Governor Phil Scott announced Thursday the successful sale by Vermont Housing Finance Agency (VHFA) of Vermont’s first Sustainability Bonds. The bonds sale raised $37 million to fund the “Housing for All” initiative, the largest state investment in housing in several decades. Proceeds from the sale of the bonds will be awarded by the Vermont Housing Conservation Board (VHCB) for constructing and rehabilitating 550-650 homes statewide over the next two to three years. Vermont investors played a critical role in the success of the bond sale.
“As we work to create greater opportunity for Vermonters and attract more families to Vermont, decent housing Vermonters can afford is critical. The Housing for All initiative we passed last year is an important step toward addressing that need,” Governor Scott said. “We appreciate the hard work of our partners in ensuring a successful bond sale, and those individuals and institutions who chose to invest in Vermont communities.”
VHFA and VHCB chose the Sustainability Bonds designation to allow institutions and individuals to invest directly in bonds that finance affordable housing, promote environmentally friendly development, stimulate economic growth, and revitalize Vermont communities. The bond sale, which closed on January 25th, was well-received on the market, with seven times more orders than available bonds. The sale raised $2 million more than originally anticipated. The bond sale attracted many Vermont investors, including People's United Bank and The Vermont State Employees Credit Union.
"We were very pleased to use our experience working with our financial partners and investors to maximize the funds raised for this important initiative," remarked VHFA's Executive Director Sarah Carpenter.
Proceeds from the sale will fund the Housing for All initiative to develop housing for the low- and moderate-income working Vermonters who often struggle to afford decent housing. