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Article 32 - Establish Municipal Housing Trust FAQs 033021 pdf

Town Meeting · Town Meeting archive year 2021 · Record e8deb99e9821537d49

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Article 32: Frequently Asked Questions about Municipal Affordable Housing Trusts

This Frequently Asked Questions (FAQ) document is intended to outline some common questions and
concerns related to Canton’s housing challenges and address them.

Why is the creation of a local housing trust a benefit to our Canton community?
Housing is not only where we live. It’s how we preserve and protect what’s best about a community,
where community is a function of generations of families who have created a sense of place as well as a
constant influx of new families to provide richness and diversity. Housing issues can be complex, and
require long term strategies and solutions.

A housing trust can advance our affordable housing goals which can be found in Canton’s Housing
Action Plan (2015) and the Canton Master Plan adopted by the Planning Board in 2020. A housing trust
can ensure that we continue to have a minimum of 10% of our housing stock certified affordable. By
establishing designated funds and creating a board to oversee their use, Canton can provide a local way
to advocate for and preserve its affordable housing. Many current and future residents cannot afford to
purchase or rent a home in town because of the high cost of housing; the trust can establish a locally-
directed and coordinated process to help meet this need.

Don’t we have enough affordable housing already?
There are two key reasons why any town wishes to have a housing inventory that includes moderately
priced housing options. The first and most important is to provide housing to their residents who need
it. This includes lifelong Canton residents who tend to be older, with grown children who want to
downsize and move into more manageable space. It also includes young families just starting out who are
new to Canton, as well as town employees or those grew up here and want to move “home”.

Fully thirty percent of Canton households could be considered income qualified for what is considered
as “Affordable Housing.” This means almost 2,700 households of our 9,000 Canton households would
be income qualified for one of those affordable homes – such as the apartments or condos designed to
be affordable in the new Revere development. But there are only about 500 homes in Canton, including
apartments, condos, and single-family homes, that have affordability restrictions. Some of these
restrictions are legally “in perpetuity” meaning they last forever. But some restrictions are term limited,
meaning they will expire after a certain period of time, after which the rent or purchase price on that
home can revert back to market prices. In Canton, we know that restrictions on almost 300 homes are
due to expire in the next 15 years. In other words, we currently have about 2,700 households who
would qualify for affordable housing but only about 500 of such “affordable” homes, and most of those
will lose their affordability restrictions over time. So, it is really important to do something now to
preserve the affordable homes – we can also call them moderately priced housing choices - we have
now.

The second key reason is because having enough affordable housing preserves local control and planning
to be sure we have the right fit of housing style for Canton. As a result of a Massachusetts law known as
Chapter 40B, whenever a town’s inventory of affordable housing choices falls below 10%, then private
developers who want to build affordable housing are not subject to many of the town’s zoning bylaws.

This sometimes means that outside developers who may care more about building the highest density
project with the highest financial returns are able to build a development that the town would otherwise
believe is in the wrong spot, of the wrong height or design, or wrong density to suit the character or
needs of the town. This is a reality. In the town of Milton, there are currently 7 pending 40B projects
that will not have to abide by local zoning districts, that many in the town are concerned about. We
are fortunate that as a result of proactive management by local officials, Canton has an enviable 12% of
our housing inventory that qualifies as moderately priced or “affordable” using the housing lingo.

But our 12% status is at risk for two reasons. The first is that as more housing units are developed, the
denominator grows. We will fall behind 10% unless we are doing a good job of incrementally creating
new deed-restricted moderately priced units.

The second reason is a unit is affordable only if its rent or sale price is subject to a legally enforceable
restriction. Some restrictions are forever. If restrictions are not in perpetuity they are time based,
usually for 10, 15 or 20 years, after which they expire and the property reverts to market rates. Over
the next 15 years, the restrictions on 296 Canton homes are due to expire. Without action, Canton’s
affordability restriction could drop to 8.8% by 2035. And this calculation INCLUDES the 76 affordable
units gained as part of the Revere Copper Works project as well as another property being developed.

There is no current mechanism in place in Canton to protect against the expiring affordability
restrictions. We need a dedicated effort with the legal authority, sources of funding, competence and
expertise to really dig into and start to propose solutions to these issues. Most of all we need to be
proactive because preserving and creating affordable housing takes time – often 10 to 15 years. A
Canton Housing Trust could be part of our long-term plan to address our housing challenges.

Won’t more affordable housing mean more apartment buildings and large condo buildings
in town? This will create traffic nightmares on the town’s thoroughfares.
Over the last 30 years there have been noticeable changes in our community. Many Canton residents
cite over development as a big problem. Development is not always, but usually related to residential
building. We have seen a great increase in condominiums, apartments and particularly, single family
homes in areas that were once woods or undeveloped open spaces. This development, some say, has
resulted in chronic traffic congestion and growing demands on our public services. Some claim that as a
result of the development, Canton feels less and less like a small New England town, and more and
more like a bedroom community that is a suburb of Boston.

Most of the large-scale apartment buildings that have been put in Town are as a result of 40B
development. That means, the Town had little to no say in the scale or location of these large-scale
developments, because at the time they were developed the Town was not at a 10% threshold of
affordable housing units. Now that over 10% of the Town’s housing units are counted on its Affordable
Housing Unit inventory, the Town is back in the driver’s seat and can permit apartment buildings or
condo buildings where it is zoned to do so. A municipal affordable housing trust can both preserve
Canton’s affordable housing inventory over 10%, as well as thoughtfully allow for more deed restricted
affordable housing at an appropriate scale and location.

Affordable housing can take many forms. Indeed, much of the housing built in Canton in the last 20-30
years have been either large, expensive single-family homes or larger condo or apartment buildings.
There is also a need and desire for the so-called “missing middle” of housing. For example, this might
include small single-family homes/ “cottages,” two-family, three-family, quads, townhomes, or small
apartment buildings. These are both more naturally affordable due to their smaller sizes, and also can be
deed restricted and placed on the Affordable Housing Inventory. New affordable housing units do not
necessarily need to take the form of a very large apartment complex with hundreds of units.

Will more affordable housing impact our schools and burden our community?
Some people who hear “affordable housing” think only of large, public housing projects for the very
poor. Actually, affordable housing can be publicly or privately owned. Affordable housing can be an
entire building or development, or it can be a portion of the homes in a larger building. For example, 15
of the over 55 apartments at the Paul Revere Heritage Site are affordable. The key is that the rent or
purchase price on an affordable home – be it an apartment, condo or single-family home - is legally
capped at an amount that is deemed to be affordable by persons of certain income and asset levels. But
these levels are definitely not limited to the very poor. If fact, some might consider eligibility to include
many middle-income families. To give you an example, a family of 4 is income eligible for affordable
housing if the household income is about $96,000 per year. A single person is income eligible for
affordable housing if his or her income is about $67,000 per year. This means for example, many town
employees – including police, fire, teachers or DPW workers – could be considered income eligible for
affordable housing.

Despite all the residential development in the past 30 years, Canton’s housing challenging are worsening.
Median sales price of single-family home in Canton has climbed to over $600K. Exacerbated by low
inventory, bidding wars are causing buyers to routinely make cash offers above asking price. We know
this phenomenon is not unique to Canton. This is desirable place to live. Ironically, even during a world
pandemic when loss of jobs has made it difficult for many to pay their mortgage or rent, the housing
market is as hot as ever. The current real estate market makes it a great time for sellers. Unless
someone is a seller who wants to downsize and remain in Canton. That’s because median condo prices
have risen to over $400k and average rents for 2 bedrooms exceed $2,300 a month, which is the
highest rental market of all surrounding towns except Sharon.

Beyond the very high prices, Canton’s status as one of the oldest villages in New England works to
create housing challenges. That’s because our housing stock, which includes many older homes, is
disproportionately conventionally sized single-family homes of 3-4 bedrooms, all on the upper floors.
There are, relatively speaking, many fewer town houses, duplexes, 2 families, or homes of 1 or 2
bedrooms with an open design and ground floor bedroom.

Changing demographics will profoundly affect what kind of housing choice is required to meet the needs
of our residents. Consider that today 30% of all residents are persons over 50 years old. By 2030 –
less than 10 years from now, the percentage of persons over 50 is projected to be 44% of our
population, with the fastest growing segment those over 65. And what do we know about older adults,
many of whom are empty nesters? They want housing choices that have fewer bedrooms, with a master
on the first floor, little to no outdoor maintenance, and barrier free designs which have bigger openings

and fewer stairs. Consider that today, almost half our residents over 65 have a disability that translates
to housing needs. Consider as well the very high cost of living in Boston that is forcing many young
families or single professionals to flee the city in search of more affordable options, and a changing
economy that is making it easier to work remotely. These 20 or 30 something young adults often do
not want or need a 4-bedroom colonial.

So, people moving into so-called affordable housing are actually more likely working middle-income
people, who either have no children, very few children, or are older empty nesters looking to downsize.

What can a local housing trust do? A local housing trust allows municipalities to collect funds for
affordable housing, separate them from the general fund into a trust fund, and designate and use the
funds for local initiatives to create and preserve affordable housing. Examples of what other nearby local
affordable housing trust funds have done include:
    • Provide financial support for the construction of affordable homes by private developers (non-
        profit or for-profit); (Medfield, MA)
    • Rehabilitate existing homes and apartments to convert to affordable housing; (Milton has a
        condo conversion bylaw draft; Norfolk, MA)
    • Increase affordability in existing and future housing developments; (Medfield, MA)
    • Develop surplus municipal property for affordable housing; (Norwell)
    • Preserve properties faced with expiring affordability restrictions; (Newburyport)
    • Create programs to assist low- and moderate-income homebuyers; (Easton)
    • Create programs to help low- and moderate-income families make health and safety repairs; and
        (Southborough)
    • Educate and advocate to advance affordable housing initiatives. (many trusts)

Further, it is often the case when developing affordable housing that local funds are the first committed
funds to a project. A Trust can serve as a vehicle to aggregate existing resources as well as leverage new
public and private resources to support the creation and preservation of affordable units by entities such
as the Canton Housing Authority and the Community Preservation Committee.

What kind of affordable housing would the Trust seek to create? I don’t want my next-
door neighbor’s house to be converted to affordable housing and risk reducing the resale
value of mine.
As stated previously, affordable housing can take many forms. There is also a need and desire for the so-
called “missing middle” of housing. For example, this might include small single-family homes/ cottages,
two-family, three-family, quads, townhomes, or small apartment buildings. These are both more naturally
affordable due to their smaller sizes, and also can be deed restricted and placed on the Affordable
Housing Inventory. New affordable housing units do not necessarily need to take the form of a very
large apartment complex with hundreds of units.

One of the main goals of the trust will be to simply preserve the affordable housing units that Canton
already has, rather than immediately go to building new units. Another housing goal for Canton is to
increase the affordability of the existing market-rate housing. That can be done through first-time
homebuyer programs or rental assistance. Finally, the Trust may seek to selectively and thoughtfully

increase new affordable housing –as a part of a “missing middle” smaller scale housing development in a
location close to transit and services.

Can’t Town staff and Town Meeting perform these functions now?
Yes, in part. Though housing strategies often required dedicated subject matter experts, who have the
time and resources to focus on housing. We have no such dedicated or focused bodies in Canton.
Moreover, many of the activities listed above require a lengthy process which currently requires further
Town Meeting action. By establishing a housing trust, the trust can move swiftly with Select Board
approval – often, real estate opportunities that would preserve and create affordable housing are highly
time-sensitive. Additional oversight will be provided by the Select Board which must review and approve
any purchase, sale, lease, exchange, transfer or conveyance of any interest in real property. The bylaw
restricts any borrowing, mortgaging, and pledging of Trust assets, employment of lawyers and full or
part-time staff, and settlement or otherwise adjustment of claims in favor or against the Trust without
Select Board approval.

