March 2015: In the busy college town of Amherst, affordable housing is hard to come by. So when financing restrictions ensuring the affordability of 41 units at the Rolling Green apartment complex expired, residents of the complex began to worry. Soon enough, word came that the owner of the complex would be raising rents for these affordable units to match current Amherst market rates, levels that residents could not afford. However, thanks to the town’s commitment to retaining and broadening affordable housing options, and to its embrace of the CPA program, a $1.25 million contribution of CPA funds will allow the town to preserve the affordability of these threatened 41 units.
Rolling Green Apartments is a 204-unit, multi-family development. The issue arose for the 41 affordable units when the mortgage for the property was repaid in full earlier than expected, moving up the expiration date for the affordability restrictions. A similar Amherst rental complex, Echo Village, had already evicted several tenants after rising rents outstripped their modest budgets. With so few affordable options in town, most of those residents had been forced to leave Amherst and relocate to nearby communities.
Mary Streeter, Chair of the town’s Community Preservation Committee described the affordable housing situation in Amherst as “dire,” and affirmed that young families were leaving the community due to the lack of affordable rents. She mentioned that the town had closed an elementary school several years ago due to under-enrollment, after the population of families with children in the town had declined. Amherst’s Housing Production Plan (HPP) confirms this trend by noting that the amount of “young families are rapidly declining as adults age 25 to 44 decreased from 7,323 in 1990 to 4,009 by 2010, a drop of 45.3%". Knowing that sudden rent increases at the Rolling Green complex would likely have the same effect of driving low- and moderate-income young families out of town, Amherst had a strong incentive to preserve the 41 affordable units.
Ultimately, an affiliate of Beacon Communities, LLC was able to acquire Rolling Green in September 2014. Meanwhile, Amherst Town Meeting voted to appropriate $1.25 million dollars of its CPA funds to help. Since the community did not have this large a sum of CPA dollars at hand, it issued a bond against its anticipated CPA revenues to come up with the funds. Being able to bond under the CPA program made a “big difference” in this instance, Streeter remarked. Along with CPA funds, a variety of other funds contributed to the success of the development, including federal, state and private funds such as Beacon Communities, LLC’s own equity. Working with the local office of the Massachusetts Housing Partnership (MHP), the town explored its options. MHP provided funds for a preliminary capital needs analysis, and facilitated talks with potential buyers interested in working with the town. There were five interested buyers, and MHP helped the town in deliberations with them, while also supplying financial models. Rita Farrell, Senior Advisor from MHP’s Amherst office, assisted in the collaboration process, which eased the burden on town representatives.
Mark Epker, President of Beacon Communities Development, noted that the ability to utilize CPA funds was “extraordinarily helpful” in maintaining the affordability of the 41 units. He explained that when Beacon acquired the Rolling Green complex, the affordability restrictions had already expired; however, Beacon promised to keep the units affordable while Amherst finalized the details of the new financing arrangement. Epker commented that it was “great to work with such a proactive town;” Amherst was “eager to preserve their housing and keep families” in town.
Collaboration was crucial to the success of this endeavor, said Assistant Town Manager and Director of Conservation and Development for Amherst, David Ziomek, and he praised the way Amherst rallied to keep the affordable housing in town. With a positive vote of over 200 Town Meeting members, Ziomek “cannot recall a vote against” the preservation of Rolling Green.
Currently, the project’s permanent financing (including the CPA funding) is in the final stages of review, and is expected to wrap up soon. The closing date is scheduled for June 2015. The outcome - 41 units that are permanently restricted as affordable - keeps families in town that may not have otherwise been able to stay, adding to the overall demographic diversity and long-term stability of the community.
While Mary Streeter describes the project as merely “a drop in the bucket” compared to what is needed in the way of affordable housing, she is pleased with the outcome and joins Farrell in describing the project as a “huge win” for the town of Amherst.
The story appeared in the MA Community Preservation Coalition Newsletter - http://www.communitypreservation.org/successstories/community-housing/9206
Special thanks to David Ziomek, Assistant Town Manager, Amherst, Mary Streeter, Chair of the Amherst Community Preservation Act Committee, Mark Epker, President, Beacon Communities Development LLC. and Rita Farrell, Senior Advisor at Massachusetts Housing Partnership for their assistance in preparing this story.