For a Good Cause

The cause for affordable housing is important, indeed vital, and many good people have been hard at work on this cause for a number of years now. Millions of dollars have been raised, countless hours of volunteer labor has been donated, housing has been built, and untold numbers of deserving Islanders who need the housing have benefitted.

There is much work yet to be to be done, and with dramatic changes in the housing market, so too the landscape for affordable housing on the Island now is shifting. Mixed-income building projects whose business plans are modeled on the premise of selling market-rate homes to underwrite the cost of the lower-priced homes may no longer be viable in the current economy. The real estate market is still falling here and is flooded with existing unsold homes.

Meanwhile, questions that have surfaced recently over the project at 250 State Road in West Tisbury appear to have put leading Island affordable housing advocates on the defensive as they scramble to explain the cost of construction for the project. The questions came up first at the West Tisbury annual town meeting and again later at a selectmen’s meeting. The town is contributing more than four hundred thousand dollars to the project from its Community Preservation Act Fund. With public money now involved, the selectmen are right to ask questions, and leaders at the Island Housing Trust and Affordable Housing Fund should be held accountable for how the money is spent.

Thanks to grant money from the Cape Light Compact, the State Road housing project is planned as an energy efficient green building community that is expected to be a model for the commonwealth, and that is a wonderful thing.

But it does not excuse the housing trust and its sister organization, the fund, from questioning over the decision to hand the construction contract for 250 State Road to a company owned by one of its board members. This exercise in self-dealing leaves the two nonprofits open to charges of conflict of interest. It may well be legal for the nonprofits, which are not subject to public bidding laws, to give business contracts to board members, but is it wise?

Massachusetts Attorney General Martha Coakley thinks perhaps not. The state attorney general provides a helpful and detailed guide for board members of public charities, easily available for viewing on the Web. In a section that addresses conflict of interest, the guide underlines the sensitive nature of board members engaging in business dealings with their nonprofit: “Any conflict transaction should be scrutinized very closely by the board, both because of the dynamic it creates within the board and because of the predictable skepticism with which the public and regulators will view the transaction, no matter how scrupulously a careful policy is followed,” the guide says in short.

At this juncture any board members of the Island Housing Trust and Affordable Housing Fund whose businesses have received contracts for building homes — or are likely to receive contracts in the future — would do well to step down.

The goals of affordable housing are both vital and laudable, but they are not above the equally important principles of transparency and accountability, especially to the thousands of private donors and taxpayers who have contributed so generously to a good cause.