Wheels to Work Makes for a Smooth Ride from Welfare to Work

A lack of dependable transportation can present a significant barrier to consistent employment for many low-income workers. According to the 1990 Census, 30 percent of New Hampshire residents who are in poverty and looking for work do not own vehicles. Businesses are negatively affected when employees are unable to get to work on time, due to chronic breakdowns and lack of access to public transportation. This need provided the impetus for the Wheels to Work program.

Wheels to Work Staff and Participants.

The New Hampshire Community Development Finance Authority (CDFA) provides about $4 million annually in financial support and technical assistance to community development projects by accepting donations from businesses in exchange for state tax credits. However, Robert Nichols, Executive Director of the CDFA, felt that this money could be used more creatively, to help low-income workers.

For the Wheels-to-Work project, CDFA accepts donations of “pre-owned” vehicles from area auto dealerships, in exchange for a 75 percent state tax credit based on the appraised wholesale value of each contributed car. CDFA-then sells the vehicles to the Rockingham Community Action (RCA) Program for 15 percent of the appraised value (on average between $4,000 and $6,000). RCA, in turn, sells the vehicles to income-qualified program participants. Local banks provide financing at a reduced rate and extended terms to make car payments affordable. RCA uses the modest revenues generated by the sales to support an emergency repair fund and cover other program costs. CDFA expects to accept about 100 vehicles as donations over the next two years and $65,000 in cash contributions.

Started as a pilot program for Rockingham and Strafford Counties in February 2000, the Wheels to Work program was instituted statewide in April 2000. Thus far, they have received 19 cars from dealers. And 15 are currently on the road.

Started as a pilot program for Rockingham and Strafford Counties in February 2000, the Wheels to Work program was instituted statewide in April 2000.

Janis Reams, Business and Industry Coordinator and also Interim Temporary Assistance to Needy Families Administrator with the New Hampshire Division of Family Assistance, solicited assistance from the car dealers to make the program work. Before the program was developed, she spoke with individual dealers and with the New Hampshire Auto Dealers Association, trying to get donated cars with no incentive. What she found was not an unwillingness to help, but rather a desire to make a practical business decision. The tax incentive definitely helped. Reams found that it was necessary to do more outreach and get buy-in to the program, allowing the dealers to be as involved as they want.

The dealers are still making a charitable donation; these cars will not be sold at full price, and salespeople will be losing commissions. According to Reams, "You have to be sensitive to broader public policy balancing decisions. We learned more and more as we talked to dealers and found out about their concerns. The program does not have to be good for the dealer’s bottom line, but it cannot be harmful to it. In addition, the dealers wanted to know if they were really helping people, especially those people willing to help themselves. This is not a giveaway. It is a reward or a hand up to people who need a break and who are moving in the right direction. Businesses know that everyone benefits from a strong community where people have jobs."

Many applicants to the program are referred to RCA from agencies throughout the state, including the NH Employment Program, Welfare to Work, HUD Family Self-Sufficiency, HeadStart, and the six statewide Community Action Programs. Applicants are screened based on income and need. Applicants need to be engaged in training, actively searching for work or must need transportation to continue working. In addition, applicants need to be approved for the bank loan.

Of 115 applications submitted so far, 15 applicants have cars on the road and five or six more have been approved.

The process is extremely competitive. Of 115 applications submitted so far, 15 applicants have cars on the road and five or six more have been approved. The typical applicant is a single mother with one to three children, transitioning off public assistance. Applicants are committed to self-reliance and have set goals to that end.

The Bank of New Hampshire has been a valuable partner as well, according to Bob Adams, project coordinator. The bank has been allowing leeway with the loan applications. Applicants, who normally would have difficulty getting credit, are given attractive loans. The average loan is $2,000, with average payments of $68 over 36 months.

For those applicants who may not have the ability to secure a loan in the Wheels to Work program, the RCA is also receiving cars from the general public.

For those applicants who may not have the ability to secure a loan in the Wheels to Work program, the RCA is also receiving cars from the general public (four or five so far), which generally do not have many years left and may need significant repairs. The Rotary Club and local garages donate the necessary repairs.

The biggest challenge, according to Robert Nichols, CDFA Executive Director, was how to get the cars titled. In this program, the car is titled from the car dealer to CDFA, then from CDFA to RCA, and finally from RCA to the owner/bank. Car dealers do not have to file for a title, so CDFA tried to apply to the Department of Motor Vehicles (DMV) as a car dealer. This would cut down on the title delay, which can be time-consuming. Once it was determined they could not be a car dealer, the governor’s office became involved and made a compromise, where once the title is signed to CDFA and then to RCA, the title is carried to the DMV.

Steve Geller, Executive Director of RCA, explains, "This is a wonderful example of a public-private partnership, which can serve as a model for others. Usually, organizations look at economic development as redeveloping buildings, more of a brick and mortar approach. However, we have found a unique way of looking at economic development. The cars are not given away, but there is a low-rate, low-payment loan. This program gives people an ownership stake; once they pay off the loan, the car is solidly theirs. It also allows them to develop a credit history, where in the past, they might have had bad credit or no credit at all."

Angela Christie’s mother had bought her a car for Christmas, but once the head gasket went, she had to constantly ask for rides to work and for various trips for her five children. Christie first became aware of the program when she went to Strafford Community Action. She was told about Wheels to Work, applied and within two months, had a 1997 black Ford Taurus, which she loves. Wheels to Work helped Christie to get a $2,300 loan to be paid in three years with monthly payments of $77. Christie was working for Verizon as a temporary telephone operator. Having the car made it very easy for her to get there consistently on time. Usually, Verizon employees have to wait three years to become permanent employees. For Christie, it was merely four months, thanks to the car. Wheels to Work Coordinator Bob Adams accompanied her to the bank to negotiate the loan and to get insurance, to City Hall to register the car and basically was there with her at every step. According to Christie, "This is a fantastic program to help get people back on their feet. Bob helped me in so many ways. I’m grateful to Wheels to Work."

By Melissa Levy, Digest Managing Editor

For more information, contact:

• Robert Nichols of the NH-CDFA at (603)226-2170;
• Janis Reams of the NH Division of Family Assistance at (603)-271-3013;
• Steve Geller of RCA at (603) 431-2911;
• Bob Adams of RCA-at (603)-431-2911.

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