Massachusetts Gov. Maura Healy announced $15 million in Housing Development Incentive Program (HDIP) awards late last month, seeking to expand affordable housing options for residents.
The announcement was made in partnership with the state’s Housing and Livable Communities Secretary Ed Augustus. The funding will be given to six Gateway Cities to create 829 new homes across the state. The announcement marks the program’s first funding round of 2025. The program’s goal is to create housing that makes it more affordable and attainable while revitalizing downtowns, neighborhoods and underutilized properties. Under the current state administration, 100,000 new homes have been built or are under development with the program, according to state officials.
In Massachusetts, there are currently 26 municipalities labeled as Gateway Cities. The criteria to become a Gateway City is the following:
- A population greater than 35,000 and less than 250,000.
- A median household income below the state average.
- A rate of educational attainment of a bachelor’s degree or above that is below the state average.
The HDIP is an annual program that provides Gateway Cities with a tool to develop market-rate housing. It provides two tax incentives to developers to undertake new construction or substantial rehabilitation of properties for lease or sale as multi-unit market rate residential housing. The tax incentives are:
- A local-option real estate tax exemption on all or part of the increased property value resulting from improvements (the increment).
- State tax credits for Qualified Project Expenditures (QPEs) that are awarded through a rolling application process.
In October 2023, Gov. Healey raised the cap of the program to $30 million annually with a one-time increase of $57 million. Her administration awarded a total of $72 million creating 1,544 new housing units in Gateway Cities in 2024. State officials note the HDIP as an effective and valuable tool for Gateway Cities to produce more market-rate housing, increase residential
growth, support economic development, expand the diversity of the housing stock and create more vibrant neighborhoods.
The HDIP awards in the first round of funding this year were given to six Gateway Cities across Massachusetts. The city of Revere was granted two awards for development on the former Suffolk Downs site. The awards are as follows:
- $5 million to Revere for Portico 1 and Portico 2. The projects will construct nearly 475 new units.
- $3 million to Haverhill for a project seeking to make 124 new units at District Square.
- $2.5 million to Fall River for the Bedford Street Lofts project, which will develop 52 new units.
- $2 million to Worcester for the 17 Pearl project that will construct 139 new housing units.
- $1.3 million to Lowell for the 484 Merrimack project, seeking to create 24 new units.
- $1 million to Fitchburg for a project that will construct 17 new units.
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