Workforce housing will help grow the economy

LACONIA — Working to develop affordable housing in New Hampshire is not for the faint of heart.

High costs of labor and building materials, exclusionary zoning requirements and land that is difficult to build on all make it a challenge to find ways to put a roof over the head of workers needed to maintain and grow New Hampshire’s economy.

Carmen Lorentz, executive director of Lakes Region Community Developers, chooses to be optimistic.

“I do have hope,” she said. “I know there will be more funding available over the next few years to build housing for essential workers. It’s not anything that will happen quickly, but state and federal agencies are investing more money in housing production.

“We want to make sure the Lakes Region is positioned to use some of that funding.

“I definitely feel like the tide is turning.”

There are signs that public opposition to growth may be easing.

A telephone survey of nearly 500 people last year by The Center for Ethics in Business and Governance at Saint Anselm College found that 63 percent supported the statement, “My community needs more affordable housing to be built,” while 21 percent disagreed.

Top reasons for this support were:

— Letting seniors downsize.

— Fairness to the less fortunate.

— Keeping young people in the state.

— Reducing homelessness.

“We are seeing a growing awareness of the connection between an adequate supply of housing and a strong state economy,” said Dean Christon, executive director and chief executive officer of New Hampshire Housing Finance Authority. “If employees have an adequate range of housing options near where they work, the state’s businesses will be able to attract and retain the workers needed to keep our economy thriving.”

Even if there is a growing consensus that affordable housing is needed, zoning rules frequently do not provide the flexibility or density required for a project to materialize. 

“But that’s changing, too,” Lorentz said. “There’s a realization that businesses are better off when they have a local workforce. Workers do need to have homes. Among our tenants are people who work in health care, education and hospitality.”

Still, change takes time.

Lorentz’s organization has had to delay a project in Wolfeboro that would provide single-family, starter homes.

“We put it out to bid, but the prices came back too high,” she said. “We would have had to sell them for well above the intended price. That’s on hold until next year.”

Labor and material costs in the wake of the pandemic are particularly high and the hope is that they may decline somewhat in the coming months.

Lorentz said municipalities can help by easing zoning requirements that sometimes prevent new apartment buildings or housing subdivisions from ever getting off the ground.

“Zoning is a huge part of making it work out,” she said. “As a developer, when we look at a town, if we have to try to get a zoning variance, we’ll just say ‘Never mind.'”

Lorentz said the state Legislature can assist by passing a new tax increment financing law that would apply to residential development.

This financing, now often used for commercial development, allows municipalities to fund infrastructure improvements in a given district by borrowing money and paying off the debt with increased property tax revenue fostered by those improvements.

Infrastructure improvements make land ready for development.

This is true in Laconia, where residential growth could take place if Hilliard Road, which runs northeast from Parade Road, could be improved and if water and sewer service could be brought to the area.

Laconia Planning Director Dean Trefethen said the city has the ability to work with a developer through “performance zoning,” essentially providing flexibility to move a project along if it matches city goals, in this case for more housing.

“What we’d like to see is typical middle class housing,” he said. “This would look a lot like what was built in the ‘60s or the ‘70s, smaller ranches and Capes.”

Performance zoning is allowed in the urban commercial zone downtown, along the Court Street and Union Avenue corridor as well as at the former Laconia State School property and a couple of adjacent parcels.

Although the Hilliard Road area is not designated for performance zoning, it is mentioned in the city's Master Plan as a possible place it could be implemented.

If smaller, less expensive homes were to be built, middle-income families could qualify for programs that could allow for financing of 90 to 95 percent of the overall cost.

Also, there is a chance that the old Laconia State School property at Meredith Center Road and North Main Street could eventually be opened for residential and commercial development.

Ultimately, this could tie in with hoped-for development around Hilliard Road.

It could all be done in a way that preserves the natural beauty of the area, Trefethen said.

“There are state forest and state park parcels in that area that can’t be developed,” he said. “It would be kind of neat if you could do development around them. It would provide open space for the people.”