Business & Economy

CARES Act money is a nudge in the right direction for Vermont’s housing supply

Note: This story is more than a week old. Given how quickly the Covid-19 pandemic is evolving, we recommend that you read our latest coverage here.

Construction workers are renovating the former Baymont Hotel in Essex into rental apartments. The Champlain Housing Trust project, to be called Susan’s Place, was made possible by federal Coronavirus Relief Fund money. Photo by Glenn Russell/VTDigger

This is the last in a four-part series exploring how Vermont has spent its $1.25 billion share of the federal Coronavirus Relief Fund. VTDigger is diving deeper into where the money went and the impact on Vermonters and on the crucial small business, agriculture and housing sectors.

Covid-19 is the emergency that pushed Vermont further into a housing crisis, one that the state’s leaders have struggled with for years. 

But the flood of federal money that resulted from the pandemic could yield small long-term improvements for thousands of Vermonters who have a tough time paying the rent or who have no home at all.

Lawmakers this year allocated $87 million of Vermont’s $1.25 billion share of CARES Act money to housing needs in Vermont. Agencies that work to ease housing problems, help the homeless, and create affordable housing bought several motels and other buildings around the state to turn into supported housing. Landlords got about $8 million to rehabilitate housing that was unlivable, and so bring more units onto the market.

The Vermont State Housing Authority got $25 million for a program that helps tenants pay their rent, and $5 million went to the Vermont Housing Finance Agency for mortgage assistance of up to six months.

And the Vermont Housing and Conservation Board got $34 million to add new housing and improve housing for the homeless.

Long-term, sustainable benefit was a guiding principle for the lawmakers who allocated the housing money, said Sen. Jane Kitchel, D-Caledonia, chair of the Senate Appropriations Committee.

“One area that we felt we could make some real progress was to deal with the emergency housing and temporary housing need,” a problem that existed long before the pandemic, Kitchel said. The state has been spending millions of dollars on short-term hotel rooms for the homeless, but it would make more sense to provide housing that includes social support, housing advocates have said. Senate Appropriations directed the Vermont Housing and Conservation Board to acquire properties and turn them into shelter for the homeless, with social services provided.

The board worked with other organizations, including the Champlain Housing Trust, to find properties that could be easily converted to permanent housing.

“We looked everywhere for opportunities,” said Gus Seelig, the Housing and Conservation Board’s executive director. “We found several motel properties to convert, and we worked with the shelter system to improve the quality and safety of shelters.”

Gus Seelig of the Vermont Housing and Conservation Board testifies
Gus Seelig, executive director of the Vermont Housing and Conservation Board. Photo by Glenn Russell/VTDigger

So far, the board has closed on about $18 million worth of real estate, including motels — many in Chittenden County — a chalet in West Brattleboro, and an apartment building. It worked with mobile home parks that had vacancies to add modular homes there, and it’s investing in vacant apartments in Bennington to make them available to renters again.

Vermont Housing Authority has spent about $8.5 million on back rent, and has $15 million left. The deadline for applications is Dec. 11. The mortgage assistance program, administered by VHFA, has spent $3.1 million of the $5 million it was allocated. And the rental rehabilitation program, which helps landlords fix up uninhabitable properties, has work underway on 229 apartments statewide, said Chris Donnelly, director of community relations at the Champlain Housing Trust. 

The result so far: The Vermont Housing and Conservation Board provided funding for ventilation, kitchen and bathroom improvements to 13 shelters with 258 beds. The shelters will add 11 beds as a result of the improvements. In all, Seelig estimated that the Housing and Conservation Board and the CRF money has had an impact on 500 beds and apartments, although some of those were already on the market.

He said the money has also helped the housing board rehabilitate 15 sites that will include 253 beds or apartments, all of it new, permanently affordable housing. It has also created 32 quarantine or isolation rooms through the purchase of the Ho Hum Motel in South Burlington. 

That’s good news, but it won’t substantively alter the conversation about affordable housing in Vermont.

“That’s a long-term asset for everybody. But are we going to change the trajectory of homelessness in Vermont?” Seelig asked. He said the real estate market — where prices are now rising, as newcomers arrive to work remotely — and the overall economic recovery also play a large role in what happens with housing.

“The economic forces that make real estate very expensive and depress wages or eliminate jobs aren’t going to be fixed by 250 new units of housing,” he said.

Workers work on the renovation at the Baymont Hotel in Essex on Oct. 23. Photo by Glenn Russell/VTDigger

Housing work continues

Vermont lawmakers in 2017 authorized the Vermont Housing Finance Agency to sell $37 million worth of bonds, with the money earmarked for construction of several hundred units of affordable housing in the next few years.

Before the pandemic, lawmakers were discussing approval of a second housing bond, this one for as much as $50 million. A 2020-2025 state housing needs assessment conducted last year, and issued in February, found that construction of new homes had stagnated in Vermont, with the proportion of seasonal homes and short-term rentals growing over the last few years, whittling away the supply available for full-time working residents.

ANEW Place
The Champlain Inn on Shelburne Road is the new home of ANEW Place, a low-barrier shelter. Its purchase was made with money from the Coronavirus Relief Fund. Photo by Katya Schwenk/VTDigger

Vermont has some of the oldest housing in the nation, with more than a quarter of homes built before 1939, the report said. And it said about 20,000 households had “serious” quality deficits, lacking essentials such as heat, bathrooms, or kitchens. About 7,000 of these were renters, the report said.

The CRF money doesn’t help everyone who is in need. “We’re giving out the Covid money, but we don’t have enough funds to give out to people who weren’t affected by Covid who have been having these issues since longer than Covid has been around,” said Pat Burke, family services director at Southeastern Vermont Community Action. “This has made some things better for people who might have been in motels, but for regular working-class poor people who might still be eking out a living, we don’t have those funds.”

Travis Poulin, director of Chittenden Community Action, said the number of people requesting rental assistance from his office dropped after the pandemic began, since other programs were put in place to help people who were struggling to pay the rent, including an eviction moratorium.

Travis Poulin, director of Chittenden Community Action in Burlington. Photo by Glenn Russell/VTDigger

Overall, anecdotally, it seemed to be working well,” Poulin said of the rental assistance program. “My bigger concern is what is going to happen in the spring of next year, or even in the new calendar year, whether or not we’ll see an increase in the number of termination of tenancy notices.” 

Donnelly views the CRF-funded programs put together by lawmakers and others as an important step. He pointed to a new state program, proposed before Covid but never funded until the CRF money became available, to rehabilitate unused rental housing so it could be put on the market again.

“You never want to take a silver lining out of something that has resulted in 200,000-plus people dead in the country, and lots of people sick, but I think what we have done here in Vermont to respond to support people in need has been pretty amazing,” he said. He noted that in June, only one homeless person in Vermont had tested positive for Covid, while in Boston a third of that population had.

“The work that the state did to put people up at motels saved lives, really,” he said. About 2,000 homeless people were housed in motels during the height of the pandemic. “Not just the lives of those being put in hotels, but the lives of the community.”

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