A Path to Affordable Housing

Proposed architectural rendering, River Oak Commons, Old Lyme, CT

As many are aware, HOPE Partnership with Women's Institute for Housing and Economic Development, our development partner, is in the process of seeking the necessary approvals to develop new, affordable housing communities on Neck Road in Old Lyme. We are writing today to share the story of HOPE and the path that brought us to this point.

In 2001, a group of local faith leaders became aware of a growing problem in the community, children in their homework clubs living in hotels or academic rentals without safe and stable homes. This realization prompted a call to action for community and faith leaders to provide housing options for the families in the community. HOPE Partnership, a 501(c)3 nonprofit, was formed in 2004 with the mission of developing affordable housing in lower Middlesex County and surrounding towns.

In 2012, HOPE, in partnership with the Women’s Institute, opened Ferry Crossing, an affordable development made up of 16 townhomes,located in Old Saybrook and since that time it has been fully occupied and has a waiting list for individuals hoping to make it their home.

Proposed architectural rendering, River Oak Commons, Old Lyme, CT

While HOPE was working in Old Saybrook, Old Lyme Affordable Housing (OLAH) was making similar efforts in Old Lyme. Old Lyme Affordable Housing was also formed by concerned community members with support from the faith community and the town of Old Lyme. In 2015, OLAH merged with HOPE Partnership to ensure their work would continue. With this combining of efforts, HOPE pledged to make developing affordable housing in Old Lyme a priority. As part of HOPE’s efforts, we actively pursued opportunities to meet with community groups to educate and advocate for affordable housing. We had a table at both the Lion’s Club Car Show and the Mid Summer’s Festival in 2017. Focusing on the need in Old Lyme, we met with members of three Old Lyme churches; Christ the King, Saint Ann’s and the First Congregational Church of Old Lyme as well as the Old Lyme Lions Club.

Every year HOPE hosts a “Friendraiser” to share our efforts in the communities we serve. In 2016, it was there that the owner of property on Neck Road learned of our work and approached us to discuss working together to solve the issue of the lack of affordable housing in Old Lyme. Once discussions began it was HOPE’s task to determine the viability of building a community at the location.

Proposed architectural rendering, River Oak Commons, Old Lyme, CT

Working with local engineers, architects and housing consultants, HOPE and the owner of the property applied for and received a subdivision of the property into four separate lots in October 2017 from the Town of Old Lyme’s Planning Commission. HOPE’s plans include the two ”front lots” on Neck Road, while the owner will retain the two “rear” lots closer to the River . In November 2017, the team invited neighbors as well as stakeholders in the community to discuss the preliminary plans for the properties.

During HOPE’s feasibility process a Phase I Environmental Study and a Hazardous Material Survey were conducted with satisfactory results. HOPE has conducted multiple soil tests to ensure that septic and water capacity are sufficient to meet the needs of the development and all regulations. An archeological study was conducted as well as discussions with the Connecticut Trust for Historic Preservation which determined there was nothing of historical value in need of protection. A traffic study was conducted in October 2017. The study is being updated using more current data now available, and an additional study will be conducted over Memorial Day weekend to determine the traffic impact on the area. This impact study will be provided to the Town’s own independent Traffic Engineers in sufficient time for review. The Town’s Inlands Wetlands and Watercourses unanimously approved HOPE’s application for Lot 1 on May 22nd, with stipulations to add rain gardens in between buildings to capture more water onsite; to require owner to clean and inspect wetlands area and to have a plan to treat invasive species.

Proposed architectural rendering, River Oak Commons, Old Lyme, CT

With preliminary studies and test results in hand, HOPE and its development partner, Women’s Institute, determined that the property would be a suitable location for affordable housing this past spring. HOPE officially announced its intention to move forward at its annual Friendraiser at the Old Lyme Country Club in April 2018. We continue to meet with community groups and have shared our plans with the Lyme-Old Lyme Junior Women’s Club, the Mentoring Corps for Community Development (MCCD), representatives from the school district, Christ the King Church and First Congregational Church of Old Lyme. What we heard from these organizations was a need to serve incomes of households that would meet community needs – such as young adults who grew up in Old Lyme but cannot afford to move back after college, the volunteer firefighters in the community, or the families sending their students to school in Old Lyme.

We also heard the importance to preserve the cultural entranceway to Old Lyme. We have responded with a design that is set back the length of a football field from the road, mirrors the road patterns of the adjacent neighborhoods, has space for a community room and on-site property management to oversee the ongoing maintenance of the grounds and building, and building designs that reflect the historic aesthetic of Old Lyme. This new neighborhood will serve to convert an underutilized parcel to a tranquil neighborhood for 37 families, supported by public transportation and contributing to nearby commercial activity.

Affordable housing provides a solid foundation for a strong community. Residents who live in a home that is affordable have funds to purchase food, provide health care and satisfy other living needs. Residents of affordable homes also have the economic means to purchase goods and services in their communities creating economic stability.

The exact mix of unit rents and income limits is still being finalized for a number a reasons. Because we restrict the rents of our housing to ensure that it remains affordable to households who can't afford a home at market rate in Old Lyme, we need to leverage a variety of private and public sources to provide a mix of debt and equity that will sustain the project for decades to come. Each one of these sources will have different financial and policy goals.

When determining the rental and income limits in a project, we take a three tier approach. 1) We determine the greatest community need, based on local engagement and formal market studies, and examine how this need aligns with the mission of HOPE and our partners; 2) We determine how much income the property will need to make through rents to pay for ongoing expenses, maintenance, and capital improvements so that the development is fiscally responsible and sustainable for the duration of the deed restrictions; and 3) We must meet the various needs of lenders and funders in the project that all have different policy requirements for how they want funds to be used and who they are aiming to serve. This approach will impact how many apartments will be set aside for families earning very low incomes to meet community or state policy goals, versus how many might be left at market rate to ensure there is greater revenue to offset lower rent limits. Until all financing is fully committed, these projections will be re-examined continuously.

Thanks to a financial commitment received through Guilford Savings Bank and the Federal Home Loan Bank of Boston on April 30, 2018, the project will have access to a reduced rate mortgage, which at this time should allow us to preserve 100% of the units as affordable. Affordable is defined by HUD as spending no more than 30% of their income on housing costs. For these units, the household income ranges will be from $20,000 to $71,000, all based on the area median income in Old Lyme. The remainder of the development will be funded through a variety of sources, private investor equity through the Low-Income Housing Tax Credit program (LIHTC), energy efficiency rebates through the utility companies, and CT Dept. of Housing bond financing.

River Oak Commons I will consist of 7 residential buildings (23 affordable units) and 1 pump house. River Oak Commons II will consist of 4 residential buildings (14 affordable units) and 1 community building, including an office for an onsite property manager.

Our next step in the process is to obtain approval for our applications from the Old Lyme Zoning Commission. The public hearing is set for June 5that 7:30pm at the Old Lyme Town Hall.