I went to an event to kick off the campaign to elect Andreae Downs to the City Council yesterday. After her remarks she opened the floor to questions from the audience.
The first question came from housing advocate, and director of housing non-profit CAN-DO, Josephine McNeil. She asked (my paraphrasing) “the administration in Washington has been clear about their intention to cut the HUD (dept of Housing and Urban Development) funding by $8 billion and to completely eliminate the entire CDBG (Community Development Block Grants) program. What would be your plan for the city’s affordable housing efforts, in the wake of these drastic cuts in federal housing funds.”
This was the first I’ve heard of this – shame on me. For any one with any interest in affordable housing or development issues in general in Newton, that is hugely disturbing news.
When it comes to affordable housing in Newton there really are only two significant ways it gets funded – the state’s 40B program, and through HUD/CDBG funding.
The 40B program funds new affordable housing by trading regulatory concessions for building affordable units. In essence the developers of large 40 B projects, fund the new construction of affordable units and in return the state waives most of the local zoning control of their project. While this approach has definitely worked over the years it has been a continual source of frustration and tension here in Newton and elsewhere. When a big 40B project gets proposed, local residents and their elected officials have very little say in what gets built.
The one thing that both the housing advocates and opponents of large 40B projects seem to be in agreement about is that the alternative approach to building smaller affordable housing, exemplified by CAN-DO is important too.
Virtually every affordable housing initiative in the city depends on HUD/CDBG funding. When local non-profits build housing units, it is always in part by leveraging HUD/CDBG funding and often 40B as wells. The city’s existing public housing (Newton Housing) depends on HUD funding for its continued operation. The city’s planning department is even partially funded by HUD/CDBG funds. Much of the official City of Newton’s Housing Strategy depends directly and indirectly on the HUD/CDBG funding.
Josephine Mc’Neil’s question yesterday shined a much needed light on an impending slow-motion affordable housing train wreck that may be happening soon. Josephine McNeil may be officially retiring but clearly she’s not ready to stop working/worrying about housing issues in Newton.
What’s the answer? Damned if I know. Clearly all efforts should be made to prevent the slashing of the federal housing budget. That’s a tough one since virtually our entire elected national delegation is already in that camp, so there are none of our elected reps who need convincing.
If the budget does get slashed, how will the city cope? Contingency planning really should begin now. I think its a great public service that Ms McNeil is introducing that as an issue in this year’s campaign. It sounds like an issue that all our elected representatives and their challengers should begin grappling with sooner rather than later.
What was Andreae Response to the question?
This is crazy, the lack of affordable housing in Newton has nothing to do with Trump or republicans. Its solely because of NIMBYs who hide behind historic districts and aesthetic height requirements.
If Newton lowered the minimum lot requirement to build a house and increase height requirements for condos, the supply would meet demand… Although we would have to build and fund a few new schools
Josephine crystalized how national politics affects our neighbors in Newton. Not just housing funding is affected by these cuts, but services on which our most vulnerable neighbors depend.
While this is a national issue, I am committed to work with concerned residents to organize and fight against the proposed cuts to these vital programs. Our municipal budget is limited, but I would work with the mayor and council to protect our neighbors and find creative ways to meet the needs of all of us.
I look forward to hearing your thoughts and suggestions.
@Bugek – Cutting $8 billion from federal housing funding (the topic of the post) is most certainly directly connected to the Trump administration. If you think loss of those federal housing dollars in Newton will somehow have no effect, I’m not sure what to say to you.
As for lowering lot size or increasing allowable heights, yes those would both increase the number of market rate housing units built. It wouldn’t bring down land prices in Newton though.
If the Trump administration is cutting federal funding for local housing, it will be the first thing Trump has done so far that I agree with. Hooray!
I grew up in Erie PA in a house in that Zillows for $120K. People in Erie make a lot less money than the typical person in Newton and, for that matter, the typical person in MA. Why should people in Erie pay federal tax dollars to subsidize housing in Newton? If “affordable” housing is worth it, let’s put our money where our mouth is and pay for it ourselves.
