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Two workers at Simpson Housing Services, a Minneapolis nonprofit on the front lines of the housing crisis, say their wages as case managers leave them struggling to afford rent and turning to second jobs, family and food banks to make ends meet.

"I would like people to know that the system intended to prevent and end homelessness does not receive enough funding to guarantee the housing stability of the people who work in this field full time," said Tom Vatterott, who earns about $45,000 at Simpson. "I'm advocating for change."

Vatterott's struggle is more evidence that Minnesota's affordable housing shortage is so dire it affects even middle-income workers. In May, the Legislature approved $1 billion and a new metro 0.25% sales tax for more affordable homes, but the fix will be neither easy nor quick.

"It is heartbreakingly ironic that folks who dedicate their career and life to helping people find stable, affordable housing cannot themselves find affordable housing," said Rep. Michael Howard, DFL-Richfield, who led the push for a record state investment in housing. "We have such a supply and demand gap."

In a statement, Christina Jacobson, Simpson's director of equity and human resources, said the organization has increased case manager pay 15% over the last two years and offers competitive benefits and generous paid time off. She acknowledged that funding for nonprofits is tight and that workers can struggle to make ends meet.

"Each person has a unique set of circumstances — but at the most basic level, housing is increasingly unaffordable in relation to income levels," Jacobson said.

Cost burdened by rent

Hennepin County has 34,000 fewer affordable homes than it needs to meet demand, according to the Minnesota Housing Partnership. The county's median rent is $1,244 a month and nearly half of renters spend more than 30% of their pay on housing costs.

That includes Vatterott, who says his monthly housing and utility costs are nearly $1,250, about 33% of his take-home pay — making him rent burdened, according to the U.S. Department of Housing and Urban Development.

Vatterott's colleague at Simpson and a fellow case manager, Julia Kramer, is also struggling financially and works as a server for extra cash. Kramer lives with roommates and says needing a car to work with clients is a big financial pressure.

"If I didn't have a family that supports me in the way they do, I couldn't do this work and I would have a very different life experience," Kramer said. "I'm working seven days a week, and sometimes when things are tight, I still go to food shelves."

Vatterott and Kramer say they know other co-workers in the same position who are afraid to speak out. They don't blame Simpson, which gives modest annual raises, and say they both love to work there.

Nevertheless, both say something is inherently wrong when college-educated workers trying to tackle one of society's biggest challenges cannot afford rent.

Sen. Liz Boldon, DFL-Rochester, and vice chair of the Senate Housing Committee, agrees. Boldon and Howard are hopeful new funding for housing programs, including $50 million to help stabilize housing nonprofits, will lead to better pay for those on the front lines of the crisis.

"People who are doing this critical work deserve to be able to afford their lives," Boldon said.

Tight nonprofit budgets

Lawmakers and housing advocates acknowledge a longstanding preference to keep administrative costs low at nonprofits receiving state grants. Those constraints can make it tough for places like Simpson, which received more than 60% of its funding from government grants, to offer salaries and benefits that attract and keep the people who make the programs function.

Kari Aanestad, associate director at the Minnesota Council of Nonprofits, notes that the nonprofit sector represents about 14% of the state workforce, and each year the state pays $500 million to nonprofits to do work that would otherwise fall to government workers.

A recent study by the Council of Nonprofits found that when adjusted for inflation, worker pay in all sectors — public, private and nonprofit — fell in 2022 after years of gains.

"This isn't just a nonprofit problem. I would argue that any employer in Minnesota is dealing with this," Aanestad said. "Workers are feeling the pinch of inflation."

Rinal Ray, assistant commissioner of housing stability for Minnesota Housing, said she saw the struggles firsthand during her time leading the nonprofit People Serving People.

Ray said some programs will now have more flexibility for how they spend state funding, which should free up money that could be used on worker pay. But she noted that state government agencies will not dictate how nonprofits operate.

"We need good administration for programs to run well," Ray said. She added there is also a broader question: "How do we as a society value this work?"

That's the question Simpson case managers Vatterott and Kramer, as well as human resources director Jacobson, want to see get more attention.

"Our society continues to undervalue care for others, whether that be teachers, medical care workers or nonprofit workers," Jacobson said.

Vatterott and Kramer emphasized that experienced workers earning a livable wage would be more effective for their clients — and more cost effective for the state.

"Helping people is expensive," Vatterott said. "I hope people know that these programs really do have a profound effect on people's lives. They can help people in tremendous ways."

But they also have a feeling that part of the social contract has broken down, Vatterott said.

"Our expectations are that if you live in the United States and you work a full-time job, you will have a certain level of income and quality of life and be able to house yourself."