It's no secret that New Hampshire and much of the nation has a housing crisis.

Our state is short at least 23,500 homes to meet current demand.

That means tens of thousands of New Hampshire residents are struggling to find affordable and inviting housing in their communities.

Efforts to create more housing are slow and made more difficult by a lack of understanding of how the process works at the local level.

This lack of understanding leads some opponents to invoke myths and attempt to delay new housing.

How do we address these issues and make it easier to create more housing?

Welcome.

In this program, we're going to focus on New Hampshire towns and the more rural communities where local control is a core value.

Better understand the process and the associated risks, challenges and opportunities to creating more housing.

We will address three key elements in that process.

Identifying and assessing a potential parcel of land or property.

Securing financing and navigating local land use boards whose regulations often differ from one town to another.

We've assembled some of the brightest minds and stakeholders from local communities to roll up our sleeves and work through the process and hopefully address concerns residents have so we can get more housing built in towns throughout New Hampshire.

Joining us are Kevin Lacasse, CEO of New England Family Housing in New Hampton.

He has experience in both single family homes, acquisitions and redevelopments of existing properties and multifamily housing.

Evelyn Whelton is a banker with 36 years of experience.

She's also a founding board member of the Mount Washington Valley Housing Coalition and serves on the board of directors for New Hampshire Housing.

Rob Taylor is land use and community development administrator for the town of Enfield.

Rob served as a selectman in Plainfield for 20 years and on Plainfield Planning Board.

He has a background in agriculture and he and his family still operate a cheese and maple business called Taylor Brothers and Meriden, New Hampshire.

And Harrison Kanzler, executive director of Ahead Affordable Housing, Education and Development.

Previously, Harrison served as executive director of the Mount Washington Valley Housing Coalition and in the New Hampshire House of Representatives.

Thank you so much for being here today.

Kevin, we're going to start with you.

Your perspective as a developer, how do you find and assess a potential new housing opportunity and what are the initial risks that you weigh?

Sure.

Thanks, Sarah.

Nice being here with everybody.

So the first thing is someone will bring, you know, a piece of land or an existing building to us and we'll run an initial proforma on it.

So depending on the area that it's in the town, we will look at if it's a product that's going to be either for sale or for rent, and we'll kind of build that into a pro forma to see kind of where that sits.

And then we look at the expense side.

So we look at the cost of the land and then weigh that against the infrastructure which I know we were talking about earlier, whether or not there's public infrastructure, water, sewer, roads, power, potentially natural gas and if there is not, then what alternatives are there, whether it's, you know, to put in a well and a septic system, which those things have an effect on density.

You know, if there is public water sewer there, obviously we can build more dense than if we've got to leave land and so forth set aside for water and sewer infrastructure.

From there, we'll kind of take a look at the zoning regulations within the community and balance that out to see how it is.

And, you know, the specific things we kind of look at as density and setbacks, because again, that'll tell us how many units we can get and everything is divisible by the amount of units, whether it's rental housing or product for sale.

And then once we kind of establish that and build that into the pro forma, we'll take a look at the town itself and the makeup of the community and how willing they are to attract development or to push it off.

You know, typically zoning regulations are created by the master plan, which is voted on by the entire community.

And the Planning Board's job is basically to uphold the zoning regulations that are written in that community.

And there's a lot of communities that are pro-development and they know what the zoning regulations are and they do a good job in and basically following those guidelines, other communities, there's maybe less education or there's an agenda in place and they kind of go by there their own, you know, own thoughts and and opinions as opposed to upholding the zoning regulations.

And we try to stay out of those communities because when we know what the playbook is, we'll follow the playbook and we can build a project in accordance to that.

But when we don't know what it is or it's a moving target, it's a lot more difficult.

Right.

Harrison So your process looks similar to that?

Yeah.

I mean, I think one thing that Kevin touched on that's really important is I think a lot of people think that developers like go into communities sniffing around for the right thing, that it's such a big issue right now.

We're hardly having to people are coming to us and saying, we have this building, we have this land, we want you to do something with it.

And so that I will say right away, that makes the job a lot easier because we're not pounding the pavement looking for something.

People are bringing it to us.

And and I think really what's what's harder is, is having to tell people, you know, thanks, but no thanks.