What controls the limits of the Trust’s authority?
Although the concept of local housing trusts is not new, the state legislature concluded that – due to
increased availability of local funding through inclusionary zoning, negotiated development fees, and state
and federal funding – there was a need to provide specific legislation to allow communities to form their
own municipal affordable housing trust funds. In 2005, the Massachusetts legislature passed the Municipal
Affordable Housing Trust Fund Law (MGL c.44 s.55C), which effectively simplified the process of
establishing a local housing trust and allowed it to be created through the Town Meeting process. Prior
to 2005, municipalities were required to file Home Rule petitions to establish Trusts.

This law also set guidelines on what local housing trusts can do, specifies who can serve on a local
housing trust board, and establishes the powers a community can grant the board. Since the new law
passed, 115 communities in Massachusetts have established municipal affordable housing trust funds
(One-third of Massachusetts cities and towns). Should Canton Town Meeting accept the legislation and
adopt the proposed bylaw, the Trust would be required to comply with the local bylaw.

Who would be members of the Trust?
The trust would consist of seven voting Trustees: The Town Administrator, the Finance Director, the
Town Planner, one member of the Select Board (chosen by the Select Board), a member of the Housing
Authority (chosen by the Housing Authority), a member of the Community Preservation Committee
(chosen by the Community Preservation Committee), and one citizen-at-large (appointed by the Select
Board).

What is the term of office for the trustees of the Housing Trust?
Trustees serve for a term of two years except that three of the initial trustee appointments would be
appointed for one year to stagger terms. They may be re-appointed at the discretion of the Select
Board. Vacancies shall be filled by the Select Board for the remainder of the unexpired term. Any
member of the Board of Trustees may be removed by the Select Board for cause after the opportunity
of a hearing.

Are the Trustees subject to the Conflict of Interest Law and are Trust meetings subject to
the Open Meeting Law? The Trust and the Trustees would be subject to the Conflict of Interest Law
and the Open Meeting Law.

What funds can be used in a local housing trust?
The sources vary among housing trusts. Under MGL c.44 s.55C sources of funding for trusts include:
Community Preservation Act (CPA) funds, inclusionary zoning payments, negotiated developer fees, the
Town’s general fund, payments or fees from special bylaws such as short-term rentals, grants, gifts, and
private donations. However, any funding from the Town’s general fund or from the CPA would require
Town Meeting action. Approximately 80% of the communities with a housing trust have also adopted
the CPA. One of the biggest benefits of a trust is its ability to be funded through a variety of sources.

What financial oversight of the trust will be required?
The Treasurer/Collector shall be the custodian of the Trust Fund's funds and shall maintain separate
accounts and records for such funds. Any income or proceeds received from the investment of funds
shall be credited to and become part of the Trust Fund. In accordance with MGL c. 44, § SSC, the books
and records of the Trust shall be audited annually by an independent auditor in accordance with
accepted accounting practices. Upon receipt of the audit by the Board of Trustees, a copy shall be
provided to the Select Board.

Will the housing trust have a plan and/or a budget?
Transparency and visibility through strong public communications will greatly enhance the effectiveness
of the trust. There would be a housing needs/priority planning process, regular report, publicizing
milestones, and maintaining an up-to-date online presence via a website and social media.

The trust would report annually to the Select Board and may also report regularly to the Community
Preservation Committee annually as needed (if receiving CCPC funds). The trust would work to identify
priorities consistent with the Canton Master Plan (2020), Housing Action Plan (2015), and Community
Preservation Plan (2019). The Trust would engage community members and other public and private
stakeholders while identifying and creating priorities. This would be done in the Trust’s first year.

As a part of the initial planning/ start-up process a budget would be created, most likely depicting
multiple years. This budget would indicate estimated revenue as well as expenditures by initiative. The
trust’s budget would track the money it uses in a clear, concise way and convey the work the trust is
supporting. It would track money by source to help track use restrictions that often come with different
sources.

Will the Trust’s activities (including potential borrowing or property purchase) have the
potential to negatively affect the Town, the Town’s financial stability, bond rating or
borrowing capacity?
A trust is a separate legal entity from the municipality, and as such, its financial actions would not impact
the Town’s financial actions.

