BOSTON — Gov. Maura Healey signed a $5.1 billion bond bill Tuesday aimed at boosting the state’s dwindling housing stock, but critics say the plan will do little to help struggling renters and people now at risk of losing their homes.
The measure, approved on the final day of formal legislative sessions, includes a mix of bonding, policy changes, tax breaks and other incentives to help spur the much-needed development of new homes.
Healey, a first-term Democrat who has made housing a key part of her legislative agenda, described the measure as the “most ambitious” in state history to address what she called the state’s “toughest” challenge.
“The Affordable Homes Act creates homes for every kind of household, at every stage of life, and unlocks the potential in our neighborhoods,” Healey said in a statement. “Today we are taking an unprecedented step forward in building a stronger Massachusetts where everyone can afford to live.”
Under the plan, at least $2 billion will be devoted to the rehabilitation of more than 43,000 public housing units, with 25% of the money dedicated to preserving housing for those with low incomes.
The bill also calls for diverting $800 million to the state’s Affordable Housing Trust Fund to create and preserve affordable housing for households whose incomes are not more than 110% of area median income.
Among the policy initiatives in the bill is a proposal to authorize accessory dwelling units equal to or less than 900 square feet to be built by-right in single-family zoning districts in all communities.
The plan expands funding for the state’s Community Investment Tax Credit Program, which funds community development corporations that partner with nonprofits to build affordable housing across the state.
Under the tax credit program, donations to community development corporations that qualify are eligible to receive a 50% refundable tax credit.
The Senate approved the $5.4 billion housing bond bill in May and the House followed in June with a $6.5 billion bill. Differences between the two bills were worked out by a six-member committee, which announced a compromise on the final day of formal sessions.
Lawmakers rejected Healey’s controversial proposal to give communities the authority to add transfer fees from 2% to 5% onto property tax bills to fund affordable housing, which faced opposition from the real estate industry.
Lawmakers also rejected a plan to spend $1 billion to allow the Massachusetts Water Resources Authority’s water system to be expanded to the Ipswich River Basin, which includes Beverly, Danvers, Ipswich, Middleton, Peabody, Salem and other communities north of Boston.
And some housing advocates say the changes in the new law will do little to help people who are now struggling to pay the rent or facing foreclosure.
“The housing bond bill includes meaningful funding to support public housing and build new affordable housing, but legislators failed to include any tools to help renters who are facing enormous rent hikes and eviction today,” said Carolyn Chou, executive director of the group Homes for All Mass.
Homes for All Mass was pushing for inclusion of a proposal that would allow cities and towns to stabilize rents by pegging increases to the rate of inflation with a cap at 5% and protect tenants by banning no-fault evictions.
“We need strong rent stabilization now to protect people during the decades it will take to make housing more affordable in Massachusetts,” Chou said.
The housing bill was a top priority for Healey and other Beacon Hill leaders, who are trying to spur more home building amid a shrinking inventory that is edging first-time buyers out of the market.
The prolonged housing crunch is affecting the state’s economic growth, making it much harder to attract new families and companies, they say.
Massachusetts has some of the highest housing costs and rents in the country. The median price of a single-family home hit a record $609,000 in June, according to real estate industry reports. Meanwhile, single-family home sales were down in June versus the same month last year.
Christian M. Wade covers the Massachusetts Statehouse for North of Boston Media Group’s newspapers and websites. Email him at cwade@cnhinews.com