And through a lot of what Kevin was saying is is pretty much how we get to that decision.

And, you know, in in a lot of our rural parts of our state, without that infrastructure of water and sewer, it's a lot of no's.

You know, when you're looking at what is the state minimum of I think it's 30,000 square feet, if you're on a septic system for one unit, that's about two thirds of an acre, you need a lot of land to put in, you know, just a few units and that that can kill something real quick.

So if it's not on water and sewer, it's probably not going to happen.

Not for any type of, you know, kind of a I wouldn't say huge development, but even just, you know, four or five homes, suddenly you want to do something, you know, four or five units, something small.

You need a huge chunk of land to do it if it's on a septic system.

So water and sewer is a big one for us, especially because it's so limited where we are.

Yeah, it's a big challenge.

Rob From the planning perspective, at what point do you want to hear from developers?

Do you find that relationship to be a collaborative one?

absolutely.

We want them to come through the door.

We want them to see that our town is welcoming and friendly and capable and professional, as I'm sure you're looking for when you come through the door.

I will just piggyback on what Harrison is talking about.

We do have a municipal water and sewer in the town that I work for, town of Enfield, New Hampshire, and you know, the reality there is we built a sewer collection system back in the seventies during the Clean Water Act.

And, you know, it very successful, helped clean up our lakes and clean up our rivers and so forth.

But zoning came along and the intention of zoning was to sort of pack development into village center.

And the actual opposite of that has been true.

Our village centers are largely unchanged and the development has largely happened in five and ten acre lots out on the periphery of town, sort of going against what we really wanted in our master plan and all that.

So we're really taking a real hard look at zoning regulations to try to increase density and try to get some infill on the system because we have these fixed costs to run a municipal sewer system and a municipal water system, and it's becoming oppressive on sort of a stagnant population in the village center to the point where we have some of the most expensive sewer and water rates in the state.

And and you can see why that is.

We haven't had the growth that we wanted.

So we're trying to do things now to tweak it.

We've increased density.

We've added a second ADU now a buy right in our community.

And we're actually we've got a New Hampshire HOP grant that's going to really go at the zoning ordinance.

Hard to try to do some new work there to really kind of go back to the drawing board and really see what we can do to try to solve this problem again, because we have capacity and we actually collect our sewage and we pump it to the city of Lebanon, which is a neighboring town city, and we actually own 300,000 gallons of treatment capacity in the city of Lebanon, of which we're only using 70,000.

So you can see why our costs are so high.

But I think the developers are starting to look at us and saying, hey, there is some capacity there for us to come in and build some really nice stuff density that will help us solve the problems of of housing.

So we're going to circle back to eventually to risk and to that sort of local approval process.

But in the meantime, Evelyn, we want to hear from you.

Can you help us understand how you go about considering if a project makes financial sense and how you help them put together their capital to finance it?

Sure.

Kevin and I actually chatted about this before we went online and at the end of the day, the developer is going to bring their plan to the lender.

That plan may or may not include funds from New Hampshire Housing Finance Authority, for example.

And it all comes down to whether that plan is a market based plan or if that plan includes some sort of low to moderate income caveat to adding a density bonus in order to get more units to make that project profitable.

So you're talking about weighing two different things.

If it's a straight market based product project, then it's going to be the strength of the developer.

It's going to look at debt ratios and whether or not they can make those payments while they're building.

There are interest payments due while they're building and they don't yet have the income stream from that property.

So, you know, as Harrison and Kevin are thinking about putting up buildings to help this problem out, they also have the challenge of we've got to make some payments.

The other thing we're looking at and I soon as you two gentlemen started speaking, it just hit me like it always does.

Time.

When we think about what you go through in order to time out a project, it might be market based.

And today it works on paper financially.

But if it takes a year or longer to get something through a town but a septic approval issue, whatever the case may be, whether you're working with the state or a town, that time impacts the cost of everything going into that project.

And so now we might be looking at numbers that don't work a year from now.

So it's really complicated.

There's no single answer.

And then when you get to the low to moderate income piece and add that density bonus and use multi layer financing, you might have six or seven different lenders putting in putting money into that project.

Every one of them is doing their due diligence slightly differently.

So the developers I'm going to look at Kevin and Harrison here, you guys are taking huge risk because you're putting money out to go through all these processes, right?

