WILLIAMSTOWN, Mass.— Work continues on the planned subsidized housing project at the former Photech mill, but escalating costs at home and tax cuts from Washington, D.C., have slowed progress on project.

 

The president of Pittsfield's Berkshire Housing was before the Select Board last week to discuss what has been done and what has caused delays and to ask the board for an extension on the non-profit's option to build more than 40 units of Affordable Housing at 330 Cole Ave.

 

Elton Ogden told the Select Board that, as expected, the project was unsuccessful in its first round of applications for funding from the Massachusetts Department of Housing and Community Development.

 

As far back as 2015, when Berkshire Housing started talking to the town, Ogden has been consistent in saying that, unlike the Highland Woods senior housing project that was expedited by the state as replacement housing for the former Spruces Mobile Home Park, the Photech project could expect to "get in line" with other projects around the commonwealth.

 

"We've completed all of the work it takes in order to put together an application to DHCD for $9.6 million in equity, low-income housing tax credits and $3.3 million in soft debt," Ogden said in a meeting telecast on the town's community access television station, Willinet. "We made that application unsuccessfully last year, but we got our foot in the door, and that's what it's all about.

 

"You come in with a competitive application and get your place in line."

 

And the line got a little longer last year when Congress added $1.5 trillion to the national debt with a massive tax cut.

 

"We've got an environment where the federal government has basically checked out of funding affordable housing projects," Ogden said. "So the Department of Housing and Community Development, the state, is pretty much the only source. Consequently, all their resources are stressed.

 

"Then we have the wrinkle that was thrown in with the reform of the corporate income tax. That ended up devaluing the federal Low-Income Housing Tax Credits. … That created a significant gap in every project. It's not just us. It's across the board."

 

While Berkshire Housing continues to work on putting together funding for the $13.5 million project, the nonprofit and town continue to make sure it is "shovel ready" when financing is in place.

 

Ogden's agency partnered with the town on a $200,000 EPA Brownfields Grant to remediate contaminated areas of the former industrial site that the town obtained in a tax taking. Berkshire Housing has pledged $40,000 in matching funds for that grant.

 

Unfortunately, Town Manager Jason Hoch told the Select Board last Wednesday, the town received just one bid for the work it needs done, "and it was significantly over the amount received from EPA."

 

Williamstown and Berkshire Housing are instead going to phase in the project, an approach that begins by abating and removing the boiler room in the "cube," the one remaining factory building that dominates the property beside the Hoosic River.

 

Ogden said that higher site prep costs and a reduction in the maximum low-cost loans allowed by the Federal Home Loan Bank have combined to leave the project with a shortfall of about $1.5 million.

 

"We've had some significant [cost] increases that became realized as the engineering became more advanced," Ogden said. "We did geotechnical explorations, which weren't terribly positive. They told us that we had about $500,000 worth of site costs that weren't anticipated. That's to remove all the debris that was put into the basements of the old buildings that now has to come out and be replaced with structural fill.

 

"We've also had something that everyone is going to be subject to because of changes in the building code: The Cube, which we thought was going to be cost efficient to renovate and create 22 units, is not as cost-efficient."

 

Ogden said Berkshire Housing still plans to renovate and reuse the Cube, but it has made another change to its site plan in order to reduce costs. Instead of building the 46 units of housing it anticipated, the nonprofit currently plans to build 41 units, leaving out one five-unit townhouse but leaving room for expansion at a later date.

 

Reducing the project by five units will reduce its total cost by $1 million, Ogden said. In answer to a question from Select Board member Andy Hogeland, Ogden said the commonwealth's funders have approved the idea of reducing the number of total units in the project.

 

Another option Berkshire Housing is looking at to help close its funding gap is an application to the town for Community Preservation Act funds, Ogden said. In the past, CPA money has been expended to support the non-profit's development of the Highland Woods project.

 

After the board voted unanimously to extend Berkshire Housing's option on the site, Hoch praised the local agency's contribution during the pre-development phase.

 

"They've expended a lot of money on behalf of this community for this project," Hoch said. "We all want to see housing there. They've spent the hundreds of thousands of dollars to get it there.

 

"One of the options they've put on the table right now is deferring some of their own development fee right now to make it happen. That's a major commitment, and a major commitment on behalf of the developer to put together a plan like that before a shovel hits the ground."