Affordable Housing Supply in Jeopardy
by John Edward, MCHC correspondent, 3/11/05
The need for more affordable housing in Massachusetts is well documented. State House leaders, community planners, and business interests have acknowledged the seriousness of the problem. Communities across the state have struggled for hard-won increases in their supplies of affordable housing. Housing analysts note that the state’s definition of affordable does not satisfy the need for truly affordable housing. Now housing advocates are focusing on another problem – a ticking time bomb that will actually reduce the limited supply of truly affordable housing in the state.
Unfortunately, affordability can evaporate due to something called “expiring use”. Units that were originally designated as affordable can be converted to “market rate” because of this provision. Use as affordable housing can expire when the units were built with federal or state subsidies, and the original mortgage is paid off. Many properties built in the 1970s fall into this category, with 30-year mortgages having been paid off, or soon to be paid off. Even housing stock added more recently can fall under the expiring use provision if owners of publicly subsidized property opt to prepay their mortgage, or let subsidy arrangements expire.
Greater Boston Legal Services (GBLS) has a Housing Unit that provides legal assistance to people who have lost or are in danger of losing their housing. GBLS declares their “highest priority is to preserve existing low-income housing.” They have identified 6,500 units in Boston that may be lost due to expiring use.
Approximately 20,000 units statewide are thought to be at risk under expiring use. At an affordable housing forum sponsored by UMass Lowell, State Senator Steven Panagiotakos, former chair and current member of the Senate’s Housing Committee, indicated that the City of Lowell is losing affordable units by the hundreds. In fact, Lowell’s Master Plan lists over 500 units designated at risk. The Plan observes that while these units are spread throughout the city, they are concentrated in low and very low-income population clusters.
This is not just a problem for cities like Boston and Lowell. A story in the February 20, 2005 edition of the Boston Globe discussed the Town of Andover’s success in meeting the Chapter 40B goal of 10% of the housing stock qualifying as affordable. However, as noted by the town planner, this includes units that were built almost 20 years ago and may soon be converted to market-rate housing. Andover may see its success undermined by expiring use.
In 1998, the state legislature attempted to provide relief from expiring use to local communities. Both houses passed the Enabling Act to Save Affordable Housing, which would allow communities to prevent conversion to market rates, and to regulate rents for units that had been converted. Governor Cellucci vetoed the bill. An attempt to override the veto failed. Subsequent attempts to pass similar legislation failed.
In the 2003-2004 legislative session An Act Promoting Affordable Housing and Community Planning in the Commonwealth was proposed but failed to pass. While this legislation purported to address expiring use, regrettably, it did so only in the context of the counting rules of Chapter 40B. The language used was as follows:
In instances where housing units were developed to serve low or moderate income households and the use restriction has expired as a result of refinancing or operation of law or otherwise, the department shall have the discretion to count such units pursuant to guidelines promulgated by the department toward a city or town’s affordable housing threshold as recorded in the subsidized housing inventory.
If this legislation passed, the Department of Housing and Community Development (DHCD) could allow an expiring use unit to count as “affordable” no matter how expensive it becomes. Unfortunately, DHCD has been a strong advocate of the legislation, which appears to have substituted a misleading definition of “affordability” for a real solution to the expiring use problem. A similar bill, which addresses many housing issues beyond expiring use, has been filed in the current session. The Citizens Housing and Planning Association (CHAPA) is closely monitoring the situation. Other housing advocates and community planners are paying attention as well.
Housing advocates and many community planners have suggested that a more meaningful response to expiring use would be home rule petitions allowing communities to prevent affordable housing from expiring. The Massachusetts Alliance of HUD Tenants has been promoting such an effort, and some cities have passed or are in the process of passing home rule petitions that would allow them to maintain the affordability of these “expiring use” units, where rents may otherwise increase two to three times the current rate.
Home rule petitions may provide an important solution in the face of a growing housing crisis. However, this approach will require statewide enabling legislation. The 1998 Enabling Act to Save Affordable Housing vetoed by Governor Cellucci included a provision enabling these home rule petitions. An effort is underway, supported by the Mass Alliance, to generate legislative support for expiring use home rule petitions.
In the coming months concerned citizens and housing advocates will be alerting the public to the expiring use problem. It is hoped that citizen action will compel a public debate which will in turn compel legislative action – on this and other urgently needed solutions to a growing housing emergency in Massachusetts.
The problem of expiring use will be discussed at “A Community Workshop for Just, Sustainable Development” on March 13. A variety of speakers and organizations will discuss “local solutions for livable communities”. If you are interested in participating click here for more information http://www.masschc.org/workshop.html