Latest / ChangeMakers with Katie Goar / Episode 133: Maura Collins, Executive Director, Vermont Housing Finance Agency

Transcript

Episode 133: Maura Collins, Executive Director, Vermont Housing Finance Agency · ChangeMakers with Katie Goar

• 0:05
  Speaker 1: This is change Makers with Katie Gore finding the right
• 0:09
  Speaker 1: solutions for the affordable housing community.
• 0:13
  Speaker 2: Today's change maker is Mora Collins, the executive director of
• 0:18
  Speaker 2: the Vermont Housing Finance Agency, where she has been working
• 0:22
  Speaker 2: for several years to expand affordable housing in Vermont. And
• 0:27
  Speaker 2: today we welcome you, Moura. We want to hear about
• 0:30
  Speaker 2: more of what you're doing. No pun intended, but welcome
• 0:34
  Speaker 2: to the change Makers program.
• 0:36
  Speaker 3: Thank you so much for having me.
• 0:38
  Speaker 2: It is an honor to have you here. I'm excited
• 0:41
  Speaker 2: to hear about Vermont. Let's just start right there. Tell
• 0:46
  Speaker 2: us more about Vermont and maybe how long you've lived there,
• 0:51
  Speaker 2: what the affordable housing is like, before we dive into
• 0:55
  Speaker 2: all of the innovative programs that you're doing in all
• 0:59
  Speaker 2: the ways you're health helping solve affordable housing challenges.
• 1:03
  Speaker 3: Well, I'm not a Vermonter. I want to be very clear.
• 1:07
  Speaker 4: I'm from New York and after graduating from college, actually
• 1:11
  Speaker 4: lived in Boston for several years working in affordable housing
• 1:14
  Speaker 4: before moving up here in two thousand and two. So
• 1:18
  Speaker 4: it was a bit of a culture shock. Vermont is
• 1:20
  Speaker 4: the nation's second smallest state, and we are really rural
• 1:27
  Speaker 4: until I started more spending more time out west, and
• 1:31
  Speaker 4: I got caught.
• 1:32
  Speaker 3: With only a quarter tank of.
• 1:33
  Speaker 4: Gas in the middle of nowhere, Utah, and I realized
• 1:37
  Speaker 4: we're we are rural, but it's.
• 1:39
  Speaker 3: A different kind of rural.
• 1:40
  Speaker 4: New England rural is small, so most of our communities
• 1:46
  Speaker 4: have less than twenty five hundred people. The state as
• 1:50
  Speaker 4: a whole is about six hundred and fifty thousand people.
• 1:53
  Speaker 4: So the great State of New Hampshire, which we are
• 1:57
  Speaker 4: often confused with because one of us is right side
• 1:59
  Speaker 4: up and one of us as upside down, we look
• 2:02
  Speaker 4: the same the stan New Hampshire and Vermont, but they
• 2:05
  Speaker 4: have twice as many people as we do. So bringing
• 2:09
  Speaker 4: and delivering housing and focusing on affordability when you have
• 2:15
  Speaker 4: such a small scale is really top of mind for us.
• 2:20
  Speaker 4: So our largest city is Burlington with forty thousand people,
• 2:24
  Speaker 4: and after that it dramatically drops off to communities one
• 2:29
  Speaker 4: or two communities of twenty thousand.
• 2:31
  Speaker 3: After that, no community has more in ten thousand people.
• 2:33
  Speaker 3: So I have, you know, worked at.
• 2:38
  Speaker 4: VHFA, the Housing Finance Agency for twenty three years in
• 2:42
  Speaker 4: a variety of positions, and in my seventh years executive director,
• 2:47
  Speaker 4: and we really are required to do it all, be
• 2:51
  Speaker 4: soup to nuts and addressing all the needs of our state.
• 2:57
  Speaker 4: The incomes of vermontors skew a bit lower than the
• 3:01
  Speaker 4: national averages, but stay relatively strong because of our demographics, which,
• 3:08
  Speaker 4: as most of us know who work in this industry,
• 3:10
  Speaker 4: sadly are directly correlated with race. Our state is ninety
• 3:16
  Speaker 4: two percent white, and so a lot of our statistics
• 3:21
  Speaker 4: skew toward the kind of white statistics you see in
• 3:25
  Speaker 4: the nation, meaning we have a high home ownership rate.
• 3:27
  Speaker 4: I think we're at seventy three percent.
• 3:31
  Speaker 3: We are. Income skew a bit.
• 3:34
  Speaker 4: Higher in the rest, but the poverty that we have
• 3:38
  Speaker 4: and the needs that we have are still very acute,
• 3:41
  Speaker 4: and they are spread across a lot of small communities
• 3:46
  Speaker 4: that are under resourced, don't have a lot of infrastructure, water,
• 3:50
  Speaker 4: sewer and the like, and so the challenges really run
• 3:55
  Speaker 4: the gamut.
• 3:56
  Speaker 2: I've heard Vermont described as a state that is a
• 4:02
  Speaker 2: big small town, and it sounds like some of the
• 4:06
  Speaker 2: dynamics that you're talking about as far as proximity, you know,
• 4:09
  Speaker 2: outside of Burlinton, and then some of the other challenges.
• 4:13
  Speaker 2: Have you seen an influx of people moving into the
• 4:16
  Speaker 2: state like our rents going up. Or is it purely
• 4:20
  Speaker 2: an access to affordable living situation?
• 4:25
  Speaker 3: We I have several answers to that.
• 4:28
  Speaker 4: So Vermont follows only the state of Maine in having
• 4:33
  Speaker 4: the largest proportion of our housing stock being second homes.
• 4:37
  Speaker 4: And I actually bristolet the term's second homes because they're
• 4:40
  Speaker 4: often the third or the fourth home that someone has,
• 4:42
  Speaker 4: so non primary residences. I should say, now, in fairness,
• 4:47
  Speaker 4: a fair number of those are what we locally call
• 4:50
  Speaker 4: deer camps. They may be lakefront properties that don't have
• 4:56
  Speaker 4: year round septic or are fully insulated for our harsh wind.
