Boston (7/3/2024)— The Massachusetts Senate took action on Thursday to address the state’s housing crisis. S.2834, An Act relative to affordable homes—also known as the Affordable Homes Act—authorizes $5.4 billion in borrowing and makes crucial policy changes with the goal of building new housing, accelerating the rehabilitation of existing housing, reducing barriers to development, and promoting affordable housing. 

Following robust debate, the Senate passed the legislation unanimously. 

"For many Massachusetts residents, finding affordable housing that meets the needs of their family has become a significant challenge, if not nearly impossible. The bottom line is that we need more housing of all kinds, everywhere across the State, and we need to do so as quickly as possible to clear the housing backlog, free up space in the market and create opportunities for all those who want to call Massachusetts home. By authorizing bonded funding to provide historic investments in public housing, support new and existing programs that drive production, and prioritize climate-resilient investments that support our green energy benchmarks, we are reaffirming our commitment to addressing the reality of the current and projected housing demand to meet the needs of Massachusetts residents,” said Senator Paul Feeney (D-Foxborough). 

Addressing the “Missing Middle” through Starter Home Construction

To address gaps in affordable homeownership for the Commonwealth’s “missing middle,” Senator Feeney secured funding to reduce barriers in construction and zoning for starter homes. Starter homes are smaller homes or condo units up to 1,850 square feet in a heated living space that provide first-time homeowners with enough space and amenities yet are priced within reach of first-time homebuyers.

Decades ago, starter homes were built at an extremely high rate, yet these entry-level homes are disappearing from the market as builders focus on more lucrative projects. The gap in affordable construction has made it difficult or close to impossible for many first-time buyers to afford homeownership. Senator Feeney filed amendments which were adopted in the final Senate Affordable Homes Act that create a commission to study barriers to starter home production across the Commonwealth, as well as updates definitions in the 40Y chapter of the Massachusetts General Laws relative to starter home school cost reimbursement to boost funding for starter home zoning. The latter amendment would provide more reimbursement to communities who zone for starter home districts in order to incentivize the zoning and construction of these units and facilitate additional pathways to homeownership.

“At this critical time in the Commonwealth's housing crisis, and as young people and families contemplate their futures in Massachusetts, we must continue our work to ensure finding a home is not a luxury reserved for the ultra-wealthy," added Senator Paul Feeney. “I have been intently focused on addressing the need for more middle-class housing through the construction of starter homes that can boost the Commonwealth’s housing stock and provide options for working people and families otherwise unable to afford their first home due to skyrocketing costs. I am proud that my amendment passed to create a Special Commission to study hurdles to “starter home” zoning and construction to ultimately help ease the demand for more “missing middle” housing and support the American Dream of homeownership.” 

Supporting Local Housing Needs

During debate of the Affordable Homes Act in the Senate, Senator Feeney was proud to secure funding through the adoption of his amendments to address housing needs in the Bristol and Norfolk Senate District. The Senator secured an amendment to provide $5,000,000 to be expended and disbursed equally among the local housing authorities in the towns of Canton, Foxborough, Sharon, Norton, and North Attleborough for capital improvements to public housing properties. This funding will help provide municipalities the resources needed to keep public housing properties in a state of good repair to meet the standards occupants deserve.

The Senator was also proud to secure $3,000,000 for the Northern Bristol County Assistance Collaborative, Inc. for costs associated with the development of an affordable senior housing project development in Attleboro. This proposal aims to provide secure, affordable, and well-designed homes that support the well-being and stability of Attleboro’s senior population. The project includes approximately 70 units of mixed income and service-enriched rentals for seniors aged 62 and over.

Additional Affordable Homes Act Highlights:

The legislation makes important investments in public housing; housing affordability; sustainable building initiatives; initiatives for first-time homebuyers; essential infrastructure; geographic equity; and incentivizing local best practices. Additionally, the bill includes policy proposals to further housing equity for both homeowners and renters. The bill contains $5.4 billion in bond authorizations, including:

Creating and Repairing Public Housing

The Senate Affordable Homes Act provides $2.2 billion for repairs, rehabilitation, and renovation across the 43,000 units of state-aided public housing. This significant investment ensures that the state's public housing infrastructure remains safe, modern, and sustainable, so it can continue providing quality living conditions for thousands of families.

