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Year-Round Market-Rate Rental Housing Trust

    MARKET-RATE RENTALS

    Provincetown Takes Steps to Sell Harbor Hill

    The town also allocates $348,500 to Lease to Locals program

    By

    PROVINCETOWN — The town is looking for a real estate broker to help sell or lease the town-owned apartments at Harbor Hill, the 28-unit former timeshare complex where 55 people now live.

    Two of the four apartment buildings at Harbor Hill on Bradford Street Extension in Provincetown’s West End. (Photo by Paul Benson)

    An invitation for bids from qualified brokers that the town issued in January had a deadline of Feb. 15. Two brokers applied, according to Year-Round Market-Rate Rental Housing Trust chair and select board member Austin Miller: John Ciluzzi, owner of Premier Commercial, and Doug Grattan, president of the Christie’s International affiliate Atlantic Brokerage, which covers the Outer and Lower Cape and Nantucket.

    Whichever broker is picked will have the job of recruiting outside parties that would rent units to “qualified applicants earning between 80 percent and 200 percent of the area median income” — the same income range the apartments are currently structured to serve. The invitation for bids also says any buyer would need to “maintain the property as a going concern serving the Provincetown community.”

    The search for a new owner or leaseholder will be subject to Massachusetts 30B procurement laws, which means the rental housing trust will issue a request for proposals with “bids that will be public and openly debated, with no commitment to accept any,” said Miller. “The broker we are hiring will help to craft the RFP to meet our needs and attract a bidder at the right price, with the right commitment to the property and its mission.”

    The bid invitation says that Harbor Hill would be conveyed with deed restrictions consistent with the legislation that created the Year-Round Market-Rate Rental Housing Trust — but it does not include details about how the rents paid by tenants at Harbor Hill would be set. That legislation gives the trust the authority to establish “alternative or additional definitions for ‘market-rate’ ” rent, however.

    Members of the trust have disagreed about how much rent the tenants at Harbor Hill should be paying. They rejected a proposal last November to raise rents by several hundred dollars per month. Town Manager Alex Morse weighed in on that debate, telling trustees that the town had “a lot of resources at its disposal” and that the town’s goals at Harbor Hill were “less focused on what the rents would be and more focused on the incomes of people who live and work in town.”

    Morse suggested that the trustees look at the income of the town’s median earners and work backward from there to a rent schedule rather than using current listings of rental apartments to define “market-rate rent.”

    For the 55 tenants at Harbor Hill, how much rent they would have to pay a new owner would almost certainly depend on the wording of the town’s deed restriction.

    The Community Builders, the nonprofit developer that is constructing 65 apartments, including four market-rate units at 3 Jerome Smith Road, conducted a study that found a “market-rate” rent of $1,480 per month for a one-bedroom apartment in Provincetown.

    Just down the street at the old police station on Shank Painter Road, a redevelopment proposal from Christine Barker and M. Tatiana Eck for 40 market-rate apartments includes a rent schedule of $2,500 to $2,750 per month for a one-bedroom apartment.

    The tenants in Harbor Hill’s one-bedroom units are currently paying between $1,040 and $1,550 per month. That means their rents could go up by $1,200 per month and still be considered “market-rate” under Barker and Eck’s rent schedule.

    The legislation that created the Year-Round Market-Rate Rental Housing Trust gives it the authority to buy and sell property without a vote of town meeting. Miller said the trust will hold a public hearing to discuss any offers it receives to buy or lease Harbor Hill.

    ‘Lease to Locals’

    The town is also moving forward with a program from Placemate.com called “Lease to Locals.” The company, founded by a former marketing director at Airbnb, provides subsidies to property owners to turn their short-term rental properties or vacation homes into year-round rentals.

    “The idea of Lease to Locals is we are converting existing housing stock to new long-term rentals for the local workforce, and we are doing this in tourist towns around the country,” Placemate CEO Colin Frolich told the select board on Jan. 8. “Our strength is our ability to find vacation-home owners, second-home owners, short-term rental owners, property managers, and real estate agents and get them to do something that is different and that has a financial benefit to them.”

    The subsidies are based on the number of tenants who sign a one-year lease and are funded by the town’s share of the rooms tax on stays in hotels and short-term rentals.

    Placemates typically requires that tenants in their subsidized properties work in the county, but at their Feb. 12 meeting select board members said that people who work remotely but are involved in the town’s civic life should also be eligible.

