McClaughry: Working out of the housing crisis

By John McClaughry

The recent discussion of “Vermont’s housing crisis” reminds us that this problem never goes away. That’s because the interests active in shaping housing policy continue to be far apart on almost any policy change that promises more affordable housing.

My first experience in this subject came in 1972. I sponsored a House bill whose purpose was “to encourage the Vermont building industry to increase the supply of housing within the reach of the average Vermont family by removing the barrier posed by a multiplicity of different building codes, each containing local embellishments and some deliberately used to keep out new moderate income housing.”

John McClaughry

John McClaughry is vice president of the Ethan Allen Institute.

The bill also provided for state certification of manufactured housing and mobile homes as code-compliant, and updated a building code law largely unchanged since 1904.

The House passed the bill on a voice vote, triggering alarm at the Vermont League of Cities and Towns. Some of its larger municipalities saw a stringent building code as a way to discourage new housing for young families producing children that town taxpayers would have to educate. The Senate defeated the bill on a 13-14 vote.

Over the ensuing half-century the housing controversy has played out in various forms.

Once viewed as a way to avoid public nuisances and efficiently accommodate growth with roads, schools, water and sewer, zoning in developing communities all too often has been reconceived as a tool to protect the residents against the suspected burden of newcomers. This leads to “I’m aboard, pull up the gangplank” zoning that creates obstacles to growth.

Development of ten or more houses faces the ordeal of Act 250. As I wrote two years ago, “even developers willing to meet the development criteria of Act 250 do not dare to expose themselves and their capital to a regulatory process with no predictable end, infested with well-lawyered adversaries determined to thwart their every move.”

If the site is out in the countryside, and thus easily buildable, enviro organizations will show up to demand protection of wildlife transit corridors, cyclists’ views of the Lake, and protection of possible indigenous people’s artifacts (known as “compliance archeology).” The Climate Council will object to new housing out in the country because the residents will have to drive to their jobs, shopping and schools, thereby releasing emissions aggravating the declared climate emergency.

But for a Scott veto (of H.606) the State would be required to “conserve” 50% of Vermont’s land area from the depredations of human occupation by 2050. Rural land is “conserved” when the state and Federal government owns it, or an environmental organization or trust owns it, or you own it, but can’t build housing or in fact do much of anything with it except pay taxes on it.

There are numerous tax benefits for creating housing in neighborhood centers, but that opportunity comes with compliance headaches. Converting disused college dormitories and building on vacant state land would offer some progress. So would community land trusts, that stabilize land value in exchange for limiting future sales of improvements.

Then there’s the special problem of Vermont’s 2,780 homeless people, on whom the State has spent $455 million over the past six years. The emergency rental assistance program and other Federal subventions create little or no needed housing. They just give money to qualified people to occupy housing they can’t otherwise afford.

Let’s give Burlington credit for doing the best they can. Last week the mayor announced the installation of 25 little dwelling pods for the homeless, But as the Auditor’s office ruefully observed in a recent report, “Vermont is not building its way out of the problem.”

There is no bold-stroke solution to this persisting problem with its conflicting interests. Giving the Vermont Public Housing Authority irresistible power to create and finance public housing all over the state is (I hope) an idea that even the most enthusiastic advocate for expanding government power would pause before embracing. Rent control, a chronic favorite of progressives, is provably destructive to increasing the rental housing supply.

The opposite policy, shrinking the reach of regulatory bodies that can impose costly conditions and mandatory cross subsidies, moves in the right direction. Any such step, of course will invite stiff resistance from the interests that insist on installing heating systems that don’t make use of gas and fuel oil, and those who really don’t want a lot of new housing at all.

If Vermont fails to move down this path, decent new housing will increasingly be available only to the custom-building rich and the increasingly subsidized families who used to, and ought to, be able to pay their own way.

John McClaughry is vice president of the Ethan Allen Institute.

Images courtesy of Public domain and John McClaughry
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6 thoughts on “McClaughry: Working out of the housing crisis

  1. Melissa Casey hit the nail; on the head. “A cesspool of corruption and a grifter’s paradise”. I found a sea of nepotism and political payoffs by just looking at the people I know that suddenly were Vermont employees. It is disgusting and disheartening. And the salaries for these grifters are unbelievable.

