Alex Farrell, commissioner of the Department of Housing and Community Development, told the House Committee on General and Housing on Feb. 21 that units financed under the state's housing initiative will begin to reach the end of short-term affordability covenants starting this year and ramp up in 2027–2029.

Farrell said 525 units were funded under the program’s first round. “525 is the exact number for b hip 1,” he said. He told the committee that 66 units completed in 2020 using federal Coronavirus Relief Funds lacked a homelessness re‑housing requirement and thus their five‑year compliance windows end in 2025; other, later units carry the homelessness requirement and will come off compliance later.

The department provided a chart showing when units were completed and when their compliance periods end. Farrell said the earlier five‑year window was intended as a temporary runway so state and federal affordable‑housing portfolios could expand and absorb people leaving homelessness. He described a recertification process the department will run this summer: landlords will be required to report turnover, tenant stability and plans for units when covenants expire so staff can assess whether the program created durable housing matches with coordinated‑entry agencies.

Committee members pressed the department about several operational details in draft legislation. One question asked whether the 10‑year option in the administration’s draft carried a homelessness requirement identical to the five‑year option, which could remove any incentive to choose the longer covenant; Farrell said the language in the draft appeared unintended and explained two ways to preserve incentives: relax the longer‑term requirement or increase the financial incentive for a 10‑year covenant. He said, “They would always just choose the 5 year” if requirements were identical.

Members also asked whether private scattered‑site units could be preserved by the Vermont Housing & Conservation Board or other entities when covenants expire. Farrell said the units are mostly private landlords and geographically dispersed, which makes nonprofit acquisition difficult. He said VHCB’s typical mechanism is perpetual affordability tied to its own investments, and many landlords participating in the earlier program would not have participated if perpetual affordability had been required.

The committee sought clarification about program caps and accessibility funds. Committee members asked whether accessibility upgrades require first unlocking a rehabilitation grant. Farrell said he believed accessibility could be funded without also triggering rehabilitation, but deferred formal confirmation to his staff: “I will let you know right away. I am not under the impression that you need to also rehabilitate.”

Members raised fair‑housing concerns about family members moving into assisted units and whether accepting public dollars imposes obligations on which tenants may be selected. Farrell cautioned that public funding carries fair‑housing requirements and that using grants to house family members could raise legal questions. He said the administration would provide written clarifications and that the department’s general counsel and policy team would weigh in on narrower definitions used in draft statutory language.

The department said it will return written answers to the committee and circulate them through staff. Farrell recommended committee members email questions so general counsel could provide precise drafting fixes. The department also offered to bring Sean Gilpin, the housing‑division director, back to provide further technical detail if the committee desired.

Ending: The committee recorded several operational questions for written follow‑up, including whether the administration intended to change homelessness requirements for the 10‑year option, whether accessibility funds require rehabilitation, how many households will be affected when covenants expire, and what agency processes will be used to preserve affordability. The department said it will provide written answers and additional witnesses as needed.