Homes key to growth of jobs, Businesses need workforce housing
By Jessica Arriens
Sentinel Staff
Published: Wednesday, March 18, 2009
Susan R. Thielen has heard the myths.
When people hear “workforce housing,” they picture derelict trailers, imagine an influx of children and cry out that such a move will cost them more in property tax dollars.
It’s all part of what Thielen, coordinator of Keene’s workforce housing coalition Heading for Home, calls workforce housing’s “image problem.”
“(People) want the younger people, they want the workforce, they want the viable tax base,” she said. “But they just don’t want their neighborhood to change.”
Whether towns like it or not, that change has come, in the form of a new workforce housing law, passed last year and set to take effect this July.
Concern from towns about how to implement the law - which requires municipalities to provide their fair share of workforce housing - led to another bill that would delay the law’s implementation for one year.
That bill recently passed the House, after being amended to a six-month delay, and Thielen said it will probably be approved in the Senate. The delay will give towns “a bit of breathing room” in trying to adhere to the new regulations, she said.
But the legislation is just one step in solving New Hampshire’s workforce housing problem, a problem with deep roots and far-reaching implications.
“I don’t think the public realizes how serious it is,” Thielen said.
N.H. court sparks change in workforce housing rules
Another facet of the solution is happening in Keene on Friday, at a business leaders’ breakfast sponsored by Heading for Home and featuring a presentation by Benjamin D. Frost, director of public affairs at the N.H. Housing Finance Authority.
At its core, workforce housing - housing stock that employed people in low- and middle-income brackets can afford - is linked with economic development, Frost said.
Without an adequate stock of affordable housing, business growth in New Hampshire is stymied, he said. Businesses can’t find workers, he said, because potential employees can’t afford to live where they work.
This strong interest from the business community helped propel the workforce housing law forward, Frost said.
The law was written to codify a 1991 N.H. Supreme Court decision, Britton v. Chester, a case sparked after the town of Chester blocked one developer’s attempt to build housing that included lots for low- and moderate-income tenants.
In that case, the court determined that every municipality has the obligation to provide a reasonable and realistic opportunity for developing affordable housing.
“The expectation at that time was that municipalities would change their zoning ordinances to comply with what the court was saying,” Frost said.
That didn’t happen, he said, partly due to a housing market surplus in the early ’90s.
But by mid-decade, that surplus was eaten up and home prices began to inflate rapidly, the situation becoming so dire by about 2000 that the state Legislature commissioned a series of studies on how to boost workforce housing in the Granite State.
The business community ran on a parallel track, Frost said, and the state’s Business and Industry Association made workforce housing its top legislative priority for three years, until last year’s law was passed.
The law requires municipalities to allow workforce housing within a majority of total land area zoned for residential use.
Rental multi-family housing - a structure with five or more dwelling units - must also be allowed.
Under the law, municipalities are not held responsible for economic conditions beyond their control, or natural features that make development impossible.
The law also defines workforce housing: that which is “affordable” to a household within an income no greater than the median income for a four-person family, in the geographic area where the housing is located.
But definitions like that make most people’s eyes glaze over, Thielen said. So in 2006 she set out to put some real numbers next to that definition.
The quest for affordability
An affordable home in the Monadnock Region would be about $134,000 to $252,000, she said, a range that’s primarily affordable for households with salaries of about $50,000 to $70,000 per year. A household usually consists of two people, she said.
People making that kind of money are some of the workforce’s critical pillars, Thielen said, such as police, teachers and nurses.
“We’re not talking about irresponsible people who are partying,” she said. “We’re talking about key younger people that we need to retain and bring into the state.”
But increasing the state’s affordable housing stock in not as simple as just building more two-bedroom starter homes and apartment buildings.
“The rub is, land is expensive and demand is high,” said Susan B. Newcomer, workforce development coordinator for the Greater Keene Chamber of Commerce.
Even though the housing market has cooled substantially, that doesn’t mean things are truly affordable again - like they were in the early ’90s - Frost said, since land values in the state haven’t gone down.
And when high land prices are combined with restrictive zoning ordinances - which can demand minimum lot sizes of up to 5 acres and large frontage requirements - building affordable housing becomes even more of a challenge.
But it can be done, Thielen said, if communities and businesses think creatively and cooperate.
One way to build affordably, and to ensure municipalities comply with the new law, is through inclusionary zoning, which allows towns to offer incentives to building affordable housing.
Frost gives the example of a 15-lot subdivision proposed by a developer who promises to make some of the units affordable. The town might then give that developer a bonus: five extra lots on the subdivision.
Heading for Home is also looking at “smart growth” principles and cluster housing, Thielen said, which allows for more homes to be built closer together, leaving room for the open space so valuable to many New Hampshire communities.
Collaborative solutions to the housing crisis
Some New Hampshire residents have already seen changes to their towns’ planning regulations, due to the new law.
Fitzwilliam, Pelham, Brookline and Goffstown all passed articles at last week’s town meetings, adding some variation of a workforce housing statute to zoning ordinances.
What the law will essentially do, Thielen said, is speed up workforce housing development, since municipalities are required to respond to a developer’s request to build workforce housing within six months from when a plan is submitted.
The law “doesn’t force anything down anyone’s throat,” she said.
“It obligates communities to look at these issues, to actually take a fair look at them and try to address them.”
As with any new law, there’s a certain amount of ambiguity, she said, and the legislation will surely be tested in the courts.
The law is certainly on municipalities’ radars, if Frost’s schedule is any indication. He has done 50 presentations to local planning and zoning boards over the last six months, educating them about what they need to accomplish under the law.
But when it comes to workforce housing, relying on those board members to solve the problem is not enough, Newcomer said.
Businesses understand that to recruit employees, they need workforce housing nearby.
“Yet any individual business struggles with an answer,” she said.
The Keene breakfast this Friday is an “attempt to bring the business community into a place where they understand it on a broader scale.”
And this is important despite the recession, Newcomer said, since the central roadblock to workforce housing is zoning restrictions, which means developers can’t build affordable housing no matter what the economy is doing.
Frost agrees, adding that the business community can play a fundamental role in educating local officials.
“Right now, not too many businesses are expanding,” he said. “But everyone is looking to the future.”
u Heading for Home’s Business Leaders Breakfast will be held this Friday from 7-9 a.m. at Bentley Commons, 197 Water St. in Keene.
If you are interested in attending, please RSVP Susan Thielen at 352-1449 or susyt@headingforhome.org.
Jessica Arriens can be reached at 352-1234, extension 1433, or jarriens@keenesentinel.com