After delay, Executive Council approves Sununu’s $100 million workforce housing grant program
Councilor Cinde Warmington (center), a Concord Democrat, voted in favor of the program, saying, “We were able to get some guardrails, which provided some assurance that this money will go to affordable housing.” (Annmarie Timmins | New Hampshire Bulletin)
New Hampshire’s Executive Council signed off Wednesday on a program to distribute $100 million in federal funding toward workforce housing efforts.
Voting 4-1, the council approved the program two weeks after tabling it over a lack of details and the absence of safeguards for affordable housing.
The program, touted by Gov. Chris Sununu, will use federal American Rescue Plan Act funds to devote $60 million toward matched grants for developments, $30 million in incentives for towns and cities to speed up approvals of rental housing projects, $5 million to help towns and cities demolish dilapidated buildings, and $5 million to help municipalities update zoning ordinances.
Sununu has presented the program as a direct cash injection into the state’s struggling rental housing market, which has seen vacancy rates hover below 1 percent across the state and rising rents.
Earlier versions of the proposal contained sparse details and attracted criticism from councilors, who argued the program could be used to fund market-rate or luxury housing developments at the expense of affordable rental apartments. On April 20, the council voted, 5-0, to table the item, requesting that Department of Business and Economic Affairs Commissioner Taylor Caswell, whose department will oversee distribution of the funding, provide more information.
By Wednesday, those positions had changed. Days before the meeting, Caswell sent councilors additional details about how his department would allocate the funds.
The letter to councilors outlined new affordability requirements. Housing developments of more than 15 units that benefit from the money must demonstrate that they have other funding grants lined up that include affordability standards, and they must target at least 20 percent of units toward families making at or below 80 percent of the area median income, according to Caswell’s new guidelines. Grants will be capped at $3 million per project, and the affordable units must adhere to a rent cap for at least five years after completion, Caswell added.
The clarifications appeared to sway councilors who had been skeptical.
“I received quite a lot of feedback from housing advocacy groups and also municipalities about the guardrails that were put in,” said Councilor Cinde Warmington, a Concord Democrat, in an interview after the meeting. “Of course, when we saw that contract before it had nothing, we had no detail whatsoever. We were able to get some guardrails, which provided some assurance that this money will go to affordable housing.”
Some councilors voted to approve the program with reservations. Councilor Joe Kenney, a Wakefield Republican, urged Caswell to pick projects across the state, arguing that North Country towns and cities could be left out.
Caswell said the department would do that. Under the program, each of the projects selected by the department to receive grants must come before the council for final approval.
Councilor Ted Gatsas, a Manchester Republican, questioned how any projects would qualify for the funding, citing the program’s requirements that the funding be used only to cover shortfalls at the end of the development cycle.
Caswell replied that securing funding at the beginning of a development project does not always protect against a shortfall down the line, and pointed to projects in the state that had fallen short. Those projects included the “Rail Yards,” a 96-unit proposed apartment complex in Concord; the Swanzey West development in Swanzey; and the Avesta Housing project in Conway, each of which is $1.2 million behind its funding goals.
One councilor, Dave Wheeler, voted against the program. He said funds could go toward commercial endeavors and that the workforce housing might go to jobs in surrounding states. Wheeler pressed Caswell to allow the council to approve the projects individually, rather than lumping them together for council approval.
Sununu hailed the approval of the program, which the department says will be opening applications in June, with an initial priority for nonprofit-led projects and developments with fewer than 10 units.
Affordable housing proponents, who had been cautiously optimistic ahead of the vote, applauded the council’s decision.
“It’s gratifying to hear that the Executive Council has prioritized long-term affordability for the InvestNH Housing Incentive Program,” said Elissa Margolin, director of Housing Action NH, in a statement after the vote. “We’re looking forward to working with (the department), New Hampshire Housing, and municipalities on addressing housing needs for Granite Staters.”
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