ARPA Innovators: Vermont Housing Improvement Program
by Shaun Gilpin, Vermont Department of Housing and Community Development, with an introduction by Sarah Goodwin, NCHH.
This is the first entry in our “ARPA Innovators” blog series. If you want to read more about the goals of this series or brush up on general information about the American Rescue Plan Act, you can read our opening post here.
This entry is about Vermont’s Housing Improvement Program, which provides grants to property owners for repair of housing units that are vacant or threatening to become vacant due to code violations and issues. This program was initially funded by earlier COVID-19 relief funding through the CARES Act; $5 million of initial ARPA funds were allocated to continue the program. The later rounds of funding required property owners to rent the renovated properties to residents exiting homelessness.
The Vermont Housing Improvement Program’s goal is to provide relatively modest public investment grants to property owners who had units that were either offline completely or threatening to go offline because of health and safety code violations.
In the first round of funding, which was funded by the CARES Act, we provided grants of up to $30,000 per unit to property owners, with each property owner providing a 10% match. Originally, we wanted to focus on vacant properties, but we expanded the program’s reach to address properties with code violations that could threaten to displace an existing tenant. And the stipulations on it were that the unit needed to be rented for at least five years at or below the HUD fair market rent. The only exception was if somebody came with a voucher that had a higher maximum than that rate; then they could charge that rate instead. We allowed this exception because we were trying to encourage property owners with these affected units to accept tenants who were exiting homelessness, and a lot of the programs that provide assistance for that population have more flexible vouchers.
One other thing that we required the property owners to do was contact their local Continuum of Care (COC) organization and receive and review at least three referrals. One of the reasons why we had that requirement was to establish a line of communication, because most of the naturally affordable housing in Vermont is owned by private individuals. I heard, anecdotally, that a couple property owners who went through the program didn’t necessarily take somebody in from the referrals for those particular units but then realized, “Oh, hey, I can talk to this homeless service provider group and actually have a line of referrals for other units.” So making those connections about what’s available in the community was another secondary goal of the program.
We worked with our five homeownership centers that cover every region of the state to manage the inspections, invoicing, and dispersing funds. The homeownership centers also reviewed the scope of work to make sure that we were talking about code issues, not granite countertops or things like that.
We then opened a second round with same program parameters, except instead of just needing to review three applicants from the COC, it was required that any of the units affected had to be rented to somebody who was exiting homelessness.
We wrapped up the majority of the CARES-funded units a couple months into 2021. We ended up creating about 253 units in about an 18-month timeframe, and probably about 45% of those ended up being rented to people who were experiencing homelessness prior to moving into the unit. Our average grant size was around $23,500.
The legislature granted us $5 million of ARPA funds in order to continue the program. For this version of the program, we’ve increased the match to 20%, so still a $30,000-per-unit grant maximum with a 20% match. Because it’s ARPA funding, we want to be sure that we have a clear COVID connection. Our agency of administration has essentially said that anybody who is experiencing homelessness is categorically eligible, because the risk of overcrowding in congregate shelters or being in in more congregate spaces was a high risk of COVID transmission. So, for this particular round, we’re requiring that property owners rent to a household who’s experiencing homelessness, and we are tying at this time to the Coordinated Entry lead organizations, because we have a really robust grassroots system of care in the state. We found that some of the landlords found it a little frustrating because they didn’t necessarily know who they were supposed to be talking to, and we’re getting referrals from a couple different organizations that were covering the same area. So we’re trying to streamline it. We’re thinking with the $5 million, we’re probably going to hit around 160 units. I suspect that the average grant size will go up as we continue with this program because the low-hanging fruits have already been taken out.
We were shocked at how much interest there was, even after that phase two of the CARES Act funding, where we raised the bar and said you had to work with homeless households, we still had an incredible amount of interest among property owners. One of the reasons why we had more open parameters at the beginning was we weren’t really sure how many people would get engaged. It’s been a hugely popular program. Currently, the governor’s administration is requesting an additional $20 million for this program. And based on the conversations I’ve had with the homeownership centers, we could spend all that $25 million just with the people who are on the on the informal waiting lists right now. Some of the property owners were pretty forthcoming with us and saying that they probably would have gotten the units fixed at some point, but having this infusion of funding transformed a six-year timeframe into an 18-month timeframe. I think that is still a noteworthy and important part of the program, because we need the units now. We have close to 1,600 households that are experiencing homelessness in Vermont.
Ultimately, we’re really hoping that this becomes an ongoing project or program that’s ultimately funded through general funds, rather than just COVID-related because we know that we need to increase the housing stock and affordability. Right now, it costs about $300,000 to construct a modest unit n Vermont, so a $30,000 public investment to bring a unit online is pretty remarkable.
How Innovative Communities Are Using ARPA Funds to Transform Housing and Address Environmental Hazards
Read or revisit the introductory blog about our “ARPA Innovators” or visit another blog in this series:
The American Rescue Plan: A New Opportunity for Healthy Homes Funding
Read our previous blog about the American Rescue Plan, by NCHH’s Sarah Goodwin and Devra Levy from the Childhood Lead Action Project.
The American Rescue Plan: Opportunities to Address Lead in Paint and Pipes
This fact sheet from NCHH clarifies the applicable uses for ARPA funding by states and localities and demonstates how communities can benefit from investments in lead-based paint remediation and lead service line replavcement. [pdf; NCHH, 2021]
The American Rescue Plan: Opportunities to Address Lead Hazards in Homes
This fact sheet from NCHH clarifies the applicable uses for ARPA funding by states and localities and demonstates how communities can benefit from investments in various healthy homes-related programs. [pdf; NCHH, 2021]
Shaun Gilpin represents the Vermont Department of Housing and Community Development.