For us, we're kind of watching where those dollars go in the project.

And is it still feasible as we near closing?

It's a challenge, right?

Yeah, to build on that.

You're exactly right.

When you start looking at a project, it can often change, you know, So when we're underwriting it, you know, so for example, we're underwriting projects now or a year and a half ago that we're looking at now and the whole environment's changed.

I mean, the interest rates have gone way up from where they were.

So in our pro forma, we'll build a funding stack, which may include commercial lending, it may include our own equity and it may include, you know, some program like the LIHTC or CDBG funding and so forth.

New Hampshire has put some money in Invest NH Exactly.

So things are fluid until we get to that point.

So it is good to have those relationships with the lenders, with the different sources as we build and kind of fine tune that funding stack as we go because it is ever evolving until you put a shovel in the ground.

Absolutely.

Just in the past couple of years, the volatility of even the labor market, the materials market, I mean, something that penciled out great two years ago.

Right.

Yeah, It's delays in permitting and financing of whatever.

You get to put that shovel in the ground now and you go, well, now I can't make it work because now that, you know, we we were just looking at an access road for a project, you know in the typical piece has always been for a town spec a town approved road with utilities buried underneath it.

It's going to be about $1,000,000 a mile.

And we're now being told no way, it's going to be like two or two and a half million dollars a mile, not a million.

So, I mean, when you see prices jump that much over such a short period of time and when these developments can take so many years, I mean, it can have a huge impact if you hit any delays.

Right.

We're gonna circle back to how we can mitigate some of those.

Rob, will you tell us a little bit about how you and the town go about engaging with the developer in housing and also navigating the land use boards and the other boards that a developer might have to go through?

Yeah, it's a very it's complicated.

We have, you know, hundreds of towns and dozens of cities and everybody has their own uniqueness.

And that's that's a real problem in the state of New Hampshire is that you've got developers that may work in a town or a city and get good there and they don't really want to step outside of where they're comfortable and where they know how things work.

So we have to do a lot to try to attract developers and we have meetings and we invite them in and then we do have some tools at our disposal, you know, to help with some of this financing.

We do have some tax incentives like 79 EA.

We also have a TIF district for our downtown area, which is where, you know, our sewer and water is available so we can hopefully bring some of that to bear to help a developer with some of the infrastructure costs.

We're particularly looking at some of the city or the town owned land that we have that maybe was something previously and now we're cleaning it up to try to make it available for some private development.

Working with brownfields is one of our big things that we do, but it's really, you know, the the state encourages developers to come in and talk to the planning board.

It's a it's a sort of no strings attached process they call the conceptual.

I encourage everybody that comes through the door, come in and meet our planning board, ask lots of questions, have questions asked of them, and that can be very productive.

Like I said, there's no strings attached.

It really is sort of the introduction to see if there's a if there's a good fit.

Sometimes there's not a good fit, sometimes is a great fit.

But again, I think we're sort of dealing with all kinds of I call it the perfect storm.

There's just so many things working against us that we really have to be very, you know, intentional with what we do and really work very hard.

You know, it may take talking to 25 developers to make one of the opportunities actually come to some fruition.

Right.

Another thing I want to throw out there is for this group, you know, a lot of the state of New Hampshire legislature, a lot of their concern is local planning and zoning, which obviously we bear a lot of the blame for what's what's happening.

But I always say that there is something that the state can do to us as a, you know, an entity.

The state is is in charge of the highways, you know, the state roads.

We got a couple of them going through our town.

So you're dealing with New Hampshire DOT.

That is a huge wild card for developers with us.

You know, we have rules in planning and zoning where we have to give people answers in a certain timeline.

State of New Hampshire doesn't really have that for themselves.

So they can literally say, we'll get back to you next year, you know?

DES.

You guys probably are familiar with all that stuff with wetlands and shore lands.

And there's just so many other things.

It's not just planning and zoning.

And I know I will take I will take my lumps.

And we were you know, we're doing things and we're really efforting that and we're trying to basically make a difference with, you know, changing our zoning and trying to get, you know, on top of things.

But I think the state of New Hampshire can help, particularly with their regulations, which are so open ended and are you know, you need certainty when you're doing a development.

It's it's the uncertainty that actually causes these developments to sort of get scuttled and sort of fall off.

