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Commentary: Lawmakers put money aside for housing
By Rep. Helen Head

This year, the Legislature made significant progress in tackling Vermont's housing crisis.

The state doesn't have enough housing and the housing we do have is unaffordable for many Vermonters. In the six northwest counties — home to nearly half the population — a shortage of nearly 10,000 homes and apartments is expected within the next few years. Other parts of the state are experiencing similar shortages.

In 2005, the median purchase price for a home in Vermont rose to $182,000, a 10 percent increase from 2004 and an 87 percent increase since 1996. The average fair market rent for a modest two-bedroom apartment in Vermont is now $723 a month, according to the federal government.

Our work to improve housing affordability came through in several different initiatives despite a tough budget year.

First, we increased funding for affordable housing while recognizing that the state's housing needs must be balanced with the need to preserve our rural heritage. Population increases and economic pressures threaten our farms and our natural landscape, creating a serious challenge for communities interested in creating housing that is affordable and can attract people to live in those communities.

Since 1987, the Vermont Housing and Conservation Board has awarded over $142 million to nonprofit housing and conservation organizations, towns, municipalities and state agencies to develop more than 745 projects in 205 towns. The result: In less than 10 years, over 6,500 units of affordable housing have been built and over 325,000 acres of agricultural and recreational lands and natural areas have been protected for conservation. This session, the Legislature made an important investment in VHCB by significantly increasing its funding.

Second, the Legislature passed the Growth Centers Act, S.142, which encourages development, including affordable housing, in downtowns and village centers rather than in agricultural and natural areas. Tax Increment Financing District legislation was revamped and improved. The TIF is a financing mechanism that enables a municipality to build infrastructure (for example, a parking lot or septic system) that will support compact growth, including affordable housing.

Third, the Legislature made it easier for Vermont's 17,000 mobile home residents to collectively purchase a mobile home park when it is put up for sale. Mobile homes are a critical source of affordable housing for Vermonters, yet it is often difficult for mobile home residents to initiate a process of collective park ownership. This bill, now Act 116, makes it easier to initiate this purchasing process, creating greater access to affordable financing to Vermonters currently living on leased land.

Lastly, tax policy plays an important role in keeping housing affordable. The Legislature expanded tax credits that encourage private investment in affordable housing and repeatedly affirmed its commitment to keeping pressure off property taxes.

When property taxes are high, housing becomes increasingly unaffordable, and the Legislature took several actions to keep property taxes down. We refused to agree to the governor's budget proposals to cut prebates, raid the Education Fund and shift new burdens onto the Education Fund, which would have increased pressure on school property taxes. We also passed the School Funding Simplification Act, which furthers this goal by reducing the base education tax rates, simplifying aspects of school funding law and examining ideas for further simplification and reduction of reliance on the property tax.

Looking to the future, the 2006 Legislature directed its Joint Fiscal Office and the Legislative Council to review all state housing funding and incentives, while state government must develop a housing budget and investment plan.

The lack of affordable housing in our state is a problem that affects all Vermonters. Without affordable places to live, how can Vermont attract and maintain a vibrant economy?

How can we ensure that as housing costs continue to skyrocket, average Vermonters aren't left behind? The Legislature made real progress in addressing these questions by making smart investments in Vermont's housing future. We still have a lot of work to do in reaching our goal of ensuring that all Vermonters can buy good homes that they can afford.

Rep. Helen Head is a Democrat who represents South Burlington.