• 5:00
  Speaker 4: They also maybe ski condos because we have a really
• 5:05
  Speaker 4: active tourism and ski community. But a lot of them
• 5:09
  Speaker 4: are what would be year round homes available for Vermonters,
• 5:14
  Speaker 4: but are not available to us who live and work
• 5:16
  Speaker 4: locally because they're owned by out of state folks. So
• 5:21
  Speaker 4: when the pandemic happened, a lot of New York and
• 5:25
  Speaker 4: Boston and big city folks were treated up to their
• 5:29
  Speaker 4: Vermont vacation homes, and we absolutely saw a ton of
• 5:33
  Speaker 4: out of state license plates, and in many ways I.
• 5:38
  Speaker 3: Will say that was hard for our.
• 5:40
  Speaker 4: Communities to see an adapt to and it was hard
• 5:45
  Speaker 4: to watch my fellow Vermonters have that kind of reaction.
• 5:49
  Speaker 4: It was a little embarrassing to see how we treated
• 5:52
  Speaker 4: outsiders when there was this influx. But there were a
• 5:56
  Speaker 4: lot of things about the pandemic that maybe all of
• 5:59
  Speaker 4: us weren't at our best because there was a lot
• 6:01
  Speaker 4: going on. We haven't seen that increase and out of
• 6:05
  Speaker 4: staters maintain since twenty twenty two. A lot of them
• 6:10
  Speaker 4: have gone back to their big city lives, but they
• 6:14
  Speaker 4: there has been an uptick in interest in living in
• 6:18
  Speaker 4: Vermont and that has really driven our housing shortage. And
• 6:24
  Speaker 4: our housing markets have gone haywire since twenty twenty and
• 6:29
  Speaker 4: prices have skyrocketed faster than they were. We have not
• 6:33
  Speaker 4: been keeping up with supply going back to the eighties.
• 6:37
  Speaker 4: So I don't ever want to blame this problem on
• 6:41
  Speaker 4: the pandemic or out of staters or anything like that.
• 6:43
  Speaker 4: But yes, rents continue to rise, home prices are up
• 6:48
  Speaker 4: every year.
• 6:50
  Speaker 3: Our inventory is not what it needs to be.
• 6:53
  Speaker 4: We have estimated that we need to do about double
• 6:57
  Speaker 4: or triple the amount of home construction that we've.
• 7:00
  Speaker 3: Been doing in our state, and.
• 7:02
  Speaker 4: Our legislature and governor and housing policymakers have been doing
• 7:08
  Speaker 4: wonderful things to try to meet those goals, but I
• 7:12
  Speaker 4: don't think we've done everything just yet.
• 7:15
  Speaker 2: And this is a common theme that used to be
• 7:18
  Speaker 2: isolated to the big cities. Right now we are seeing
• 7:21
  Speaker 2: that rural areas, am inner Midwest types of areas, even
• 7:27
  Speaker 2: some Southern cities that are experiencing this dynamic. And so
• 7:32
  Speaker 2: we're trying to you know, the pace by which construction
• 7:36
  Speaker 2: hasn't caught up, combined now with the dynamics post twenty twenty,
• 7:41
  Speaker 2: combined now with the pricing like this is. I don't
• 7:44
  Speaker 2: want to say the perfect storm, because it's not a
• 7:46
  Speaker 2: perfect storm, but this is a scenario that is playing out.
• 7:50
  Speaker 2: So I'm fascinated with what Vermont Housing Finance, what you
• 7:55
  Speaker 2: guys are doing here because I read a couple of
• 7:58
  Speaker 2: things and I want to I want to look at this.
• 8:02
  Speaker 2: But I saw a news article pop up ironically on
• 8:06
  Speaker 2: Instagram about your credit rating being upgraded, and I find
• 8:14
  Speaker 2: this fascinating because it's part of the economic conversation that
• 8:17
  Speaker 2: we're saying we're talking about right here, and how that
• 8:20
  Speaker 2: impacts then what you as an agency are able to
• 8:24
  Speaker 2: do financially when it's you know, building in and getting loans.
• 8:30
  Speaker 2: So walk us through how crucial that upgrade was for
• 8:35
  Speaker 2: you and maybe even how it happened.
• 8:37
  Speaker 3: Yeah. Well, you know, an agency's credit rating is a.
• 8:41
  Speaker 4: Lot like any of our credit scores. It is a
• 8:45
  Speaker 4: bit of a black box. We know generally how the
• 8:48
  Speaker 4: agencies go about it, and uh so we do intentionally
• 8:54
  Speaker 4: and overtly try to maintain the highest ratings we can.
• 8:58
  Speaker 4: And there's always a feeling like it could be a
• 9:02
  Speaker 4: little higher, you know, I'll say that internally we think
• 9:05
  Speaker 4: that we could still be one notch higher, and so
• 9:07
  Speaker 4: we look forward to educating the rating agencies about.
• 9:12
  Speaker 3: That in the future. But it always is good.
• 9:14
  Speaker 4: It's the same thing with anyone's credit rating, that when
• 9:16
  Speaker 4: an agency's credit rating goes higher, it means that the
• 9:21
  Speaker 4: borrowing costs are lower. Now, Housing Finance Agencies, I know
• 9:25
  Speaker 4: you've spoken with other HFA leaders in the past.
• 9:28
  Speaker 3: You know, we exist in.
• 9:30
  Speaker 4: Every state in the country, and our primary core programs
• 9:35
  Speaker 4: are it's well known the Low income Housing text credit program,
• 9:39
  Speaker 4: but also the original olympetus for us was to sell
• 9:43
  Speaker 4: private activity bonds for affordable housing, meaning that when we
• 9:48
  Speaker 4: want to make mortgages or make large loans to developers
• 9:52
  Speaker 4: of affordable rental housing. We don't get any state appropriations
• 9:57
  Speaker 4: for that. We have to go to the bond market
• 10:00
  Speaker 4: and sell these bonds, which essentially is another way of
• 10:03
  Speaker 4: saying we're borrowing the money from investors and we promise
• 10:07
  Speaker 4: them a good rate of return on that. But they're
• 10:11
  Speaker 4: usually happy with a slightly lower rate of return than
• 10:14
  Speaker 4: they could get elsewhere because our bonds are tax exempt,
• 10:18
  Speaker 4: so they're not paying taxes on the earnings of that investment.