Two separate concerns:
A housing crisis is about to hit the entire northeast region, from Washington to Massachusetts, and we’re not prepared for it. The first wave of baby boomers are now 70 years old and have nowhere to go when they can no longer deal with the maintenance of a house, snow, stairs – you name it. Within 10 years, this generation will be a tsunami of people needing housing that enables them to remain independent. Every community is going to have to do its part to get through this crisis, including Newton. And it will be a crisis.
As for affordable housing: many people (my family included) moved to Newton because there was economic diversity lacking here that’s lacking in other suburbs. We didn’t move here for the villages-we lived in a community with villages we called squares. Most New England cities/towns have sections with centers – call them villages, squares, corners, circles, or whatever. We didn’t even move here for the schools. I’m an educator and knew there were (and are) a lot of really good systems in the metro area.
We moved here because it was a city close to Boston and work – and because it was an economically diverse community. I wanted my kids to grow up surrounded by, and with friends from, people from all walks of life. If we lose the diversity in Newton, we lose it for good. There’s no turning back. If we turn our backs on people who want to age in place, then I just don’t know what to say to that.
Jeffrey Pontiff – Erie PA’s federal housing funds will also get cut.
Jeffrey Pontiff – As you say people in MA and in Newton make more money (and pay more federal taxes) so the subsidy actually goes the other way – from Newton to Erie … and that’s as it should be.
Jerry. I lived in a middle class house in Erie PA. Are you sure Erie gets federal housing funds? If they do, it is laughable that federal money is being used to create affordable housing in Erie. More reason to cut HUD.
Our recently passed ordinance to lower barriers to building accessory apartments is one answer. I also think we should be making it easier to build rooming houses – also known as boarding houses or SROs. Councilors Hess Mahan and Crossley have docketed such a change.
Accessory apartments will help — they can be naturally affordable, without government subsidies. There’s also a little room to create some middle-class (but probably not “Affordable”) housing by loosening lot size requirements. But for the most part demand for Newton housing is high enough to keep prices high.
CAN-DO does good work. I used to live around the corner from a site where they were planning a 5-unit project. Some neighbors petitioned against it. I couldn’t go along with that — I saw no problem. There is alas some NIMBY feeling. And I think it did get built.
What I wonder: Does a 40B get rent subsidies for its Affordable (lottery prize) units, or does the landlord cover it?
Newton has done a miserable job creating affordable housing over the past eight years and the Mayor, City Council and Zoning Board of Appeals all share in the blame. While a number of inclusionary units have been permitted (but mostly not built), The administration, City Council and the ZBA have opposed 40Bs that are purportedly too large, but shown a startling unwillingness to negotiate with developers to get better projects that fit in with their environs. The Mayor initially withdrew a qualified ZBA nominee who previously represented developers because of a handful of objections (mostly from the NVA), and when he sought to change direction with nominees who were more receptive to 40B development, the City Council blocked all of his nominations. Virtually the only affordable units created have been developed by CAN DO with the support of federal, state and local housing funds. Yet, the administration has made the procurement requirements for public funds so restrictive that it actually increases costs for producing housing. And don’t even get me started about Engine 6.
While the Mayor has put forth a housing strategy that could work, the City Council thus far has not been receptive to the zoning changes it will require and the planning department continues to pursue the 1.5% “safe harbor” that the Housing Appeals Committee has already struck down twice. Accessory apartments and expanding the inclusionary zoning ordinance will have salutary impacts on diversifying housing options, but they are a drop in the bucket compared to the need. Meanwhile, Newton is actually losing ground on its subsidized housing inventory as long-term (but not permanent) affordability restrictions from many years ago expire. The next Mayor, City Council and ZBA will have a tall task before them to rectify this slide.
Solving the problems of income inequality and lack of diversity and the acute housing demands in our region require a multi-pronged approach that involves development of both market rate and affordable housing to meet the demand for housing and supports the economic development that is needed to make it all work. In order to draw employers to the region and get them to stay, we need places for their employees to live that are in relatively close proximity. Without housing, the exodus of employees and employers is virtually inevitable. So it is in all of our best interests to encourage housing production and economic development that meet our regional needs.
