BENJAMIN FIERRO
Rural towns would benefit

Builders are urging lawmakers to expand a state law that provides financial incentives for dense mixed-income housing development near town centers and public transit stations to appeal to smaller rural communities.

The Home Builders Association of Massachusetts and the National Association of Industrial and Office Properties’ Boston chapter support a bill that would enable communities to designate areas near bus stops as smart-growth districts, making them eligible for the benefits provided under the state’s Chapter 40R law.

The bill also would authorize commercial- or industrial-zoned areas for smart-growth housing districts and would allow for less dense development, or four housing units per acre, in areas that don’t have town sewer services.

Supporters of the changes contend that Chapter 40R shuts out small communities that don’t have transit stations or existing town centers.

“Rural communities don’t have [MBTA] stations or bus stations,” explained Benjamin Fierro, counsel for the builders’ association, who spoke at a Joint Committee on Housing hearing last week.

Rep. Kevin Honan, the housing committee co-chairman who filed the bill, said officials from rural communities have told him that they would like to benefit from Chapter 40R but can’t.

Under Chapter 40R, communities that establish smart-growth zoning districts can receive one-time zoning incentive payments and density payments for each new unit that’s built within the district. The districts must be zoned for eight single-family homes per acre or 20 multifamily units per acre. The law also says smart-growth districts can be designated in or near town centers, transit stations, or in areas with existing infrastructure and underutilized buildings.

“Many communities are not willing to consider 40R because they believe that 20 units per acre for multifamily housing or eight units per acre for single-family homes is not possible without town water and sewer,” said Tamara C. Small, policy and public affairs director for NAIOP.

But opponents of the bill argue that the changes aren’t necessary because communities already can determine what areas are suitable and can approve a broad range of eligible locations.

Jay Wickersham, an architect who is a member of the Massachusetts Smart Growth Alliance, said the proposed changes could open up much more land for development and could undermine the open-space protections that are part of Chapter 40R.

“Any commercial-zoned area, regardless of location, could be designated for development. This would open up areas that may be zoned commercial and are located in the middle of farmland,” he said.

Wickersham, who helped the state draft regulations for Chapter 40R, said smaller communities already have options to allow them to participate in 40R. He noted that towns with fewer than 10,000 residents can seek waivers to the density requirements.

“We think [Chapter 40R] should be allowed to continue to work in its current format,” he said.

Several supporters noted that the lack of a reliable and steady funding source for program has become the biggest hurdle in getting more communities to adopt it.

Fourteen communities have approved 40R districts in the last 18 months. The districts could lead to the construction of more than 4,500 housing units, according to Ted Carman, president of Concord Square Development and a member of the Commonwealth Housing Task Force. The task force opposes efforts to amend or expand 40R.

“We think it’s a little early to be tinkering with the details of the program,” said Carman.

Marc Draisen, executive director of the Metropolitan Area Planning Council, said the Legislature shouldn’t expand the law to allow for more land to be zoned for development until a secure source of funding is determined.

“The last thing we want to do is Â… dramatically expand areas that are eligible,” he said.

‘A Systemic Problem’

While Chapter 40R is helping to produce multifamily housing, it hasn’t spurred single-family housing construction, according to builders.

Jeff Rhuda, a development expert with Symes Assoc. in Beverly, said most developers prefer to construct multifamily housing under Chapter 40R because they can include more units per acre.

“It’s not geared for family housing,” said Rhuda. “We need something to encourage housing production for families.”

The builder association, NAIOP and the Massachusetts Association of Realtors have been working with the Commonwealth Housing Task Force to come up with a proposal that would encourage the construction of starter homes for families. The initiative would provide incentives to communities to zone for smaller homes – totaling about 1,700 square feet and located on smaller lots – that are priced to appeal to working families.

Builders said many communities require homes to be built on large lot sizes, which helps drive up the cost of housing.

“There is no one community that’s at fault, in my opinion. I think it’s a systemic problem,” said Rhuda.

While builders were asking for changes to Chapter 40R, they also told legislators to reject an exclusionary zoning bill. The bill would permit communities to require developers of 10 housing units or more to set aside 25 percent of the units for households earning up to 120 percent of the area median income, build the lower-cost units off-site or make a donation to an affordable housing fund.

In exchange, the developer would be able to get a density bonus of one unit for every 10 units that are built.

The builder association supports inclusionary zoning but questions the formula included in the proposed legislation, which determines the number of units that must be set aside and the density bonus, according to Fierro.

If the bill is passed, a developer building 10 single-family homes would have to set aside about three homes to be sold at below market-rate prices. “How do you do that without increasing the cost of the other seven homes?” Fierro asked.

At the same hearing, Realtors spoke in favor of a bill that would permit towns to adopt zoning-density bonuses without a special permit if some of the units are affordable. Leaders of MAR and the Greater Boston Real Estate Board also testified in support of a bill that would require towns to adopt only temporary building-permit caps and to have a plan to address specific growth-related concerns that prompted the cap.