Affordable Housing and Chapter 40B FAQ
Q: What is Chapter 40B?
A: Chapter 40B is a Massachusetts statute passed in 1969 by only one vote, which allows developers override local zoning and to appeal local zoning board denials or restrictions to a Beacon Hill "Housing Appeals Committee" (HAC). 40B allows this if a certain percentage of affordable housing (25% for owner-occupied units) is included.
Under 40B, affordable housing is defined as units which can be afforded by households making 70% of the local median income, have been subsidized by certain state or federal housing subsidy programs, and have deed restrictions. Developers have successfully used Chapter 40B proposals to build over 800 developments across the state that are at variance with local zoning rules for density, conservation restrictions, and type of housing.
Q: What is the definition of "affordable housing?"
A: Affordable housing is defined by statute as housing that is affordable by people making 70% of the median income for a given area, adjusted for family size. In order to be counted as "affordable" units toward the 10% mandated by Chapter 40B housing statute, however, the housing also has to be built utilizing state/federal subsidies (including the LIP process and/or Community Preservation Act (CPA) funding) and must be deed-restricted to remain affordable for a certain time period (5 years for rental and 15 years for owner-occupied units).
Q: Who is eligible to rent or purchase affordable housing?
A: In general, people making up to 80% of the median income for a given area are eligible.
Q: How does Massachusetts rank in affordable housing?
A: Massachusetts ranks 49th in national housing affordability according to the National Low Income Housing Coalition.
Q: How much does it cost to "buy down" and properly deed-restrict an existing unit of housing?
A: It depends on the individual unit, of course, and the overall shape that it's in. The minimum cost is around $15,000 per rental unit and approximately $20,000 - $30,000 for owner-occupied properties. These costs are much more efficient in using government monies to create more affordable housing over new development.
Q: So, what's the least expensive way to reach 10% affordable housing? What's the least damaging to the environment? What requires the least reduction in open space? And what will yield the lowest adverse impact on traffic, services and the property tax rates in towns around the state?
A: These goals - limiting expenses, preserving open space, reducing environmental degradation, maximizing quality of life, and minimizing taxes - turn out not to be mutually exclusive. The approach that causes the lowest negative impact on each of these turns out to be buy-downs and redevelopment of existing properties.
The impact of buying down and/or simply deed-restricting existing properties is much more positive than allowing developers to create a few new owner-occupied affordable units in return for allowing them to build complexes which are unsuitable for many neighborhoods, environments and town. Remember, if a city/town helps finance an affordable housing project, say by providing some land and that project has 25% affordable units, only those units are counted. So only one quarter of the units that are constructed count toward the affordable total for the town. However, every single unit that is bought down and/or deed-restricted counts 100% toward the total.
Q: Why is it so important for cities/towns to have a Master Plan for Affordable Housing?
A: The Master Plan allows the town to better guide the nature of development, control the rate of development, and more precisely track the progress of affordable housing against the plan. Very importantly, the plan shows how the town intends to provide affordable housing, and makes it easier to exclude developers who want to violate town policies for their own profit. Specifically, when a developer wants to bypass local zoning restrictions under Chapter 40B, the comprehensive permitting process shifts to the state level. If the town does not have a master plan, it is harder to consistently apply guidelines, and it is harder to convince the Board of Appeals that a consistent set of guidelines is being applied.
Q: How can the CPA fund can be used to provide affordable housing?
A: The CPA fund (Community Preservation Act) is specifically required to spend at least 10% of its funds on affordable housing, but the amount can be up to 80%. As long as the state matches the funds, about a million dollars a year will become available for environmental and historical preservation, and affordable housing.
