With the Bay State recording some of the highest residential real estate prices in the nation, several Massachusetts cities and towns are seeking to establish affordable housing trust funds as a vehicle for creating reasonably priced housing. Four municipalities in the state – Duxbury, Hamilton, Wellfleet and Mansfield – have legislation currently pending in the House of Representatives that would create a tool to help spur the construction of more inexpensive homes.

The need to adopt affordable housing trust funds can arise as a result of a variety of different programs and initiatives, but usually with the same overall objective of increasing affordable housing production.

“I think towns are looking for any possible tool that they can find to increase their supply of affordable housing. Affordable housing trust funds are there for those looking for the ability to establish accounts that can hold money and move developments or proposed developments forward. They can come about through programs like the Municipal Affordable Housing Trust Fund, the Community Preservation Act or elsewhere to provide the opportunity to produce some level of funding,” said Chris Norris, assistant director of the Citizens’ Housing and Planning Association in Boston. The most recent round of affordable housing trust fund applicants represents a variety of different beginnings.

Duxbury

The town of Duxbury originally filed its affordable housing trust fund application in March 2004, but the legislation was filed too late to pass in that cycle and was refiled this year.

“A few years back we formed a community development plan with the use of state EO-418 funds [a program designed to help local officials balance economic progress with preserving quality of life in their communities]. Each town got $30,000, which eventually led to the establishment [by Town Meeting] of an affordable housing trust fund,” said Christine Stickney, Duxbury’s town planner.

After gaining “overwhelming approval” by voters at Town Meeting, a petition was submitted to the Legislature to create the trust fund.

“We’re waiting to get it passed in general court so we can have a dedicated account. If we get a gift, or grants, or any other funding, that’s where it’s going,” said Stickney.

There are a few affordable housing development plans that are currently in the works in Duxbury, including one to expand rental properties and another to build new units.

“We have some new projects, but our plan is also to help retain the existing housing stock in town and make sure it’s accessible to everyone,” Stickney said.

Hamilton

In May of this year, Hamilton’s Planning Board proposed an inclusionary housing zoning bylaw that now requires any new development of 10 homes or more to include at least one unit of affordable housing; for every additional seven units, another affordable unit must be built.

As an alternative to including an affordable element in their own project, the town has proposed an affordable housing trust fund to give developers the opportunity to deposit money to be used toward future affordable housing production. The legislation creating the trust fund is currently being considered in the House.

Although the two are not directly related, at the same time the affordable housing trust fund was approved at Town Meting, Hamilton voters passed the Community Preservation Act. The CPA would to increase residents’ tax bills by 2 percent in order to collect money for preservation of open space and historic sites, as well as creation of affordable housing or recreational facilities. The money is matched dollar-for-dollar by the state and placed in a separate fund.

Town Meeting voters narrowly defeated the CPA in 2002, but the proposition passed easily this time around.

“It seemed to pass without contest,” said Jean Nelson, Hamilton’s planning coordinator.

After the adoption of the CPA and affordable housing trust fund, a nine-person Community Preservation Committee was established.

“In Hamilton there is a need to give people more opportunities when it comes to housing,” said Nelson.

Mansfield

The town of Mansfield has at times come close to reaching a state-set goal of having 10 percent of its housing stock be affordable, but staying at that level is proving to be a challenge as new market-rate housing is built.

“A few years ago Â… four [Chapter] 40B housing applications came in, all four of which we approved. We looked at that and said, ‘Gee, that’s pretty good.’ Mansfield had almost reached its goal of 10 percent of the housing stock being affordable,” said Shaun Burke, the town’s planning director. “As a result of market-rate units being built like crazy, that percentage dropped down to about 7 percent. The [Chapter 40B] applications would take us back up near 10 percent, but the town had to ask itself, ‘how are we going to stay there?'”

The answer came through working with the Community Opportunities Group, a Boston-based company founded in 1979 to help meet the housing and community development needs of cities and towns throughout New England.

“COG worked with us in putting together an affordable housing plan, a part of which was the affordable housing trust fund,” said Burke, who admitted the town was in need of help. “At one point we were doing really fine with affordable housing and then we seem to have fallen asleep at the wheel and that 10 percent goal was a moving target.”

Another part of the affordable housing plan was adoption of an inclusionary housing zoning bylaw, which raised some concern from local developers but ultimately passed without strident opposition.

“I think people ultimately understand that we’re trying to do something proactive. If the bus is going to get us there, isn’t it nice to be driving instead of sitting in the passenger seat?” Burke said.

In communities where less than 10 percent of the housing stock is deemed affordable, developers may circumvent the local permitting process by proposing developments with an affordable component under the state’s so-called anti-snob zoning law, Chapter 40B. However, communities that are making progress toward that goal may be exempted for a period of time and gain more control over the type of developments approved.

Though the adoption of an affordable housing trust went unopposed, the town elected to not be part of the CPA. The legislation is still pending and to date the inclusionary bylaw has yet to be triggered by a new, large-scale housing development.

Wellfleet

Wellfleet’s pending affordable housing trust fund legislation was not the result of expressed need, but rather enthusiastic generosity.

“It came about initially because we had people in the community who wanted to contribute toward affordable housing and we didn’t have a way as a town to accept that money and designate it for that purpose,” said Rex Peterson, Wellfleet’s assistant town administrator. “We’ve also had situations come up where, because of high prices, people buy land and want to take down the existing house and build a larger one. Some want to donate their smaller house to the town, but due to time limits it doesn’t give us the room to wait until next May when there’s a Town Meeting to authorize funds. The housing committee felt that a trust fund would let us take advantage of those opportunities.”

Not only have a few individuals attempted allot funds to affordable housing, but local groups also have organized events explicitly for that purpose. A poetry reading fund-raising event last summer at the town’s Congressional Church raised $5,000 earmarked for housing, for example.

Wellfleet originally filed special legislation to create an affordable housing trust fund in 2004 just before the state passed a bill that would allow municipalities to create affordable housing trust funds without the extra step of special legislation. Even when considering the state-sanctioned option, however, Wellfleet decided to stick with its own plan.

“The state’s plan has certain stipulations that we didn’t like. We really want our own version, which we’re very hopeful it will pass,” said Peterson.

Ultimately, no matter how towns in Massachusetts choose to meet their individual affordable housing requirements, it is clear that a need has been identified in select communities.

Some municipalities, like Marshfield, have had affordable housing trust funds proposed only to have them voted down at town meetings. In late April, residents of that community voted 118-93 not to create a fund.

“I think some communities have a variety of concerns on a local level – everything from school costs to water supplies to sewer capacity to other infrastructure. Sometimes these issues seem to outweigh other needs,” said Norris.

The concerns for the communities that will soon have new affordable housing trust funds appear to be three-fold: overall high costs of housing deterring new residents and diversity; senior citizens who may be forced out of their communities because of housing costs; and younger people who grew up in the community but may be prevented from moving back to be with their families because of limited housing options.

“Housing prices are just too high. Older generations and younger generations are looking for places to live but it’s just too expensive,” said Nelson.

In Wellfleet, some are fearful that they’ll turn into a community that shuts out its own municipal workers and teachers.

“Working folks can’t find housing. If they don’t live here when they get hired, it’s unlikely that they’ll be able to,” said Peterson.

The high prices are not only keeping people out, they may be forcing people out as property taxes increase.

“Mansfield is like many other communities – the value of houses appreciated so rapidly that rather than importing, we’re exporting,” said Burke.

Ultimately, expensive price tags on housing stock leads to exclusionary communities, a reality that is can only be combated by creating more affordable housing.

“We’re losing the diversity of the community,” Stickney said.