• 10:22
  Speaker 4: So let's say that we promise bondholders that will pay
• 10:27
  Speaker 4: them five percent on the return for their money for
• 10:32
  Speaker 4: the next thirty years. We turn around and make mortgages
• 10:36
  Speaker 4: either to first time home buyers or to rental developers
• 10:39
  Speaker 4: at six percent.
• 10:41
  Speaker 3: Let's say.
• 10:42
  Speaker 4: Now that's below what the market can offer and what
• 10:44
  Speaker 4: they can get from a conventional lender, and we're limited
• 10:47
  Speaker 4: as to how much that spread can be between what
• 10:50
  Speaker 4: we're getting in from our borrowers and what we have
• 10:53
  Speaker 4: to pay back to our bondholders.
• 10:55
  Speaker 3: So when our.
• 10:58
  Speaker 4: Ratings chain, that means that we look like a better
• 11:02
  Speaker 4: investment for that bond holder. We are more safe, secure,
• 11:07
  Speaker 4: higher rated, so they may accept even a lower rate
• 11:12
  Speaker 4: of return on their end, which means we can pass
• 11:15
  Speaker 4: that forward to our borrowers and make the housing more affordable.
• 11:20
  Speaker 3: So it's very important what our rating is.
• 11:24
  Speaker 4: At the same time, I'm going to keep talking about
• 11:28
  Speaker 4: our small state, we feel an obligation to really balance
• 11:34
  Speaker 4: the mission of our agency with the margin, the profit
• 11:39
  Speaker 4: margin of the agency, and we can't get too focused
• 11:42
  Speaker 4: on one.
• 11:42
  Speaker 3: Or the other.
• 11:43
  Speaker 4: If we were one hundred percent mission focused with no
• 11:49
  Speaker 4: awareness of our financial sustainability, we run the risk of
• 11:54
  Speaker 4: going out of business three years from now.
• 11:57
  Speaker 3: If we are so.
• 12:00
  Speaker 4: Focused on the margin, then we run the risk of
• 12:02
  Speaker 4: not meeting our mission. And so a rating is a
• 12:06
  Speaker 4: balancing act. We could stalk away lots of cash in
• 12:13
  Speaker 4: our bank accounts and in our bond indentures and all
• 12:15
  Speaker 4: that and get a much higher rating, and we know
• 12:18
  Speaker 4: that we could do that, but it's important to put
• 12:21
  Speaker 4: the money out there and build the housing and get
• 12:24
  Speaker 4: it done. So we've strategically chosen to find that goldilock
• 12:29
  Speaker 4: sweet spot of offering low enough rates so that we
• 12:33
  Speaker 4: can deliver on our mission while also making sure that
• 12:38
  Speaker 4: we are sustainable for the next fifty years.
• 12:41
  Speaker 3: Since we just hit our fiftieth birthday.
• 12:43
  Speaker 4: We're very focused on how we set ourselves up for
• 12:46
  Speaker 4: success to be here longer.
• 12:48
  Speaker 2: That balance a strong financial performance with social mission is
• 12:54
  Speaker 2: one that housing finance authorities you guys are trying to strike,
• 12:58
  Speaker 2: but now so are on profit developers, So our housing
• 13:03
  Speaker 2: authorities who are dabbling into mixed finance. Even Quadelle as
• 13:09
  Speaker 2: a private company, you do, we want to.
• 13:12
  Speaker 4: Do the same thing when we take on projects.
• 13:15
  Speaker 3: We're like, does it is it our ideal client? Is
• 13:17
  Speaker 3: it our ideal market? Yes?
• 13:21
  Speaker 2: It is it even financially feasible, But yet what is that.
• 13:24
  Speaker 3: Mission that we're going to accomplish?
• 13:26
  Speaker 2: And I'm excited that so many different entities are trying
• 13:31
  Speaker 2: to find that right balance here between strong financial performance
• 13:36
  Speaker 2: and then social mission because the social mission of affordable
• 13:40
  Speaker 2: housing is very, very niche, but you described it perfectly
• 13:46
  Speaker 2: like you can't go all in on one and go
• 13:49
  Speaker 2: all in at the exclusion of the other.
• 13:52
  Speaker 3: So you mentioned fifty years.
• 13:54
  Speaker 4: Congratulations, that's a big milestone. We just hit our fifty
• 13:58
  Speaker 4: year as well.
• 14:00
  Speaker 2: What are some people strategizing about that is like a celebration,
• 14:05
  Speaker 2: But then we saw have so much more to do,
• 14:08
  Speaker 2: Like what's the common theme there as you hit that milestone.
• 14:11
  Speaker 3: Yeah, you know there was.
• 14:13
  Speaker 4: In the past year, there's been a lot of celebrations
• 14:15
  Speaker 4: and it has been so much fun to look back
• 14:17
  Speaker 4: and just to recognize how we are standing on the
• 14:20
  Speaker 4: shoulders of giants. I am very proud that I'm only
• 14:25
  Speaker 4: the third executive director at VHFAS, so we have a
• 14:29
  Speaker 4: lot of stability with our agency. We started, like many HFAs,
• 14:35
  Speaker 4: doing traditional mortgage lending. A couple years later, we added
• 14:39
  Speaker 4: on rental housing. In the late eighties, obviously we took
• 14:43
  Speaker 4: on the li tech program, and then in the pandemic,
• 14:47
  Speaker 4: we were asked to do so much for so many.
• 14:50
  Speaker 4: I mean HFAs in general are a B to B
• 14:54
  Speaker 4: type of organization. We work through our participating lenders for
• 14:59
  Speaker 4: people who want to get mortgages. We don't have retail
• 15:02
  Speaker 4: locations all across the state. You don't come to our
• 15:04
  Speaker 4: office to get a mortgage. You go to the local
• 15:07
  Speaker 4: community banks, the credit unions, the mortgage companies.
• 15:10
  Speaker 3: You deal with them.
