After substantial cuts over the last few years, the Department of Housing and Community Development (DHCD) will see its budget increase modestly if Governor Romney signs the fiscal year 2005 budget released by the House-Senate Conference Committee yesterday. The Legislature is expected to pass the budget and send it to the Governor today. The committee's budget provides DHCD and its programs with $76,837,284 from the state's operating fund, an increase of nearly $10 million from FY 2004. The budget also includes an infusion of $2 million (in addition to previously authorized bond funds) for the Affordable Housing Trust Fund and an increase in public housing operating subsidies and MRVP. Remember, however, that in FY 2001, DHCD's budget was $141 million, not including $20 million in operating funds for the trust fund.

One of CHAPA's priorities included in the budget is the extension, for five more years, of the state low income housing tax credit. The extension, if signed by the Governor, means an additional $100 million in state tax credits for the development of affordable rental housing. Earlier this year, the Governor showed his support for other tax credits by supporting the historic tax credit, so CHAPA hopes that he will agree that the state low income housing tax credit is an important program that should continue.

The key changes from the Senate Ways and Means proposal include:

Another long time CHAPA priority, Residential Assistance for Families in Transition (RAFT) was also included in the budget. This new program would provide one-time cash assistance (grants of up to $3,000) and supportive services for families who are homeless or at risk of homelessness so that they can move into housing or preserve their current housing. The committee funded it with $2 million and placed the program within DHCD.

The Commonwealth Housing Task Force's proposal to provide municipal incentives for smart growth housing development is included in the final budget. A description of the incentives (zoning incentive payments and density bonus payments) can be found in previous Housing Briefs. The incentive payments for implementing overlay zoning districts and building new housing remain the same as those passed by the Senate. However, the conference committee deleted the "hold harmless" language that would have allowed communities to be reimbursed for "any actual additional net public school costs." A separate section of the budget calls upon DHCD, the Department of Revenue, and the Department of Education to study the impact that smart growth zoning districts have on educational systems and to recommend a formula for ascertaining "any actual additional net public school costs to which cities and towns may become subject as a result of adopting the smart growth zoning districts described in Chapter 40R."

Finally, CHAPA and the Massachusetts Coalition for the Homeless advocated successfully for outside section 297 of the budget, which calls for the implementation of a statewide application system for "all state public housing and, to the extent possible, other affordable housing resources."

Below is a breakdown of program funding amounts for DHCD:

The Committee chose to fund the Family Emergency Shelter line item (4403-2120) at $73,637,389, slightly lower than what passed the House and $2 million less than FY 2004.

The budget, once passed, will go to the Governor who will have ten days to sign it and to issue his vetoes.