In a pair of cases decided in January 2013, the Supreme Judicial
Court ruled that the availability of unsubsidized, affordable
market-rate housing cannot be considered in weighing a city's or
town's local concerns against the regional need for low and
moderate income housing under the Massachusetts comprehensive
permit act, G.L. c. 40B, §§ 20-23. In Zoning Board of Appeals
of Sunderland v. Sugarbush Meadow, LLC, 2013 Mass. LEXIS 7,
Sugarbush Meadow, LLC (Sugarbush) applied for a comprehensive
permit to build five, three-story buildings containing 150 rental
apartments. The Sunderland zoning board of appeals denied the
application. Sugarbush appealed the denial to the Housing Appeals
Committee (HAC), which overturned the decision and ordered the
board to issue the comprehensive permit. The Superior Court
subsequently upheld the HAC decision.
On appeal to the SJC, the board alleged that the HAC erred in
"refusing to consider the availability of low-cost, market-rate,
unsubsidized housing in the town in weighing the town's local
concerns against the housing need." Id. at *12. In support
of its position, the town provided expert testimony that:
the town has one of the highest percentages of rental housing in
the Commonwealth, that 83 percent of all existing rental housing
units in Sunderland are being rented at affordable rents, even
though they may not be subsidized, and that 46 percent of
Sunderland's housing stock is rented at affordable prices as
designated by the department.
Id. at *12-*13 (internal quotations omitted).
Notwithstanding this evidence, the SJC rejected the town's argument
on the ground that the Act and its governing regulations do not
allow the HAC to consider the availability of unsubsidized housing
units in determining whether the "housing need" is outweighed by
local concerns.
Under the regulations issued by the Department of Housing and
Community Development (DHCD) to administer the Act, "housing need"
is defined to mean "the regional need for Low and Moderate
Income Housing considered with the number of Low Income
Persons in a municipality affected." 760 Code Mass. Regs. § 56.02
(2012) (emphasis added). The Act defines "low or moderate income
housing" to mean:
any housing subsidized by the federal or state
government under any program to assist the construction of low or
moderate income housing as defined in the applicable federal or
state statute, whether built or operated by any public agency or
any nonprofit or limited dividend organization.
G.L. c. 40B, § 20 (emphasis added). Based on these definitions,
the SJC concluded that "the plain text of both the act and the
governing regulations require the HAC, in weighing the housing
need, to exclude from consideration any affordable housing that is
not subsidized under a qualifying government-sponsored
program." Sunderland, 2013 Mass. LEXIS 7 at *14 (emphasis
added).
Although this analysis appears sufficient to dispose of the
issue, the SJC went on to explain how the exclusion of affordable
market-rate housing is consistent with the purpose of the Act,
namely to "address an acute shortage of decent, safe, low and
moderate cost housing throughout the commonwealth." Id. at
*15 (quoting Board of Appeals of Hanover v. Housing Appeals
Comm., 363 Mass. 339, 351, 294 N.E.2d 393 (1973)) (internal
quotations omitted). First, an affordable market-rate unit may be
affordable simply because it is neither decent nor safe, while
subsidized units typically are required to meet minimum standards
in order to qualify for a federal or state subsidy. Second, even if
a market-rate unit is decent and safe, its affordability may be
attributable to a weak housing market, in which case there is no
guaranty that it will remain affordable as market conditions
improve. By contrast, under the DHCD's Comprehensive Permit
Guidelines, the affordability requirements must be met for a
minimum of 15 years for rehabilitated units and 30 years for new
construction in order to be counted in a community's subsidized
housing inventory. See Comprehensive Permit Guidelines
(July 30, 2008) § II(A)(1). Third, unlike subsidized low and
moderate income housing units, which are required by 760 Code Mass.
Regs. § 56.02 to be restricted to "income eligible households,"
there is no way to guaranty that a market-rate housing unit will be
rented by, or sold to, a low or moderate income household.
In light of these differences, the SJC agreed with the HAC that
"the Legislature required a state or local subsidy in order to
ensure that housing constructed under the [Act] would be subject to
enforceable controls on quality, sales price or rental rate, manner
of marketing, and income of the occupants - all factors essential
to the long-term stability of affordable housing."
Sunderland, 2103 Mass. LEXIS 7 at *18.
The SJC applied the same analytical framework and reached the
same conclusion in Zoning Board of Appeals of Lunenburg v.
Housing Appeals Committee, 464 Mass. 38 (2013), which involved
the denial of an application for a comprehensive permit to build
146 condominium units and followed the same procedural path as the
Sunderland case.