I love that you brought that up, because in a minute we're going to talk about the role of the state.

Exactly that.

In the meantime, though, I want to emphasize a sort of a theme that I'm hearing through what you're saying, which is some of these things sound sophisticated tax increment financing and 79 E and other sort of tax incentives.

But it sounds like what you're saying is that there absolutely is a role for our smaller towns and our rural communities, and they can take advantage of some of those tools to Harrison, will you speak to that a little bit, the role of these smaller, more rural communities?

Sure.

I mean, I think the the state I think in recent years has made huge progress in finding that balance of New Hampshire doesn't want to tell municipalities what to do, but wants to reward them for doing something well or what they feel is the right path.

And so if you look back over the last few years in the legislature, there's been a lot of new, new things that have come forward with 79 E, not as new, but there's TIFs, there's been additions to 79 E. The ADUs they've done a lot to say to towns, Hey, why don't you adopt these things and why don't you look at maybe trying to incentivize people to come through?

And now with this newest tool that they're adding, which is the Housing Champions Program, that is that is almost, you know, the icing on the cake, as it were, because if you do these things that we have put into law that you're now allowed to do, you're also going to be rewarded for doing it.

So, I mean, I love that they are they are trying to find inventive ways.

New Hampshire is such a unique state in our revenue, our ability to produce and maintain programs.

It's just they have you know, we really have come up with a solution that fits New Hampshire.

And I think that they've done a great job with that.

And a lot of municipalities are starting to see that and are starting to grab on to the ones that are going to work for them.

And I think that's the ultimate piece, is making sure that we have enough programs that, you know, every town is different.

So you've got to have a wide variety of tools.

So if you only have a hammer, you know, everything's a nail.

So you're got to have more tools.

Kevin, if we can turn to you for a moment, I think something that a lot of our small communities are worried about is this relationship between housing and conservation, that they see those as opposing forces rather than things that can be married together quite well.

Will you speak to that?

Sure.

So conservation and housing is absolutely goes hand in hand.

And I think a lot of our zoning regulations throughout the state have been kind of, you know, old school, let's say, where, you know, minimum lot size and so forth.

You know, some of the things that we can do is build more dense and that allows more green space to remain as green space.

So increased density and minimizing setbacks and so forth is really a good way to look at conservation.

We're going to continue this conversation in a moment.

But in the meantime, we all know that New Hampshire views local control as a core value.

It's natural to explore what role the state can play in easing the housing crisis.

Joe Alexander is a Republican state representative serving Hillsborough, who chairs the Special Committee on Housing.

And Senator Rebecca Perkins Kwoka, a Democrat from Portsmouth and former city councilor.

We asked them to speak to the tension between the role of the state while respecting the value of local control.

I think any of us that have worked on housing know that there's a natural tension between what the state can do and what our municipalities can do and having served as an elected official for both and as a New Hampshire native, I'm well aware that local political solutions are going to be the ones that last.

And so I think our job at the state level is really to enable our cities and towns to find solutions that work for them and respect the fact that housing is a deeply personal thing.

It's it's where you live, it's your neighbor.

And how those things interact is really important to get right.

And we want to empower local municipalities to be able to lead their own way.

So educate local planning and zoning boards.

We want to make sure that private property rights are being respected.

Private property owners are allowed to do what they need to do on their own property, but also the state remove the barriers necessary to increase housing.

So we want to be your partner in this process, and good planning is as much art as it is science.

And so the state level, what tools do our municipalities need?

Some that we're entertaining this year is making sure there's a smooth appeals process for land use decisions, considering whether boards of selectmen should have the power to change zoning, removing parking requirements from housing requirements.

So we're constantly looking for ways to make sure that barriers to creating new housing are streamlined, but respect that local control balance.

There's some great ideas in there.

Harrison Can we get your reaction to the role of the state?

Sure.

I mean, I think something that's really important is to acknowledge that while the state certainly plays a role, I think that the municipalities at a certain level will have to put a bit of effort in on their end as well.

But I think the the state's biggest where we talk about I think we talked about the municipality that already I think the state's biggest role really is that, you know, a lot of other states have funding, have programs, have opportunities that the state of New Hampshire simply doesn't have.

And that's predicated on a certain way of life that we have and enjoyed here in New Hampshire.

