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In wake of executive council vote, some affordability requirements added to $100 million housing plan

The beams and foundation of a new, partially completed home under construction in Portsmouth
Dan Tuohy
In statements after that vote, Department of Business and Economic Affairs Commissioner Taylor Caswell and Gov. Chris Sununu made clear they did not intend to reinvent their proposal, and argued the omission of affordable housing requirements was intended to allow projects to be flexible and move quickly.

Gov. Chris Sununu’s administration has released more details on its proposed $100 million housing plan – including new income limits for projects over a certain size – after the Executive Council voted to table the program over affordability concerns.

In a letter sent to the council Friday and released publicly Monday, Department of Business and Economic Affairs Commissioner Taylor Caswell added specifics to what the state will look for when picking projects. And he urged the council to pass the program at its meeting Wednesday, citing the additional information.

Some income requirements are included, among other changes. Projects that have more than 15 units or will cost more than $3 million for all development costs must include other funding from grants, loans, or tax credits that impose their own affordability limits. Those limits must allow for at least 20 percent of the houses to serve people making at or below 80 percent of the area median income, Caswell specified. “I appreciate your desire for these details and am hopeful that you reach a point that allows you to support our request to obligate these resources to address the current housing crisis,” Caswell said.

Sununu and Caswell have proposed the program as a means to increase the number of available rental units in the state, and reduce the problem of low vacancies and high rents. The proposal uses $100 million in federal coronavirus relief funds and devotes $60 million of that money to direct, matching grants to developers whose projects are in the final stages; developers can receive up to $3 million in grants.

But housing advocates have raised concerns that the program as presented did not have any guarantees that the funding would go toward affordable housing. State officials are proposing to use a special designation – “revenue replacement” – that allows them to avoid the income targeting that traditionally accompanies coronavirus relief funds. At the April 20 meeting, both Democratic and Republican executive councilors raised strong objections to the lack of safeguards, with two asking Caswell to “go back to the drawing board.”

The council voted, 5-0, to table the proposal until more details were released.

In statements after that vote, Caswell and Sununu made clear they did not intend to reinvent their proposal, and argued the omission of affordable housing requirements was intended to allow projects to be flexible and move quickly.

Caswell’s letter and memo to councilors also makes clear that the $60 million in funding can only go toward “construction and other hard costs,” which include environmental remediation, necessary upgrades to the infrastructure, and required upgrades to meet the standards of the Americans with Disabilities Act. The money cannot go toward land acquisition, developer fees, financing costs, or architectural, legal, engineering, or permitting costs, he wrote.

Eligible projects must add to the housing stock; they can’t include refurbishments of existing housing, the document states. And the projects must be used for long-term residential development – not short-term rentals.

Caswell said he had directly reached out to each of the councilors over the past two weeks, he said in the letter.

“I cannot emphasize enough that time is of the essence here as we move to have this program available for the upcoming construction season while remaining mindful of the relatively short window we have under the ARPA rules,” he wrote.

New Hampshire Bulletin is part of States Newsroom, a network of news bureaus supported by grants and a coalition of donors as a 501c(3) public charity. New Hampshire Bulletin maintains editorial independence.

Contact Editor Dana Wormald for questions: info@newhampshirebulletin.com. Follow New Hampshire Bulletin on Facebook and Twitter.

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