Marshfield Housing Partnership
April 2, 2007
Frequently Asked Questions Regarding Affordable Housing in Marshfield
What is meant by an “affordable unit”?
To be an ‘affordable unit’, the unit’s selling price must be within the financial grasp of a household that has an annual income of 80% of the Median Household Income (MHI) for the area in which Marshfield is located and must be secured as affordable by a deed rider. Additionally, the unit must have been sold or rented on a fair and open basis by means of an affirmative fair marketing and lottery plan approved by the State. A typical two bedroom affordable unit currently sells for approximately $160,000.
Marshfield has many small homes and a number of apartment buildings. Why don’t these count as “affordable” housing?
They may count if they meet the definition of “affordable” as defined above. If any of the above conditions do not apply, then the housing cannot be counted as “affordable”.
What is the Median Household Income (MHI) for Marshfield?
The MHI for all communities in the United States is published annually by the U. S. Department of Housing and Urban Development. The current MHI (2006) is $82,400. 80% of the MHI is $66,150.
How much “affordable housing” does Marshfield have?
Currently, Marshfield has 421 affordable units towards it 10% goal of 912 affordable units. The current percentage of affordable units is 4.62%
How will the occupants of “affordable” housing units in Marshfield be chosen?
Qualified occupants for affordable units are selected through a lottery conducted by the Marshfield Housing Authority.
How do I apply for an affordable unit?
When units become available, The Marshfield Housing Authority will advertise the acceptance of applications for the affordable unit in the local papers along with all information necessary for determining qualifications and the process for submitting the application.
Will qualified Marshfield residents have to compete with qualified persons who don’t live in Marshfield?
Yes, it’s a lottery. However, preference is given to Marshfield residents for 70% of the affordable units. To meet the definition of a Marshfield resident you must a) have your principle residence in Marshfield, b) work in Marshfield, or c) be the child/step child or parent/step parent of someone who has their principle residence in Marshfield. The only competition with qualified persons who don’t live in Marshfield occurs when a sufficient number of Marshfield residents have been selected for 70% of the affordable units and qualified applicants for the remaining units are being selected. In developments produced under Chapter 40B there is no guarantee of a preference for Marshfield residents.
What is a Deed Rider?
A Deed Rider is a legal instrument which records any use restrictions attached to the property. A use restriction for all affordable housing units is required to ensure long-term affordability. Long-term affordability in the Marshfield affordable housing program means “in perpetuity”. The Deed Rider is recorded at the Registry of Deeds.
What is Chapter 40B and why is it so unpopular?
Chapter 40B, also referred to as Chapter 774 of the Acts of 1969 and the Comprehensive Permit Law, created a process for granting “comprehensive permits” by the Zoning Board of Appeals (“ZBA”) for the construction of subsidized low or moderate income housing. These permits streamline the local process by consolidating local permitting. It became unpopular within many communities because it can supersede local requirements and regulations, including zoning. In communities where less than ten percent of the housing units are affordable, the denial of the comprehensive permit or the imposition of conditions which render a proposed development uneconomic may be appealed to the state Housing Appeals Committee.
Does the builder of a 40B development have the rights to bypass the housing requirements of Marshfield and just comply with state requirements?
Yes, but conditions may be negotiated. The builder must submit an application under Chapter 40B to the ZBA. The ZBA will conduct hearings and accept comments regarding the proposed development. The ZBA may approve the comprehensive permit with or without conditions or it may deny the permit. Conditions must be reasonable, and the conditions cannot render the development uneconomic.
Do local boards have any say in the decisions for a 40B project?
Yes, with limitations. Local boards and the public are invited to submit comments to the ZBA for consideration, and the ZBA may negotiate conditions regarding the development with the builder. However, it is the sole responsibility of the ZBA to grant, modify or deny the permit.
How can Marshfield avoid “Chapter 40B” developments?
Chapter 40B is the law and builders have a right to utilize Chapter 40B to streamline the permitting process, if ten percent of the housing units in the community are not affordable or if the community has not met its annual goal for producing affordable housing under its Community Housing Plan. Communities can hold off 40B projects for one year, on a year-by-year basis, as long as they are achieving their annual goal. Marshfield’s annual goal is 68 affordable units.
What~is inclusionary zoning, and how does it help Marshfield?
Inclusionary zoning is a tool that enables a community to promote the development of affordable housing, meet the requirements of the State’s Local Initiative Program (LIP) and have the units count towards the State mandated 10% affordability goal.
What advantage does the Inclusionary Zoning Bylaw (IZB) offer a developer when they can build under 40B?
A builder electing to build under the IZB seeks to work with the Town in a non-hostile manner. Affordable units are provided as prescribed by the Town and in return the Town offers the builder incentives such as a density bonus. Both benefit from this cooperative effort to provide affordable housing, while both agree to make some concessions. The end result is that the needs of both the Town and the builder are achieved. The Chapter 40B process is often hostile and often results in expensive litigation for both.
Why is the Inclusionary Zoning Bylaw voluntary and not mandatory?
There is much debate around IZBs and whether they should be voluntary or mandatory. One school of thought is that they should be voluntary because if mandatory they may constitute an unconstitutional land taking and the builder may be able to successfully sue the municipality. A second point of view is that it can be mandatory as the land taking serves the public good similar to an eminent domain taking. Some IZBs are mandatory and others are voluntary. As there is not sufficient case law clarifying this issue, the Housing Partnership has recommended that Marshfield’s IZB be voluntary.
What is a density bonus?