To ensure that the Commonwealth makes strides towards its climate goals as it creates housing, $150 million of the funding for public housing is specifically allocated to making energy efficient upgrades.

Spurring Affordable Housing Units

A further $425 million will go to the Housing Stabilization and Investment Trust fund, working with municipalities, non-profits, and developers to support housing preservation, new construction, and rehabilitation projects for affordable rental units. This will help the longevity and sustainability of affordable housing stock, addressing both immediate needs and long-term housing solutions.

It additionally adds $800 million into the Affordable Housing Trust Fund to create and preserve housing for households with an income at or below 110 per cent of area median income, helping to bridge the gap between the high cost of housing and what many families can afford.

Building Sustainably

This bond bill includes $275 million for innovative, sustainable, and green housing initiatives. By finding new ways to build that don’t have such a detrimental environmental impact, these initiatives will help pave the way for a greener housing portfolio in Massachusetts and will be an important part of the state’s response to the climate crisis.

Supporting First-Time Homebuyers in Gateway Cities

The Senate Affordable Homes Act authorizes $200 million for the CommonWealth Builder program to further the production of housing in gateway cities for first-time homebuyers. This initiative supports economic development in these cities, helping families achieve homeownership and contributing to the revitalization of urban areas.

The legislation also includes $50 million for MassDreams, a program that provides down payment and closing cost grants to first-time homebuyers who meet the program's eligibility criteria and who currently live in one of the 29 communities that were disproportionately impacted by the COVID-19 pandemic.

Maintaining Essential Infrastructure

The bill provides $375 million for HousingWorks, a program that awards grants to municipalities and other public entities for a variety of infrastructure-related support. Improving essential infrastructure supports the health and safety of residents and the feasibility of new housing projects.

Of this amount, $100 million will be dedicated to addressing water, sewer, and septic challenges tied to housing developments, and $100 million will help incentivize best practices in communities that have adopted the Community Preservation Act (CPA) and are spending a high percentage of those funds on housing, as well as  MBTA communities that are going beyond the minimum requirements set forth in the MBTA zoning law passed in 2021. Communities that have been proactive in creating transit-oriented development, which reduces traffic congestion and promotes sustainable urban growth, will be eligible.

Addressing Regional Equity

The legislation includes $150 million in dedicated funds to address the unique housing needs of rural towns, seasonal communities, and mid-sized communities. This ensures that all areas of the state, regardless of size or location, have the resources to meet their specific housing challenges.

The Senate’s Affordable Homes Act also contains multiple policy proposals to go hand in hand with the new authorizations.

Protecting Tenants from Broker Fees

By requiring that real estate brokers’ fees be paid solely by the party that contracted with them, this legislation ensures that buyers are not burdened with unexpected and extraordinary costs. It also promotes transparency and fairness in real estate transactions.

Establishing Equity-Focused Housing Offices

The Office of Fair Housing and the Office of Livable Communities and Community Services will be established under the Executive Office of Housing and Livable Communities. These offices will set the Commonwealth on a path to address many decades of housing discrimination by prioritizing equity issues in housing across the Commonwealth, ensuring equal access to housing opportunities for all residents, and offering technical assistance to cities and towns that can sometimes lack dedicated housing staff.

Eviction Record Sealing

The bill introduces a process for tenants to seal their eviction records in cases of no-fault evictions and other limited scenarios. This policy protects vulnerable tenants from the long-term stigma of eviction records, enhancing their ability to secure future housing and promoting housing stability.

Accessory Dwelling Units (ADUs)

The legislation prohibits the banning or unreasonable restriction of ADUs in single-family residential zones, promoting flexible housing options. This policy enables homeowners to create additional living spaces, increases housing supply and provides more affordable rental options within established neighborhoods.

Homeownership Tax Credit

This new tax credit will be available for the production of homeownership units for households that make up to 120 per cent of the area median income, incentivizing housing production and promoting homeownership opportunities.

Separate versions having passed the Senate and the House of Representatives, the two branches will now reconcile the differences.

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