In Lunenburg, the town argued that the HAC should have
considered the availability of affordable market-rate housing in
the town and presented expert testimony that, within the Lunenburg
region, "the maximum affordable sales prices for a household
earning seventy and eighty per cent of area median income were
$140,000 and $160,000, respectively, … that 11.5 per cent of the
homes sold in the town in 2006 and 2007 were purchased for $160,000
or less, and that 8.2 per cent of the homes were purchased at
prices at or below $140,000." Id. at 44. In a virtual
carbon copy of its discussion of the issue in Sunderland,
the SJC likewise rejected Lunenburg's argument, affirming the HAC's
decision to exclude such evidence in its consideration of the
regional need for affordable housing. See generally id. at
44-48.
While the Sunderland and Lunenburg decisions
leave little question that unsubsidized, affordable market-rate
housing units cannot be considered by the HAC in evaluating the
"regional need for affordable housing," precisely what constitutes
the pertinent "region" for the purpose of that anaysis remains an
open question. As the SJC pointed out inSunderland,
"region" is not a defined term in either the Act or the
regulations. See Sunderland, 2103 Mass. LEXIS 7 at *21.
The DHCD's Comprehensive Permit Guidelines also do not define the
term or provide guidance for determining what constitutes the
pertinent "region" within the meaning of G.L. c. 40B, §§ 20, 23. As
a result, the HAC is left to define the region on a case by case
basis, and the results are not always consistent, as the
Lunenburg and Sunderland cases demonstrate.
In Lunenburg, the pertinent "region" was defined as a
seven-community area comprised of Lunenburg and the six towns with
which it shares a common boundary (Ashby, Fitchburg, Lancaster,
Leominster, Shirley, and Townsend). This approach is generally
consistent with dicta in the case Bagley v. Illyrian Gardens,
Inc., 401 Mass. 822 (1988), in which the SJC stated: "Without
attempting to define comprehensively the terms 'local need' and
'regional need,' we think that in this context it is clear that
'local' need relates to the municipality directly concerned, . . .
while 'regional' need includes surrounding communities."
Id. at 826 n.4.
In Sunderland, the town and the developer offered
differing views on how the region should be defined. The town's
version of the region was established by drawing a circle with a
radius of twenty miles around the proposed site, while the
developer argued in favor of a six-town region that included
Sunderland and five abutting communities (Amherst, Hadley, Whately,
Deerfield, and Montague). See Sunderland, 2013 Mass. LEXIS
7 at *21; see also Sugarbush Meadow, LLC v. Sunderland Board of
Appeals, 2010 MA. HAC. 08-02 at *5. The HAC accepted the
developer's delineation, noting that the town's radius approach was
"arbitrarily determined" and "based only on a contrived
interpretation" of testimony given by one of the developer's
witnesses. Sugarbush Meadow, LLC, 2010 MA. HAC. 08-02 at
*5.
The accepted Sunderland region might, at first glance, seem to
employ the same "surrounding communities" approach espoused by the
SJC in Illyrian Gardens and accepted by the HAC in Lunenburg. It is
noteworthy, however, that this region did not include the Town of
Leverett, which abuts Sunderland to the east and shares a longer
common boundary with Sunderland than any of the communities that
were included in the accepted region. Although the HAC noted that
the Sunderland region was established "using national standards for
examining supply and demand for the need for housing," it is not
clear why Leverett was excluded from the defined region. It is also
unclear whether the HAC's evaluation of the regional need for
affordable housing would have been different if the region was
drawn to include Leverett.
This comparison of the regions that were accepted in the
Sunderland and Lunenburg cases highlights the
importance of defining the "region" within the meaning of G.L. c.
40B, §§ 20, 23. In its Sunderland decision, the HAC began
its analysis of the regional need for affordable housing with the
following observation:
At the outset, we must address the regional affordable housing
need -- a term that is not clearly defined in Chapter 40B, § 20 or
our regulations and yet which is critical since it is the need that
is to be balanced against local concerns in determining whether the
proposed housing [is] consistent with local needs.
Sunderland, 2010 MA. HAC. 08-02 at *3. Until the term
"region" is clearly defined, either in the Act or the regulations,
this critical element of the regional need for low and moderate
income housing standard will continue to be decided on a case by
case basis and will remain vulnerable to inconsistent
interpretation.
TIMOTHY C.
TWARDWOSKI is an attorney at Robinson & Cole LLP in Boston,
where his practice focuses on representing clients on development
permitting matters and land use and planning law. He is a member of
the Property Law Section Council of the Massachusetts Bar
Association. He also is a member of the Zoning board of Appeals and
the Master Plan Committee in the Town of Franklin.