Cozy Hearth's win on appeal now faces ZBA challenge
In a creative attempt to solve their own need for affordable housing, businessman Bill Bennett and some of his employees, friends, and family members joined forces and purchased 11 acres off Watcha Path Road in Edgartown in 2002. They envisioned a ready-made 11-house community named Cozy Hearth.
Since then they have endured the ups and downs of a regulatory roller-coaster ride that included Martha's Vineyard Commission review. In May 2006, the Edgartown Zoning Board of Appeals (ZBA) voted to scale back the project from 11 to 9 houses as one of several conditions that proponents said would cripple the project.
The Cozy Hearth group appealed the ZBA decision in June 2006 to the Massachusetts Housing Appeals Committee (HAC). In a 24-page decision issued on April 14, the HAC agreed that the elimination of two houses would make the project uneconomic and that several of the conditions imposed by the ZBA were beyond the scope of health and safety issues.
Although happy with the HAC decision, Mr. Bennett's enthusiasm is tempered by uncertainty. Edgartown town counsel Ronald H. Rappaport's office said this week the ZBA will appeal.
Called by The Times, Edgartown attorney Martin (Skip) Tomassian, Jr., ZBA chairman, refused to confirm that the board has instructed town counsel to file an appeal. Mr. Tomassian told The Times that such information was privileged information between client and counsel.
Reminded that Edgartown taxpayers have a right to know what the ZBA will do because they will bear the legal expenses of an appeal, Mr. Tomassian insisted, "Any discussions we have are confidential between the board and town counsel."
Not a developer
The Cozy Hearth plan hinged on subdividing the acreage, zoned for three-acre lots, under the terms of Chapter 40B, a state statute to encourage affordable housing by helping developers bypass local zoning restrictions.
Under 40B, 25 percent of the lots must be given to Edgartown for affordable housing. Cozy Hearth would contribute three homes to be sold by the town through an affordable housing lottery. The remaining eight lots for homes built by Cozy Hearth members would include five deed-restricted and three unrestricted for resale.
"When we first applied to Mass Housing, at that point they took two years to give us a 40B eligibility letter, because we didn't fit the mold," Mr. Bennett recalled in a phone call last week. "We were not a developer for profit, and the developer in this case was the people who were going to live in the houses. They couldn't find a place to put us."
Frustrated by the long delay, Mr. Bennett asked Senator Ted Kennedy to intercede. "It wasn't until I got Ted Kennedy's office involved that Mass Housing finally decided they'd sit down with us, and within a month, we had a decision," said Mr. Bennett.
The tortuous trail
The Edgartown ZBA referred the Cozy Hearth project to the Martha's Vineyard Commission (MVC), where it underwent a seven-month review process. After addressing abutters' concerns and environmental issues, the MVC approved Cozy Hearth in December 2005, attaching a lengthy list of conditions. In addition, a conservation and management permit from the Massachusetts Natural Heritage and Endangered Species Program limits the housing development to just 3.6 acres of the 10.93-acre property.
After the Martha's Vineyard Commission signed off on the project, it went back for review by the ZBA in March 2006. The ZBA approved the project in May with several conditions, the primary one being the decrease in the number of houses.
"Basically what the ZBA said was that they wanted us to move forward with eight subsidized houses and one market rate - and then they were appalled at the decision of the housing appeals committee that it was less economic, and they want to appeal it," Mr. Bennett said. "Now, mind you, the state's 40B law says that 25 percent of the units need to be affordable. So, originally we had three affordable and eight market rate. The commission turned that around, and said, oh, no, you're going to have eight affordable and three market rate. And then Edgartown said, oh, no, no, you're going to have one market rate and eight affordable. It's just so far from what the statute requires."
If regulatory boards continue to impose those kinds of conditions, there won't be another Cozy Hearth, Mr. Bennett predicted. "No one in their right mind would do it. Looking at the process we had to go through, if these boards continue in their ways, then they can talk about affordable housing all they want, but it will never be economically feasible," he said.
"People need to do it for themselves. Otherwise, they're on a list, and that's a tough way to live, because the lists are really long. If there was a way, a formula by which people could get together and combine resources and do it in an easier way than we did, that would be great."
During the ZBA hearing process, Mr. Bennett explained that the cost of the affordable houses given to Edgartown would be divided among the Cozy Hearth members. Scaling back to nine houses, of which 25 percent must be affordable, would increase the economic burden shared by a smaller number of Cozy Hearth members. Mr. Bennett cautioned that the project might become unaffordable for the very people it was designed to help.
Cozy Hearth attorney Marcia Cini pointed out that Massachusetts General Law regarding a comprehensive zoning permit for affordable housing states that the ZBA "must approve the project or approve it with conditions which do not render it 'uneconomic' unless the health and safety of town residents is imperiled, the natural environment is endangered, the proposed housing is seriously deficient, or open space is critically needed."
Fire safety was the only topic raised by the ZBA that fit any of those criteria, which the board addressed with conditions calling for the installation of a 10,000- gallon cistern and a turn-around area at the end of the road. Other conditions included limiting the rights of the homeowners to rent their properties or build garages.
At the HAC evidentiary hearing in May 2007, Edgartown's attorney Michael Goldsmith said that based on his evaluation and analysis of Cozy Hearth's estimated costs and revenues the expected profit was about a 2.4-percent return on a total development cost expected for nine units.
Peter L. Freeman, also an attorney for Cozy Hearth, in collaboration with economic expert attorney Bob Engler, argued in turn that such a small profit margin or margin for error would result in the subsidizing agent's refusal to fund the project.
The HAC's decision agreed with the Cozy Hearth attorneys' opinion that a 2.4-percent profit would be inadequate and that a nine-unit project would be uneconomic.
The decision further stated that once Cozy Hearth demonstrated that the conditions in the ZBA's decision would render the project uneconomic as a whole, the burden then shifted to the ZBA to prove that each condition contested was consistent with local needs.
The ZBA had cited density, traffic, and road safety as the basis for many of the conditions it imposed. Under current zoning, it would be possible to build a single-family dwelling and a guesthouse on each of the three three-acre lots that comprise the Cozy Hearth project site off Watcha Path Road, which intersects with Oyster Watcha Road at Edgartown-West Tisbury Road.
As described in the HAC decision, presently there are 22 homes on 25 parcels off Watcha Path. Current zoning would allow a maximum of 28 additional dwellings. Oyster Watcha Road has between 22 and 35 residences, many of which are used as seasonal homes.
The ZBA provided little evidence that demonstrated the difference in impact between 9 and 11 houses on health and safety issues that would outweigh the regional need for affordable housing, the HAC concluded. Two more homes would not be more dangerous in terms of traffic volume and impact than the 28 additional homes off Watcha Path possible under current zoning.
Although the HAC overruled the ZBA's condition prohibiting home businesses because of traffic concerns, the committee did agree with the conditions requiring a cistern and turn-around area.
"For me, the way the decision was written is a validation of the Cozy Hearth model," Ms. Cini said. "The Housing Appeals Committee was very careful to pick through the ZBA's decision and keep the safety measures. The home business condition was taken out, as were the ones for no rentals and limits on garages."