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January 26, 2023

GOP proposal could mean significant change to CT affordable housing law

TOM CONDON / CT MIRROR The Griswold Hills apartment complex in Newington, offers a mix of affordable and market-rate apartments. Housing advocates and local officials say the complex is an example of how the state's affordable housing law works.
By Ginny Monk, CT Mirror

A proposed technical adjustment to one of the state’s foremost affordable housing laws could put many Connecticut towns well over the threshold that exempts them from potential legal action if they deny developers’ proposals for certain affordable housing — without any new housing going up or changes to zoning policy.

The bill proposal from the House Republican caucus would add what’s called “naturally occurring” affordable housing to towns’ counts under the law known as 8-30g.

The law, enacted in 1989, gives developers the opportunity to take a town to court if it rejects their proposals for certain affordable housing. Municipalities are exempt if 10% of their total housing stock is designated affordable.

The Republicans’ proposal, which a sponsor said is a work in progress, would add properties that aren’t deed restricted but are affordable to people whose income is up to 80% of the area median income.

Rafie Podolsky, a housing attorney at Connecticut Legal Services and advocate, said the measure violates the intention of the law and would mean many towns could be exempted from the court remedies without any more housing actually being built.

“By simply re-labeling something that already exists as affordable housing and doing it for the purpose of telling towns that you can freely turn down any developer who wants to come in and do some additional density, you have just eliminated the statute,” Podolsky said.

The potential impact on towns and on the state’s housing stock comes from a little-known but important distinction: the difference between deed-restricted and naturally occurring affordable housing.

The two are often discussed in the same breath — an umbrella of affordable housing.

But deed-restricted affordable housing refers only to housing units that are government-subsidized and set aside as affordable. For example, under 8-30g, it can mean: homes that have mortgages financed through the government, homes that are paid for in part by housing choice vouchers, or homes that are developed using government money that have designated a certain percentage of units to be affordable, among other units.

Naturally occurring affordable housing is typically at least 30 years old and has lower-cost rents. This type of housing is at high risk of getting too expensive for people with low incomes to afford.

Some of the contention may have sprung from the use of the word “affordable,” a layman’s term, which 8-30g uses to mean deed-restricted housing, Podolsky said.

“The technical issue was ultimately substantive,” he added.

The measure is one of a slew of bills referred to the House Committee to change 8-30g, which has come under fire repeatedly.

Housing Committee members voted Tuesday to consider the measure as a committee bill.

“8-30g has been a failure in lower Fairfield County at any measure,” said Rep. Tom O’Dea, a Republican from New Canaan and one of the bill’s sponsors. “I think it will be bipartisan, and I think you will see a positive impact on our number of affordable units.”

O’Dea added that the proposed bill was a work in progress and that he might like to see incentives such as tax credits for some landlords who provide affordable housing or have only units with longer-term leases count.

“If we put in some requirements and hoops for them [landlords] to jump through in order for them to do that [get incentives] — I don’t want perfection to be the enemy of the good if we do this,” he said.

Housing Committee ranking member Rep. Tony Scott, R-Monroe, said he supported the concepts in the measure and isn’t concerned about the addition of naturally occurring affordable housing to the count.

“The biggest overall concern I hear [about 8-30g] is that Hartford is taking away local control of town elected officials in deciding what is best for their municipality,” Scott said in a written statement. “This is not a one-size fits all situation and the majority party in Hartford is attempting to make it that way and doing a disservice to a vast majority of municipalities who are not cities.”

Committee Democratic leadership didn’t comment on whether they’d support the proposal, pending further work from the committee.

“Generally, I’m focused on stronger policies to promote affordable housing production,” co-chair Rep. Geoff Luxenberg, D-Manchester, said in a written statement.

While 8-30g hasn’t solved the affordable housing crisis, advocates say it wasn’t meant to, and thousands of units of housing have been built because of the law.

Connecticut lacks tens of thousands of units that are available and affordable to its lowest income renters. Housing is typically considered affordable if a household spends up to a third of their income on housing costs.

There are only about 3,600 homes for sale in Connecticut, including those designated as affordable, down from more than 15,000 in 2019. Only about 2% of the apartments statewide are available for rent.

Recently, Connecticut has seen more large landlords purchasing properties, making improvements and raising rents, Podolsky said. This can mean naturally occurring affordable housing is getting more expensive.

And if the law was intended to include naturally occurring affordable housing, Podolsky said, it should be much higher than 10%.

“Why would we use 10%? What sense would that make? We would use a much, much higher percentage,” he said. “That would mean 90% of your town is unaffordable.”

Town officials have said the appeals process is arduous and overrides local zoning measures, ultimately threatening local control.

Fairfield First Selectwoman Brenda Kupchick, who said Wednesday that she is in favor of overturning the law altogether, has spoken previously about struggles dealing with 8-30g developer applications. She added that she thinks the naturally occurring affordable housing should count toward a town's total.

Since 8-30g became law more than 30 years ago, the town has had 23 applications under 8-30g, 10 of which have been filed in the past two years, according to Fairfield’s website.

“Personally I think the whole bill should be scrapped, and we should do a do-over that makes sense,” Kupchick said. “It’s a total gift to developers, and it’s not allowing measurable housing to be built.”

If a local zoning board in a town that has less than 10% of its housing units designated affordable denies an application for a building where at least 30% of the units are affordable for at least 40 years, the local board has to show that the denial was for reasons related to public health or safety, that these interests outweigh the need for more affordable housing, and that public interests cannot be protected by reasonable changes to the proposal.

As they make progress toward the goal, towns can get moratoriums from the court appeals process.

The law has been a target of criticism in recent years. Then-Republican gubernatorial candidate Bob Stefanowski said in the fall that he wanted to repeal the law, saying it is ineffective and erodes local control.

Stefanowski pointed to the fact that few towns have met the 10% threshold as evidence the law isn’t working.

And last session, lawmakers heard public comment on a bill that purported to study 8-30g, although advocates said it was an attack on the law.

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