• 15:12
  Speaker 4: They know our rules and eligibility. They offer our down
• 15:16
  Speaker 4: payment assistance, they can give the low rate that we offer,
• 15:20
  Speaker 4: and after the loan closes, we work with them to
• 15:24
  Speaker 4: pay for that loan essentially, and it's the same thing
• 15:27
  Speaker 4: when we're dealing with a fairly small cadre of community
• 15:31
  Speaker 4: development nonprofits and for profit housing developers on the rental side.
• 15:36
  Speaker 4: But during the pandemic, there was the Homeowner Assistance Fund
• 15:42
  Speaker 4: and that was providing direct mortgage arrearage assistance and pass
• 15:47
  Speaker 4: do property taxes and the like to Vermont consumers directly.
• 15:52
  Speaker 4: And so that was more business to consumer type program,
• 15:57
  Speaker 4: and we administered about sixty million dollars in total of
• 16:00
  Speaker 4: federal and state funding for that, and it really challenged
• 16:04
  Speaker 4: us at the same time as the housing needs, let
• 16:10
  Speaker 4: me say, the housing needs in our state, and I
• 16:13
  Speaker 4: think many states have for long been focused on the
• 16:16
  Speaker 4: lowest income band among US. People on SSI income, people
• 16:21
  Speaker 4: with disabilities, people without homes, people living in deep chronic
• 16:25
  Speaker 4: poverty have really always had housing challenges, and sadly, this
• 16:31
  Speaker 4: nation has not taken that seriously enough. And it wasn't until,
• 16:37
  Speaker 4: in my opinion, the impact of the housing shortage and
• 16:41
  Speaker 4: housing unaffordability started creeping up that income band and it
• 16:45
  Speaker 4: started affecting you know, college educated children of ours who
• 16:50
  Speaker 4: couldn't move out of our basements because they couldn't get
• 16:52
  Speaker 4: a job, and then it was you know, early career,
• 16:56
  Speaker 4: mid career folks who couldn't get a job. Now we
• 16:59
  Speaker 4: have hospital executives who are trying to hire senior vps
• 17:02
  Speaker 4: and above with healthy six figure salaries and affordable places
• 17:07
  Speaker 4: to live in our state, who cannot find people to
• 17:12
  Speaker 4: afford housing at the salaries we're paying. And now that
• 17:15
  Speaker 4: it's impacting everyone.
• 17:17
  Speaker 3: We see more outcry.
• 17:19
  Speaker 4: So during the pandemic, our agency was asked to start
• 17:24
  Speaker 4: to address more of the middle income Vermontors in addition
• 17:28
  Speaker 4: to the lowest income Vermonters, and we rolled out both
• 17:31
  Speaker 4: a home ownership and a rental housing development and also
• 17:36
  Speaker 4: a weatherization program, three different programs to help middle income
• 17:40
  Speaker 4: Vermnnors afford housing and to create the housing stock that's
• 17:45
  Speaker 4: for sale rental. And so we have been stretched to
• 17:52
  Speaker 4: respond to all the ways we've been called up to
• 17:55
  Speaker 4: the plate. And so as we look at the last
• 17:58
  Speaker 4: fifty years, we're proud of what we've done. We're a
• 18:02
  Speaker 4: little exhausted by what we've been doing lately, and to
• 18:05
  Speaker 4: be honest, we're catching our breath right now and making
• 18:09
  Speaker 4: sure that our internal systems and programs and what we've
• 18:14
  Speaker 4: been doing, are strong enough and that we've learned enough
• 18:17
  Speaker 4: from this fire drill we've been on for the last
• 18:19
  Speaker 4: several years to see what do we want to sustain
• 18:23
  Speaker 4: going forward, what we're good in the moment, responses to
• 18:29
  Speaker 4: the pandemic and the housing spike and needs. And then
• 18:34
  Speaker 4: you know what should we let go and say we've
• 18:36
  Speaker 4: learned from that, but that may not be the sustainable
• 18:39
  Speaker 4: way forward for our state and what we need.
• 18:42
  Speaker 2: That's an interesting process because you can point to milestones,
• 18:46
  Speaker 2: you can point to responsiveness. You can point to some
• 18:49
  Speaker 2: programs that you probably had to create on the fly.
• 18:53
  Speaker 2: They weren't sitting on a bookshelf with this scenario. But
• 18:57
  Speaker 2: then now, like, what do you do with that moving forward?
• 19:02
  Speaker 2: So I noticed, and now they're a program that you
• 19:05
  Speaker 2: guys are doing. And this may be one that you
• 19:07
  Speaker 2: just described, but it was called let's build homes for
• 19:12
  Speaker 2: Vermont's takeholders. It was a coalition you created.
• 19:15
  Speaker 3: What does that project look like? What does that coalition
• 19:20
  Speaker 3: look like? What does that phrase mean?
• 19:23
  Speaker 4: Explain some of the dynamics behind that.
• 19:27
  Speaker 3: It's been really exciting.
• 19:28
  Speaker 4: I would love to take credit for being the brainchild
• 19:31
  Speaker 4: and this being a VHFA program. But we really were
• 19:34
  Speaker 4: invited into it by a bunch of local employers who
• 19:39
  Speaker 4: were meeting with a goal of feeling like they had
• 19:43
  Speaker 4: to create tens of thousands of homes to meet their
• 19:47
  Speaker 4: workforce needs. Well, okay, and really this is the kind
• 19:51
  Speaker 4: of dream I've had for twenty five years, wishing that
• 19:55
  Speaker 4: the employers of our state would start talking more about
• 19:59
  Speaker 4: the house needs, because, as I said.
• 20:02
  Speaker 3: Before, we know that.
• 20:05
  Speaker 4: Since the eighties we've not been building enough, and we've
• 20:08
  Speaker 4: been talking about how we're heading for this brick wall
• 20:11
  Speaker 4: of if we continue to not build what we need
• 20:13
  Speaker 4: to keep up with our household growth, it's going to
• 20:16
  Speaker 4: be a problem.
• 20:17
  Speaker 3: And in the last few years that has come to pass.
• 20:20
  Speaker 4: And so it was exciting to see the University of Vermont,
• 20:25
  Speaker 4: the local hospital, other colleges, Middlebury College, and major local
• 20:30
  Speaker 4: employers of our industries come together and start talking about
• 20:34
  Speaker 4: housing and then invite in Vermont Housing Finance Agency to say,
• 20:39
  Speaker 4: how can what we're talking about mix with what has
• 20:43
  Speaker 4: been happening in the industry.
