Details are still scarce, but affordable housing advocates say Governor Chris Sununu’s recently announced $100 million affordable housing fund is cause for optimism.
“We’re excited about the investment,” said Elissa Margolin, director of Housing Action New Hampshire, an advocacy group. “And, obviously, we recognize this huge opportunity: truly once-in-a-generation federal investments in this state.”
Announced during Sununu State’s state address on Thursday, the federally funded initiative would seek to break traffic jams that have blocked local housing approvals through financial incentives.
From the new fund, $60 million would go to flexible matching grants for developers who produce “construction-ready multi-family housing projects,” Sununu announced. An additional $30 million would be distributed as grants to cities “that can approve permits within six months of application.” And the final $10 million would help cities tear down vacant and dilapidated buildings and fund planning grants that would help cities rewrite regulations to allow them to “facilitate the modernization of development in New Hampshire.”
The goal, the governor said, is to help incentivize developers and city officials without being overly punitive.
“One of the issues we have is slow or uncertain local approval. This happens a lot,” Sununu said. “So I want to encourage that.”
The new fund is financed with federal funds from the US bailout package, passed by Congress in March. It was unclear on Thursday whether the $100 million came from unencumbered bailout funds; a Sununu spokesperson did not immediately respond to an inquiry.
New Hampshire continues to suffer from a severe statewide housing shortage, a difficult situation that is affecting home prices, rents and labor availability. In 2019, the New Hampshire Housing Authority calculated that 20,000 new homes would need to be built to bring the state’s housing stock to healthy levels.
And Sununu’s Housing Stability Council, a panel of stakeholders, has its own target: 13,500 new units in the state by 2024.
But the causes of the shortage are complex, say proponents. Sometimes it’s about getting developers the capital they need to support an affordable housing project rather than a more lucrative development. Other times, a familiar challenge arises: NIMBY-ism, the widely used acronym for “not in my backyard.”
But the $100 million could help grease the wheels in several directions, Margolin said.
“Most workforce housing projects are padded with many different resources – some state, some federal, some tax credits, some investors – and whatever is really necessary to move the project forward” , she said.
But Margolin warned that she would closely monitor the details of new funding proposals.
For Margaret Byrnes, executive director of the New Hampshire Municipal Association, the $30 million in incentive funds could help cities and towns overcome difficult appeal processes.
But she said the often slow pace of approval for many cities and towns isn’t always a downside. Sometimes cities just need more time to effectively review projects, Byrnes said.
“I know comments are often made about things that are local slow moving or things that are local heavy,” Byrnes said. “But our process is a public process and approved by the local board for projects, and so sometimes they can be slow and sometimes getting developers and applicants the information needed to approve the project can also be difficult for them to their side.”
The new housing funding is part of a bipartisan push for housing affordability this year.
Addressing lawmakers, Sununu also touted Senate Bill 400, a complex bill to boost affordable housing sponsored by Senate Majority Leader Jeb Bradley, a Republican from Wolfeboro — and backed by a large number of House and Senate Democrats. This bill would introduce several changes to try to incentivize cities and towns to produce workforce housing, including giving “preferential access to state resources such as discretionary infrastructure funds.” of the State” to cities that have joined a certification program that has demonstrated a commitment to increasing housing. .
The bill would also allow cities to create “tax increase funding” neighborhoods specifically for workforce housing, a designation that would allow them to recoup some construction costs using future revenue from property tax developments.
And it would require cities and towns to apply the same density and lot size allowances to labor housing as to any other type of housing in their zoning laws.
“SB 400 will increase some regulatory flexibilities and incentives at the local level to really get things done, because that’s where we see things stalling,” Sununu said.
For her part, Byrnes said the Municipal Association prefers positive incentives for cities to develop workforce housing over more punitive approaches.
“I think overall it’s a step in the right direction,” Byrnes said of the new fund. “We see a lot of statewide zoning mandates being promoted as solutions to the affordable housing crisis. But we continue to advocate for incentives, partnerships and investments that will lead to solutions to the affordable housing crisis.
On this point, Margolin agreed.
“What we endorse is encouraging ‘yes in my backyard’ communities and rewarding them when provided,” she said. “Because at the end of the day, we believe investing in a diverse real estate portfolio sells itself. And communities that have demonstrated commitment have seen positive results in terms of vibrant communities and longer-term sustainability.