Newton shares this burden with many other communities in the region, and it is only through regional collaboration and coordination that these demands will be met. Needham, for example, has made great strides in the past few years to surpass the 10% threshold under Chapter 40B, and has attracted numerous companies willing to relocate there in the bargain, including some from Newton. Newton needs to do its share of shouldering the burden in order to share in the benefit. So, it’s time to get to work.
@Jeffrey, the reason Erie is (and should be) eligible for federal housing funds is that HUD’s definition of “affordability” is based on the area median income. As you note, household income in the Erie area is much lower than in the Boston area, as are the housing costs (which are, by the way, related). Newton’s median income is much higher than the area of which it is a part, but the need for affordable and middle income housing is no less acute here. Eliminating federal housing funds will hurt low to moderate income households in Erie and Newton, and in most of the rest of the country where low to moderate income families and individuals have few affordable options.
@Fred, 40B developments are “subsidized” in multiple ways. Some receive merely technical assistance from subsidizing agencies, while others, like CAN DO, receive federal, state and local funds which subsidize the creation of affordable units through permanent deed restrictions that maintain affordable rents or purchase prices. As a result, while relatively small, these projects include up to 100% affordable units. In each case, the owner carries the burden of maintaining affordability. Some projects may receive rental subsidies through programs such as Section 8, which relies on federal funding for eligible households to assist with that burden.
@Ted Hess-Mahan – Are you sure you won’t run again?
Positively, absolutely sure.
In fact, I am looking forward to retiring from public service so I no longer have to pretend to like people I cannot stand and can say what I really think. 😉
@Ted hess-mahan – that should be fun. I can’t wait.
I can. We don’t need the level of dialogue in Newton and the country to sink lower than it is. Right now, we have a very small number of activists butting heads and getting nowhere. Then there are the rest of us who want less and less to do with civic life in Newton because it gets nasty fast. Other people have different perspectives or a different set of priorities they want to focus on.
Every thought that enters one head doesn’t need to come out of one’s mouth. At some point, people need to develop a filter. Getting personal in your remarks only serves to diminish you and the potential good you can do as a citizen.
@Jane, perhaps you are a little unclear on the concept of the winky-smiley emoji. So I provided a link for you.
You’re welcome.
Ted, sounds very interesting. Just don’t stop talking.
Fred, there can be subsidies involved as Ted said, but the developers of large 40Bs cover, at least in the beginning, the difference in cost of the lottery based affordable and the market rate apartments. Their concession is in the lifting of zoning requirements. These apartments are deed restricted in perpetuity unlike “Newton’s naturally affordable” apartments. (Oxymoron)
Jeffrey, being the numbers guy I think you must know that HUD funds in Newton are different from the HUD funds in Erie, PA. It just doesn’t fit your argument this time.
Thanks, Marti. I would only add that under Chapter 40B and DHCD regulations, the developer’s profits are restricted within certain limits. From time to time, communities have sought to recover excess profits from 40B developers, which can be used for subsidizing affordable housing.
@JanE Franz – me too 😉
I noticed the wink, but I also picked up on the tone. Winky dinks don’t erase words, especially after what one might call a pretty angry post.
@Ted. I say this only partly in jest. You will find there are trade offs with speaking your mind without filters. You will find that the older you are, the more you may feel free to say what you want to say; the trade off is that the older you get, the less people may want to listen to what you are saying.
@Jane and @Bob
When Barney Frank announced his retirement from Congress after many years of “speaking frankly,” the Boston Globe reported: “I don’t have to pretend to be nice to people I don’t like,” the famously irascible Frank told reporters and supporters during an early afternoon news conference at Newton City Hall. Rep. Frank was clearly making a joke at his own expense.
I freely admit that I “repurposed” Barney Frank’s joke at my own expense. I have always tried to say what I think and let the chips fall where they may, and have been critical, at various times, of both friends and foes alike, when I think they are in the wrong. Jerry Reilly obviously got the joke, but I see that not everyone did. I sincerely regret that my attempt at humor fell flat. #sorrynotsorry
Ted. Yeah, but nothing beats mo Udall’s jocular “the people have spoken; the bastards”, after he conceded defeat in New Hampshire. Or my personal favorite, 85 year old Senator Steven Young of Ohio responding to a constituent who wrote him a nasty letter; “Dear sir. Some idiot sent me a letter and signed your name. I just thought you’d want to know.”
