By Ethan Forman at The Gloucester Times
For developers or nonprofits looking to build or preserve scarce affordable housing in America’s oldest seaport, the Gloucester Affordable Housing Trust has $1.5 million in COVID-19 Local Fiscal Recovery dollars by way of the American Rescue Plan Act just for this purpose.
One project that could tap into the money is a 20-unit affordable senior housing development proposed at 256 Main St. by Beverly-based Harborlight Homes, which hopes to redevelop a parking lot owned by the Gloucester Housing Authority.
To spark developers’ interest, the trust has launched the ARPA-Funded Affordable Housing Initiative (AAHI) with the goal of committing the one-time funding to affordable housing projects by the end of this year to help mitigate the city’s affordable housing crunch. The money was designated for this purpose by Mayor Greg Verga.
What’s the extent of the crisis?
Forty-eight percent of Gloucester renters are housing cost burdened, meaning they are spending more than 30% of their income on housing costs. This in a city where the average monthly rent for a two- or three-bedroom apartment is $2,500 and the 2022 median sale price for a single-family home was nearly $655,000, which is up 45% since 2017, according to Housing for All Gloucester.
“We have a once-in-a-lifetime opportunity with this ARPA funding, and I am excited to see this money being used to help address the affordable housing crisis here in Gloucester,” Verga said. “The Affordable Housing Trust Initiative has been well thought out to have a lasting impact on our community. It will help preserve, create, and repair affordable housing.”
The effort to boost affordable housing in the city just happens to coincide with the Healey-Driscoll Administration’s recent unveiling of the Affordable Homes Act, a $4.13 billion plan to jumpstart housing production and make housing more affordable in Massachusetts. The act, if passed, along with recently reauthorized housing tax credits, would fund or enable the creation of over 40,000 homes statewide that would otherwise not be built and preserve or rehab more than 27,000 existing homes, according to the administration.
“People and businesses can’t stay in the communities they love if they can’t afford it,” Lt. Gov. Kim Driscoll said in a prepared statement. “The Affordable Homes Act will help us create the housing environment that we want and need for Massachusetts, unlocking our competitiveness and improving quality of life for all.”
In Gloucester, the Affordable Housing Trust plans to direct its funding to projects reflecting the priorities and concerns raised by the community during ARPA listening sessions in 2022. The trust has come up with an online application open to nonprofit and for-profit organizations with a deadline of April 30 to apply. The link to the application can be found at https://gloucester-ma.gov/129/Affordable-Housing-Trust.
The trust aims to have the money committed by the end of this year.
The money can be used to assist with the planning and development of new affordable housing, as well as site acquisition.
The funding is targeted to projects that create or preserve affordable housing for the long term at or below 60% of the area median income.
Larry Oaks, chair of the Gloucester Affordable Housing Trust, said the funding could support the creation of more than 100 units.
“This money, I think, will easily leverage that number of units of housing,” he said.
Andrew DeFranza, of Harborlight Homes, which creates, preserves and manages affordable housing, said the money can act as powerful leverage to help provide ways to get additional funding.
“I think from our perspective, we are excited and applaud the city’s efforts, the mayor and Larry,” DeFranza said.
In collaboration with the Gloucester Housing Authority, Harborlight plans to redevelop a parking lot owned by the housing authority for a building with 20 affordable studios for seniors that includes intensive care for elders. The 0.74-acre lot sits next to Nelson’s men’s clothing and work gear store at 256 Main St.
Harborlight Homes could apply for city funding for this project “and we hope to,” DeFranza said.
Oaks, president and CEO of Newton-based Mainstay Supportive Housing and Homecare, said in an interview last week in Verga’s office the issue of affordable housing is one “that’s affecting communities all over the country and in particular Massachusetts and really — especially — in Eastern Massachusetts, the problem is really significant.”
Oaks emphasized that the $1.5 million is not going to build 100 units, “but it’s going to get paired up with funding from other places that developers secure and that’s going to be a big help to them and to us.”
There is an annual funding round called OneStop where the state awards its allocation of federal low-income housing tax credits plus other funding available to affordable housing developers, Oaks said.
“But here’s the caveat,” he said, “the state really needs to see a local funding commitment, and even a buy-in for an applicant to be a credible applicant.”
Affordable housing developers will get turned away without a letter of support from the community and local funding. He added that affordable housing developers cobble together funding from a variety of sources even with the OneStop process.
“So leveraging means Gloucester’s ARPA commitment is one more source of funding for that developer as they cobble together their funding along the way to being fully funded to they can start construction,” Oaks said.
Sunny Robinson of Housing For All Gloucester, which focuses on the issue of affordable housing in Gloucester, said: “I think the application from the Affordable Housing Trust is terrific. I hope a lot of affordable housing providers will apply for that money.”