulties the program has encountered.

MADELEINE BRAND, host:

Housing declines have contributed to massive budget shortfalls in the states, meaning a lot of services are being cut, including one in California meant to help low-income home buyers. Shia Levitt reports.

SHIA LEVITT: In a new subdivision in Fresno, California, Pedro Santiago Velasco(ph) and his wife, Elena, are putting tiles into the bathroom of their new home. They've spent the past nine months putting in 40 hours a week in sweat equity as part of a program for low-income farm workers to become first-time home buyers. Velasco often worked the night shift picking onions under a giant floodlight until 7 a.m.and then went straight to meet his wife for another four-hour shift at the construction site.

Mr. PEDRO SANTIAGO VELASCO: (Through Translator) It's been a big sacrifice, but it's what's going to give me a house. It's worth it. I have to do it.

LEVITT: The house is about a month from completion, and Velasco's teenage girls are already calling dibs on the room with more closet space. The family qualified for a special state loan to help buy the home, and that was to be the last step before they get the keys.

Mr. VELASCO: (Through Translator) I'm grateful the state wants to still help me with this loan because this program is the only way that owning a home could be within my reach.

LEVITT: But about two months ago, California ran out of the funds it uses for these loans. Tom Collishaw is vice president of Self-Help Enterprises, a non-profit organization that helps folks like Velasco navigate state money.

Mr. TOM COLLISHAW (Vice President, Self-Help Enterprises): We are very concerned that these families, after all of this hard work, will not be able to close their loans and move into their new homes when they're completed in about a month's time. They've been made a promise by the state of California, and right now, the state is reneging on that promise.

LEVITT: Standing inside one of the homes under construction, Collishaw says Velasco isn't the only person whose housing status hangs in the balance of California's budget crisis. Thousands of families are on the wait list for housing programs, he says, and many rental units are at risk of remaining vacant.

Mr. COLLISHAW: The number of affordable rental housing complexes also that are being built around the valley, where they are having similar difficulties drawing on promised state financing. And the problem there is that they can't let tenants in until they close on their final mortgages.

LEVITT: Collishaw says some apartments remain vacant because there's no money for water hookups. In one town, there's arsenic in the drinking water and no state dollars to clean it up. And it's not just water or housing projects. Across the state, people in education, scientific research and conservation have seen frozen funds for tens of thousands of dollars in back pay. Countless projects have been scaled back or halted all together, and now restarting them will end up costing even more.

David Crane is economic adviser to Governor Schwarzenegger. He says passing the budget is a great first step to getting some of that money flowing again. But beyond that, California is one of many states that may need some help solving budget woes.

Mr. DAVID CRANE (Economic Adviser, California): California has in common with all states the need for the federal government to take the lead in resurrecting our economy. And for our economy to be resurrected, we need two things: a lot of stimulus at the federal level and a stable financial system. We need both, and that can only be done by the federal government.

LEVITT: Crane says the feds should not simply stimulate the economy by digging holes and filling them up again. Instead, he says, what will help is a stimulus that produces long-term benefits, like slowing climate change, improving education, and increasing energy independence. That, he says, will help bring sustainable economic growth that will last long beyond the recession. For NPR News, I'm Shia Levitt.

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