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Vogel: Affordable Housing Policies

There’s a housing crisis in Vermont. According to a recent study, more than a quarter of Vermont renters pay more than 50% of their gross income in rent. Another study indicates that Vermont must build 21,000 affordable housing units just to meet the current need. And most alarming, more and more Vermonters are living in motels and even in their cars.

Given the urgent need, it’s painful to watch when precious housing resources get wasted. And at Safford Commons, a 36 unit affordable housing project in West Woodstock, more than 1.5 million dollars has been needlessly squandered.

The eight acre Safford Commons site was purchased in 2005 by the Woodstock Community Trust. The land was zoned for 72 units. The nonprofit developers decided to build only 36 units and leave half the property as green space.

At some neighborhood meetings, constructive criticism led to positive changes in the design. Soon however, it became clear that the neighbors really didn’t want this project.

They contested the development in the Environmental Court, Superior Court and the Vermont Supreme Court. When the neighbors lost, they appealed - multiple times. As a result, the project was delayed for nine years, adding additional legal, engineering, financing and construction costs amounting to $1.5 million - or $43,000 per unit.

Confronted by similar tactics, Massachusetts, Rhode Island, Connecticut and Illinois have all enacted laws that include a special appeals process for affordable housing. According to the Citizen’s Housing and Planning Association, because of these special legislative provisions nearly 54,000 affordable housing units have been built in Massachusetts. Other studies indicate this legislation helped Rhode Island build 5,500 units and enabled Connecticut to build an extra 10,000 units between 1990 and 1998.

Affordable housing development in Massachusetts, Rhode Island and Connecticut has resulted in billions of dollars of economic activity. In contrast, according to business leaders in Vermont, the lack of affordable housing limits their ability to recruit and retain good employees and expand their businesses.

The special appeals process passed by other states has been controversial. Local governments can feel threatened by anything that encroaches on their control over what gets built in their jurisdiction. But sometimes states need to step in and decide that tying up the court system, draining taxpayer money and housing families in motels for nine years is not good policy.

John Vogel is a retired professor from the Tuck School of Business. His tenure at Dartmouth began in 1992, where he taught Real Estate and Entrepreneurship in the Social Sector, among other subjects. He was named by the “Business Week Guide” to Business Schools as one of Tuck’s “Outstanding Faculty” members.
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