Charlotte mulls affordable housing fund use

By MADELINE HUGHES

After hearing suggestions to try to jumpstart affordable housing efforts using a town housing fund, the Charlotte Selectboard this week posed more questions to the volunteer group that is offering the ideas.

At its meeting Monday night, the Selectboard heard suggestions from the group that offered possible changes to the current affordable housing fund grant program so that more people could use it to create more housing units.

The fund, which has not been tapped since 2016, was discussed at a town meeting in March, and again in April by the Selectboard.

The working group was formed by Charlotte residents who volunteered at the board’s April 23 meeting to look into the matter. The group – Peter Richardson, Kate Lampton, Michael Russell and Nancy Wood – were previously involved in the grant program.

In the late-2000s, Charlotters voted to create a fund to build affordable housing. Between 2008 and 2013, the voters approved budgets that put $220,000 of taxpayer money into the fund.

Between 2009 and 2016, the Charlotte Selectboard approved $80,000 in grants to provide affordable housing, and another $1,226 for a feasibility study, according to a list compiled by working group member Richardson. After those grants, the fund now contains about $140,000.

The projects grants were used for included:

• Three houses built by Habitat for Humanity on Albert’s Way that received grants of $10,000 each.

• Three condos built by developer Steve Davis in conjunction with Champlain Housing Trust that received grants of $10,000 each. The units are on Camel’s View Lane.

• David and Diane Nichols received $5,000 in 2016 to rehabilitate two residential units that will be completed this year.

• Mark Dillenbeck received $10,000 to turn a master bedroom into a studio apartment.

All of these projects were done and financed with the condition that the units will remain perpetually affordable. The units in built conjunction with Habitat for Humanity and Champlain Housing Trust had that requirement in conjunction with state and federal funds used for those projects.

Dillenbeck’s project was one of the first that used the town affordable housing funding. He received his grant in 2010.

When talking to Richardson, Dillenbeck said there was hesitation about the perpetual affordability requirement, of 99 years, on the rental property, according to the list made by Richardson. The studio apartment created with the grant money currently rents for $750 per month. According to the current policies governing the fund’s use, if Dillenbeck wanted change the use  of the property with the affordable apartment, he would have to pay back the grant with a penalty.

Suggested changes

Because the housing fund has not issued any grants since 2016, the working group has been looking at ways to generate more interest in it. The group members went to the Selectboard Monday hoping it would approve five general policy changes:

• Withdrawing and revising the previous priorities of the fund used to approve grant applications that prioritized applications by Charlotte residents over nonprofits, projects with rental units over those with units for sale, and those that called for rehabilitation rather than new construction.

• Allowing grants awarded to Charlotte property owners to be repaid without financial penalties after five years which would remove the “perpetual affordability” requirement of  99 years.

• Increasing the maximum awards to $30,000 per unit and $100,000 per project from the current $10,000 per unit and $30,000 per project.

• Allowing grants to be used in conjunction with density bonuses, but requiring that such projects maintain perpetual affordability stated in the zoning bylaws.

• Permitting the Selectboard to use funds from the program to pay for marketing the grant program to prospective applicants.

The Selectboard members generally agreed with the suggestion to increase the maximum awards. Members also liked the suggestion to allow the grant awards to be used with density bonuses.

However, board members Frank Tenney and Carrie Spear questioned the notion of allowing the grants to be repaid after five years. In that case, how were they not simply interest-free loans rather than grants?

“Being able to repay this guarantees nothing in the future,” Tenny said. He questioned how the housing created with the grant money would remain affordable without the “perpetual” requirement.

Selectboard member Fritz Tegatz asked how the housing fund would continue. “When this was voted was this a one stop shop? What if someone wants more than that’s there?” Tegatz asked.

When it formed in April, the working committee was not tasked with answering those questions. The group was asked to make recommendations.

Monday night the Selectboard did not vote on the working group’s recommendations. Members expect the topic will be discussed further at future meetings.

Tegatz proposed trying to assess affordable housing in Charlotte to inform that discussion.

“Now we sit as a group and talk it out a little bit more and answer questions that we have,” Spear said. “I don’t think we are there yet to say ‘we approve, let’s go forward.’”

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