Continued cuts to the Community Development Block Grant entitlement program, coming at a time when other federal and many state resources are shrinking and the City budget is facing increasing pressure, are impacting the City’s ability to develop and preserve affordable housing, decent jobs, and livable neighborhoods. The City’s citizen-based CDBG Advisory Board has been forced to cut allocations for programs serving some of our residents who are most in need.

Affordable housing continues to be the City’s highest community development priority. Local rental vacancy rates have fallen again to around 1.5%, signaling increased pressure on low- and moderate-income tenants, and homelessness is rising. In the summer of 2005, the City Council established housing as one of its three priorities for in-depth Council consideration. The Housing Super Committee (HSC) was formed, with Councilors Ashe, Fiermonte (Chair), George and Wright appointed to assess the housing challenges facing Burlington and to recommend local solutions to address those challenges. The Committee held seven meetings, including three public hearings between October 2005 and February 2006, to gather public comments, assess Burlington’s current housing conditions, review regulatory impediments to creating more housing and explore changes needed at the local level to achieve the City’s housing goals: encourage the production of new housing, preserve existing affordable housing, protect vulnerable residents and promote homeownership for lower-income households. The Committee issued a set of recommendations that were unanimously adopted by the City Council and action steps are underway to implement the recommendations.

In 2005, Burlington was recognized by HUD as a model for reducing regulatory barriers that drive up housing costs. Unfortunately, the vast majority of market-rate and affordable housing projects that have been approved by the City are under appeal by adjacent property owners. Recent legislative changes that were intended to make the appeal process more fair and timely have not yet proven to ameliorate a permit process that often takes years to negotiate and is both very costly and risky for developers.

Much of the funding and staff effort this year in our Housing Division has gone into preserving Low Income Housing Tax Credit apartment complexes as affordable housing and acquiring and rehabilitating substandard rental properties in the Old North End. In addition, we have provided significant technical assistance to several private sector housing developers to navigate the development review and permit appeal process.

On the nonprofit development side, several major projects are just now coming to fruition. The structure of the BankNorth redevelopment project has changed, and it is now being done as a turn-key project by Redstone Development; demolition has begun, but several ideas have emerged which have stalled the design and permitting process. The Burlington Community Land Trust and Housing Vermont have acquired 5 rental properties scattered through the Old North End and formed the Callahan Housing Project, involving major rehabilitation and lead hazard reduction of 28 existing apartments. The Burlington Housing Authority purchased Randall Apartments in the King Street area of St. Paul Street, an 11-unit property that was at risk of being converted to market rate rentals when the owner has the option to opt out of the project-based Section 8 contract in a few years. Burlington Co-Housing is in the midst of purchasing the Turner property on East Avenue from the Burlington Community Development Corporation to create a 32-unit common interest “co-housing” community (condo); as part of this project, 11 units will be sold to households earning less than median income. And, two new transitional housing projects are in the works: the Northern Lights project for women exiting corrections and Sophie’s Place for victims of domestic violence.

Over the last program year:

• CDBG and HOME dollars (together with the Housing Trust Fund, inclusionary zoning, and other resources and technical assistance from the Community & Economic Development Office) are helping to develop 47 new affordable rental units and 63 new owner units currently underway, in the predevelopment phase and/or under appeal.
• Two hundred ninety-nine housing units were rehabbed, with work ranging from new paint to hard-wired smoke detectors to emergency repairs to a new lift at St. John’s Hall to major rehab at Northgate.

The past year saw a slight decline in the number of jobs in the City. Reappraisal resulted in a shift in overall value and tax burden from commercial property to residential homes and commercial apartments; post-reappraisal, the commercial and industrial tax base has remained static, with PILOT decreasing. However, the commercial vacancy rates remain healthy, and the City continues to see growth in gross receipts and in rooms, meals & alcohol taxes.

Downtown, a new 127-room hotel is under construction; the $1.8 million Section 108 loan which facilitated this project has been repaid. The City is working with Redstone Commercial and the Burlington Community Land Trust on the mixed-use redevelopment of the downtown BankNorth site and on the redevelopment of the former Shanana (Hunts Armory) site on Main Street. Infrastructure renovations on the Church Street Marketplace will continue with $6 million in new federal funding. To date, almost $23 million in Commercial Revitalization Deductions (which allow for accelerated depreciation) have been awarded to assist with the construction/rehabilitation of over 198,000 sq. ft. of commercial space, principally downtown.

