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Housing Trust pulls down tax credits for three-phase project

BRATTLEBORO—The Windham & Windsor Housing Trust (WWHT) entered the final phase of a three-phase rehabilitation and renovation project this month.

Construction costs for the project totaled $8.9 million, according to WWHT Executive Director Connie Snow. The funds spruced up 83 of the housing trust’s older apartments across 13 buildings.

Improvements included refinishing or replacing flooring, updating fixtures, and energy and heating upgrades.

According to Snow, staff noticed more than two years ago that some of the apartments purchased during the WWHT’s early years underperformed financially.

Some of this underperformance was a result of the units’ inefficient energy systems or maintenance needs, she said.

“Financially, they just weren’t doing as well,” she said.

Staff decided to restructure and renovate the 83 apartments.

The first phase wrapped up last year and included properties in Brattleboro and one in Wilmington, she said. Phase two finished in September and included two Brattleboro properties and the acquisition of a new property in Putney.

Finances for phase three closed Nov. 30, with construction starting this month, said Snow. This phase included five Brattleboro properties.

Snow said WWHT raised money for the three-phase project through the state’s tax credit program, which helped to provide a path for the housing trust to raise private capital.

The Vermont State Housing Authority (VSHA) allocates tax credits to organizations, such as WWHT, providing affordable housing, Snow said.

The organizations take the tax credits to private investors, who then give the organizations money in exchange for the tax credits.

The tax credits program originates with the Internal Revenue Service (IRS), added Snow. The IRS designed the program to stimulate investment in affordable housing.

“In Vermont, it tends to be the banks who buy these credits,” she said.

For the past 30 years, federal funds for affordable housing have decreased, Snow said. The tax credit program helps organizations generate private capital.

As an example, Snow pointed to the WWHT apartments above the Brattleboro Food Co-op. Approximately 60 percent of the funds for that project came through private capital via the tax credit program. The remaining 40 percent came from government funding.

“I don’t know that we’ve done a project without tax credits in a long, long time,” she said.

The housing trust expects to see cost savings in the 83 units with the repairs, she said.

Some of the buildings haven’t received attention in 19 years, Snow added. “This level of investment” will give the apartments another 20 years of useful life. The energy upgrades will also lower heating and electric costs.

“We try to provide affordable housing,” Snow said. “Keeping costs low is one of the ways we do that.”

According to the trust’s website, the trust is accepting applications to its wait list for all properties except those with single rooms. Monthly rental costs range from $354 for a room (including all utilities), to $900 for a market-rate three-bedroom apartment (heat and hot water included).

WWHT employs three strategies to keep rents low, said Snow.

The first is to purchase new properties outright and avoid holding a mortgage. The second is investing in efficient energy features such as solar panels. The third strategy is installing fixtures and finishes, like flooring, that stand the test of time and require little maintenance.

The trust wants these apartments to “be great resources” for the community, Snow said.

“We’re excited about this three-phase project,” she said. “We’re here for the long haul.”

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Originally published in The Commons issue #335 (Wednesday, December 9, 2015). This story appeared on page A2.

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