Author: Esteban Pages
3 min read March 2023 – Addressing the climate crisis in tandem with housing affordability, the City of Boston recently announced new funding for renovations at Ausonia Homes in the city’s North End neighborhood.
The 100-unit public housing community for low-income seniors and people with disabilities will be awarded $1.75 million toward modernization and energy upgrades financed by the Community Project Funding for FY23 federal budget.
“Boston residents across every neighborhood deserve the opportunity to age in place, and to do so in quality, accessible and affordable homes,” said Wu in a press release. “Communities like Ausonia are critical for older adults, people with disabilities and families to afford to live and thrive in the North End.”
Among the available funding, $750,000 will be allocated specifically toward capital upgrades and accessibility measures permanently securing affordable housing for extremely low-income seniors and persons with disabilities. The remaining $1 million will be directed toward health and climate retrofits — weatherization, energy efficiency and electric heat pumps installation, to name a few. These improvements will allow for improved air quality and reduced energy consumption within the community.
The funding is expected to further propel BHA’s efforts toward a comprehensive, systematic modernization and preservation of all its federal public housing for seniors that also preserves affordability, maintains BHA ownership of the assets and improves resident health and quality of life. According to the agency’s website, BHA houses more than 25,000 people under the public housing program.
Mayor Wu has made affordable housing and energy efficiency key priorities of her administration as Boston and the wider region face an increasingly dire situation for renters. According to the 2022 Greater Boston Housing Report Card, around 45% of renters in Greater Boston are cost burdened, and more than half of Black and Latino renters are cost burdened. (The term cost burdened refers to renters paying 30%-50% of their income on rent.)
In February 2023, Mayor Wu announced a $67 million plan to create and preserve 802 income-restricted units across the city. The new developments’ footprint extends over eight neighborhoods: Allston, Chinatown, Dorchester, Jamaica Plain, Mattapan, Mission Hill, Roxbury and South Boston for units available for both rent and purchase. Among the units, 160 will be income-restricted senior housing.
Funding-wise, $32.5 million of the plan will come from municipal and federal funds administered by the Mayor’s Office of Housing; $13.9 million will be sourced from the city’s Linkage program, requiring large-scale commercial projects developers to make a contribution to the Neighborhood Housing Trust. According to the Boston Planning & Development Agency (BPDA), in 2022 alone, the agency approved new development estimated to generate close to $40.7 million in linkage fees to support affordable housing development in Boston. Considering federal recovery money is being used for this initiative, Mayor Wu is proposing a 2% real estate transfer fee pending in the state legislature to secure a sustainable revenue source once those funds run out.
Earlier this month, Mayor Wu also announced the city’s intention to adopt a new green building code poised to strengthen energy efficiency requirements for new construction in Boston. The plan: filing an ordinance before the Boston City Council to adopt the State Department of Energy Resources’ Municipal Opt-in Specialized Stretch Energy Code. In addition, a new Large Building Green Energy Retrofits Program, administered by the Mayor’s Office of Housing, was announced It will be financed with $10 million from American Rescue Plan Act (ARPA) funding to foster energy performance improvements for affordable housing developments.
The need for affordable housing and its critical funding streams become further relevant in the face of the Bay State’s nascent out-migration and the ripple effects of Silicon Valley Bank’s (SVB) crash on Boston’s affordable housing push. SVB counted $209 billion in total assets and loaned close to $1.6 billion toward affordable housing development. SVB also acquired Massachusetts-based Boston Private Bank back in 2021, which worked with the affordable housing sector within the Boston area and provided housing development loans.
There are some encouraging signs to calm the uncertainty surrounding SVB’s involvement in affordable housing developments; however, as First Citizens Bank announced the purchase of about $73 billion of SVB’s assets at a discount of $16.5 billion. The FDIC will retain ownership of the remaining $90 billion, while it also received rights related to First Citizen BancShares stock to the tune of $500 million.
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