    Prospective tenants must earn less than 150 percent of the area median income in Barnstable County, which is $126,975 per year for a single person or $145,125 for a couple. The amount of the subsidy depends on how many working tenants are on the lease and ranges from $6,000 per year for one working person in a studio apartment to $20,000 for three working tenants in a three-bedroom unit.

    The rent that property owners can charge for a property with a Placemate lease is also capped. Studio apartments may be rented for up to $1,600 per month; one-bedroom units may be rented for $2,200; two-bedroom units for $3,000; and three-bedrooms units for $3,800.

    Select board members had initially worried that the rent caps were too high. At their Feb. 12 meeting, however, Morse said that using the “30 percent of income toward rent” rule — which derives from housing legislation introduced by U.S. Senator Edward Brooke III in 1969 — median earners would be able to afford those rents.

    A person earning 80 percent of area median income would be able to afford $1,693 in rent, according to the 30-percent rule, while a person earning 100 percent of AMI could afford $2,116, Morse’s data showed.

    The board accepted that argument and voted unanimously to move $348,500 in rooms tax money from the town’s Housing Fund to the Year-Round Market-Rate Rental Housing Trust Fund to pay for a one-year Lease to Locals pilot program. Trust members were set to vote on the program on Wednesday, Feb. 21, after the deadline for this edition of the Independent, with the program itself set to begin on April 1.

    This Week In Provincetown

    Meetings Ahead

    By

    Meetings are held remotely. Go to provincetown-ma.gov and click on the meeting you want to watch.

    Thursday, April 22

    • Public Pier Corp. Board, 2 p.m.
    • Planning Board, 6 p.m.

    Monday, April 26

    • Select Board, 6 p.m.

    Tuesday, April 27

    • Licensing Board, 5:15 p.m.

    Wednesday, April 28

    • Local Comprehensive Planning Committee, 1 p.m.
    • School Committee, 4:30 p.m.

    Conversation Starters

    Orleans Housing Asks for $

    Town meeting will begin on Saturday, May 1, at 10 a.m. at the St. Peter the Apostle Church parking lot at 11 Prince St., with a rain date of Saturday, May 8 at 10 a.m.

    Among the 39 articles that may generate interest is Article 9, which asks to use $20,000 in community preservation funds to help the town of Orleans fund a $27.7-million affordable housing project in that town.

    The development by Pennrose, which also built the Village at Nauset Green in Eastham, would have 62 affordable units including 10 that are “workforce apartments,” designated for people earning up to 120 percent of area median income.

    The Orleans Zoning Board of Appeals granted the comprehensive permit for the project last month, said George Meservey, Orleans town planner. “It’s a good project,” he said. “It takes an empty commercial building that was kind of a white elephant and puts it to good use.”

    Pennrose is asking Orleans for $2 million in community preservation funds and $100,000 from Eastham. Five other towns — Harwich, Chatham, Brewster, Truro, and Wellfleet — will be asked to contribute next year, Charlie Adams, regional vice president of Pennrose told the Independent.

    The rental units would be on 3.5 acres at 19 West Road and 10 Skaket Corners, where the Cape Cod Five Cents Saving Bank had its headquarters. It would include a renovation of the former bank headquarters as well as the addition of two separate townhouse buildings.

    Also on the Provincetown warrant are four debt exclusions for capital improvements, the largest of which is $3.5 million to fix chronic flooding of Court Street. This will raise taxes by $55.85 a year for a property valued at $620,500 — the median house price in town. There is also one override for consideration: $136,000 to create a town diversity, equity, and inclusion office. —K.C. Myers

    Not on the Agenda: Harbor Hill

    Last year, there was a warrant article at town meeting to transfer $594,500 from the general fund to the Year-Round Market-Rate Rental Housing Trust. It was billed as annual payment on the bonds that the town issued in order to purchase and renovate Harbor Hill, the bankrupt time-share development that the town turned into market-rate rentals.

    This year, there won’t be such an article, because the bond payments have been reassigned to the town itself, rather than the trust. Instead of transferring money to the trust, the payments will be made directly from the general fund.

    This change was initiated by Robin Craver, who served as town manager for the first half of 2020. At the time, she said the rents at Harbor Hill ought to cover operating costs, but the town ought to cover bond payments.

    “When people talk about the debt service like it’s a subsidy, or an addition, they’re counting it twice,” Craver said. “That $595,000 is your mortgage, basically. You’re actually investing in a property.”

    Craver argued that special tax revenue, such as the short-term rental tax or the marijuana tax, should not be used for bond payments, as that would suggest a subsidy. Instead, the payments should be made in the same way as for other capital projects, Craver said.

