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SENATE DOCKET, NO. 2368 FILED ON: 1/17/2025
SENATE . . . . . . . . . . . . . . No. 989
The Commonwealth of Massachusetts
_________________
PRESENTED BY:
Paul R. Feeney
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To the Honorable Senate and House of Representatives of the Commonwealth of Massachusetts in General
Court assembled:
The undersigned legislators and/or citizens respectfully petition for the adoption of the accompanying bill:
An Act establishing the missing-middle starter home development and home ownership program.
_______________
PETITION OF:
NAME:DISTRICT/ADDRESS :Paul R. FeeneyBristol and Norfolk 1 of 5
SENATE DOCKET, NO. 2368 FILED ON: 1/17/2025
SENATE . . . . . . . . . . . . . . No. 989
By Mr. Feeney, a petition (accompanied by bill, Senate, No. 989) of Paul R. Feeney for
legislation to establish the missing-middle starter home development and home ownership
program. Housing.
[SIMILAR MATTER FILED IN PREVIOUS SESSION
SEE SENATE, NO. 874 OF 2023-2024.]
The Commonwealth of Massachusetts
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In the One Hundred and Ninety-Fourth General Court
(2025-2026)
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An Act establishing the missing-middle starter home development and home ownership program.
Be it enacted by the Senate and House of Representatives in General Court assembled, and by the authority
of the same, as follows:
1 The General Laws are hereby amended by inserting after chapter 40Y the following
2chapter:-
3 Chapter 40Z. Starter Home Development Fund.
4 Section 1. (a) As used in this section, the following words shall have the following
5meanings unless the context clearly requires otherwise:
6 “Agency”, the Massachusetts Housing Finance Agency, established under section 3 of
7chapter 708 of the acts of 1966.
8 “Committee”, the advisory committee established under section 4 2 of 5
9 “Fund”, the Starter Home Development Fund established under section 2.
10 “Income-eligible homebuyer”, a household within the commonwealth with annual
11income not less than 80 per cent that does not exceed 120 per cent of area median income.
12 “Starter Home”, as defined under section 1 of chapter 40Y.
13 Section 2. (a) There shall be established and set up on the books of the commonwealth a
14Starter Home Development Fund, which shall be administered by the department of housing and
15community development. The department shall enter into a contract with the Massachusetts
16Housing Finance Agency for the administration of the fund, according to guidelines promulgated
17by the department and in consultation with the advisory committee. The fund shall provide
18subsidies for new construction or acquisition and substantial rehabilitation of owner-occupied
19starter homes for the benefit of households whose incomes are between 80 per cent and 120 per
20cent of area median income as determined by the federal Department of Housing and Urban
21Development. The fund shall be an expendable trust fund and shall not be subject to
22appropriation.
23 (b) There shall be credited to the fund revenue from appropriations or other monies
24authorized by the general court and specifically designated to be credited to the fund and gifts,
25grants, private contributions, repayment of loans, investment income earned on the fund's assets
26and all other sources. Money remaining in the fund at the end of a fiscal year shall not revert to
27the General Fund.
28 (c) The agency shall maintain the fund as a separate fund and shall cause it to be audited
29by an independent accountant on an annual basis in accordance with accepted accounting
30principles. 3 of 5
31 (d) The agency shall administer assistance from the fund using only the criteria set forth
32under this chapter.
33 Section 3. (a) The fund shall finance subsidies directly to support the construction and
34purchase of starter homes; provided, however, that such assistance shall be the minimum amount
35necessary to make a project feasible.
36 (b) The total amount of subsidies shall not exceed 35 per cent of eligible development
37costs, as determined by the agency.
38 (1) The agency may provide a direct subsidy to a developer of a starter home, which shall
39not exceed the difference between the cost of development and the market value of the home as
40completed.
41 (2) Of any remaining amounts available for the project after the developer subsidy, the
42agency may provide a subsidy for the benefit of the homebuyer to reduce the cost of purchasing
43the home; provided, however, that: (i) the agency includes conditions in the subsidy or uses
44another legal mechanism to ensure that, to the extent the home value has risen, the amount of the
45subsidy remains with the home to offset the cost to future homebuyers; or (ii) the subsidy is
46subject to a housing subsidy covenant that preserves the affordability of the home for a period of
47not less than 99 years.
48 (c) The agency shall allocate not less than 33 per cent of the funds available through the
49program to projects that include a housing subsidy covenant consistent with clause (ii) of
50paragraph (2) of subsection (b). 4 of 5
51 (d) The agency shall adopt a program plan that establishes application and selection
52criteria, including: (i) project location; (ii) geographic distribution; (iii) leveraging of other
53programs; (iv) housing market needs; (v) project characteristics, including whether the project
54includes the use of existing housing as part of a community revitalization plan; (vi) construction
55standards, including considerations for size; (vii) priority for plans with deeper affordability and
56longer duration of affordability requirements; (viii) sponsor characteristics; (ix) energy efficiency
57of the development; (x) historic nature of the project; (xi) projects which seek to address and
58overcome historic, systemic inequities in the housing lending system in communities of color.
59Priority consideration shall be given for projects sited and developed in a starter home zoning
60district as defined in section 1 of Chapter 40Y.
61 Section 4. (a) There shall be an advisory committee to the fund, which shall make policy
62recommendations to the agency and to the department of housing and community development
63regarding the fund's program and funding activities.
64 (b) The committee shall be comprised of: the director of the department of housing and
65community development or a designee; the executive director of the Massachusetts Housing
66Partnership Fund or a designee; the executive director of the Community Economic
67Development Assistance Corporation or a designee; 2 municipal officials appointed by the
68Massachusetts Municipal Association, Inc., 1 of whom shall be from a city and 1 of whom shall
69be from a town; 1 lender experienced in the financing of starter homes and 1 for-profit developer
70of starter homes, each appointed by the agency; an executive director of a local housing authority
71appointed by the Massachusetts chapter of the National Association of Housing and
72Redevelopment Officials; a representative appointed by the Home Builders and Remodelers
73Association of Massachusetts, Inc.; a representative appointed by One Family Inc.; a 5 of 5
74representative appointed by the Massachusetts Affordable Housing Alliance, Inc.; a
75representative appointed by the Massachusetts Association of Community Development
76Corporations; and a representative appointed by the Massachusetts Nonprofit Housing
77Association, Inc. Committee members shall serve at the pleasure of the appointing authorities.
78 Section 5. The Massachusetts Housing Finance Agency shall, as part of its annual report
79pursuant to section 14 of chapter 708 of the acts of 1966, detail all expenditures from the fund,
80including, but not limited to, the recipient of the funds, the cost of administration and the number
81of units constructed, acquired and rehabilitated.