• 20:45
  Speaker 3: And from there it.
• 20:47
  Speaker 4: Was a natural evolution that we recognized that there were
• 20:51
  Speaker 4: really meaningful advocacy steps that we could take together that
• 20:57
  Speaker 4: could change the narrative about housing and try to be
• 21:02
  Speaker 4: solutions oriented and not just problem identifiers.
• 21:06
  Speaker 2: Right.
• 21:07
  Speaker 4: For a long time, the housing community has been trying
• 21:10
  Speaker 4: to wake people up. I keep saying to this brick
• 21:13
  Speaker 4: wall we're heading for, But now that it's in the media,
• 21:16
  Speaker 4: it's obvious it's, as I said, impacting all folks on
• 21:21
  Speaker 4: the income spectrum. We're kind of done convincing people that
• 21:25
  Speaker 4: we have a problem, and we quickly need to pivot
• 21:28
  Speaker 4: to what are we going to do about it? So
• 21:30
  Speaker 4: let's build homes. I'm on the executive committee of it,
• 21:33
  Speaker 4: and there's a board of twenty individuals statewide that have
• 21:37
  Speaker 4: come together and identified a few key priorities such as,
• 21:41
  Speaker 4: how do we control the cost of housing and as
• 21:44
  Speaker 4: a part of that, how do we encourage offsite manufactured
• 21:47
  Speaker 4: housing as one example. How do we look at both
• 21:51
  Speaker 4: local and we have some statewide permits that can make
• 21:57
  Speaker 4: housing development riskier because of the unknown delays and the
• 22:02
  Speaker 4: time that it takes and the costs of those permits.
• 22:07
  Speaker 4: How can we look at encouraging more communities to embrace
• 22:12
  Speaker 4: housing in many ways, and how can we support the
• 22:17
  Speaker 4: affordable housing network and having the funding they need to
• 22:21
  Speaker 4: direct the resources because without those resources, we will not
• 22:25
  Speaker 4: be able to hit that lowest income band who does
• 22:29
  Speaker 4: need the assistance the most. So it has been very exciting.
• 22:34
  Speaker 4: We launched in January. We have a part time legislature
• 22:38
  Speaker 4: that only meets from January through mid May, and there
• 22:42
  Speaker 4: was a tremendous win that came out of the first
• 22:44
  Speaker 4: legislative session of advocacy that lets Build Homes really championed,
• 22:49
  Speaker 4: and that was a project based TIF tax increment financing.
• 22:54
  Speaker 4: It's focused just on housing, and it's supposed to be
• 22:58
  Speaker 4: accessible to our very small rural communities that otherwise would
• 23:03
  Speaker 4: not probably be candidates for offering a TIFF program town wide.
• 23:09
  Speaker 4: But this is just to pay for infrastructure ran to
• 23:14
  Speaker 4: support housing, and it's supposed to be designed to be
• 23:18
  Speaker 4: so easy and accessible that we can make investments in
• 23:22
  Speaker 4: housing in these very rural, very small Vermont communities because
• 23:27
  Speaker 4: our worry is is that if we don't equitably distribute
• 23:32
  Speaker 4: resources and make sure that we're building everywhere, then we
• 23:36
  Speaker 4: may end up with communities that grow and thrive that
• 23:40
  Speaker 4: are the big name towns, the ski towns, you know,
• 23:43
  Speaker 4: Killington and Jpek and Burlington and Rutland, and Montpelier, and
• 23:48
  Speaker 4: maybe those communities will grow and thrive, but the towns
• 23:51
  Speaker 4: that I could list off.
• 23:52
  Speaker 3: That you've never heard of will all behind.
• 23:56
  Speaker 4: And we run the risk that those could essentially become
• 24:00
  Speaker 4: communities because if the stock doesn't came up with the demand,
• 24:06
  Speaker 4: then the prices will just increase, and Vermont runs the
• 24:09
  Speaker 4: risk of becoming a playground of the rich and famous.
• 24:13
  Speaker 4: I mean, we have so many out of staters and
• 24:15
  Speaker 4: so many second homes, and we have so much great
• 24:18
  Speaker 4: outdoor recreation that we do find a lot of people
• 24:21
  Speaker 4: coming in using some of the resources and maybe not
• 24:25
  Speaker 4: calling Vermont homes. So we need to make sure that
• 24:28
  Speaker 4: we can house Vermonters who want to be here at
• 24:31
  Speaker 4: the same time while creating a welcoming environment for all.
• 24:35
  Speaker 2: But it's a public private partnership that is looking at
• 24:39
  Speaker 2: filling the gaps in a city that maybe it's just
• 24:42
  Speaker 2: not a business case to put infrastructure there. So, like
• 24:46
  Speaker 2: you know, a business is going to look at this
• 24:48
  Speaker 2: on the books and say it costs too much to
• 24:51
  Speaker 2: get infrastructure there, and they're just not going to be
• 24:54
  Speaker 2: able to do it. And so that's what makes this
• 24:56
  Speaker 2: partnership that you guys are doing so much better, better
• 25:00
  Speaker 2: because you're gonna be able to fill those gaps. And
• 25:04
  Speaker 2: I think of a couple of examples. We had somebody
• 25:08
  Speaker 2: on the podcast from Steamboat Springs, big ski town saying
• 25:13
  Speaker 2: dynamics that you're talking about, and they looked at the
• 25:19
  Speaker 2: inability to get workers and the inability of the workers
• 25:24
  Speaker 2: to live in proximity to what people were valuing.
• 25:29
  Speaker 3: Within the states.
• 25:30
  Speaker 4: So having a plan to accomplish.
• 25:33
  Speaker 2: And recognize those dynamics makes economic sense too, because you
• 25:40
  Speaker 2: want people to be able to live and work in
• 25:43
  Speaker 2: proximity to some of these attributes. Is there a number,
• 25:47
  Speaker 2: like are you trying to build x amount within so
• 25:49
  Speaker 2: many years?
