Boston — Governor Maura Healey signed into law the most ambitious legislation in Massachusetts history to tackle the state’s greatest challenge – housing costs. The Affordable Homes Act and related initiatives will support the production, preservation and rehabilitation of more than 65,000 homes statewide over the next five years. It is the largest housing bond bill ever filed in Massachusetts, at more than triple the spending authorizations of the last housing bill passed in 2018.
The historic legislation authorizes $5.16 billion in spending over the next five years along with 49 policy initiatives to counter rising housing costs caused by high demand and limited supply. Key spending authorizations and policy changes include allowing accessory dwelling units, an unprecedented investment in modernizing the state’s public housing system, boosts to programs that support first-time homebuyers and homeownership, incentives to build more housing for low to moderate-income residents, support for the conversion of vacant commercial space to housing and support for sustainable and green housing initiatives.
“The Affordable Homes Act creates homes for every kind of household, at every stage of life, and unlocks the potential in our neighborhoods. Today we are taking an unprecedented step forward in building a stronger Massachusetts where everyone can afford to live,” said Governor Healey. “What the Affordable Homes Act represents is our ability to come together and address our toughest challenges. I am deeply grateful to our partners in the Legislature for their leadership and look forward to the work ahead in implementing this law and making affordable homes a reality for every resident of our state.”
“Housing plays a critical role in supporting our local economies and this bill will make a meaningful difference in helping Massachusetts residents to live, work and stay here in the state that they love,” said Lieutenant Governor Kim Driscoll. “We went big with the Affordable Homes Act, and it received incredible support from members of the Legislature, advocates, employers, business leaders and health care professionals. Together we understand the importance of investing in housing in order to remain a competitive state.”
In addition to the unprecedented level of spending authorizations, the Affordable Homes Act creates key policy initiatives, including allowing accessory dwelling units under 900 square feet by right on single-family lots. Often referred to as in-law apartments, accessory dwelling units can be attached or detached from a single-family home and often take shape as a basement or attic conversion, a cottage in a backyard or a bump-out addition to a home. This new policy replaces a patchwork of zoning regulations across the state with a uniform law that allows homeowners on single-family lots to add these small units without needing a special permit or variance unless they want to add more than one. Construction of ADUs is still subject to local building codes. The Healey-Driscoll Administration estimates that between 8,000 and 10,000 ADUs will be built across the state over the next five years due to passage of the law.
Another significant policy action enacted with the Affordable Homes Act is the creation of a Seasonal Communities designation. The Seasonal Communities designation is the first step in developing unique tools for communities with a substantial variation in their housing needs due to seasonal employment in places such as Cape Cod and the islands and the Berkshires. A framework for these tools will be developed by a Seasonal Communities Coordinating Council, which the Affordable Homes Act also creates.
“From ADUs to seasonal communities, this administration in partnership with the Legislature has now adopted some of the most forward-looking and proven practices to not only meet this moment, but also set a course to meet the housing needs of our communities for years to come,” said Housing and Livable Communities Secretary Ed Augustus. “The passage of the Affordable Homes Act is a monumental step toward building a Massachusetts where everyone – from our talented workforce and families to our retirees – can afford to live and thrive.”
In addition to new policy initiatives and spending authorizations for housing, the Affordable Homes Act authorizes a record $2 billion for the repair, rehabilitation and modernization of the state’s public housing portfolio. Massachusetts has the largest public housing portfolio in the U.S. with more than 43,000 units, but it has been underfunded for decades.
“Public housing is a vital piece of our housing portfolio here in Massachusetts,” said Deputy Secretary of Housing and Livable Communities Jennifer Maddox. “It provides access to affordable housing for thousands of residents while also serving as one of our best defenses against homelessness. But for too long it has suffered from underinvestment. With the passage of this bill, we say to those residents, you deserve to live with dignity in a community you can be proud of.”
The bill also creates additional opportunities to develop vacant or underutilized commercial space into housing through the creation of the Commercial Property Conversion program and the Commercial Property Conversion Tax Credit.
“The availability of housing, particularly housing that families can afford, is at the core of everything we hope to accomplish. Our economy and our state are only as strong as the people who live here, and the Affordable Homes Act represents a huge step forward, giving us the tools we need to speed the production of new homes,” said Administration and Finance Secretary Matthew J. Gorzkowicz. “Since taking office, we have been able to significantly increase capital spending for housing, dedicating 52 percent of the growth in the capital budget over the past two years to this mission. We remain committed to continuing to make progress in this area to realize the full potential of this legislation.”
Other key initiatives include the creation of the Momentum Fund. This new program creates a permanent revolving fund to be administered by MassHousing to accelerate the development of mixed-income multifamily housing. The Affordable Homes Act authorizes an initial $50 million for the fund, which will help directly move the needle on the development of multifamily homes that can be difficult to build due to the high-cost environment.
“The Healey-Driscoll Affordable Homes Act is a critically important and comprehensive piece of legislation that will make housing in Massachusetts more accessible, more available and more affordable,” said Newton Mayor Ruthanne Fuller. “Newton was pleased to welcome Governor Healey, Lieutenant Governor Driscoll, Housing Secretary Augustus and Secretary of Administration and Finance Gorzkowicz to Newton for the official signing of this landmark legislation. It is fitting that the ceremony was held at the Golda Meir House so that we can shine a light on the amazing work of 2LifeCommunities, a leader in providing affordable housing here in Newtown and Greater Boston.”
Other programs receiving dramatic increases in authorizations by the Affordable Homes Act include $800 million for the Affordable Housing Trust Fund, which doubles the previous authorization, an increase in the Housing Stabilization and Investment Fund to $425 million and $275 million for sustainable and green housing initiatives, which is more than four times the previous authorization. The Historic Rehabilitation Tax Credit – a key component for repurposing historic properties for housing – is doubled to $110 million with this law.
At Tuesday’s event in Newton, Governor Healey also announced new Responsible Contractor Guidance for affordable housing developments funded by the Executive Office of Housing and Livable Communities. These standards reflect the commitment of the Healey-Driscoll Administration and HLC to assure that construction workers receive the full protection of our labor laws, including prohibitions against wage theft and compliance with worker protections. The Responsible Contractor Standards further reflect this administration’s commitment to making sure that those who violate these laws do not participate in projects receiving funding from many of the resources authorized in this bill.
The Affordable Homes Act is one piece of the Healey-Driscoll Administration’s strategy to push back against rising housings costs impacting Massachusetts residents. The Administration continues to work with 177 communities on implementation of the MBTA Communities Law signed into law in 2021 and last fall, the governor signed three executive orders targeted at increasing housing production. Those executive orders created a Housing Advisory Council to develop a statewide housing plan, created an Unlocking Housing Production Commission to develop recommendations for streamlining housing production and directed state agencies to develop an expanded inventory of state-owned land suitable for housing. And the governor’s tax cuts signed into law last fall included substantial increases to both the Housing Development Incentive Program and the Low-Income Housing Tax Credit, two programs important to building both market rate and low-income housing.
