PITTSFIELD, Mass. — Mayor Linda Tyer's At Home in Pittsfield Initiative — freed from election year politics — is headed to City Council with the endorsement of its Community and Economic Development subcommittee.

 

The panel voted unanimously Wednesday to approve using $500,000 from the General Electric Pittsfield Economic Development Fund for the residential exterior home improvement loan program.

 

"This is a really big night for my administration and for the city of Pittsfield," Tyer said.

 

Tyer presented the program again last week to the City Council, which referred it to the subcommittee after it had been rejected by the council more than a year prior. The council is expected to take it up at the next meeting on Nov. 10.

 

Community Development Director Deanna Ruffer outlined the basic functions and need for the program that is designed to help eligible homeowners repair chimneys, roofs, siding, windows, and exterior doors.

 

Ruffer explained that this is one part of the city's multifaceted approach to housing. The city has made significant investment in demolitions of vacant housing to improve quality of neighborhoods, partnerships and investments in market-rate housing to meet need and is working on a sheltering and supported housing plan.

 

Tyer and her team are confident that the At Home program meets all economic development and public benefit guidelines as it will leverage private investments by local lending partners, providing jobs in the construction trade, and will increase homeowners equity and overall wealth.

 

Some 43 percent of Pittsfield housing stock was built prior to 1939, meaning that many homes are in need of renovation, repair, and improvement. Tyer believes this initiative that is intended to provide funding for exterior improvements is vital to establishing housing and neighborhood stabilization, especially in the Morningside and West Side neighborhoods.

 

Tyer also believes this program has the potential to help close the wealth gap that exists within the city.

 

This program originally requested $250,000, but this was increased to $500,000 because of a great deal of interest in the program 18 months ago. During this time, more than 100 residents contacted Tyer's office to inquire about the program.

 

Officials believe that this increase is even more necessary during the COVID-19 pandemic because residents are in a worse financial situation than before.

 

Ruffer said the program took a couple of years to develop and still holds the support of local lenders Pittsfield Cooperative Bank, Greylock Federal Credit Union, Lee Bank, and Berkshire Bank. These lenders saw the same reasons as to why now is a good time for the program, she said.

 

Additionally, the same two community partners — Central Berkshire Habitat for Humanity and Berkshire Bridges — remain supportive of the program.

 

The At Home in Pittsfield Initiative program guidelines reflect the discussions that were held in 2019, including changes that the council asked for and to which Tyer agreed.

 

An additional change that was made since the first proposal of the program was doubling the funding from $250,000 to $500,00 so that the program could make a greater impact. Another change was to make the recipients' loan a forgivable loan in an effort to bridge the wealth gap in Pittsfield.

 

Funding would be secured by a subordinated mortgage that would would be forgiven at the end of seven years.

 

"It is our desire to help more vulnerable members of the community who tend to have lower asset value in their property to gain the benefit of increased equity value in homes," Ruffer said.

 

Sixty percent of this program will be allocated to the Morningside and West Side neighborhoods, and the remaining 40 percent can be used throughout the city. Single-family homes and duplex homes will be eligible for the funds.

 

The maximum funding per household is $25,000 and the maximum income of eligible households is 120 percent of the area median income.

 

The average home in Pittsfield in 2019 was appraised at $193,000.

 

Funding is capped at $25,000 for each household or up to 10 percent of the appraised as completed value of the property. For Morningside and West Side properties, the program is allowing up to 20 percent of the appraised value because those houses are appraised at almost half of the amount than properties in other neighborhoods.

 

Ruffer said if 10 percent of the property's value was allocated for those neighborhoods, it may only come out to allowing about $10,000 in funding from the program, and that is not their goal.

 

The At Home in Pittsfield Initiative wants to make sure that it is addressing the needs of lower-valued neighborhoods so they can strengthen those communities.  

 

Applicants can go through local lenders or apply directly through the city. Tyer's team feels that encouraging the use of local financial institutions may open up other opportunities for financing and wealth growth through recipient's interaction with the lenders.