  2. I happen to just love Nantucket and follow some news there once and a while.
    We all know the crowd, the politics, the lifestyle that is Nantucket.
    Nantucket and Martha’s Vineyard were not always what they were today, in fact I have a friend that told me when she was growing up in the 50s and their family vacationed out there, they were laughed at and poked fun of saying things like “Why would you spend money to go out to that stinky fishing shack??”
    So you can see what those areas were and what they are now- in a fairly short span.

    There are still regular people out there that were natives to that area, there is a year around population. They do need police, restaurant staff, cleaners, lawn people, carpenters, shopkeepers, all the “stuff” that the wealthy people need and all of them really. There is a school to run, an airport..
    The islands have had a housing crisis like what is described now in Vermont for decades now..
    It’s a playground now for the elites.. and the ‘normals’ have been totally priced out of the club.
    BUT they need these working people to make the place run.

    THIS is just exactly what is happening to the entire state of Vermont now.
    It’s as though the entire state is being gentrified and the ‘normals’ driven out.

    Here in NH, over the course of my life, I’ve seen this happen here to towns.
    Old scrappy mill towns that went sorta derelict for a while when mills shut down.. but the remnants of a beautiful town remain..
    A few wealthy Massholes move into, do some expensive gut jobs renovations on the best houses in town that they bought for a song in a run down town, THEN all their friends descend upon the area like locusts and take over.
    Yeah, the place looks great in 20 years or so. BUT these people then took over local government, ran the property taxes sky high, it’s non-stop ugliness coming out of ‘the beautiful people, and the locals all leave to flee from them.
    THIS is how you have all the elderly people there, that had been in that town for their entire lives and now they are forced out of their homes because they now have property tax bills that are approaching $20K a year.

    I’ve watched this happen over and over again, this same pattern, all my life.

    In the grand scheme of things, this IS a Population Replacement.. because I’ve seen the entire cycle of this plenty of times.

    It happens in entire towns, the Islands in Mass. the entire state of Vermont is now going down this same path.
    It’s easy to see when you’ve been watching this..
    It’s the same plan but simply larger in scale in Vermont.

    The reason nothing is ever truly fixed is because it’s not in the Democrats best interest to actually fix things.
    They need needy, broken people that are suffering and need help and services thus growing government.. this is how they get votes.

    They make busy work studying all these issues that arise, it’s all nothing but a Democrats Jobs Program. It’s not about fixing anything, it’s about making WORK out of the non-stop problems!

    If everything was running efficiently and smoothly, if success abounds, there is no need for Government.. and guess what the Democrats worship like a God…

  3. Its the taxes, fees, and regulations keeping Vermont from being affordable. Until that changes, there is no solution and the only people doing well are the government employees.

  4. Vermont is one big crisis. Leaders spend millions of taxpayer dollars over decades and the same crisis remains, only to get worse and more wide-spread. The housing crisis, the homeless crisis, the drug crisis, the food insecurity crisis, the healthcare crisis, the unemployment crisis, the affordability crisis, the energy crisis, the climate crisis, the open border crisis, etc. The leaders set policies that create the crisis, take our money to address it, and the situation remains the same or worse. The Truth is Vermont is a cesspool of corruption and a grifter’s paradise. Vermont is a small State and the money spent is way out of whack for the number of people paying taxes. The real crisis is the people running the offices and pocketing all the money.

  5. Oh dummy me, I thought the gooberment was addressing the problem by making the state unaffordable for most folks so they’d move out. Maybe we should pay more welfare so the poor and middle class can afford a richy high price house? I see a lot of those going up in S.Burlington and Shelbure.

  6. These are some excellent points to remember. I’d just like to add that the housing crisis is going on all across the nation, not just here in Vermont. They may have similar regulatory problems in other places, but one thing that we have in common: Home buying programs backed by the full strength of the Federal Reserve. Over the past 30 years, the regulations governing these programs were changed, making it easier for people to get loans. I submit that the real driving force behind unrestrained home price growth has a good deal to do with this. These programs bypass the normal self-regulating behavior of a free-market economy, and people are allowed to overbid on homes regardless of market conditions. We need to return to locally sourced mortgages by local banks that can react to market conditions and have a vested interest in making sure the cost-to-value is where it should be. If such a thing still exists.

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