ARPA funds open the door for major investment in housing

Baker, Legislature should seize once in a generation opportunity

IN 2018, Gov. Baker attended the Massachusetts Association of Community Development Corporations (MACDC) convention, at which MACDC’s executive director, Joe Kriesberg, presented the governor with Richard Rothstein’s book, The Color of Law.

Rothstein details the policies that the US government has historically had in place that perpetuated racial segregation in housing. Our membership felt it was important for the governor to have clarity on the dark history of housing and how wealth and race inequality is prevalent in our housing system today. At a later meeting with the governor in 2019, we were pleased not only to hear that the governor had read the book, but that he was enthusiastic about facing the racial wealth gap in housing head on. The governor’s proposal to allocate $1 billion to housing from the ARPA relief funds represents a substantial step toward that goal.

The governor’s plan splits the $1 billion into four buckets, which include: housing production, elderly and veteran housing, affordable homeownership production, and mortgage assistance. While many were surprised at the scale of this proposal, housing advocacy groups have been ringing the alarm for many years and have highlighted the significant lack of investment in affordable housing opportunities, in particular, affordable homeownership opportunities. The governor’s announcement is a great start. Now, we must follow through and expand it by devoting additional funds to improving the quality and safety of Massachusetts housing stock to truly impact the Massachusetts housing crisis.

We join with other advocates to urge the Legislature to invest $1.6 billion in ARPA funds for housing investments so we can not only build the new apartments and homes envisioned in the governor’s proposal, but also improve and stabilize existing homes for low- and moderate-income households. Moreover, municipalities should build on the governor’s announcement by committing a significant portion of their ARPA allocations toward supporting affordable housing initiatives in their communities. While we support the governor’s full proposal, we urge the governor and the Legislature to center their focus on investing in home ownership and housing quality as a tool to move the needle on racial equity.

Housing Crisis as Economic Crisis

The housing crisis has caused an erosion of affordability and inventory and increased financial distress for many families in the Commonwealth. Residents, particularly low-income households, are maxing out their available resources in keeping up with the growing financial demand of basic household needs. With the expansion of high paying jobs and great career opportunities entering the Commonwealth, we are witnessing skyrocketing rents and home prices for longtime Massachusetts residents. This is the opportunity to meet the need for housing production that can stabilize this economic crisis. Residents of Massachusetts deserve to live and work comfortably, in the communities they love.

Over the years, fierce housing advocates have helped shape innovative homeownership products such as ONE mortgage and the Commonwealth Builders’ program. But the disparities in wealth and homeownership between black and brown residents and white residents in Massachusetts remain staggering.

Investment in home ownership programs is particularly necessary to build wealth among people of color in Massachusetts, who are more likely to be first generation home buyers and who are more likely to experience housing insecurity. Gov. Baker’s proposal to deploy ARPA funds to address the Racial Home Ownership gap is a bold move that will have significant impact. We therefore applaud the governor’s proposal to spend $500 million to support expanded homeownership opportunities for first-time homebuyers in disproportionately impacted communities.

Housing Crisis as Public Health Crisis

COVID-19 has highlighted that affordable housing is a necessary component of public health. In the last year and a half, we have witnessed the ways in which overcrowding, poor ventilation, and lack of access to shelter contributed to the spread of COVID-19 in our communities. Of course, access to safe, stable, and affordable housing is a crucial component of physical and mental health, whether or not we are in the throes of a global pandemic, as the Massachusetts Department of Public Health recognized in new regulations in 2017. By committing a large portion of Massachusetts’ ARPA funds to affordable housing we will invest in residents’ health going forward.

However, the Legislature needs to build upon the governor’s baseline proposal by devoting additional funding to improving the quality and safety of Massachusetts’ housing stock. The presence of lead, poor indoor air quality, and substandard housing conditions lead to developmental delays in children, respiratory disease, accidents, and injuries, and spread of infectious disease, among other serious, preventable health consequences. Owner-occupied homes in Massachusetts represent the second oldest housing stock in the nation, and over 70 percent of homes were built before lead paint was banned in 1978, highlighting the need for an overdue investment in improving housing quality and safety in Massachusetts.

Investing in housing quality and safety will have long-term impact by directly addressing racial inequities in health outcomes. Black children are nearly 2.5 times more likely to have lead poisoning than white children and are also 3.5 times more likely to visit an emergency room for asthma, a condition that is frequently caused or exacerbated by poor indoor air quality. We therefore call on the governor and the Legislature to designate an additional $100 million to address housing quality and safety improvements in order to improve public health in the Commonwealth.

Funding from the American Rescue Plan Act is a once-in-a-generation opportunity to address the economic and public health crises affecting Massachusetts residents, through investing in affordable housing. By investing significantly in affordable housing, along with other critical sectors such as small business, childcare, infrastructure, digital access, and public health, the Commonwealth and its municipalities can move toward a more equitable future in the aftermath of the COVID-19 pandemic. Indeed, we must not miss this opportunity to begin to close the racial wealth gap and to address racial disparities in health outcomes.

Meet the Author
Meet the Author
Katherine Martinez is director of economic development and Elana Brochin is program director for health equity for the Massachusetts Association of Community Development Corporations.