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News | Affordable housing at any cost?

By Carrie Chandler | Special to theVermont Guardian

Posted April 19, 2007

MONTPELIER — For years, Vermonters have heard Gov. Jim Douglas, lawmakers, lenders, developers, and non-profit agencies talk about the drastic need for affordable housing in Vermont.

Little has been done to achieve that yet, but this session, legislators think they have found the answer in the so-called New Neighborhoods Initiative, a bill that will allow towns and developers to bypass the Act 250 process in order to build needed housing.

According to Douglas, the initiative would create housing “near existing neighborhoods and increase the stock of new housing while respecting the traditional settlement patterns that make Vermont such a unique and wonderful place to live,” and will also offer incentives for towns and developers.

“If a property in a new neighborhood is sold as a primary residence, the town will get to keep all of the property tax for the first three years,” said John Hall, commissioner of the Department of Housing and Community Affairs. This creates an incentive for towns, “who already bear the burden of affordable housing through subsidies.”

The bill would also allow developers to bypass the Act 250 development review process, but Hall noted that developers “will still have to get local permits. It will reduce the cost on permitting so hopefully housing prices will go down.”

“In essence, this bill says that housing is an area where people come first,” said Tayt Brooks of the Homebuilders and Remodelers Association of Vermont, citing the fact that the environment has always been important to Vermonters. Noting that Vermont only produces 35,000 housing units per year, when the state needs to create at least 2,000 more to meet the need, he said, “In the last 10 years, the median purchase price of homes has nearly doubled. We believe that this is a major reason that young people leave Vermont, or don’t come to the state.”

While this bill is gaining the backing from a wide variety of groups in the state, the relaxation of the Act 250 permitting has caused many to question the intent of the initiative.

“The New Neighborhoods bill represents an unprecedented roll-back of Act 250 environmental protections by exempting land in poorly defined, scattered locations outside downtowns, village centers, new town centers, and growth centers from Act 250. If passed, this would be the largest Act 250 rollback in its 37-year history,” said Stephen Holmes of Vermont Natural Resources Council (VNRC).

Sandy Levine, of the Conservation Law Foundation, agreed, noting that “it is important to have places for people to live, but we shouldn’t do that by throwing out environmental standards and gagging the neighbors for comment in the process.” Act 250 is the process through which neighbors learn about and become involved in the permitting for land in their town.

But the proponents say the bill does offer a line of defense for the environment.

“New Neighborhoods will only be in communities that already have development review and subdivision bylaws in place. They will be exempt from Act 250 on the assumption that the town is doing a development review and has a town plan, said Sarah Carpenter, executive director of Vermont Housing Finance Agency.

“Safeguards are still in place to protect the environment,” added Brooks. “Projects will still have to go through town processes. It doesn’t stop the development review or zoning board from having input.”

There is also a concern that the bill will undermine a law passed last year by the Legislature designed to help foster so-called growth centers.

“The growth centers law attempts to focus future growth in downtowns, village centers, new town centers, and lands adjacent to these three areas — all collectively defined as growth centers,” said Holmes. Currently, towns are just getting ready to apply for the growth centers designation. “The New Neighborhoods bill, if passed, would at best distract the attention of state agencies and communities from growth centers implementation, and at worst weaken the growth centers law to the point of irrelevance.” The law strictly defines the process of building within a town, and incorporates Act 250 standards, and supporters see the New Neighborhoods Initiative as an easier and less time consuming option to create housing.

“Any housing initiative should fit in with the growth centers law; to create a completely separate process that doesn’t fit into that makes no sense,” said Levine.

According to Brooks, “We cannot sit back and wait any longer. Growth centers are so comprehensive. They encompass a majority of the town’s growth within the next 20 years.”

Because of that level of planning, the process to apply for the growth centers designation could take up to three years.
“New Neighborhoods can be incorporated into growth centers, but we are talking about something on a much smaller scale that is needed very quickly,” Brooks said.

Another sticking point for opponents of the bill is the fact that the proposal would allow any housing project to be exempt from Act 250 jurisdiction.
“The density standards are not defined, so you could see large houses on large lots or second home development exempted from Act 250 review,” Holmes said.

Holmes notes that the terms “adjacent” and “community core,” which both appear in the bill as descriptors of where houses may be built, are not defined.

“There is lots of ambiguity here … houses could be built next to land that is not served by infrastructure, and is not planned for infrastructure and without a definition of ‘adjacent’ this could be miles outside of downtown,” Holmes said.

Carpenter thinks that the bill will do just what it is supposed to do. “This is not, in a sense, an affordable housing bill. It is to encourage good housing planning and to make homes more affordable by increasing the housing stock.”

And that is something that Vermont needs, with the home ownership vacancy rate at 1.2 percent for 2006, the third lowest in the nation. Although the houses built under the New Neighborhood Initiative would not fall under VHFA’s definition of affordable, Carpenter noted that “the intent of the bill is to encourage developers and communities to build moderately priced housing.”

A median priced home in Vermont is $197,000. To pay that, a household would need to make $66,000 a year. With only 32 percent of the households in the state making above that wage, housing is out of reach for many Vermonters.

“This bill will make it easier in communities that welcome housing to build housing,” Carpenter said.

“One of the ways that you deal with the affordable housing problem is to build more housing,” she added.

Will the bill really help Vermont’s housing shortage? Hall believes that it will. “It will allow communities of every size and description to designate areas where they want to put dense housing,” he said.

But others are not so sure. Levine calls for “a more carefully drafted bill that targets incentives to housing in good locations, linked to the growth centers concept, and that doesn’t throw the environment out the window.” Along with VNRC and the Vermont Forum on Sprawl, Levine said, “We have identified areas where this bill could move forward and do what’s it’s supposed to do.”

And according to her, and many others in the state, that is to help create affordable housing.

Although crossover has already occurred, two House committees are reviewing the bill. Though not likely to pass this year, the bill is sure to be on the agenda at the beginning of next year’s session.