WELLFLEET — The planning board is discussing a new zoning bylaw that would loosen the rules governing accessory dwelling units by removing the requirement that they be “affordable.”
The town’s Affordable Accessory Dwelling Unit (AADU) bylaw has regulated such secondary dwellings since 2002. Though it was designed to increase the supply of year-round rental housing for low-income tenants, only 11 such units currently exist.
Housing advocates argue that the current AADU bylaw offers too little financial reward and has too much red tape. The income restrictions, they say, exclude renters in the so-called missing middle: those who make too much money to qualify for a rental unit but not enough to purchase a home. This dilemma is especially relevant in Wellfleet, where shellfish grants and permits are restricted to town residents.
Under the existing bylaw, home owners with an accessory unit of 1,200 square feet or fewer on their property can apply for AADU designation, which allows them to rent the unit on a 12-month lease at an “affordable” rate dictated by a special permit from the zoning board of appeals. The unit must be occupied by an “income-eligible household,” that is, one earning less than 120 percent of the Area Median Income (AMI). Priority goes to tenants who earn less than 80 percent of the AMI.
“If you get two adults working full time, at 40 hours a week and $20-plus an hour, they’re making over $80,000 a year,” said Community Development Partnership CEO Jay Coburn. “They make too much money to qualify for a restricted housing unit (such as the Village at Nauset Green or the proposed Cloverleaf site). There are very few mechanisms to solve that [problem and to] meet that need.”
Operating in tandem with the AADU bylaw is Wellfleet’s Affordable Housing Tax Exemption (AHTE), which “allows the town to issue tax exemptions to property owners that rent to income-qualified tenants, whether in an AADU or otherwise,” according to Assistant Town Administrator Mike Trovato. “Think of it as property tax relief to incentivize property owners to rent to income-eligible tenants.”
Yet with only 11 AADUs in Wellfleet, the program is clearly not living up to its potential. Truro, which has a similar bylaw, has zero AADUs.
Illegal Rentals Abound
According to Town Assessor Nancy Vail, there are 180 properties in Wellfleet that are classified as “state code 109,” meaning they contain one or more secondary dwelling units built before zoning laws banned such construction. Combined with secondary units that have been built since then, illegally, as well as home owners who rent out their basements or other parts of their homes — which aren’t included in that total — there are hundreds of units eligible for AADU designation in Wellfleet. Most of these units are already being rented illegally.
These units are largely rented in the high season to tourists, not to year-round residents in need of permanent housing. They are also not monitored for health and safety code violations, presenting liability issues for both the home owners and the town.
The economics of local tourism drive the rental market. Summer rentals are far more lucrative than year-round ones, even when the AHTE exemption, about $4,000 a year for the average home owner, is taken into account.
A 2018 report by the Public Policy Center at UMass Dartmouth found that, in Provincetown, “if a property owner can fill their unit every night of the 20-week season from May through September, they could potentially net more than $34,000 for a unit that could otherwise rent for $1,300 per month or $15,600 per year.”
For the hundreds of owners of these illegal units, that extra money, as well as avoiding the bureaucracy of registering units as AADUs, is worth the risk of being caught and fined for zoning violations. Moreover, according to some town officials, AADUs and illegal secondary dwellings are not actively monitored.
“We’ve had one building inspector after another, and they just don’t come out,” said planning board member and AADU owner Olga Kahn. “They don’t check on it annually. I find this a real dilemma. Who’s watching? What good is having a bylaw when nobody’s bringing the housing up to code?”
The proposed zoning change would create a new Accessory Dwelling Unit (ADU) bylaw, modeled after a template from the Cape Cod Commission. In theory, it would encourage home owners to register existing illegal secondary units as ADUs. (The template contains an amnesty clause that would give owners of illegal secondary units five years to register them as ADUs without facing penalties.)
The affordability rules of AADUs come with serious administrative costs, Coburn said.
“The minute you require an income level and an annual income qualification, you’ve layered on a regulatory cost,” he pointed out. “Who’s going to do the income qualification every year? The home owner [likely] doesn’t have that expertise. And so, somebody at town hall needs to do it, or an agency like mine. It’s probably $1,000 a year for the whole equation.”
Accessory dwelling bylaws can be allowed “by right” or “by special permit.” If an ADU is allowed by right, all a home owner has to do is prove it meets setback, septic, and lot size requirements. The planning board, however, is in favor of a by-special-permit designation, meaning that the home owner would have to go to the ZBA — a process that gives neighbors a say. Even though pushback from abutters could lower the number of ADUs permitted, Local Housing Partnership member Sharon Rule-Agger said that a by-special-permit bylaw would be more likely to be approved at town meeting.
Zoning bylaw changes currently require a two-thirds majority vote at town meeting. But Gov. Charlie Baker has proposed that such changes require only a simple majority vote.
“It’s not a panacea,” said Rule-Agger of the ADU proposal. “In the towns that have passed the least restrictive, most lenient bylaws surrounding ADUs, the maximum growth has been maybe five units a year. If we got even four ADUs every year for 11 years, that would be the same number of units as we are proposing for the 95 Lawrence Road project. Both are needed. Every little bit helps, especially to that family that’s looking for a place to live.”
Editor’s note: Due to a fact-checking error and erroneous information on the Wellfleet town website, an earlier version of this article misstated the qualifications for income eligibility in the AADU bylaw. Tenants must earn less than 120 percent of Area Median Income, not 100 percent, and priority goes to those earning less than 80 percent of AMI, not 60 percent.