Workforce housing is generally understood to mean affordable housing for people who work in the “essential industries” - industries required for economic prosperity of a given community. These industries typically include public safety, healthcare, education, and skilled trades. Industries evolve over time. For example, on Cape Cod, commercial fishing has long been the dominant industry. Cape Cod has now evolved into a year-round, world-class travel destination, changing the workforce demographic to include hospitality and dining and the industries that support them, such as construction, landscaping, and other related trades. One of the greatest challenges facing the region is the ability to grow and sustain a vibrant economy along with a workforce to support our essential industries, whether that’s through retention of Cape-born workers or attracting workers from outside the region.
Cape’s higher-than-state-average housing costs and lower-than-state average wages are contributing to affordability gaps which occur when workers’ earned income is insufficient to secure quality housing within reasonable proximity to their workplace. As an example, according to 2014 Barnstable Housing Needs Assessment, in the Town of Barnstable the difference between the median sales price of a single‐family home and the sales price affordable to a household with the Town’s median income was $165,500. This data clearly identifies that in order for the Cape to be viewed as a desirable place to live, work, and raise families, there needs to be housing available that meets affordability criteria.
What is Affordable?
The US Department of Housing and Urban Development generally considers housing as affordable if gross rent, including cost of utilities, is not more than 30% of a household’s net adjusted income, or if the carrying cost of purchasing a home (mortgage, homeowner’s association fees, property taxes and insurance) is not more than 30% of net adjusted income. Affordable housing can also be defined according to percentages of area median income (AMI).
Communities may offer subsidized housing for those who cannot afford to pay market cost for housing. Generally, housing subsidy programs are targeted to households with particular income ranges depending upon programmatic goals: from extremely low income households (30% AMI) to very low-income (50% AMI), and low- to moderate- income (51% to 80% AMI). Buyers meeting the affordable housing criteria are typically selected via housing lotteries which ensure fair distribution of affordable housing. Lotteries are designated for individuals that meet financial criteria and, in some communities with affordable housing waitlists, applicants may also need to meet additional criteria such as first-time homebuyers, currently reside in the community, employee of a local business, municipal employee, a household with children attending local school system, and those over 55 who meet certain income/asset guidelines.
How Do We Close the Gap?
Affordable workforce housing has been a buzzword with many community organizations concerned with housing policy across the spectrum, from town planners and housing advocacy groups to business owners and real estate developers. The need is also recognized at the government level. Under 1969 Massachusetts General Laws Chapter 40B Section 20-23, the Commonwealth’s goal for all Massachusetts municipalities is to have 10% of housing units affordable to low/moderate income households or affordable housing on at least 1.5% of total land area. It is a moving target and to date all Cape towns are below the minimum threshold. The Cape Cod Commission, a regional planning and regulatory agency, promotes efficient land use and provides review assistance to the local towns. Tools include:
- Changing zoning bylaws to allow higher density (multi-family/mixed use) in village centers and/or locations that are less environmentally sensitive and have greater infrastructure capacity. The new state Housing Choice Initiative creates a new system of incentives and rewards for municipalities that deliver sustainable housing growth; creates a
new technical assistance toolbox to empower cities and towns to plan for
new housing production; and proposes legislative changes through An Act
to Promote Housing Choices to deliver smart, effective zoning at the
local level. The initiative is aimed to produce of 135,000 new units by
- Adopting less restrictive Accessory Dwelling Unit (ADU) bylwas in each Town. A Smarter Cape Cod initiative is partnership between Cape Cod Chamber of Commerce, Cape Cod Economic Development Council, Cape Cod Technology Council, Cape Cod Young Professionals, Open Cape, Home Builders and Remodels Association of Cape Cod, and Cape Cod Community College who is committed to building support for better ADU bylaws in each town. So far, three Cape Cod Towns - Falmouth, Truro and Provincetown - have passed the ADU by-laws.
- Preparing Housing Production Plans to serve as the basis for Local Comprehensive Plans that address each Town’s housing needs and unique character.
The middle class market (100%-120% AMI), who sort of been lost in the housing programs, will hopefully benefit from recent amendments to the Chapter 40R Smart Growth Housing Law, which is offered by the state to facilitate the production of “starter homes” – defined as smaller homes (maximum 1,850 sq.ft.) on smaller lots (maximum ¼ acre) that are affordable to young families and other entry-level buyers. Municipalities can take advantage of the zoning incentives ranging from $10,000 to $600,000, depending on the size of the starter home zoning district, as well as housing production payments of $3,000 for each unit of housing built. The law requires that 20% of the units be set aside for sale to persons and families earning no more than 100% of AMI. There is also an open space requirement.
How Are We Doing?
Cape and Plymouth Subsidized Housing Inventory