• 25:50
  Speaker 4: Like what's the goal there? Yeah, the state is set
• 25:53
  Speaker 4: a target of trying to build forty thousand homes by
• 25:57
  Speaker 4: twenty thirty. I mean, Vermont numbers are small, So when
• 26:01
  Speaker 4: I say forty thousand, I understand that many listeners may
• 26:04
  Speaker 4: say that's not that many.
• 26:06
  Speaker 3: But we only have.
• 26:10
  Speaker 4: Two hundred and seventy thousand homes in the state. So that,
• 26:14
  Speaker 4: as I said, it would mean right now we're building
• 26:17
  Speaker 4: about twenty four hundred homes a year, and we need
• 26:21
  Speaker 4: to get well over eight thousand homes a year. So again,
• 26:25
  Speaker 4: our numbers are small, and I can appreciate that California
• 26:28
  Speaker 4: and New York is laughing right now, But for us,
• 26:31
  Speaker 4: it's an order of magnitude of going from twenty four
• 26:34
  Speaker 4: hundred homes to eighty two or eighty four hundred homes
• 26:37
  Speaker 4: a year is such a sizeable shift that it means
• 26:42
  Speaker 4: we have to look under every rock and figure out
• 26:46
  Speaker 4: every text policy we can address, every appeals process that
• 26:50
  Speaker 4: we can streamline and make more by right, every funding
• 26:54
  Speaker 4: stream of how we can support the investments in infrastructure
• 26:57
  Speaker 4: and direct housing assistance, looking at how our permitting, zoning,
• 27:03
  Speaker 4: and all of this comes together. Because the housing shortage
• 27:07
  Speaker 4: and affordability problems we're not.
• 27:10
  Speaker 3: Caused by one thing. It's not caused by out of stators.
• 27:13
  Speaker 4: It's not caused by our ski communities or short term rentals.
• 27:17
  Speaker 4: It's not even caused by interest rates. It's not just
• 27:20
  Speaker 4: caused by the fact that now we're paying people construction
• 27:22
  Speaker 4: workers a livable wage, which we should have been doing
• 27:25
  Speaker 4: decades and decades ago. It's all these things coming together,
• 27:29
  Speaker 4: and therefore our solutions need to be as multifaceted as
• 27:33
  Speaker 4: the complex problem.
• 27:34
  Speaker 2: Is, and the economic piece of this is very hard
• 27:38
  Speaker 2: to get your arms around because it's moving. So you know,
• 27:41
  Speaker 2: you're having rates change, you're having rents change, you're having
• 27:45
  Speaker 2: wages change. And I think right now, as we're exploring solutions,
• 27:51
  Speaker 2: there are studies happening to say, you know, if you
• 27:56
  Speaker 2: control one dynamic, where does it pop up in another area?
• 28:00
  Speaker 2: And that's the hard part of this is some of
• 28:03
  Speaker 2: the policies you have to look at it from a
• 28:06
  Speaker 2: policy side, because you know, if you go to work
• 28:09
  Speaker 2: the economics and put it into policy, is are where
• 28:14
  Speaker 2: is that going to boomerang? And is it going to
• 28:16
  Speaker 2: have these unintended jumps later in the continuum as you're
• 28:20
  Speaker 2: trying to build And right now everybody's still learning that.
• 28:25
  Speaker 2: So like it's this great experiment in economics and housing policy,
• 28:32
  Speaker 2: isn't it?
• 28:33
  Speaker 3: It is?
• 28:34
  Speaker 4: And you know there's one thing I mean, Okay, when
• 28:37
  Speaker 4: I started at VHFA, I was a research annalyst, so
• 28:40
  Speaker 4: I love data and numbers, and I'm excited by a
• 28:44
  Speaker 4: matrix that we've recently we're working on right now, it's
• 28:47
  Speaker 4: not quite finished, but I would I would wonder how
• 28:51
  Speaker 4: this would play out in other states if they mirrored
• 28:53
  Speaker 4: this where we are looking at all the cost drivers
• 28:57
  Speaker 4: of housing. And if you can imagine a table where
• 28:59
  Speaker 4: every run oh is interest rates, labor costs, material costs,
• 29:05
  Speaker 4: and you know the public policy goals that we're trying
• 29:09
  Speaker 4: to do. You know, in affordable housing, we're trying to
• 29:12
  Speaker 4: address more people exiting homelessness, and so that comes with
• 29:15
  Speaker 4: social service costs. We are preserving historic structures, remediating blight
• 29:21
  Speaker 4: and brown fields, and trying us to help our state
• 29:24
  Speaker 4: meet our greenhouse gas emissions goals by having very tight
• 29:27
  Speaker 4: efficient housing. But all those things can add cost. And
• 29:31
  Speaker 4: then the table has three different columns, and it's what
• 29:36
  Speaker 4: can VHFA do to address or control those costs? And
• 29:41
  Speaker 4: then the next column is what can the State of
• 29:44
  Speaker 4: Vermont do to control or address those costs? And the
• 29:47
  Speaker 4: last one is what's the feds? You know? And we
• 29:50
  Speaker 4: probably we can talk to our congressional delegation, which is
• 29:53
  Speaker 4: the best in the nation, and we can you know,
• 29:55
  Speaker 4: write our letters of sign on support. But we really
• 29:59
  Speaker 4: can't control inter We really can't control tariffs, We can't
• 30:02
  Speaker 4: control baba, you know, the build America, Buy America requirements
• 30:06
  Speaker 4: and these things that are impacting costs. And so I
• 30:10
  Speaker 4: could raise my fist and be mad at those cost
• 30:14
  Speaker 4: drivers that we can't control. But as a leader of
• 30:18
  Speaker 4: an organization, that's not a very motivating platform from which
• 30:22
  Speaker 4: I want to have our employees be thinking about the
• 30:26
  Speaker 4: next fifty years of what we as VHFA are going
• 30:28
  Speaker 4: to do. So I don't think it's fair to go
• 30:32
  Speaker 4: into your house and tell you to clean up your
• 30:34
  Speaker 4: kitchen until I can show you that mine's pretty darn clean.
• 30:37
  Speaker 4: So I think there's an obligation for all of us
• 30:40
  Speaker 4: to look at as a public funder, what can we do.
