In August 2017, MCC unanimously voted to lease us a block of land, at peppercorn rent, on which we could build a development of up to 28 low cost home units, all manufactured from recycled sea containers.
The make-up of the development will be:
- 8 x 3 bed units, suitable for families.
- 2 x 40ft units, suitable for couples.
- 18 x 20ft. single units.
The development will be part of an overall project to provide homes and a permanent job for each of our residents under our ‘Homeless Starter Pack’ model.
The following explains:
We have engaged with a prominent architectural firm, Archiplan www.archiplan.net.au , to help us to develop a scheme for the development of 28 units on the MCC block.
Archiplan has generously agreed to do all work on this project up to Development Approval stage on a pro bono basis. Once DA is gained and we have financing in place, they will carry out the detailed design at a 15% discount to their standard fees. A copy of the concept plans is attached.
We are now finalising the design in preparation for a Development Approval application.
The jobs created to support this project will be initially focussed on a high-tech vegetable growing business located on the Homestead for Youth farm at Meelon. The vegetable project will be establishe
d as an independent business under the Sesteem model and H4Y will share in the profits.
A very positive outcome of this is that the H4Y kids will
be able to gain work experience in the business that could lead to full time work. Win-win all round!
We, at Sesteem, have been working with H4Y for over a year now and are currently actively helping them with a range of grant applications to help them to fund a series of ‘Try, Test and Learn’ programs for their young clients. Ultimately we will help them to establish a full home-stay farm at Meelon.
More information on H4Y can be found on the ‘Our Clients’ page on our website or at www.homesteadforyouth.org .
The following is a brief outline of some of the benefits that will flow to government and the Peel region as a result of this project.
The Sesteem Mandurah Project aims to provide housing and jobs to 28 homeless, unemployed people in the Mandurah area. The direct financial benefit to government of removing 28 people from welfare dependency may be calculated as follows.
Newstart Allowance: $528.70/fortnight = $13,746/year X 28 = $384,888
Rent Assistance: $130.60/fortnight = $3,396/year X 28 = $95,088
Total annual welfare savings: $479,976
The project aims to create a full time job for each participant. The goal is to pay more but initially assume that each employee is paid the minimum wage:
Min Wage (38hrs) = $672.70/week = $34,980/ year.
Tax payable on $34,980 = $3,189/person X 28 = $89,292
Total annual net benefit to government: $479,976 + $89,292 = $569,268
Personal Equity accumulation
Each employee will receive an after-tax income of $31,782. Home loan repayments will be capped at 20% of disposable income = $6,356. Thus a participant can build personal equity in their own home at the rate of $6,356 per year. Say he/she stays for five years, they will have $31,782 available that they can use as a deposit on an alternative home, if they wish.
Each employee will receive an after-tax income of $31,782. Deducting home loan repayments of $6,356, they will have a free disposable income of $25.426 per year for expenditure into the Mandurah economy.
Annual Cash contribution to Mandurah economy: $25,426 X 28 = $711,928
The overall project cost of the Davey St. development will be around $2.5 million. Wherever possible, all fabrication, contractors, services and materials will be sourced from local suppliers.
The container conversions and structural steelwork (stairs, etc.) fabrication will be carried out by Mandurah company in2steel. It is hoped that they will employ at least one new full time apprentice as a result of this project.
The Vegetable Growing Business
To employ 28 people in full time jobs will require a pretty substantial business. The wage bill alone will amount to $979,440 per year, excluding other on-costs such as superannuation, workers comp. insurance, etc.
The size is not an issue. The Sesteem growing model can be scaled up to any size. The project will also include value-add processing such as pre-packed salad greens and other higher value products.
Sesteem will provide the senior management input. Other jobs will be created around the skill-sets of the participants. Where a certain skill is lacking, we will provide training to fill the gap. Jobs will range from growing, harvesting, packaging, delivery, book-keeping, marketing and all other categories required to run a healthy business.
A business of this size and nature will generate many peripheral benefits to the community such as purchases from local suppliers, use of local consultants, community participation and so on. The additional financial benefits to the region are indefinable at this stage but will be substantial.