The Harvard Municipal Affordable Housing Trust (MAHT) voted Monday evening to grant $200,000 to Lou D. Russo of Wheeler Realty Trust for an age-restricted 42-unit, state-certified affordable apartment house on Ayer Road, behind the building containing Dunkin’ Donuts. Russo last week received a special permit from the Planning Board for the project, which will also include 20,000 square feet of commercial space. The grant applies only toward the affordable apartment house. MAHT plans to set conditions for the grant at its April 13 meeting.
The $200,000 is a pittance compared to the $12 million price tag of the apartment building, but it is a “big gulp” of MAHT’s $266,000 fund, Russo acknowledged Monday. He said that the grant represents local support of his project, a vital component in securing state and federal affordable housing funds. “When you apply for [federal] HOME funds, they are expecting matching dollars,” Russo said, referring to one of his requested funding sources.
June is the best-case starting date for construction, according to a schedule drafted by Russo last fall. The foundering real estate market, however, has caused a backlog of applications in at least one of the financing programs Russo is counting on, casting the June date into question. The developer applied for $6 million through the federal Low-Income Housing Tax Credit program last October, but a spokesman for the state agency that administers the program told the Press last week that the current round of credits will not be awarded on schedule. A hoped-for boost from the most recent economic stimulus package remains in doubt for applications still in the pipeline, such as Russo’s; previously approved but stalled projects get such money first.
“We could need to go several rounds to secure all the financing,” Russo said at Monday’s MAHT hearing.
However, the slow real estate market could work to the rental project’s advantage. “We are focusing on the need for rental housing, for which there is a great need right now,” said MassHousing spokesman Thomas Farmer on Tuesday. MassHousing, the state’s affordable housing bank, has “temporarily halted” funds for developers building homes and condos for ownership. Farmer emphasized that he was not speaking about the private banks that partner with MassHousing.
Monday evening, MAHT members debated the relative merits of allowing the grant after hearing comments from the small audience. Was $200,000 too much to pay out of a $266,000 fund? Some thought the grant a good value, given that MAHT had committed $25,000 each for four extra units in a now dormant Chapter 40B project on Stow Road.
What if the Community Preservation Act money, which funds MAHT, continues to dwindle along with real estate taxes and state funds, its own sources of funding? Trustees confirmed that the Community Preservation Committee, which recommends disbursement for preservation funds, was recommending $100,000 for MAHT at May’s Annual Town Meeting. “This won’t be our last project,” said MAHT Chairman Mort Miller, adding that funding might be reduced in future years but would be ongoing.
Could MAHT limit the encumbrance of the $200,000 if the project stalls? Trustees agreed that payment would be tied to milestones for construction, financing, and occupancy, and that a “sunset clause” would end MAHT’s obligation if the project stalled.
Should MAHT sanction a senior project for such a traffic-heavy location? Not a single person in the room disputed that Ayer Road was unsafe for walking. “This project cannot finance a sidewalk,” Russo said. Selectman and MAHT member Leo Blair noted that the selectmen had applied for federal stimulus funds for general improvements to Ayer Road between Route 2 and the Ayer rotary. Sidewalks were just one of the many possible betterments proposed in the grant request.
As for traffic, trustees noted that the special permit granted by the Planning Board has provisions for traffic management, including signs and lane markings, a possible blinking light, and a widening of the driveway the apartments will share with Dunkin’ Donuts and other businesses on the parcel.
On one point, the trustees were in full agreement. The two-year moratorium on new Chapter 40B projects that the project will allow, when fully permitted and financed, is a planner’s dream.
“We can use the time to strategize, to create a plan for affordable housing that meets our needs, absent the pressure,” said Miller.
Bill Ashe of Myrick Lane, a former selectman and Planning Board member, found the Chapter 40B respite one of the only advantages. He cautioned against monolithic affordable housing developments, calling the Ayer Road apartments “a planner’s nightmare,” and he said that the project violated the tenets of Harvard’s current affordable housing strategy, which calls for “small and scattered” affordable housing that suits the existing landscape. Another member of the audience, David Peterson of Jacob Gates Road, countered that the strategy has not worked for Harvard, which stands at 3.2 percent of the state-mandated 10 percent affordability rate.
