Challenging Retroactive Imposition of Permanent Housing Subsidy Requirement
This case involves the duration of affordable housing restrictions on property developed under the comprehensive permit provisions of Massachusetts General Laws Chapter 40B, also known as the Anti-Snob Zoning Act. Chapter 40B permits a developer who sets aside a certain number of subsidized housing units in a new development pursuant to a government affordable housing program to override local zoning requirements. The developer of Ardemore Apartments received a comprehensive permit overriding local Wellesley zoning to build a 36-unit multi-family development by agreeing to set aside nine subsidized units. The relevant program mandated that the units remain “affordable” for fifteen years, as was common in most government-assisted housing developments build before the 1990s. The subsidizing agency explicitly provided that, after the fifteen-year subsidy period, the units could be rented at market rate. When the subsidy period was set to expire, Wellesley sued for declaratory judgment to require Ardemore to continue to rent the nine set-aside units as “affordable” housing in perpetuity or to tear down the entire development as nonconforming with Wellesley zoning. The trial court decided in favor of Wellesley and Ardemore appealed. The SJC granted direct appellate review.
NELF submitted an amicus brief in its own name supporting Ardemore arguing (1) that the parties’ expectation at the time of construction was that developer’s subsidy obligation ended when the subsidy expired, and (2) that the developer should not be expected to subsidize the nine units in perpetuity itself or find alternate government subsidies after the original program expired. The SJC held that the owner must maintain the unit is as “affordable” for as long as the housing is not in compliance with local zoning requirements. The SJC discounted the parties’ expectations and the terms of the financing agreements. While noting that the absences of an affordability restriction expiration may operate “as an economic disincentive to developers to build affordable housing, “ the SJC concluded, “The solution to that problem, however, lies with the Legislature.”
This case involves the duration of affordable housing restrictions on property developed under the comprehensive permit provisions of Massachusetts General Laws Chapter 40B, also known as the Anti-Snob Zoning Act. Chapter 40B permits a developer who sets aside a certain number of subsidized housing units in a new development pursuant to a government affordable housing program to override local zoning requirements. The developer of Ardemore Apartments received a comprehensive permit overriding local Wellesley zoning to build a 36-unit multi-family development by agreeing to set aside nine subsidized units. The relevant program mandated that the units remain “affordable” for fifteen years, as was common in most government-assisted housing developments build before the 1990s. The subsidizing agency explicitly provided that, after the fifteen-year subsidy period, the units could be rented at market rate. When the subsidy period was set to expire, Wellesley sued for declaratory judgment to require Ardemore to continue to rent the nine set-aside units as “affordable” housing in perpetuity or to tear down the entire development as nonconforming with Wellesley zoning. The trial court decided in favor of Wellesley and Ardemore appealed. The SJC granted direct appellate review.
NELF submitted an amicus brief in its own name supporting Ardemore arguing (1) that the parties’ expectation at the time of construction was that developer’s subsidy obligation ended when the subsidy expired, and (2) that the developer should not be expected to subsidize the nine units in perpetuity itself or find alternate government subsidies after the original program expired. The SJC held that the owner must maintain the unit is as “affordable” for as long as the housing is not in compliance with local zoning requirements. The SJC discounted the parties’ expectations and the terms of the financing agreements. While noting that the absences of an affordability restriction expiration may operate “as an economic disincentive to developers to build affordable housing, “ the SJC concluded, “The solution to that problem, however, lies with the Legislature.”
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