2007.03.15 MAHTF MinutesAFFORDABLE HOUSING TRUST
Minutes
March 15, 2007
Members Present: Martha Ackelsberg, Betsy Siersma, Lisa Gibbs. Also present, Diane Andes, Vice-President of Spear Management Group, Gerard Hughes, Property Manager, Hathaway Farms,
Sally Fox, Rental Agent and Peg Keller, staff.
Background
Mr. Hughes described the basics of the agreement from which the Trust was created. He described the different income levels that the property serves. After the initial twenty year subsidy
ended, the goal of the owner was to create a mixed income housing complex. The eighteen-month process that was undertaken by Mayor Ford and various representatives was explained. The
Trust fund has now been operational for 9 years. Due to the fact that no ongoing funding stream for the fund has been identified, it will probably be exhausted in 2-3 years. This forms
the basis for the discussion; should current families be assisted at a financial level that is meaningful or should less assistance be given in order to have the fund last longer.
Current Issues
Ms. Andes described the current issues around which they need guidance.
With HUD income limits increasing every year, there is a possibility that some Trust households will fall below the minimum income threshold for Trust participation. (This is currently
happening with one household, may be more frequent in the future). If no longer eligible for the Trust, households will be faced with either paying market rents, or the prospect of
moving.
After some discussion about the longevity of the fund and current rent levels, Member Ackelsberg made the following motion: “ For the Fund to continue to support existing residents whose
household incomes fall below the 60% level thresholds.” This would in fact, increase the subsidy amount from the fund but would allow the households to remain in place. Management does
not expect a large number of these cases, but would like a policy decision in place to guide future action. The projected scenarios might depict a temporary loss of income, which could
later be restored. The motion was seconded by Member Siersma. The vote was unanimous in favor of the motion.
Implementation of the 3/8/06 income limits from the Springfield SMSA will result in substantial increases for Trust households, ranging from $88 dollars a month for a one bedroom to
$134 a month for a four bedroom unit.
Hathaway Farms representatives asked if the Trustees would consider increasing the fund subsidy to allow those families to remain. Members discussed the impact on the fund, if it were
tapped to cover the rental increases in their entirety. All agreed that the increases create a substantial cost burden.
After some discussion, Member Ackelsberg made a motion to reduce the cost burden of the rental increases for Trust families by contributing 75% of the increase from the Fund, with the
residents absorbing 25% of the increase. The motion was seconded by Member Siersma. The vote in favor was unanimous.
Members acknowledged that each year this situation would probably reoccur. If HUD median income guidelines continue to increase, the gap between the rents and what Trust families can
afford will continue to widen. With an expressed commitment to the existing Trust fund families, this ratio will extend the life of the fund longer than if the fund covered 100% of
the increase. Having the families absorb some portion of the increase, will alert them to the reality of increasing rents in the market place.
There was some discussion about what might occur, as time draws closer to the exhaustion of the Trust account. This is operational year 9, and Hathaway Farms predicts 2-3 more years
of funding. The 20% level mandated for low income households will continue to remain in place for the life of the MassHousing loan agreement. So, the entire complex will not be market
rate when the Trust concludes. Hathaway Farms personnel said they expect the Trust households to relocate through attrition, as their leases expire. This would preclude 48 families
needing to be relocated at one time.
Trust members want to investigate if the Fund resources could be extended through the Community Preservation Act. They also expressed a desire to meet with the City Treasurer to examine
where and how the funds are currently invested. Peg K. will follow-up. Mr. Hughes agreed to submit a chart with the new rental subsidy amounts, to be forwarded to the Housing Authority
for implementation.
There being no further business to discuss, the meeting concluded at 6:30 p.m.
Respectfully submitted,
Peg Keller