• 30:44
  Speaker 4: I can't do everything I wish I could, but I'm
• 30:46
  Speaker 4: not in control of everything. So what can I do
• 30:49
  Speaker 4: to address and control costs? And how can I use
• 30:53
  Speaker 4: our agency's voice to help the states see what it
• 30:56
  Speaker 4: can do? And from there we may not be a
• 31:00
  Speaker 4: to drop costs. I mean, it costs on average well
• 31:03
  Speaker 4: over six hundred thousand dollars a unit to build in Vermont.
• 31:06
  Speaker 4: We see applications for affordable housing well into the over
• 31:10
  Speaker 4: seven hundred thousand sometimes and that's expensive for us.
• 31:15
  Speaker 3: Expensive, yeah, And so how do we ratchet that back
• 31:20
  Speaker 3: a little.
• 31:20
  Speaker 4: Bit so that maybe we can only control costs and
• 31:24
  Speaker 4: drop it five percent?
• 31:26
  Speaker 3: But at this point, I'll take it.
• 31:27
  Speaker 4: I'll take it if we could just level off costs
• 31:29
  Speaker 4: and stop having them grow every year at the rate
• 31:31
  Speaker 4: they have them.
• 31:33
  Speaker 2: So we talked about access to workers for people in communities,
• 31:38
  Speaker 2: and we've had a couple.
• 31:40
  Speaker 3: Of people on here where they were developers for.
• 31:43
  Speaker 2: Hospitals because they just couldn't get the nurses, They couldn't
• 31:47
  Speaker 2: for the teachers. They couldn't have them commuting in an
• 31:51
  Speaker 2: hour and a half, two hours, There wasn't transit, and
• 31:55
  Speaker 2: so forth.
• 31:56
  Speaker 3: We even had some a developer on here for Disney.
• 31:58
  Speaker 2: Who said, it's you we got to have people who
• 32:01
  Speaker 2: can work here and live here out what's the theme
• 32:05
  Speaker 2: or what are initiatives that you're seeing here? Because we
• 32:08
  Speaker 2: described the state, I felt like that that's also a
• 32:11
  Speaker 2: dynamic that's happening on how people. You know, not everybody
• 32:15
  Speaker 2: can live in Burlington, right right, So what are some
• 32:19
  Speaker 2: of those things.
• 32:19
  Speaker 3: That you guys are having to address.
• 32:21
  Speaker 2: When you when you look forward for your next let's
• 32:25
  Speaker 2: build and where we're building.
• 32:28
  Speaker 3: Yes, well, we're seeing the same dynamics.
• 32:30
  Speaker 4: The University of Vermont Medical Center, which is based in
• 32:34
  Speaker 4: Burlington but actually serves actually part of New York and
• 32:37
  Speaker 4: a big region of northwestern Vermont. They have been building
• 32:42
  Speaker 4: housing for their workers.
• 32:45
  Speaker 3: And what's interesting.
• 32:46
  Speaker 4: In a small rural state, you can't have everyone live
• 32:51
  Speaker 4: in Burlington because the commute would be too far and
• 32:53
  Speaker 4: it wouldn't be appropriate. Also, I've mentioned there are ski
• 32:57
  Speaker 4: communities a lot of times. I don't know if you're
• 32:59
  Speaker 4: a skier, but I just have to say I am.
• 33:01
  Speaker 4: And when we get a major dumping of snow, you
• 33:06
  Speaker 4: can't be a worker living even at the bottom of
• 33:09
  Speaker 4: the mountain in the same town and get up the
• 33:14
  Speaker 4: mountain to then run that ski lift. But there are
• 33:18
  Speaker 4: a lot of hotels up there with people who are
• 33:21
  Speaker 4: so excited at the two feet of snow we just
• 33:24
  Speaker 4: got and want to capitalize on that. And so those restaurants,
• 33:28
  Speaker 4: those maintenance staff, the cleaning crews, and the lift operators
• 33:32
  Speaker 4: need to be right there.
• 33:34
  Speaker 3: So you can't.
• 33:35
  Speaker 4: We don't have big highways, you can't get there from here.
• 33:38
  Speaker 4: So what you're talking about, employers have been forced into
• 33:44
  Speaker 4: having to go it alone, and they have been building housing.
• 33:49
  Speaker 4: And I feel awful for them because they are tremendous
• 33:54
  Speaker 4: at widget making at whatever industry they're into, that's where
• 33:59
  Speaker 4: they shine and where they are experts, and I get
• 34:04
  Speaker 4: a little nervous. Okay, I don't know that they're experts
• 34:08
  Speaker 4: in landlord tenant law in Vermont, which.
• 34:10
  Speaker 3: Is pretty robust.
• 34:12
  Speaker 4: I don't know if they understand fair housing the way
• 34:15
  Speaker 4: we do or other housing.
• 34:17
  Speaker 3: Developers and owners and managers do.
• 34:19
  Speaker 4: So. I don't think it's fair to take the housing
• 34:24
  Speaker 4: regulations burdens realities and put it onto an employer who
• 34:29
  Speaker 4: they also are important to our economy. They need to
• 34:31
  Speaker 4: do their job right and we as housers need to
• 34:35
  Speaker 4: do our job, and asking them to be housers, I
• 34:39
  Speaker 4: think is problematic. I also, I'm not the first person
• 34:43
  Speaker 4: to point out that we already have our healthcare tied
• 34:46
  Speaker 4: to our employment.
• 34:48
  Speaker 3: And to then tie.
• 34:50
  Speaker 4: Your home in a state which has a below one
• 34:53
  Speaker 4: percent vacancy rate, there are no other choices, and we
• 34:57
  Speaker 4: have the fourth highest rate of homelessness in the nation.
• 35:00
  Speaker 4: To tie one's employment to their housing, and sorry to
• 35:05
  Speaker 4: tie their housing to their employment means you're tying their
• 35:09
  Speaker 4: kids' school district to their employment. I mean, as an employer,
• 35:14
  Speaker 4: I do not want that level of responsibility. I don't
• 35:16
  Speaker 4: want to think that if it's not working out with Moura,
• 35:23
  Speaker 4: we have to part ways in an amicable way. What
• 35:27
  Speaker 4: does that mean for more as family or more as future?
