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AFL-CIO Housing Investment Trust pitches union-built financing to Vermont committee
Summary
AFL-CIO Housing Investment Trust officials told the House Housing in General committee that HIT can provide construction and permanent financing for union-built affordable housing if Vermont sets labor standards or dedicates subsidy pools; officials cited $7.3 billion in HIT capital and examples from Nevada and Connecticut.
JP Isabel, executive director (state contact) for the AFL-CIO, and Eric Forman, director of housing policy for the AFL-CIO Housing Investment Trust (HIT), presented to the House Committee on Housing in General on Feb. 12, describing HIT’s financing model and how it might be used in Vermont.
Eric Forman said HIT is a "$7,300,000,000 social impact mutual fund" that invests union pension dollars in housing built with union‑represented labor and that HIT’s track record includes tens of billions in invested capital and projects nationwide. Forman outlined the fund’s financing approach—providing construction financing (typical share: about 65%–80% of project cost) and permanent takeout financing—and stressed that a practical pathway to HIT investment is a state or local subsidy pool (for example, set‑aside bond proceeds or a state infrastructure bank) paired with project‑level labor standards such as a project labor agreement or prevailing wage requirement.
Why it matters: HIT officials argued that aligning subsidy policy with labor standards can attract outside capital while producing family‑sustaining jobs. Forman cited recent examples: a $20 million revolving account in Nevada that leveraged HIT capital to finance 208 affordable units in Reno and an active Connecticut program backed by a $50 million commitment. He told the committee that HIT seeks projects where workers are union‑represented, and that, in HIT’s view, projects with those labor standards are more likely to yield long‑term economic and tax benefits.
Committee members asked technical questions about underwriting (construction vs. permanent financing), whether HIT ever takes subordinate positions, and how HIT could work with modular or manufactured housing in rural settings. Forman said HIT generally acts as a senior construction lender but has mezzanine options in special cases and that off‑site modular production can be financed when factory work is performed under a collective bargaining arrangement.
Next steps: HIT representatives encouraged further conversations with the state treasurer’s office, VHFA and local developers to identify pilot projects. The committee invited HIT to provide more detailed designs on subsidy set‑asides and workforce agreements so staff can assess legislative options.