What is the advantage to creating a local housing trust when we already have the Canton
Housing Authority (CHA)?
The Canton Housing Authority (CHA) is a state-controlled entity. It is funded and managed by the State
and while it works in partnership with the Town, the CHA does not derive funding from any Town
source other than Community Preservation funds, nor does it act at the direction of the Town
management. The use of the title “Canton” is the State’s method of delineating the community the
Housing Authority serves.

As identified by the CHA Director Mark Roy, the mission and agenda of the CHA is different than the
Town’s. The CHA operates under State statute, and is regulated through the Department of Housing
and Community Development (DHCD). It is not part of CHA’s mandate to buy and sell real estate,
although it is able to acquire and hold property on a self-supporting basis. CHA can purchase real
property but cannot sell property unless a legislative act is proposed and approved. CHA supports its
tenants on a rental basis.

CHA is regulated by DHCD and rental opportunities under most circumstances will mirror those
regulations. Also, both the future housing trust and the housing authority want to help local people.
However, the Housing Authority’s ability to help local people is more limited than it used to be, while
housing trusts offer more flexibility.

The Trust could be more flexible in its rental versus ownership structures. A local housing trust can, for
example, acquire property, partner with Habitat for Humanity, and eventually sell the completed units to
income-qualified individuals to expand home ownership opportunities in Canton. This type of project
could not be conducted by the Housing Authority.

Contributions negotiated as a part of special permits or affordable housing development requirements
(made as payment-in-lieu of units) directed to the trust can be used in a variety of ways – for example,
funds could be used to “buy down” market-rate housing and, with a deed restriction, keep the unit
permanently affordable to all subsequent owners. Again, such a process would be outside the scope of
the Housing Authority.

A final note: the CHA Director and the Chair of the Canton Housing Authority Board sat on the
subcommittee that drafted the Trust warrant article – the CHA looks forward to working with the
trustees on increasing housing opportunities for Canton residents and enthusiastically supports the
effort to create a Trust. The CHA will also be represented as a voting Trustee member.

What is the advantage to creating a local housing trust when we already have the Canton
Community Preservation Committee (CCPC)?
A housing trust can work cooperatively with the Canton Community Preservation Committee. The
CCPC would be represented on the Trust, and could serve complementary functions in working to
expand and preserve the supply of affordable housing in Canton. The Canton Housing Authority could
apply to both the Community Preservation Committee and the Housing Trust for funds to pursue new
opportunities. However, applications to the Trust could happen at any time of year (contingent on funds
available) and would allow more flexibility to fund programs or repairs if an urgent need arises. For
example, the COVID-19 Emergency Housing Relief Program the Town put in place last September could

have begun much sooner if a funded Housing Trust had been in place. Similarly, if any emergency repairs
needed to happen at a Housing Authority property, they could apply to the Trust outside of a Town
meeting cycle. Finally, if an affordable unit came up for sale, the Town could exercise its right of first
refusal to purchase the unit and sell it to a qualified buyer, rather than letting the affordability restriction
expire (which has happened several times in the past few years). The CCPC has expressed support for
the trust via recommending $50,000 in start up funds for initial planning work (contingent upon the
Trust’s formation at Town Meeting 2021).

Who supports the Municipal Housing Trust?
The potential Municipal Housing Trust is supported by the Planning Board, Select Board, Housing
Authority, and Community Preservation Committee. It is currently before the Finance Committee for a
vote.

Where I can I learn more?
  • The Canton Planning Department webpage: https://www.town.canton.ma.us/839/Housing
  • The Canton Housing Action Plan:
     https://www.town.canton.ma.us/DocumentCenter/View/3774/Canton-Housing-Action-Plan-
     2015-PDF
  • The Canton Master Plan 2035: www.cantonmasterplan.com
  • The Housing Toolbox has a wealth of general information on municipal affordable housing
     trusts: https://www.housingtoolbox.org/local-tools/housing-trust-funds.
  • The Massachusetts Housing Partnership’s Municipal Affordable Housing Trust Guidebook:
     https://www.housingtoolbox.org/writable/files/resources/MAHTGuidebook_2018.pdf