Out of Reach
The National Low Income Housing Coalition produces an annual report comparing side-by-side the wage and rent trends across the country: http://www.nlihc.org/oor/oor2009/ . The report shows how much money a household must earn to afford the Fair Market Rent (FMR) in any given area, while keeping rent at 30% of the household’s income (the amount that keeps housing affordable).
It comes as no surprise to us that the report ranks Massachusetts among the top five most expensive places where to live in the United States. Only a few years ago, Massachusetts held the number one position, which is now held by Hawaii.
The FMR in the Boston-Cambridge-Quincy area for a two-bedroom apartment is $1,345, so –using the 30% of income standard- a household must earn at least $4,483 a month (or $53,800 annually) to afford it. A renter would have to work 40 hours per week, 52 weeks per year, earning $25.87 per hour. This amount is known as the “Housing Wage” for the area. Now, a minimum-wage worker ($8.00 per hour) would have to work 129 hours per week for 52 weeks, or have 3.2 wage earners working full-time in the household to live in that same apartment.
The average wage in the area is $22.18 per hour. To make up the Housing Wage deficit, the average wage earner has to work 47 hours per week, 52 weeks a year, or have 1.2 wage earners in the household making $22.18 an hour.
The report also provides statewide, and other metro and non-metro area calculations but, no matter where you look, affordable housing is out of reach for many renters.
Mass. 40B produces little affordable housing
http://www.lowellsun.com/front/ci_7570859
Officials seek overhaul of 40B law
By Rita Savard, rsavard@lowellsun.com
Article Last Updated: 11/27/2007 11:37:44 AM EST
CHELMSFORD -- A broken system.
That's what 80,000 petitioners across the state said when they singed on to repeal the state's 40B affordable-housing law.
Thursday night, Chelmsford selectmen will invite town officials and residents from communities statewide to discuss changing Chapter 40B, the law also deemed the "biggest scandal in the history of the state," according to Massachusetts Inspector General Gregory Sullivan.
Originally created to solve the state's affordable-housing problem, opponents say 40B actually made matters worse.
"It's like a dog chasing its tail," said Fred Marcks, a consultant for Repeal 40B, the group behind the petition to strip four major affordable-housing provisions out of the law.
The current law gives developers power to override zoning rules in towns where less than 10 percent of affordable housing meets federal affordability requirements.
"Statistically, 40B makes that 10 percent mandate way out of reach," Marcks said.
Every time a new 40B project is built, at least 25 percent of the units must be affordable. The other 75 percent of the development is market rate, which goes toward the town's total housing tally, ultimately raising the 10 percent threshold, Marcks said.
And in cities and towns struggling to hit the 10 percent mark, a developer can obtain permission from the state to build if he plans to make 20 percent of the project affordable -- even if a community objects.
"It's taken way too much control away from local cities and towns," said Chelmsford Selectman Philip Eliopoulos, who signed the petition to repeal 40B. "It also hasn't really provided the protection needed in terms of monitoring the profits from 40B projects."
In October 2006, Sullivan announced that the state's "lack of oversight" prompted an investigation of at least 10 developers from a diverse mix of towns who were suspected of abusing affordable-housing laws and hiding profits.
After combing through state and municipal records, Sullivan's office found that some 40B developers had inflated project expenses, pocketing more than $5 million -- money that should have gone back into towns.
Saying they've had enough of developers abusing the system, state Rep. Robert Hargraves, R-Groton, and state Rep. Geoffrey Hall, D-Westford, filed a bill seeking to repeal Chapter 40B. If passed, developers would lose their power to override zoning rules in towns with less than 10 percent affordable housing stock.
For years, similar bills have landed on Beacon Hill and died there. Hargraves and Hall say their bill may have a fighting chance because it comes at a time when rampant misuse of affordable-housing laws is no longer being kept in the dark.
But repealing 40B laws would have an enormous impact on housing opportunities in Massachusetts, according to Aaron Gornstein, executive director of the Citizens Housing and Planning Association (CHAPA), a nonprofit organization for affordable housing.
Since it was implemented in 1969, 40B has lead to the creation of about 43,000 affordable-housing units serving a variety of people ranging from families to the elderly, CHAPA reports. In more recent years, 40B, also known as the "anti-snob act," has been responsible for 80 percent of all new affordable housing in suburban communities.
With the average home in Massachusetts costing about $340,000, there are few options left for families to purchase their first house, Gornstein has said.
The result, he added, is more people moving out of state, ultimately damaging the economy.
"By taking away 40B, you'd be losing the primary tool for creating mixed housing in Massachusetts," Gornstein has said. "There are a lot of success stories with affordable housing, you just don't hear them because (those people aren't) complaining."
After 38 years of 40B, state data doesn't seem to tell a success story, according to Repeal40B.com.
"Massachusetts is 49th in the list of national rankings for affordable housing," Marcks said. "And only about 13 percent of the state's 351 communities have met the 10 percent affordable standard."
Legislators hope Thursday's brainstorming session will churn out better solutions. Currently, Massachusetts is the only state with an affordable-housing law that mandates and subsidizes market growth.
"It's a law crying out to be changed," Hall said. "That's why there's a strong drive now for a ballot question. I think more and more people are realizing that 40B is fundamentally flawed and being abused."
Panelists include State Representatives Hall and Green, and Tina Brooks, Undersecretary for the Massachusetts Department of Housing & Community Development.
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