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Board discusses lottery design, New Shoreham carve-out, AMI cap and monitoring for affordable units
Summary
Legal advisor Karen told the board lotteries are allowed if they comply with the Rhode Island Fair Housing Act; she recommended an 80% resident / 20% open split as a conservative approach and explained monitoring and the town’s statutory carve-out for New Shoreham that allows a higher AMI cap.
The Block Island Housing Board spent a major portion of its Dec. 9 meeting on eligibility rules for the O’Brien affordable units, hearing legal guidance on lotteries, income caps and monitoring.
Karen (Unidentified Speaker 5) told the board that "there's no prohibition on conducting a lottery, so long as it's not discriminatory and complies with the Rhode Island Fair Housing [Act]." To reduce the risk of an outcome that would disproportionately exclude protected classes, she recommended a conservative model that prioritizes local residents while leaving units open to non-residents: "One way to protect against that is 80% of the units prioritized for residents, and the remaining 20% open to all applicants," she said.
Karen also advised the board on a local statutory carve-out affecting eligibility. She said New Shoreham is "expressly exempted from certain things" under a state carve-out cited in the transcript (cited there as "1-28-8.1"). According to her guidance, that carve-out permits a higher eligibility cap for Block Island—she referenced a 140% adjusted gross income threshold (AMI) as the applicable limit under that local statute for qualifying purchasers on Block Island.
On sales and monitoring, Karen said the housing board may sell units to a public entity (such as the town or school district) and noted that to count toward the town’s affordable-housing percentage the units must meet the same income, deed restriction and monitoring standards. She explained monitoring is typically required when state or federal funds are used and recommended reviewing the state's approved monitoring-agent program for implementation options.
Board members asked practical questions about how a lottery would work in practice: whether the lottery could draw proportionally from resident and open pools to ensure an 80/20 outcome and how to treat seasonal employees. Karen advised the board to define "resident" in local ordinance language (the town's existing general definition references nine months of occupancy) or include a definition specifically for housing-board lotteries.
Next steps: the board asked staff to consider ordinance language, define residency criteria for the lottery and include employee categories (full-time, seasonal, or job-offer contingent) in further drafts. Karen and the board will continue refining the structure before a formal lottery process.
