Legal snag puts West Tisbury, Housing Trust, at odds

By Steve Myrick
Published: January 21, 2010

The 250 State Road affordable housing development hit a bump in the road at the West Tisbury planning board last week, when board members balked at legal language intended to keep the homes affordable in perpetuity.

Air source heat pump

It's about the size of stretched out air conditioner. It's nearly three times as efficient as conventional electric baseboards, and it gets its power from solar panels on the roof. It is called an air source heat pump, and it is capable of heating or cooling this 1,350-square-foot house without buying a penny's worth of power from the electric company. And it's just one of the exceptionally green features of the homes at the new affordable housing development at 250 State Road in West Tisbury.

About 100 people, ranging from contractors, housing advocates, and the just plain curious, toured the project on January 9. Some homes are little more than framed, others are nearly finished.

The eight houses are on the cutting edge of energy-efficient construction, says developer John Abrams. They are sheathed and sealed, basement to roof, with an air-tight barrier. The walls are double insulated and the windows are triple glazed. Mr. Abrams says it costs 8 to 10 percent more to build this way.

""If you can just tell me what's going to happen to energy costs over the next ten years," Mr. Abrams said, "I can tell you exactly when that's going to break even. What we know is that the energy costs here, which are going to be miniscule, will remain that, forever."

Part of the reason for the tour was to raise awareness about the project. The Island Affordable Housing Fund has raised $613,000, according to the developers. The Fund needs to raise $93,000 more to reach its goal.

"The reason I'm optimistic is it's not just general fundraising, it's a very specific project with specific merits," said Ewell Hopkins, executive director of the Fund. "I think it's a very manageable number."

Developers say that the language, in the form of a rider to the ground leases, is standard language used in many affordable housing transactions, including some by the town of West Tisbury itself.

But the board is researching the issue, and members have raised the possibility that $570,000 in Community Preservation Act funds already approved, may have to go before another vote at the spring town meeting.

The homes will be sold to qualified buyers at a substantial discount, based on the family income of the buyer. There are many safeguards built into the transaction to ensure that a home remains affordable. But in order to finance the home, many banks want the option to sell the home at market rate, if the owner defaults on the mortgage and the home goes into foreclosure.

Island Housing Trust executive director Philippe Jordi said foreclosure is unlikely. "We have various protections built into the ground lease that allow us to purchase the property before, during, and after foreclosure," he said, adding that the trust did just that last year for a home in Tisbury. The trust quickly sold it to another qualified family under affordability guidelines.

Mr. Jordi said in the unlikely event that a bank forecloses and sells a home at market rate, it would have to refund to the town any CPA money used to finance that home.

But members of the planning board put the brakes on his request to attach the standard rider. Board member Virginia Jones said that a special permit was issued for the development, though it faced considerable opposition. One condition of that permit was that the homes remain under affordability guidelines in perpetuity.

"The planning board was pretty united that we need to consider it further," Ms. Jones said. "We've done quite a bit of research." She added the annual town meeting voted CPA funds for a specific proposal, and attaching the rider might require another town meeting vote.

"Those funds were predicated on the basis that the affordability is in perpetuity," Ms. Jones said. "We have to be very careful when people have voted on things based on certain promises. You have to be very careful how you examine them. I certainly intend to be."