In the South End, General Dynamics Armament and Technical Products started construction on the final phase of its $50 million engineering Center of Excellence, their premier technology incubator nationwide; the City continues to work with General Dynamics and Gilbane Properties on redevelopment opportunities on the property across the street. The City has received federal transportation monies for pre-development of the South End Transit Center; the land for the project has been acquired and a site assessment performed. The City worked with Specialty Filaments on the sale of its Pine Street property and on support for the 130 laid off employees; CEDO helped the company get a $1.4 million Trade Adjustment Assistance training grant, and Champlain Chocolates has begun renovation on 46,000 sq. ft. of the property. Dealer.com continues to expand in the Maltex building, running two free apprenticeship programs this year.

• This year, CDBG-funded economic development activities supported the start-up of 39 new businesses, helped to retain/expand 39 businesses, and led to the creation/retention of 690 FTE permanent plus 1,128 construction jobs.
• Those expenditures leveraged over $42 million in private and other public investment and supported the development of over 65,000 square feet of new commercial space.
• CDBG dollars helped to provide quality, affordable child care for 88 children from low- and moderate-income families.

City-initiated meetings among local agencies led to a new initiative designed to help low-income families access new resources, kicked off in January of this year. Based on the Circles of Support model developed in the Mid-West, and operated by NeighborKeepers in partnership with a group of six local social service agencies, each participating family is matched with three trained “Allies,” typically middle-class volunteers. Together, the family and its team of Allies work on developing social and community connections, increasing education and/or work skills, and building assets. The Allies in turn learn first-hand about the barriers that these families face.

The City continues to take part in the National League of Cities’ Family Asset Building initiative (having been competitively selected as one of six Round 2 participants) and in the Creating Assets, Savings and Hope (CASH) coalition, which has prepared an Asset-Building Action Plan for the upcoming year. The City sponsored a Volunteer Income Tax Assistance (VITA) site at City Hall for the first time, with CEDO staff serving as the site coordinator. Open a total of 32 hours over nine weeks, the site provided 136 clients with free tax assistance. City Hall also hosted a “Free Credit Score Day” last March, offering free credit scores (obtained and paid for by Northfield Savings Bank) together with one-on-one interpretation/counseling on the associated credit reports and workshops on budgeting, saving and checking accounts.

CDBG dollars are helping social service agencies provide for basic needs of city residents as well as fostering equal access, health, public safety, and senior and youth services:

• Through the help of CDBG grants, over 4,800 people (adults and children) were fed by anti-hunger programs; over 2,400 homeless people (including families with children and victims of domestic violence) had a safe, warm place to sleep; and over 2,200 people kept their heat on.
• Over 600 youth participated in CDBG-funded summertime and after-school recreational, academic and social enrichment programs and over 600 seniors received meals, health care, help with public benefits, in-home assistance and/or participated in social activities.
• The Burlington Neighborhood Project (formerly the Public Safety Project) supported 48 neighborhood associations in low-income neighborhoods citywide. à Seventy-eight percent of those served by CDBG-funded social service programs were “extremely low” income – which for a family of four in 2005 meant an annual income of less than $20,700.

Community facilities and public infrastructure also benefited from CDBG dollars:

• Infrastructure improvements were completed on North Street this year. Eleven new businesses have opened in the project area over the past two years. The City has partnered with a foundation, a nonprofit organization and a private architect to offer a Façade Improvement Program for commercial buildings within the project area. Two façade improvement projects are completed, and two are in the works. Burlington College, located in the project area, is undergoing major renovations and expansion of its programs.
• Community members have taken the initiative to improve their neighborhood streets and parks with over $40,000 in grassroots neighborhood grant spending.

A Public Hearing will be held before the Burlington City Council on September 18, 2006, concerning this Report. Comments will be accepted at the Public Hearing as well as online and at the Community & Economic Development Office through September 28, 2006. We continue to solicit the input and feedback of our citizens concerning the allocation and expenditure of our CDBG resources. We will continue to integrate that feedback into the future allocation of resources.

Next