Legislation sponsored by Sen. Meghan E. Kallman and Rep. June S. Speakman to establish a Rhode Island’s first permanent funding stream for affordable housing is moving forward today, both as part of the state budget that is before the House and as a separate bill passed by the Senate today.
The bill will make an estimated $4 million available annually to help address the state’s critical shortage of affordable housing.
“The affordable housing crisis is one of the greatest challenges facing our state. In addition to driving up housing costs for all Rhode Islanders and leaving many people either without or paying more than they can afford, the problem affects everyone. It hurts our economy and business opportunities, affects public education and stifles our ability to fully recover from the pandemic. It is a great relief to know that our state will finally join the rest of the New England states in making a permanent commitment to funding affordable housing development,” said Senator Kallman (D-Dist. 15, Pawtucket, North Providence) in a statement. “We will need every tool available now and far into the future to address our housing needs. The step we are taking today is so important, because it means we will have permanent funding for permanent need.”
Said Representative Speakman (D-Dist. 68, Warren, Bristol) in a press release, “Rhode Island absolutely needs a continual investment in affordable housing. Part of the reason we have reached crisis level is that we have not invested nearly enough in affordable housing over the years, and the investments we have made have been sporadic. There are many other changes we need to get the affordable housing we need, but first and foremost, there has to be predictable funding available every single year, because there will always be a need. A permanent funding stream has been a high priority for years for those who have been trying to address affordable housing in Rhode Island, and we are very grateful to our colleagues and leadership in the General Assembly for making it happen this year.”
Earlier this year, Senator Kallman and Representative Speakman introduced legislation (2021-S 0365A, 2021-H 5687) to establish a dedicated, consistent stream of funding to support affordable housing in Rhode Island. The Senate today approved Senator Kallman’s bill, and the House has amended the state budget bill — which is set for a House vote today — to include the proposal.
The legislation funds affordable housing development through an increase in the conveyance tax on high-end real estate. As included in the budget and in the amended Senate bill, it doubles the existing $2.30 rate on each $500 of the purchase price over $800,000.
The sponsors say the bill will increase opportunity for all Rhode Islanders to have access to safe, clean, comfortable homes, and is a much-needed investment in people who have suffered disproportionately from the pandemic.
Housing advocates have sought the change for years, and pushed for passage this year as the pandemic made the housing market even tighter.
“We are thrilled that this legislation will create a new housing production fund. It will help Rhode Islanders thrive and recover beyond the pandemic — by sparking redevelopment, helping rehabilitate blighted properties, and keeping families in stable housing that supports their health.” said Jennifer Hawkins, president and executive director of ONE Neighborhood Builders, a nonprofit community development leader in a statement.
“As an affordable housing developer working primarily in Newport County, we are challenged with higher land values and higher construction costs than are found in much the rest of the state,” shared Christian Belden, Executive Director of Church Community Housing Corporation, a nonprofit community development organization in Newport. “The creation of a dedicated funding stream for affordable housing will improve our ability to develop high-quality affordable homes that create opportunities for children, and address the needs of aging folks, people with disabilities, and those experiencing homelessness in our community.”
“The creation of a dedicated funding stream to build and preserve long-term affordable homes is essential to Rhode Island making progress on its statewide housing goals. Years of underinvesting have left us far behind our New England neighbors. We know from evidence and experience that safe and affordable homes are critical to keeping our economy, and our people, healthy and stable. It is time to say yes to invest, and we’re very pleased to see state leaders tackling this as a priority. We thank leadership and Senator Kallman and Representative Speakman for championing this legislation,” said Katie West, Manager of Homes RI, a multisector coalition that advocates to increase supply and access to safe, healthy and affordable homes.
According to HousingWorksRI, there is no municipality in the state where a household with the median renter income of $34,255 can afford a fair-market two-bedroom apartment, and only three where a household with a $50,000 income can.