But really, the primary source of funding through the state is the low income housing tax credit, and that is geared specifically towards more large scale rental style housing.

And the reality is, in order to try to solve this crisis, we need everything.

So we just need to see a diversity in what programs and what funding exists in the state that's going to allow developers to work on other types of housing.

Why aren't we doing more duplexes?

Why isn't there an ADU program?

What are we doing about single family housing?

So I think that there's quite a lot that can be done from the state level to say we want to incentivize all housing, not just one type.

And I think that's really the ultimate role they have to play.

Right.

Thank you.

So to close out the program, we want to hear from all of you.

Evelyn, I'm going to start with you.

From your experience, what's one idea for how to make the whole process in towns and our smaller communities more streamlined, more productive, less risky, while also alleviating the concerns that residents bring?

You know, I have to go straight to each town's zoning ordinances.

That is really the road map.

Anywhere you go and we heard it from these gentlemen, without that, there's not a lot that they can do and they're going to go find another spot.

And to Harrisons point, other states have put a lot of effort into making that road map real easy to follow.

And so, as is the state of New Hampshire has to look at this and say, how can we do that even in our rural communities and we can do it.

We have to engage our citizens.

It's great.

Kevin, what's your one idea?

I believe the call to action is for people to come out and support.

I mean, as a developer, over the last 20 years, we've had people come out and, you know, with torches and pitchforks essentially to oppose a project that we're bringing on.

And typically, if someone supports a project, they're just like, okay, I like that, so I'm not going to come out.

We need people to come out and actually speak in front of planning boards and zoning boards and city council members in support of a project and to write letters.

So, you know, in talking to, you know, city councilors and selectmen in the towns and so forth, if they get four or five letters on an issue, they think it's a really big issue and they're going to act upon it.

But most of the time, the letters that they receive surrounding a development is letters in opposition.

So, you know, one thing we can all do, even if you're not a developer, is to write a letter of support for any development in town, because that goes a long way.

People just listen to it.

Great point, Harrison.

Diversify, diversify, diversify.

I mean, I you you can't solve a litany of problems with one solution.

It's never going to work.

And so we we really need to come at this and understand that that my housing problem is not your housing problem and it's not your housing problem.

We're all experiencing it in a different way.

We're all trying to get into different housing.

And so we've got to come together and realize that this is a multifaceted problem that's going to need a multipronged solution.

So we've got to diversify.

Yep.

Yep.

Wrap You get the closing words.

I really like what he had to say.

I really do.

I think that's absolutely true.

It's a holistic you know, there's so many different things to do.

It's going to take bold leadership, as Kevin was saying, and there's a lot of moving parts.

I was talking earlier.

It's sort of a perfect storm that got us here.

It's going to take sort of a perfect storm to get us out of it.

So there's a lot of work to be done.

I love educating our people in the residences, you know, the citizens of every little town to tell them what the problem is.

And that sort of helps us suss out what the solution will be.

And again, the solution needs to come from the from the populace.

It can't come from the town employees or the developers.

It really needs to sort of come out sort of organically from the citizenry.

But once we educate them and we tell them what the problem is, I think there's a lot there.

And then, you know, back to the state thing, I think there's a lot of stuff that the state can continue to do.

One thing we didn't talk about, I think, is something that we need to look at is the current use program.

We have great swathes of land that people are sitting on with almost no carrying costs at all.

There's really no incentive for people to use that land or put it into some productive use and I think that's a problem we really need to get on top of.

But yeah, it's going to be a lot of different things to solve this.

And, you know, we're here at a you know, every little town I think is ready to roll up their sleeves and get going on it.

Yeah.

Thank you all so much for joining us and for the work that you're doing in your communities.

That's all the time we have for today.

Thank you so much to our guests for sharing their expertise with us.

And a reminder, if creating more housing is important to you, you can play a vital role by becoming informed, showing up for local meetings on housing and supporting this work by people in your communities.

If you'd like to learn more, we encourage you to visit communities and consequences dot org.

Support for the production of working the housing problem in towns is provided by New Hampshire Housing, Bangor Savings Bank and Anagnost Realty and Development DTC Lawyers, Heritage Home Service, New Hampshire Realtors and viewers like you.

Thank you Studio support is provided by Proulx Oil and Propane.