 

Owners must occupy the properties they are applying for and have a minimum of two years' residence prior to their application.

 

This program is not open to new homeowners, but program guidelines do allow a potential waiver of that contingency.

 

Tyer's team is proposing a first-come, first-serve model for eligible applicants. The application process will include income verification from tax filing, credit checks, appraisals, and scoping of work by rehabilitation specialists.

 

"Our experience is that it takes time for homeowners to determine whether or not they are in the position to do this, and it takes time for them to work with their lenders," Ruffer said. "Therefore, we don't want to limit the program to just the who happens to be ready at the moment we announce it. "

 

Most importantly, the program aims to provide resources for homeowners who don't have sufficient income or are already so debt-ridden they can't afford these exterior improvements. 

 

Morningside and West Side are targed for 60 percent of the program because they are considered most in need. Originally, the program was aimed at using $250,000 in funding to repair homes in just these neighborhoods, but the City Council requested that it was applied to more Pittsfield neighborhoods.  

 

After the first proposal, Tyer also received a wealth of inquiries from all over the city. This sparked the idea to make it citywide and double the funds, but still allocating more funds for the neighborhoods most in need.

 

Ruffer explained that this initiative meets requirements for economic development because quality housing stock and strong neighborhoods are fundamental to growing businesses and creating new jobs that attract new professionals to the area.

 

She said there is a direct correlation between General Electric's departure and deterioration of Pittsfield's housing stock. Reduced household incomes leads to reduced housing needs, Ruffer said.

 

In a statewide work group sponsored by MassInc's Gateway Cities Institute that Tyer chaired in 2018, four resolutions were made to strengthen gateway cities and urban neighborhoods and address the aging housing stock that many communities including Pittsfield have.

 

These four solutions were to strengthen market conditions, which goes directly to improving exterior quality of homes, foster increased homeownerships, encourage upgrades to existing housing, and construct new housing.

 

Two of these four resolutions would be addressed with Tyer's program. Additionally, it would provide work in the construction and contracting industries and put money back into the local economy.

 

The balance of the Economic Development Fund is just under $4 million at moment. Over the last 20 years, this fund has been used about 20 times to assist for-profit and not-for-profit businesses as well as city projects.  

 

Pittsfield's housing needs were summarized into three different columns: affordable housing recipients, those aging in place, and those in the work force. Some residents apply to more than one of these columns, and Ruffer said Tyer's team is doing work in all of these sectors.

 

Ward 5 Councilor Patrick Kavey said that when this program makes it back to the council, a lot of the discussion will be centered around the definition of what qualifies for economic development.  

 

"I obviously think that we all will have a different belief system on what we think economic development is," he said. "But having studied economics, in my own opinion what economic development is, again may vary from what other people think, but economic development is the creation of wealth from which community benefits are realized. "

 

Kavey believes that this program can qualify as economic development because it channels prosperity and improves the quality of life for residents, but he also believes that some councilors may differ in opinion and it would be a great conversation to have.

 

Thought excited about the program, Ward 1 Councilor Helen Moon thought there should be even more funds allocated for the Morningside and West Side neighborhoods.

 

She said she recognizes the need for improvements all over Pittsfield, but historically recognizes banks redlining urban communities by not giving loans to residents of such neighborhoods who are widely people of color and immigrants.

 

"I know this will come with a lot of debate from councilors, especially those who don't represent the Morningside and West Side neighborhoods," Moon said. "I know that there is need all across the city of Pittsfield, but when you think about concentrated wealth and the lack of concentrated wealth I really think that the West and Morningside neighborhoods are lagging behind the rest of the city. "

 

Tyer agreed with this sentiment, but believes that this program is putting the right balance of funds into the areas by allocating more to those two areas.

 

"I agree with you 100 percent that the great need does exist in the Morningside and West Side, and you can see that when you look at the distinction between the values of homes in those neighborhoods versus the rest of the city," she said. "I really think that what we propose here strikes the right balance around putting a greater share of the funding into Morningside and West Side but slowing for other neighborhoods in the city of Pittsfield to have access to this resource."