Advocates will seek $200 million from state for housing needs

Girding for a worsening housing and homelessness crisis in Windham County and the rest of Vermont, organizations champion the idea of building permanently affordable housing to create long-term availability and stability

For the first time, Vermont's affordable housing and homelessness advocates have joined forces and are calling for more than $200 million in public funding to address the state's housing and homelessness crises.

Prioritizing the urgent need for more permanently affordable housing - housing built on the condition that rents will always be capped - the Housing & Homelessness Alliance of Vermont (HHAV) is asking the Vermont Legislature for $160 million in one-time funding for the Vermont Housing & Conservation Board (VHCB), which funds the construction and preservation of affordable housing.

"Permanent affordability tackles the inventory problem - we need more housing - but it also invests public dollars in a long-term solution: holding community assets in perpetuity," said Executive Director Elizabeth Bridgewater of Windham & Windsor Housing Trust (WWHT), a local, nonprofit developer of affordable housing.

VHCB offers grants and loans to nonprofit housing organizations, like WWHT, around the state. Since its establishment in 1987, VHCB has contributed to the development of more than 15,000 permanently affordable homes in Vermont.

More is needed

HHAV was created this year through the merger of the Vermont Coalition to End Homelessness and the Vermont Affordable Housing Coalition.

Representatives from WWHT and Groundworks Collaborative, which runs an overnight shelter for people experiencing homelessness in Brattleboro, serve on the HHAV board.

Another priority for the HHAV: Funding for unhoused Vermonters to remain sheltered in area motels through the fiscal year.

This year's $200 million request to the Legislature is in line with previous years' asks, noted Jess Graff, HHAV board member and associate director of statewide housing advocacy programs at the Champlain Valley Office of Economic Opportunity. "It's a big number, but it's still less than what's actually needed," she said.

The Vermont Housing Finance Agency estimates that 30,000 to 40,000 homes are needed by 2030 to meet projected demand across all income levels.

'Stakes are high'

During the pandemic, the state initiated several new housing programs using federal recovery and stimulus funding. One such initiative, the Vermont Housing Improvement Program (VHIP), provides grants of up to $50,000 per unit for construction of and repairs to rental units.

Bridgewater noted that while the VHIP program is a valuable tool in the state's toolkit for creating new homes, it doesn't require that these homes be perpetually affordable. New homes created through the program must remain affordable only for five years.

Bridgewater and other affordable housing advocates are concerned that with the sunsetting of federal stimulus funding, there will be a temptation to "take our eye off the ball" of investing in permanently affordable homes.

"What happens to a family living in one of these (VHIP) homes when the rents go up after that five-year window is lifted?" Bridgewater said. "If they can't afford the higher rent, there's stress and chaos. And in this market with vacancy rates so low (i.e., very low turnover of housing units), there's potentially homelessness. The stakes are high."

She added her view that "we're in a new environment of really having to articulate why affordability strategies are ultimately more effective in the long run."

Advocates argue that by preserving affordability for the longest possible time, the public sector can serve the most people possible and maximize the return on public investment.

Permanent affordability helps relieve the pressure

In this environment of low wages - especially in southern Vermont - and high construction costs, which show up in high rents, it's more important than ever for the state to preserve affordability, Bridgewater said.

With some of the lowest wages in the state, many Windham County residents are "housing cost-burdened," defined as spending more than 30% of their income on housing.

More than half of Brattleboro residents who pay rent or mortgage are cost-burdened, according to the 2021 Brattleboro Housing Action Plan. Some 30% of renters are "severely cost burdened," paying more than half of their income on housing.

It currently costs about $500,000 to build a modest apartment or small home in the state, compared to about $370,000 in 2022, according to the Vermont Housing Finance Agency, an affordable housing organization that finances loans for lower- and middle-income Vermonters.

Because private developers need to charge higher rents to cover these costs, the creation of affordable housing is largely left to the public sector.

HHAV is also calling on the state to address the potential for "massive additional homelessness" on April 1, when hundreds of Vermont households experiencing homelessness are set to be evicted from motels where they have been sheltering since the start of the pandemic.

Motel shelter is generally available for 28 or 84 days depending on eligibility, or during adverse weather. The state expanded eligibility during the pandemic and, through legislation passed in June, most households currently in the program are eligible to stay until April 1, 2024. Fewer than half (549) of this "June cohort" of 1,289 households have transitioned out of the motel program since June.

"We need to recognize that come April 1 there won't be enough housing units, or enough shelter spaces, or enough capacity in the service delivery system to house everyone in the June cohort," said Peter Elwell, interim director of Groundworks Collaborative. "We can't have April 1 come and have the impact be 'Gee, it didn't work out for everybody but we did the best we could.'"

The state provides shelter in motels to unhoused Vermonters through the General Assistance Housing Program.

HHAV is proposing that households in the June cohort who are still unhoused on April 1 be able to stay in the motel program for the remainder of the fiscal year. HHAV is asking the Legislature to provide $6 million in the Budget Adjustment Act - the routine mid-year legislation to adjust the state budget - for this purpose.

State faces significant challenges

The Scott administration is proposing "the development of temporarily expanded shelter capacity for April 1," said Chris Winters, commissioner of the Department for Children and Families, in an email to The Commons.

These shelter options include congregate, semi-congregate, or non-congregate shelters, or expansion of existing shelter capacity in the five communities where most users of the services currently reside: Chittenden County, central Vermont, Rutland, Brattleboro, and Bennington, Winters said.

With three months to go until April 1, the administration cites "significant challenges" to standing up these temporary shelters, including finding appropriate locations and staff for them, funding the appropriate number of beds, and getting community buy-in for the effort.

Concerned about the potential for a "warehousing approach" by the administration, HHAV advocates for an approach that supports a progression from emergency shelter to more stable and sustainable housing. Advocates have been wrestling with how to best deliver this support since before the pandemic.

"The housing and homelessness crisis has developed over decades," said HHAV Vice-Chair Lindsay Thrall, who is also the Connections Program manager at Evernorth, a nonprofit developer of affordable housing in Vermont, Maine, and New Hampshire.

"So it's not going to be solved in one year, even if all of the HHAV's legislative priorities were enacted. But these are investments that we have to make long-term to slowly solve this problem," Thrall said.

This News item by Ellen Pratt was written for The Commons.

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