Newport This Week

Island Looks at Solutions for Housing Crisis

With a uniquely maddening market and a projected increase of workers and retirees in the region, Newport, Middletown and Portsmouth face a grim future if nothing is done to address housing.

That’s according to Chris Worley, an analyst with Fourth Economy, a consultant working with the Greater Newport Chamber of Commerce to enhance small business support, grow the workforce and improve infrastructure systems through increased housing on Aquidneck Island. The collaboration has yielded an initiative titled Connect Greater Newport, which was included as part of a May 11 forum hosted by Grow Smart RI and the Aquidneck Land Trust at Innovate Newport.

The event featured input from municipal planners in all three island communities, housing policy organizations and researchers looking for ways to combat worrying trends.

“If housing development doesn’t match workforce growth . . . the region will lack a core cluster of essential workers,” Worley said. “These workers, like teachers, electricians and healthcare workers, will be priced out of the local housing market.”

Newport and Bristol counties are expected to see a combined 15 percent increase in jobs in the next decade. That increase will be more than offset by a predicted influx of nearly 10,000 retirees to the region, creating a further need for housing. According to Connect Greater Newport, Newport and Bristol counties will need to add 9,000 units of housing in the next 10 years to adequately meet the anticipated need. Since 2000, the city of Newport, for example, has added a net total of 24 new units.

“People are getting numb to this,” said Newport Mayor Xay Khamsyvoravong. “The urgency that we need, that you normally associate with addressing a crisis, isn’t happening.”

Since 2015, rent has increased 40 percent across Aquidneck Island, and the cost of owning a home has increased by almost 65 percent. A recent study from the Rhode Island Foundation found that an annual income of $170,000 is required to afford to rent a two-bedroom apartment in Newport.

Even more troubling is that Fourth Economy’s research indicates that a majority of the anticipated workforce on the island will form households with annual wages between $75,000 and $100,000. Thus, a new supply of $400,000 homes and apartment rentals at $1,300 per month will be needed, Worley said.

The region has already seen a loss of workers aged 30-54 in recent years, and a quarter of its workforce spends more than 30 percent of its income on housing. Accordingly, 3,000 more workers are commuting to the island today, compared to 2013.

“We’ve heard many stories of businesses who pay really good wages not being able to recruit workers,” said Worley. “Their most qualified and preferred candidates decline or drop out after looking at housing options and realize they’re not able to live in this place.”

Nearly every speaker at the forum addressed short-term rentals and investment properties, with Khamsyvoravong calling them “low-hanging fruit.” According to Khamsyvoravong, one in four properties in Newport sit vacant for most of the year.

Affordable housing, as defined by the state, is based on area median income and adjusted for household size. Only six Rhode Island municipalities meet the state’s mandate that 10 percent of a city or town’s housing stock be affordable, although Newport is one of them at about 17 percent. But Middletown and Portsmouth are at 5 and 3 percent, respectively, according to Rhode Island Housing.

But the situation is still within control, according to experts. The objective is to increase workforce and senior housing. So, what are the municipalities doing?

In Portsmouth, town planner Lea Hitchen said the town is also redoing its zoning code, looking to modify its residential tax structure and studying accessory dwelling units. Additionally, a modernized senior center with 54 affordable units is coming to Bristol Ferry Road.

“It wasn’t easy to do,” she said. “It was an uphill battle, with lawn signs saying not to do this all over the place. That was a large uptick in our affordable senior units.”

A developer has purchased five vacant, formerly U.S. Navy-owned parcels on Burma Road, and four are intended for affordable housing. The proposal for a total of 196 units, with 40 affordable, received master plan approval in April. The project currently requires further approvals and is being negotiated to include more affordable units.

“I’m really hoping we can compromise somewhere,” Hitchen said.

Last year, Newport banned new short-term rentals in residential zones. The City Council also recently passed resolutions designed to tackle the housing crisis with various strategies, such as updating the zoning code, increasing fees on short-term rentals and reopening the request for proposals for the former Coggeshall School for possible residential redevelopment.

The city is also currently implementing a two-tier residential property tax structure that sees year-round residents pay less than non-owner-occupied homes, and is preparing an ordinance to allow accessory dwelling units, such as garages or in-law apartments, to be used as residences.

Khamsyvoravong said he is looking for City Council approval to expand the planning department.

Speeding up multifamily development in the North End is also a priority, said Newport city planner Trish Reynolds, and the city is offering bonuses to developers who provide workforce housing.

Finally, the city is considering a unified process for proposed developments to only require approval from the Planning Board, rather than both the planning and zoning boards, in the interest of timeliness.

“That way things don’t pingpong back and forth between the Planning Board and the Zoning Board,” said Reynolds.

The idea comes from Middletown, which recently implemented a system that allows for mixed use development, including multifamily housing in general and limited commercial zones by right.

The Planning Board presides over the proposals and considers zoning relief. Through this process, a 12-unit development on Forest Avenue and a 12-unit development on Aquidneck Avenue were constructed, with both projects introducing multifamily units into an office setting.

A proposal to add 60 multifamily, market-rate units and additional commercial space into the Polo Center on Aquidneck Avenue has received master plan approval.

“We recognize that introducing multifamily, residential development in appropriate locations is an opportunity to help solve the housing crisis,” said Middletown town planner Ron Wolanski. “[But] any development of housing is going to help the ongoing situation.”

An expansion of the West House property on Forest Avenue by Church Community Housing will add 54 affordable units, and a private development of the former Skater Island site on West Main Road will add 144 units, with 63 designated as affordable.

A number of affordable housing projects are also proposed on public property.

The town is also hoping to increase the amount of affordable housing proposed at Middletown Center, the private/public redevelopment of a 15-acre, town-owned parcel on West Main Road and Coddington Highway for a mix of commercial, hotel and residential uses.

Finally, the town is now drafting an ordinance for consideration that will mandate a minimum 20 percent of affordable housing for any major subdivision project of six units or more.

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