Millions set aside for affordable housing remains unspent as housing market heats up
Gov. Lamont is spending 35% less each year than his predecessor to build affordable housing, and the panel that must give the nod for construction to move forward is meeting one-third as often. State records show that a growing amount of money earmarked for housing is going unspent.
"There simply isn't enough public housing available for all those who would qualify for it," he said. "There's waitlists that go on forever. Most of them are closed because they're so long. So, we build more where we can.”
But help is not coming anytime soon.
"We're not going to build ourselves out of the housing crisis," he said. "It takes a long time — as we see with this development — it can take a very long time to build housing."
Bovilsky is talking about his team at the Norwalk Housing Authority. They and the construction crew they hired are about halfway through gutting and renovating the 200 units in the Colonial Village public housing complex. Federal funding is helping with the costs.
Right next door to Colonial is an overgrown 7-acre field on which the housing authority has been trying for over 10 years to construct 69 apartments, a walking path and a community center. After spending years getting local zoning approval, the project is now waiting on state funding to move forward.
State lawmakers every year set aside millions of dollars in the state budget to build affordable housing for low-income renters. But as the housing market heated up — and rent increased rapidly — state records show that a growing amount of money that has been earmarked for housing is going unspent.
When Gov. Ned Lamont took office, the pot of unspent housing dollars was $218 million. That pot is now almost $300 million. And when the state’s new fiscal year begins in two weeks, it will grow to nearly $450 million.
So how did this backlog happen?
The governor has sole control over how much of the construction allowance approved in state budgets to actually spend because he determines what the state's Bond Commission will vote on. That commission must approve borrowing before the treasurer goes to the bond markets.
During his fifth week in office, Lamont announced he was putting the state on a "debt diet" and would be scaling back borrowing for construction projects like affordable housing.
"We have to reduce our bloated capital spending starting right now,” Lamont said in early 2019.
The diet was short-lived — but funding to build affordable housing is still historically low. Lamont is spending 35% less each year than his predecessor and the Bond Commission is meeting about a third as often to approve what funding he does make available, a review by Connecticut Public found.
More than $80 million in state grants for affordable housing has been ready since March to be approved, but it's waiting on the governor to have the State Bond Commission give final approval to the batch so that construction can begin.
State Housing Commissioner Seila Mosquera-Bruno is not worried about the level of unspent money.
"I don't have any doubt that we will be spending by next year. I should be allocating most of those resources because of the projects that we have right now," she said. "You're going to be seeing a lot of ribbon cuttings this summer as well as groundbreakings."
@GovNedLamont and Commissioner Mosquera-Bruno at the Village at Park River ribbon-cutting in Hartford. About 155 of the 200 units will serve households from 25% to 80% of the AMI. A community building and an additional 200 units are slated to be built! pic.twitter.com/Q2Sx9UNmf9— CT Dept. of Housing (@CTDeptHousing) September 8, 2021
A broken pipeline for housing construction
A confluence of factors aside from potential delays in securing state funding could be contributing to not as many new units opening as funding allows — including local zoning approvals taking longer during the pandemic and supply chain issues stalling construction supplies.
"We've got to work to unclog the system: period," said Kiley Gosselin, the executive director of the Partnership for Strong Communities, a nonprofit that advocates for affordable housing. "At the end of the day, if the state doesn’t start getting more units built and getting more subsidies out the door to tenants, we’re going to see rising rates of housing insecurity in the state like we’ve never seen before."
The state's Department of Housing tries to help locally elected officials and housing developers navigate through obstacles to get projects ready for state funding and construction, said Mosquera-Bruno.
"You can have resources, but if the resources are not out, it doesn't help anyone, right?" she said. "So it's, how are we making those processes easier? How can we provide technical assistance to those that need it? And how to incentivize the municipalities to keep building. So I think that we will see the light at the end of the tunnel with all the work that we put in."
But affordable housing developers like Carol Martin from the Fairfield and Westport Housing authorities says the pipeline to open more housing is nearly clogged.
"There isn't a pipeline for lack of a better word. It takes so long just to get land, and go through local land use, and get the project financed," she said.
Last year, 458 new affordable apartments that state funding helped construct opened. Almost 2,000 additional units are also in development or under construction now — however, many of these projects will likely take some time to open.
"Housing needs to be on the front burner. The key here is really speeding up the process," said Evonne Klein. She was the state’s housing commissioner during the last administration and is now the leader of the Connecticut Coalition to End Homelessness. "We have a housing crisis. It's critically important that year after year, that capital funding in the budget actually gets spent so that housing is being built.”
Back in the overgrown field in Norwalk, Bovilsky hopes to finalize the paperwork and secure the funding by the end of the year.
"Hope to break ground in the in the spring at the latest," he said. "We should close by the end of the year, whether or not we can start construction that quickly is the question mark, so and maybe till the spring. If all goes well, it's possible we could break ground before the end of the year."
And some of those families who have been waiting for a decade, they will finally have an affordable place to live.