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APPROPRIATION COMMITTEE-ATM 2018 Original Estimate Current Estimate(Feb. 2018) Difference Total Cost' $1,284,653 $2,700,000 $1,415,347 Total Sq.Ft 5,144 5,144 Cost/Unit $214,109 $450,000 $235,891 Cost/Sq Ft. $250 $525 $275 The CPC proposes to fund this request with cash from available CPA funds. A majority of this Committee is opposed to recommending approval of this request without having ap- propriate affordable housing mitigation cost guidelines, policies and processes in place. In Article 44 of the 2017 Annual Town Meeting, a private land owner sought approval of a rezoning proposal in order to add high-density residential development, which typically must include an affordable housing component sufficient to maintain the Town's existing affordable housing ratio. Since including on-site affordable housing was impractical in this case, a negotiated arrangement was proposed in which the landown- er/developer would provide funding over time to support creation by the Town of affordable housing offsite rather than within the development. During negotiation of this mitigation arrangement, the Town used $214,602 as the construction cost of an affordable housing unit based on expectations provided by LexHab for projects at Fairview and the yet-to be-completed Farmview (Lowell St, the subject of this subsection). Questions were raised about the adequacy of the mitigation because it was not clear it would be sufficient to build the number of units typically required for development of the proposed size. Never- theless,the arrangement was approved and is in effect. The majority notes that the per-unit cost of the six units that are the subject of Article 10(j) is more than double the per-unit cost given above, and it is now clear that the negotiated mitigation arrangement will not come close to covering the cost for the number of affordable housing units (5.5) expected. This is a good opportunity to point out that the Town's policies and bases for estimating construction costs that will be used to guide the creation and funding of affordable housing, including a process to continuously review and adjust CPA and other guidelines for affordable housing projects, should be reconsidered and made more transparent. A minority would recommend approval of the project notwithstanding its substantially increased cost, noting that the continued production of affordable housing with dedicated CPA funds is an important pri- ority of the Town, that this is the only CPA affordable housing project advanced this year, that any deci- sion with respect to the affordable units under consideration must be made on the basis of present legal requirements and construction costs, and that costs for affordable housing projects are only likely to in- crease in future years. We note that Mr. Levine has recused himself from this article due to a potential conflict of interest. The Committee recommends disapproval (3-5-1)of 10(I). ' Costs are for design and construction only but not for the land, since the Town already owns the land. 32