Town of Bolton, MA - AFFORDABLE HOUSING TERMINOLOGY

Affordable Housing (AH) Housing available to households earning less than 80% of the area median income at a cost that is no more than 30% of total household income.

Affordable Rental Housing Unit -In a 40B development, that designates 25% of units as affordable, all apartments are counted as affordable housing. The state wants to encourage building of apartments.

Area Median Income (AMI) The estimated median income, adjusted for family size, by county or .metropolitan area. The AMI is adjusted annually by HUD.

for affordable housing and community development activities in the state representing all interests in the housing field: non-profit and for-profit developers, homeowners, tenants, bankers, real estate brokers, property managers, government officials, etc.

Chapter 40B (also referred to as “anti-snob zoning” or comprehensive permit) Massachusetts General Law enacted in 1969, which established affordable housing goal of 10% for every community. In communities below the 10% goal, developers can seek a comprehensive permit bypassing local zoning. In exchange developers must designate a minimum of 25% of total development for moderate income households. The Bolton ZBA can place conditions on the comprehensive permit as long as these conditions do not make the project “uneconomical “ for the developer.

Community Development Action Grant (CDAG) A state funded program using housing bond bill funds, to enable financing of affordable housing.

Community Development Block Grant (CDBG) HUD program which provides flexible annual grants on an entitlement basis, by formula, directly to states and communities benefiting housing development for moderate income people.

Community Preservation Act (CPA) Designed to preserve open space, historic resources and affordable housing. For every $1 that town raises through a property surcharge, the state provides matching funds. CPA funds can support housing for households up to 100% of the area’s median income. (for housing to count as affordable, however, income needs to be 80% or less of median income). Harvard got $300K this year from the state under this program.

Comprehensive Permit A permit issued to developers willing to assign 25% of proposed development to affordable housing. Comprehensive permit expedites permit approval process and provides waivers from local zoning. See also Chapter 40B.

Department of Housing and Community Development (DHCD) Massachusetts agency for housing and community development programs. DHCD oversees state funded programs and other funding incentives to promote affordable housing. DHCD keeps the individual communities affordable housing units inventory, and determines or “certifies”what “counts” as affordable housing. (see Subsidized Housing Inventory)

Executive Order 418 (EO418) subtitled “Assisting Communities in Addressing the Housing Shortage”. This state order makes available up to $30,00 in planning resources to each community to plan for new housing opportunities while balancing economic development, transportation infrastructure improvements and open space preservation. It also gives priority in awarding $364 Million annually in discretionary funding to communities that have been certified as having taken steps to increase the supply of housing to individuals and families across a broad range of incomes.

HUD (Housing and Urban Development) Federal agency responsible for addressing the nation’s housing needs and development of nation’s community, as well as for enforcing of fair housing laws and for helping local communities meet development needs.

Growth Management Uncontrolled growth cannot be sustained over a long period of time. Community to plan for specific development(s) rather than respond to permit applications.

Home Rule Petition A local initiative (from town warrant to DHCD to state legislature) taken in order to “count” innovative or unique housing concepts towards the state’s 40B requirements for affordable housing. For example, Town of Marion offers a tax exemption (subsidy) in exchange for affordability deed restriction to qualifying existing home owners, in order to “count” houses as affordable housing.

Incentive Zoning Zoning provisions that encourage but do not require developers to provide certain amenities or qualities in their projects in return for identified benefits, such as increased density or expedited processing.

Inclusionary Zoning A zoning ordinance that requires a developer to include affordable housing as part of a development, or contribute to a fund for such housing.

Infill Development Building on vacant parcels in developed areas. Compact development is promoted and undeveloped land is preserved.

Limited Equity Home Ownership Ownership housing in which resale values are restricted in order to remain the long term affordability of the units. A technique often used for housing developed with housing assistance in order to reduce development costs. This type of ownership can be a cooperative, a condominium or fee simple ownership.

Local Initiative Program (LIP) A state program under which communities may use local resources and technical assistance from DHCD to develop affordable housing

Low-Income Housing Tax Credit (LIHTC) Federal tax credit for developers of affordable housing. States receive an annual dollar value of credits which then they allocate to qualifying projects based on priorities established in a state allocation plan. DHCD is the allocating agency.

Massachusetts Housing Partnership Fund (MFP) is a quasi-public state agency financed by the banking industry to support affordable housing and neighborhood development. Provides below market financing to create affordable rental housing and home-ownership opportunities.

Mixed Income Housing Development Development that includes housing for various income levels. The idea is to “deconcentrate” poverty in urban settings. In suburbia, it is a design principle that designates a percentage of housing to different price ranges and may include persons with very low income.

Mixed Use Development Projects that involve different types of development such as residential, commercial, office, industrial and institutional into one project. Mixed-use redevelopment of neighborhoods promotes comprehensive revitalization through retention or addition of housing, services and jobs.

Overlay Zoning A zoning district, applied over one or more other districts, that contains additional provisions for special features or conditions, such as historic buildings, affordable housing, or wetlands.

Peer to Peer A technical assistance program administered by DHCD through which it provides small grants to local officials for short term problem solving.

Smart Growth The term used to refer to a rapidly growing, and widespread movement that calls for a more coordinated, environmentally sensitive approach to planning and development. A response to the problems associated with unplanned, unlimited suburban development - or sprawl - smart growth principles call for more efficient land use, compact development patterns, less dependence on the automobile, a range of housing opportunities and choices, and improved jobs. In short, a housing balance.

Smart Growth Incentives Use of tax and planning incentives by state and local governments to promote sustainable growth in developed areas and discourage growth in green areas. For instance, state funding is funneled to schools in dense, built areas and not provided for schools in new areas with no infrastructure.

Subsidized Housing Inventory (SHI) An official list of units, by municipality, that counts toward a community’s 10% goal.

Syndication As used in affordable housing, syndication refers to the raising of equity (investment capital) for low income rental housing via sale of tax benefits to outside benefits.

This glossary was compiled by the Bolton Affordable Housing Partnership, and is based on information available in a “GUIDEBOOK ON CREATING LOCAL AFFORDABLE HOUSING STRATEGIES: TAKING THE INITIATIVE”, published by CHAPA and MHP, 2002,as well as DHCD web site.