The House Ways & Means Committee unveiled its FY24 budget and an accompanying tax package last week. The pair of bills call for investing more than $1 billion to respond to the state’s housing crisis. This is roughly double the state’s annual housing spend pre-COVID. Unfortunately, the House departed from the Healey administration and left out a long-awaited increase to the Housing Development Incentive Program (HDIP).

Four years since Gov. Baker first proposed lifting the HDIP cap to $30 million, the program remains limited to just $10 million per year. Thousands of apartments that could have been built with this tool haven’t been. In a state where suburbs severely restrict housing development and projects don’t pencil out in many urban communities, it’s getting harder and harder to house a growing population.

For years, Gateway City leaders have fought for HDIP because it’s the only housing production tool that attracts private investment to fragile real estate markets, aside from affordable housing programs, which restrict occupancy to those with limited incomes. Building homes where middle-income residents can live means more patrons with disposable income to support local small businesses. New housing for middle-income renters enables upwardly mobile young people to live and work in the communities where they grew up. These market-rate apartments will also lead to a larger middle-class to reduce harmful concentrations of poverty in many Gateway City schools.

While these arguments remain compelling, it is equally important to recognize that HDIP is a powerful production tool in a state where every region lacks sufficient housing. More supply is the only way to keep prices from climbing for households at all income levels.

The post-COVID housing crunch is creating especially intense challenges for Gateway City residents. Households priced out of Boston have flocked to these relatively affordable communities, driving up rents for current residents. But rents still aren’t high enough to stimulate housing production because construction and financing costs have risen at an even faster pace. With growing populations and a fixed supply of housing, many long-time Gateway City residents can no longer afford their apartments.

When Gateway City housing is too expensive, few options remain. Homelessness has become a very real prospect for thousands of families who thought they would never find themselves in such dire positions. This reality is forcing the legislature to find more and more dollars to help keep them in their homes, but it doesn’t get to the root of the production problem.

Long-term, this is a bad deal for taxpayers and it’s terrible for Gateway Cities. Chronic housing instability exacts a heavy toll. Residents who are worried about keeping a roof over their heads experience an array of health problems. They are less productive at work. They move more frequently, which disrupts neighborhood social networks, undermining public safety and creating yet another challenge for public schools.

Housing projects take years to plan and develop. Every year that we produce less than we need means it will take more time to get out from under the problem. Recognizing this, Gateway City mayors have made HDIP their foremost legislative priority. While there is much to like about the House budget, including full funding for Early College expansion and a much larger share of Question 1 revenue for regional transit agencies, we simply can’t afford to wait any longer on a fix to Gateway City housing production challenges. New Bedford Rep. Antonio Cabral, the House chair of the Gateway Cities Legislative Caucus, has filed amendment #804 to address backlogged projects and unlock the 1,700 shovel-ready apartments awaiting these funds. Adopting this amendment will position Massachusetts to tap a deep reservoir of housing potential on offer in our Gateway Cities.

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