A density bonus is an increase in the number of market rate units that the builder can build on the site as an incentive for the builder to provide affordable housing units. In the proposed IZB the builder will receive one additional market-rate unit for each affordable unit provided. The IZB limits the total number of units to be developed on site by not allowing building lots to be reduced, on average, less than 75% of the existing lot size requirement for the zoning district.
Why do we need to provide a density bonus?
Without an incentive, such as the density bonus, the builder has no reason to voluntarily participate with the Town. The builder would be asked to provide the affordable units at his own expense and receive nothing in return. The IZB seeks to maintain a fair and equitable relationship with the builder. Additionally, we don’t want to create an environment in which the builder feels the only way he can successfully build in Marshfield is under Chapter 40B.
How does the IZB help the Town provide affordable housing through conversions rather than new construction?
The IZB allows the builder the option of either building the affordable units on site or paying a fee-in-lieu of construction. Fees-in-lieu of construction can only be used for the conversion of market rate units to affordable units and cannot be used for new construction.
How is the fee-in-lieu of construction determined?
The fee-in-lieu of construction is equal to 40% of the asking price of a comparable market rate unit being built on site and paid for each affordable unit that the builder would have built on site if the builder had selected the construction on site option.
Who receives the fee-in-lieu of construction?
The fee-in-lieu of construction is paid to the Marshfield Housing Authority (MHA) for the purpose of providing the affordable units for which the fee was intended. The MHA will administer the funds on behalf of the Town. The MHA was selected as it is a public agency with four of its five members elected and accountable to the Townspeople. As a public agency, it provides financial transparency and is subject to the States open meeting law, public records law, and public disclosure laws. Additionally, the MHA is local and knowledgeable about existing housing needs, affordable housing regulations and auditing oversight.
Won’t the IZB result in affordable housing being large “project-type” buildings that will be out of keeping with Marshfield’s character, poorly maintained and foster crime and drugs?
No. If a builder intends to build a large scale development he would most likely elect to do so under Chapter 40B and not the IZB. The IZB will more often be used for smaller developments as it is intended to be a cooperative process between the Town and the Developer. Except as otherwise permitted by Marshfield’s own zoning bylaw, the units will be single family homes or even existing homes in neighborhoods and will be well maintained and in keeping with the character of the Town.
The likelihood that affordable housing will result in increased crime and drugs is simply not true and without basis. The vast majority of units will be owned by working families.
Won’t affordable housing put additional burdens on our schools and other Town resources, resulting in higher property taxes?
Many people share this belief, but reality is that providing affordable housing under the IZB has very little influence on either municipal services or property taxes. Except for 40B developments, most development occurs as a result of what is called ‘as of right’. This represents the number of housing units a builder can build on the site within the allowances of the existing zoning bylaw. Additionally, affordable units resulting from conversions will have little to no added affect as they are units that already exist.
Won’t “affordable” units be taxed at a lower rate than market rate units, thereby reducing Marshfield’s property tax revenues?
Yes. Affordable units are taxed at a lesser amount. The reason for this is the ‘Use Restriction’ in the deed rider limits the resale value of the unit. The property is taxed on its assessed value. Its assessed value is diminished because the owner cannot sell it at full market value thus ensuring affordability in future years.
How will conversion units be funded?
By the Fee-in-Lieu of Construction funds resulting from the IZB and Community Preservation Act (CPA) funds appropriated by Town Meeting. These monies will be used to fund a Mortgage Reduction Program which will provide qualified homeowners with a deferred loan of approximately $50,000 to $75,000. In return, a ‘Use Restriction” is placed on the unit, keeping it affordable in perpetuity.
What will the Housing Partnership do with the CPA funds being requested at Town Meeting for conversions and how many affordable units will the funds provide?
With the CPA funds being requested, the Housing Partnership expects to convert 4 to 5 market rate units to affordable housing units
Why haven’t more conversions been done?
Despite the best efforts of the Housing Partnership, owners of apartments in Marshfield have not been willing to convert any of their units to affordable, primarily because the developments are profitable and the owners do not need the grants and loans that provide the incentives for conversion. The Housing Partnership has therefore designed its Mortgage Reduction Program as the vehicle for achieving the conversion of market rate units to affordable units through homeownership opportunities for qualified persons or families. The Housing Partnership has also been able to place affordability restrictions, in perpetuity, on a unit being resold, on which the affordability restrictions were expiring, thus retaining the unit on the affordable housing inventory.
Why does Marshfield need a Housing Coordinator?
In recognition of the necessity of professional assistance because of the complexity of the laws, rules, and regulations dealing with affordable housing and the need for careful and consistent monitoring, the employment of a Housing Coordinator is a key component of Marshfield’s Community Housing Plan approved by the State. Presently the functions of housing coordination in Marshfield are performed by a Housing Coordinator and a Technical Consultant working together. Together they provide expertise in different areas of affordable housing. During the past year they have corrected several years of work not adequately performed, resulting in the potential addition of 13 units to Marshfield’s affordable housing inventory, written the IZB, developed a Mortgage Reduction Program, organized the First Time Homebuyer
Program, worked with banks developing a low interest affordable home loan program pool utilizing Community Reinvestment funds, assisted eligible households in preparing for homeownership and worked with the Marshfield Housing Authority to develop capacity in the administration of the LIP affordable housing programs. Additionally, they have worked with property owners and builders to generate additional affordable units as well as providing a Housing Summit and Soft Second Mortgage Seminar. Affordable housing is a complex issue requiring constant monitoring, evaluation and program oversight to ensure a successful program. The Housing Partnership highly recommends the continued funding of this position.
For additional information please call Jack Mather, Housing Coordinator at 781-834-1051
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