• 35:30
  Speaker 4: And so we've really championed a more community based model.
• 35:35
  Speaker 4: One of the middle income rental programs I spoke of
• 35:38
  Speaker 4: was one where we will offer a subsidized interest rate
• 35:41
  Speaker 4: to developers of middle income rental housing that's available in
• 35:45
  Speaker 4: the community. But if that developer works with a municipality
• 35:51
  Speaker 4: or an employer and gets five percent of the total
• 35:56
  Speaker 4: development cost paid for by non housing money by that
• 36:00
  Speaker 4: lawyer chips in or the municipality chips in, we will
• 36:04
  Speaker 4: subsidize that interest rate and give that more, and we
• 36:06
  Speaker 4: will give them even greater loan terms.
• 36:09
  Speaker 3: And that's our way.
• 36:11
  Speaker 4: We're telling employers, you have a role here. You can
• 36:14
  Speaker 4: contribute housing development. You can identify land you own, you
• 36:19
  Speaker 4: can help at the design review board, local planning commission meetings.
• 36:23
  Speaker 4: You can be an outsport spoken advocate for housing. But
• 36:27
  Speaker 4: you don't have to actually do it on your own.
• 36:30
  Speaker 4: And there's a tremendous model from Middlebury College that showed
• 36:34
  Speaker 4: a wonderful example where the college purchased a large trek
• 36:38
  Speaker 4: of land that's going to have two hundred and fifty
• 36:40
  Speaker 4: homes eventually on it and held it until the developer
• 36:43
  Speaker 4: could go through the permitting and zoning process and collect
• 36:46
  Speaker 4: together all the funding and now it's going to be
• 36:48
  Speaker 4: a great mixed income community of for sale homes rentals
• 36:52
  Speaker 4: in the like.
• 36:53
  Speaker 2: And that's a beautiful partnership because you're still in there
• 36:56
  Speaker 2: as a housing entity to kind of guide that monitor
• 37:01
  Speaker 2: that just make sure it's compliant. But yet you're bringing
• 37:05
  Speaker 2: people with vested interest and sometimes the land to do it.
• 37:10
  Speaker 3: So a good job on that piece.
• 37:13
  Speaker 2: I want to give a shout out here change it
• 37:16
  Speaker 2: up just a little to Ashley Norcutt from the Women's
• 37:20
  Speaker 2: Affordable Housing Network and we were able to connect with
• 37:25
  Speaker 2: you through the great, great strength of Ashley and her team,
• 37:32
  Speaker 2: and so kudos and shout out to Ashley there. You,
• 37:37
  Speaker 2: though specifically were listed as one of Vermont's ninety one
• 37:43
  Speaker 2: most influential business leaders, there's only on.
• 37:46
  Speaker 4: The people in the state, Katies and means on the
• 37:48
  Speaker 4: list of ninety one is not prostically as a great job,
• 37:53
  Speaker 4: but I pair you.
• 37:54
  Speaker 2: With what Ashley's doing as a pioneer, So I'm pairing
• 37:58
  Speaker 2: the two of you with your network of influence. Here
• 38:03
  Speaker 2: tell us a little bit about how that accolade made
• 38:08
  Speaker 2: you feel, What did it mean to you?
• 38:11
  Speaker 3: What did your stab say to you when you want it?
• 38:13
  Speaker 4: Yeah, it's always uncomfortable and embarrassing in many ways. And
• 38:18
  Speaker 4: this is coming from someone who loves nothing more than
• 38:21
  Speaker 4: to have a microphone and a stage available to me,
• 38:24
  Speaker 4: and I will hold court for as long as we
• 38:26
  Speaker 4: can talk here. But it is exceedingly uncomfortable to represent
• 38:33
  Speaker 4: an organization of fifty hard working vermonitors. And just because
• 38:39
  Speaker 4: I'm the only one willing to grab the mic and
• 38:41
  Speaker 4: step up on the stage and be the face of
• 38:43
  Speaker 4: VHFA doesn't mean that all the wonderful, good ideas and
• 38:49
  Speaker 4: the hard work are all mine to do. So a
• 38:52
  Speaker 4: lot of those recognitions are because of the reputation of
• 38:57
  Speaker 4: our agency, the way we have been highly middle income
• 39:00
  Speaker 4: programs and stretching outside our comfort zone yet while still
• 39:06
  Speaker 4: maintaining the high credit ratings and having strong financial controls.
• 39:11
  Speaker 4: So it's undeserved in many ways, and it is wonderful
• 39:17
  Speaker 4: to see how VHFA is recognized in our state and
• 39:22
  Speaker 4: to use some of these platforms to talk about some
• 39:26
  Speaker 4: of the issues that are so important to our organization
• 39:30
  Speaker 4: and so it's wonderful when we can have the agency
• 39:35
  Speaker 4: be seen in a positive light and then have that
• 39:38
  Speaker 4: platform to talk about how we're embodying those values.
• 39:42
  Speaker 3: Well, congratulations on the award.
• 39:44
  Speaker 2: I think influence and pioneering come through in a variety
• 39:49
  Speaker 2: of manners, whether it's mentorship or advocacy or sharing best practices.
• 39:57
  Speaker 2: And so Vermont, you guys have a lovely state and
• 40:02
  Speaker 2: a big challenge ahead of you, so I appreciate you
• 40:05
  Speaker 2: coming on change Makers. This Forbes Quadel Platform for the
• 40:09
  Speaker 2: change Makers podcast is such an interesting one because it
• 40:13
  Speaker 2: has brought forward a lot of influential voices like yours,
• 40:19
  Speaker 2: and we're sharing best practices. So thank you for coming on,
• 40:23
  Speaker 2: and I appreciate what you guys are doing up there
• 40:26
  Speaker 2: in Vermont.
• 40:27
  Speaker 3: Thank you so much, Katie. This has been great.
• 40:29
  Speaker 1: Thanks for listening to change Makers with Katie Gore. To
• 40:33
  Speaker 1: find out more about Katie, go to quad L dot com.
• 40:36
  Speaker 1: That's qu a d e l dot com. This has
• 40:41
  Speaker 1: been a production of Forbes Books Radio