The mayor of Pittsfield, Massachusetts is taking a zero interest loan program designed to improve the city’s housing stock before the city council Tuesday night.
Mayor Linda Tyer calls the program “At Home In Pittsfield.” She says it’s intended to offer financial services to city residents trying to invest in exterior home improvements.
“When we enter into an agreement with a resident – for example, to replace their roof or to install new windows – that arrangement between the city and the resident will be a zero percent interest rate loan under a deferred payment program, which means that there’s no interest on the money that you are receiving from the city and there’s no monthly payment requirement," said Tyer. "However, when it comes time for you to sell your house, we are going to expect that money to be paid back. And our investment will be secured by a mortgage.”
She says the program is a response to a need for the city to have “a diverse landscape of housing choice,” the financial inability of some residents to make desired home improvements, and to better promote Pittsfield for businesses.
“We’ve heard from our business leaders that one of the challenges to recruiting is the quality of the housing stock here in the City of Pittsfield, and you know, it’s understandable because 43 percent of Pittsfield’s housing was built before 1939," said the mayor. "So it’s understandable why houses of that era are now in need of renovation and repair and upgrade.”
“At Home In Pittsfield” will be available to any city resident who makes less than $87,480 a year.
“So that’s a lot of people," said Tyer. "This door is wide open to a lot of people. And if you live in the Morningside, or the West Side, or Tyler Street, you will have access to a bit more money. So citywide, the cap on the amount of money is $20,000 on home improvements to the exterior of your house. If you live on West Side, Morningside, or Tyer Street, the cap on the amount available is $30,000. So we want to incentivize investment in some of our neighborhoods that need it most and for our residents that have the least resources.”
Tyer says the city has brought on four local lenders to participate in the program: Berkshire Bank, Lee Bank, Pittsfield Cooperative Bank, and Greylock Federal Credit Union. Each will offer specific mortgage plans to residents looking to take advantage of “At Home In Pittsfield.”
“When that happens, the lending institutions will share with consumers this other pool of money that’s available from the city of Pittsfield,” she told WAMC.
The plan calls for $250,000 from the city’s economic development fund – which has its origins in Pittsfield’s PCB cleanup agreement with General Electric. At its peak around 2010, the fund contained $10 million. Now, just over $3 million remains, and Tyer will be asking the city council to approve her request to draw from it.
“We have used that fund in a number of ways to support economic development, and in this case, it might not be as obvious of an economic development strategy to invest in housing," said the mayor. "But the fund has a category called public benefit, and that’s where we’re going to make our case.”
One of the people Tyer will have to make the case to is Ward 4 councilor Christopher Connell.
“I’d rather see it come out of free cash, because I don’t think it’s a business driver, which I believe that’s what the fund was intended to do,” Connell told WAMC.
He also takes issue with the program’s distinctions between city residents on a neighborhood by neighborhood basis.
“I think there is issues with poverty with our senior citizens, especially, who are struggling right now in all areas of the city, and I think if it’s going to be a program that’s going to be approved it should be the same parameters for everyone in the city,” said the councilor.
The council is expected to vote on the “At Home In Pittsfield” lending program Tuesday night.
