Adopting State Legislation to Promote Affordable Housing in New Hampshire
In contrast to the nationwide housing roller coaster, rents and housing prices in the state of New Hampshire have remained relatively stable. However, the state still faces a significant housing affordability gap, due to increasing housing expenses such as utilities and property taxes. Furthermore, the foreclosure crisis has prompted more families to rent rather than own their home, resulting in a shortage of affordable housing rentals. In this article, we will highlight three pieces of legislation aimed at achieving a more balanced housing supply, and to ultimately reduce the state’s housing affordability gap.
New Hampshire Legislation
In April 2006, the state of New Hampshire adopted the Community Revitalization Tax Relief Incentive Program granting municipalities the authority to provide tax incentives to property owners who substantially rehabilitate underutilized structures. The legislation is intended to stimulate redevelopment projects in the downtown area that serve a public benefit, such as enhancing the area’s economic vitality, increasing residential housing, and preserving or improving historic landmarks. Qualifying projects must invest at least 15 percent of the original property value in rehabilitation costs or $75,000, whichever is less. The tax exemption is based on the value of improvements and is awarded for a period of five years. The state also encourages residential development by granting municipalities the authority to provide an additional two years of tax relief for projects that result in new residential units and an additional four years for affordable housing projects.
To further promote affordable housing, the state adopted House Bill 1259 (HB 1259) - Local Housing Commissions, which enables municipalities to establish housing commissions to ensure a balanced housing supply. HB 1259 also allows municipalities to constitute affordable housing revolving funds to help facilitate affordable housing development. Senate Bill 342 (SB 342) - Workforce Housing Law is another key piece of legislation that targets provision of workforce housing opportunities. SB 342 was adopted in June 2008 to require that municipalities provide "reasonable and realistic opportunities" for workforce housing development. The legislation codifies Britton v. Chester, a 1991 New Hampshire Supreme Court ruling that prohibits municipalities from adhering to exclusionary land use policies. In accordance with the legislation, municipalities are to examine the collective impact that land development ordinances and regulations (i.e., lot sizes and overall density requirements) have on the creation and preservation of workforce housing. The Workforce Housing Law also gives developers a right to build an affordable housing project by court order if it's found that the municipality unjustifiably denied the application.
New Hampshire's housing affordability gap has prompted state legislators to adopt policies that aim to address the disproportionate housing supply. In providing tax incentives, allowing the creation of housing commissions, and adopting legislation that reduces the implementation of exclusionary land use policies, the state has taken proactive measures to ensure the viability of the state and its residents.
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