Affordable Housing Trust Fund Could Help Greenwich Achieve 8-30g Moratorium

After two weeks of non stop headlines about proposed state zoning legislation including SB1024 – “the DeSegregate CT legislation” with its provisions for “as of right” multi-family developments on “Main Street” corridors and Transit Orient development around a train station, as well as the mansion tax, gaffes and apologies over comments about race, Thursday brought an alternative solution to what many have called punitive, Draconian and regressive legislation.

At the Board of Selectmen meeting, P&Z commission chair Margarita Alban presented a possible “Affordable Housing Trust Fund” ordinance for the town of Greenwich.

She said the idea had been proposed to the RTM in 1988, but it was tabled.

A year later the state affordable housing statute 8-30g was approved.

The 8-30g statute requires all towns in CT to have 10% of their housing deemed “Affordable” per a definition set in Hartford. Fairfield County towns with high land and development prices have been particularly challenged to meet the mandate. Towns in the northeast of CT, for example, have have had an 8-30g development proposed and have de facto affordable housing because of the low cost of land.

Alban noted that Westport’s affordable housing trust fund made it possible to earn “points” toward an 8-30g moratorium, because when their housing authority redeveloped 35 units, the effort was facilitated by the fund.

“Government assisted units would count toward our 10% affordability requirement,” Alban explained. “As soon as we have a fund, by default, even if it’s not a full 30% 8-30g set aside, it will count toward the requirement.”

She said there would be no cost to the town to establish the fund, as it would be funded by private donations and grants.

That said, in the future it could grow significantly if the town implemented a development fee in which builders are charged approximately $10 per $1,000.

Affordable Housing 7-Member Board of Trustees

The trust as proposed would have a 7-member board of trustees:

• 2 appointed by the Selectmen and approved by the RTM who would be members of the public with experience in affordable housing and have knowledge of the market. Alban said they would likely have 3-year staggered terms.

• 2 would be members of the BET (the majority and minority leader)

• Town Planning director

• Human Services director

• P&Z commission member

The town finance dept controller would be the fiduciary custodian.

“We think this is super important,” Alban said. “You have to have very strong internal controls when you’re managing what could be a significant amount of money.”

All board meetings would be noticed to the public and minutes posted.

The town must file, next June, an affordable housing plan with the state. All expenditures approved by the trust would be consistent with that plan.

A super majority of 5 votes would be required for the board to approve projects.

Alban said language should be included to protect the principal, though the fund would need to be highly liquid.

“As soon as you have enough money, you begin dispersing it on a regular basis,” Alban said. “Because even if you can’t fund a big project, like a $2 or $3 million project, you would hand it over to the housing authority for a rehab of units somewhere. Or for a purchase, you would give it to the housing authority and they would buy a condo somewhere.”

“It has to be such that if the housing authority asks, ‘Can we rehab a unit that has just become vacant?’ we can hand them $50,000,” she added.

The legislation does not limit the beneficiary of the trust fund to the housing authority. It could be any low income housing developer.

The P&Z commission would still have to approve projects that go before the trust.

An annual report would be issued on all activities.

Alban said New Canaan has a affordable housing fund that has been very successful.

In fact, New Canaan has earned two moratoriums on 8-30g.

New Canaan’s former P&Z chair Laszlo Papp is credited with having the vision to create that town’s affordable housing fund 14 years ago.

On Wednesday night, during a New Canaan panel discussion of the zoning bills under consideration in Hartford, there was talk about the benefits of the fund.

Mr. Papp explained that even 14 years ago, “Developers would attempt to obtain a parcel and with 8-30g, load it up with a number of units of multiple-family housing, which would not be supported by the terrain, the infrastructure, or the environment – and therefore would not be beneficial to the town. That’s why we adopted the affordable housing fund, which enables the housing authority to build with a down payment, obtain bank assistance to build…and it is affordable.”

“The affordable housing fund has been critical in terms of giving funds to (the housing authority),” said New Canaan P&Z chair John Goodwin. “The affordable fund is not large enough to fund entire projects, but it’s a kick-starter that enables (the housing authority) to then raise funding – mainly debt financing – then go ahead and do additional projects.”

He said the commission thinks about the fund as a way to work toward 8-30g goals and earn additional moratoriums.

“Chances are we’d probably never get to 10% because of the cost of land and building in new Canaan,” Goodwin said.

Beyond earning moratoriums on 8-30g, Goodwin said New Canaan was using the fund to promote additional inclusionary zoning in general.

Mr. Hobbs, the head of the New Canaan Housing Authority, said the affordable housing fund provided seed money for projects.

“Unfortunately, because the rent rolls are so low for Affordable housing, a place like New Canaan has to basically show up with the land for free, and with several million dollars to plan a project,” Hobbs said. “Once a project is planned, you can find a way to finance it, get it built, and make it happen.”

He said a failing of 8-30g was its focus on the official definition of Affordable housing, rather than housing that is affordable.

State Rep Tom O’Dea described 8-30g as doing open heart surgery with a bazooka. “If a town doesn’t meet the 8-30g requirements and get moratoriums, we can get torn apart with developments that have no business being in a place like New Canaan.”

He also explained the town would like to create more workforce housing but hadn’t because 8-30g had monopolized their resources. He said per the state the definition, for a one bedroom apartment, if a police officer, for example, earns $56,701 they do not qualify, but if they make $56,699 they do qualify.

Alban said the Legislative & Rules committee chair and Land Use committee chair were helping draft the ordinance.

“We hope to go to the RTM with a first read in June,” Alban said.

She said P& Z would approve the language first, then the board of Selectmen, followed by RTM.

“The earliest we anticipate approval would be September because the RTM does not meet in July and August,” she said.

See also:

Frank Talk about Racism Trips up State Rep at “Mansion Tax” Hearing

Feathers Ruffled after New Haven Mayor Points Finger at Greenwich during Hearing on Zoning Legislation

Marathon Hearing Draws 340+ to Testify; Republicans Mostly Oppose, Democrats Mostly Favor SB 1024, the “DeSegregate CT” Bill

CT Sweeping Zoning Legislation, SB 1024, Aims to Increase Overall Housing Supply

A Window into the Crafting of DeSegregate CT State Zoning Legislation