    “The debt service to pay the bond for Harbor Hill has been included in the general fund budget, alongside all these other bond payments that we are always making,” confirmed Provincetown’s finance director, Josee Young. “The debt exclusion was voted in February 2017, and you can’t pay something as a debt exclusion unless it’s in the general fund.”

    If new borrowing were to become necessary, such as for renovations, roof replacements, or new construction, then it would require a warrant article. Under the current arrangements, however, the existing debt service won’t be coming up for an annual vote anymore. —Paul Benson

    CIVICS

    Cold Hands, Warm Hearts at Town Meeting

    Provincetown voters gets things done with unusual speed and harmony

    By

    PtwnTM
    On Monday, Sept. 21, 265 Provincetown voters gathered on a chilly late afternoon for a Covid-safe, socially distanced outdoor annual town meeting. (Photo Paul Benson)

    PROVINCETOWN — The long-delayed annual town meeting moved at a brisk pace on Monday, Sept. 21, with the chilly weather perhaps encouraging voters gathered in the parking lot at St. Peter the Apostle Church to reach a consensus.

    The meeting was completed in just under two hours — an achievement for any Cape town, and especially one as prone to contentious debate as Provincetown, where meetings have commonly stretched to two and even three consecutive evenings. The meeting was also remarkable for the level of agreement, with no more than a scattering of “no” votes for any of the articles.

    Article 8, concerning the Gosnold Street dune project, was approved with little discussion, and Article 9, a series of Community Preservation Act grants, including a land acquisition for senior housing at Maushope, was approved quickly as well. The grant of $425,000 will allow the Provincetown Housing Authority to expand its affordable senior housing efforts, according to PHA Director Kristin Hatch, who is seeking to add 10 to 15 units of supportive senior housing on the site.

    Article 11, a $595,000 bond payment for the debt used to acquire Harbor Hill, provoked the longest discussion, beginning with presentations from Nathan Butera of the Year-Round Market-Rate Rental Housing Trust and select board member Louise Venden. Butera’s report included information on the current tenancy of the project — 50 people, including eight children, with the 28th and final unit scheduled to be occupied on Oct. 1 — and on the trust’s efforts to pursue a broad range of financing, ownership, and management arrangements.

    The project is currently in the third year of a three-year management contract with the Community Development Partnership in Eastham. A capital needs assessment identified $800,000 worth of maintenance that ought to be done in the next five years, and the trust is studying whether outside capital can be involved in the project.

    Eight people rose to speak on Article 11, raising questions about the cost structure, and arguing for and against town involvement in middle-class housing.

    A tenant in the building, Jaime de Sousa, was last to speak. “As a resident of Harbor Hill, I encourage folks to support this article and also future articles that have to do with affordable and market-rate housing,” he said. “Studies have shown that as housing availability declines, my entire age bracket is projected to decline. To secure the longevity of Provincetown as we know it, it’s important to have housing for all.”

    A series of church bells rang out in heavy tones while de Sousa spoke. The somber tones seemed to have a settling effect — the vote was called immediately after, and the article passed with fewer than 10 votes against it.

    Article 13 appropriated $12,600 to hire an indigenous peoples consultant, who will help develop at least one public art project and study other forms of representation. Article 14 banned plastic water bottles under one gallon, and Article 15 set the town’s zero-emissions goal into town bylaws. Fewer than 10 people voted against Article 14, and no one voted against 13 or 15.

    Another interesting development at this town meeting was the debut of a group called Four Hundred Plus. On at least three articles, speakers began their public statements with “I stand in solidarity with Four Hundred Plus, an intersectional and intergenerational, queer and allied collective of seasonal, transient, and permanent residents.” Carolyn Clough advocated for Harbor Hill with this identifier, and other speakers rose for the indigenous memorial project and for the zero-emissions bylaw.

    “We started meeting in June, and we’re meeting every Tuesday night at the Provincetown Brewing Co.,” Clough told the Independent. “We’re a collective that’s sick of racism, misogyny, homophobia, transphobia. Instead of celebrating the Pilgrims taking this land, we want to see a new era. We did the Black Lives Matter chalking all over town on Labor Day, and we met on the Sunday before town meeting to go over the articles and see where we wanted to speak.”

    Organized public comments may not be entirely new for Provincetown, but they’re not typical. Town meetings are always a disparate collection of subjects, initiatives, and budgetary housekeeping — and for one to be this short and generally sweet was quite the September surprise.

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