@Ted: “From time to time, communities have sought to recover excess profits from 40B developers, which can be used for subsidizing affordable housing.” Has Newton ever gone after developers with excess profits? In fact, what’s the process to check for excess profits and what’s the time period in which a city can recover? There may be a few subsidized housing units for the taking out there!
@Sallee: Excellent question. The Court St developer is selling their units for much more than they said they would in their 40B application.
1BR units – developers said would be ~$360K but sold for $660K.
2BR units – developers said would be ~$575K, sold for $800K.
3BR units – developers said would be ~$720K, sold for $1.1M.
(Bob Kavanagh had a recent letter to the Tab about this)
In addition, in the Deed Rider summary in the public notice for the Court St affordable units, there is language that allows for the resale of the 9 “affordable” units to income-ineligible buyers in the future. “If 120 days pass from the date of the Conveyance Notice, and the DHCD cannot find an eligible buyer and the City/DHCD does not want to purchase the home, you may sell your home for the Maximum Resale Price to an Ineligible Buyer who will also have to sign a Deed Rider, ensuring the home will still be subject to all the same rights and conditions.”
So, Emily, if there were only one unit sold at each price point for the amounts you say…there would be $ 935,000 available to build extra subsidized housing units by, say the Newton housing Authority! I bet there were more than 3 units sold at those price points, too.
So…how do we get at that money? Who starts the process? Where are the guardians? Who watches the guardians? (Quis custodiet ipsos custodes? A favorite Latin phrase of mine!)
@Ted…can you help out here, too?
The restriction is on the developer’s profit.
The higher prices for the condos was said to be because of the length of the process, starting in 2013, costing more. Just because the units sold for more doesn’t mean the overage went toward additional profit over what is allowed by 40b. SEB was looking for a partner after the 40b was approved to help assuage the cost.
@Bob, I too love that first quote. It was actually Dick Tuck who first said it, after losing a California state senate primary. Mo Udall did have one of my other favorite quotes, which I plan to use if anyone asks whether I will run again this year. When urged to challenge Jimmy Carter in the 1980 Democratic Primary, Udall said: “If nominated I will run — for the Mexican border. If elected, I will fight extradition.” But no one can beat Harry Truman’s poison pen letter to Washington Post music critic Paul Hume, who had written a negative review of Truman’s daughter’s singing.
@Sallee, DHCD’s regulations provide that a reasonable return on a homeownership project is 15-20% above total development costs. The subsidizing agency that determined that the project was eligible for 40B is responsible for enforcing compliance with the limitations on profits, although DHCD reserves the right to ensure such enforcement is satisfactory. Pursuant to a regulatory agreement between the subsidizing agency and the developer, the developer is required to certify its total development costs and turn over any excess profits in accordance with the agreement.
Marti Bowen writes “The higher prices for the condos was said to be because of the length of the process, starting in 2013, costing more.”
Where did you get this information from? Did the new developer tell you this? Did the Englers provide you with this information? Do you know what these extra costs were? You appear to have information and financial details that are not common knowledge.
Mainly from asking questions of people involved after reading this article.
http://newton.wickedlocal.com/article/20141203/NEWS/141208875
The Court St developer has been in the development industry for decades. I think it’s fair to assume they knew how long the process would take.
Here is a recent column in Banker & Tradesman which suggests that supply and demand is working in the Boston housing market. Contrary to common wisdom, increasing the supply and diversity of housing–even high end, “luxury” housing–is leading to more affordable rents at the lower end:
The demand for affordable housing–indeed, housing affordable to households and individuals at all income levels–far exceeds the supply in the Greater Boston Metropolitan area. As the author reports, Boston has the lowest percentage of modern, large apartments buildings in the country at just 14%–no other major metropolitan area has less than 20%. So this region has a lot of catching up to do in order to increase housing diversity and affordable options for our workforce. The long-term economic sustainability of our region depends on it.