In the face of a persistent housing crunch, a controversial state law designed to spur development of affordable housing is once again being considered by Island housing advocates as key to meeting a critical need.

For the past 50-plus years, the Massachusetts law known as Chapter 40B has created thousands of affordable housing units across the state. On the Vineyard, however, the developer-friendly legislation has historically been met with resistance, perhaps most notably two decades ago in a failed effort to create a golf course and housing development in Oak Bluffs’ southern woodlands.

In a pivotal 2003 decision in that case, a land judge court ruled that the Martha’s Vineyard Commission has jurisdiction over all 40B projects, citing that agency’s unique authority to protect the land and water of the Island. When considering such projects, the MVC weighs their potential regional impact by examining traffic data, wastewater, strains on municipal services and several other factors.

State Sen. Julian Cyr, who represents the Island, is among those who now believe the law is an essential tool to address a housing crisis.

Development on the Island is often met with resistance. — Ray Ewing

“40B is really the only law we have,” he said. “Without it, we’d have very little in ways of affordable housing.”  

Enacted in 1969, Chapter 40B aims to increase the statewide affordable housing stock by mandating that each community meet a goal of 10 per cent subsidized housing inventory (SHI). If a community does not reach that goal, developers can bypass some local zoning laws and receive a comprehensive permit from the state to build affordable housing in the area.

While the law has succeeded in increasing affordable housing options across communities, results have not been drastic.

Since the law’s inception, only 71 cities and towns have met the 10 per cent threshold, and the state’s overall subsidized housing stock has increased by less than two per cent. Studies have also shown that despite state oversight, most 40B projects built in the last several decades have remained in already-dense multiracial urban areas, with whiter, more affluent suburban communities nearly unchanged.

On Martha’s Vineyard, five of six Island towns remain below the 10 per cent threshold, with an Islandwide average of just 5.2 per cent. Aquinnah is the only Island town to surpass the threshold, currently sitting at just over 15 per cent, though that is largely due to Wampanoag tribal housing.

In total the Island has 693 affordable housing units, the majority of which reside in Oak Bluffs and Tisbury.

Those numbers don’t tell the full story, however. Island Housing Trust director Philippe Jordi, whose nonprofit has built several 40B projects on the Island, said the state does not count the Island’s ownership units in its SHI data, or housing units built to accommodate the “missing middle” of workers with relatively high incomes who still cannot afford housing in their communities.

Some of IHT’s developments serve tenants making up to 150 per cent of the area median income, Mr. Jordi said, making those units ineligible in the state’s count. But even including non-SHI affordable options and those “community” options, just around 5 per cent of the Island’s housing stock is reserved for lower and middle incomes.

Working with the towns, all of the 40B permits IHT receives are what’s called “friendly” 40Bs, meaning they have local support either in the form of town-owned land or town funding. The reason, Mr. Jordi said, is that smaller projects like the ones IHT builds need local financing to get off the ground.

Kuehn’s Way, the 20-unit affordable housing project in Tisbury, the under-construction Carl Widdis Way in Aquinnah and Scott’s Grove in West Tisbury are all examples of “friendly 40Bs” on the Island.

Even with town support, however, 40B projects invariably prove controversial with residents. 

“You can imagine we always hear from abutters on large housing projects,” said Doug Sederholm, a member of the Martha’s Vineyard Commission. “They want to know how it will impact their daily lives and how it will impact the value of their homes.” 

NIMBYism, the pejorative term for neighbors who oppose development in their own backyards, is a constant at every housing proposal, even when opponents claim to support housing overall, Dukes County Regional Housing Authority director David Vigneault said. The best way to manage those concerns, he said, is to hear them.

In the past, developers have worked with neighbors to reduce massing, number of units, and even conserve land surrounding the development to preserve the rural quality of the neighborhood, Mr. Vigneault said.

“Specific things that come up can often be included to make a better project,” he said. 

Often, the most controversial proposals are “classic” 40Bs, in which for-profit developers rely on a portion of market-rate units to make up for any losses. Classic 40Bs tend to be larger and have more units than the average small-scale “pocket neighborhood” IHT specializes in, Mr. Jordi said. 

Mr. Vigneault believes the MVC’s unique powers have largely deterred off-Island developers from utilizing the classic 40B more on the Vineyard.

“That’s where big projects went to die for a long time,” he said. 

A new proposed development could go through the classic 40B process. Private equity investor William Cumming has presented Edgartown Gardens, a 64-unit apartment complex near the triangle in Edgartown. The project plans to have 25 per cent of its units set aside as affordable housing and 80 per cent restricted to tenants over 55.

The development is still in the early stages — its application has not yet even been filed with the MVC — and a traffic study for the clogged intersection is underway. 

Currently, 40B laws only require that 25 per cent of units accommodate residents of 80 per cent area median income or less. In resort communities where market rates can easily skyrocket during the busy season, it’s hard to quantify the costs versus the benefits of a classic 40B project, according to Mr. Jordi. 

“If 75 per cent [of units] are market-rate, in other parts of the state that might be serving the community, but here, they might be bought by seasonal investors,” he said.

Still, Mr. Jordi acknowledged, the need for more affordable housing options is great.

“The Island’s affordable housing stock has actually decreased in the past 10 years,” he said. “We can’t do it all.”

“In most parts of the state you do have for-profit developers,” he continued. “The trick is can you create year-round housing exclusively . . . and make that work under 40B?”

For communities serious about addressing their housing shortage, Senator Cyr said the classic 40B — enabling high-volume, high-density projects — is still the most impactful option.

“This is a problem we’re not going to be able to solve through publicly financed options,” he said.

In some instances, towns can collaborate with for-profit developers on a win-win solution. If a municipality that does not meet the 10 per cent threshold can prove they are building new affordable housing at a fast enough rate, the state can grant that community “Safe Harbor” status, giving them more negotiating power with a developer. On Nantucket, which has been granted Safe Harbor status through 2024, the town has worked with for-profit developers on projects like the Richmond Great Point development and Surfside Crossing. The latter proved so controversial with residents it is still under appeal.

Oak Bluffs is the only on-Island town with Safe Harbor status, thanks in part to the planned Southern Tier project. For that reason, if a developer were to approach the town — as one has with a new proposal for teacher workforce housing also brought forth by Mr. Cumming – the town is in a better position to advocate for what that project might look like. That could mean anything from increasing the percentage of affordable units to potentially giving preference to town residents, municipal workers, or other priority groups.

“It’s interesting how towns, with the right expertise, can do more to control their own future,” Mr. Jordi said.

To gain better leverage to negotiate for these kinds of provisions, Nantucket recently filed for a local option that would allow them to restrict housing to municipal employees. It’s the kind of tool that MVC Island housing planner Laura Silber hopes to utilize on the Vineyard — and one that could come alongside a larger toolbox later down the line.

Gov. Maura Healey’s Affordable Homes Act unveiled earlier this year includes a “seasonal communities” designation that could potentially tailor one-size-fits-all statutes like 40B to communities like Martha’s Vineyard. While the specifics are still unknown, the designation is proof that the governor has been listening to local concerns, Ms. Silber said.

In the meantime, both Senator Cyr and Mr. Jordi said the best way Island towns can ensure housing developments work in residents’ best interests is to work towards their own solutions.

“The question is how do we create what we want because there is going to be change,” Mr. Jordi said.

Correction: This article has been updated with more current SHI inventory data. A previous version of the article stated that 10 per cent of housing is reserved for lower and middle incomes. That number only applies to year-round housing, roughly 50 per cent of the Island's total housing stock.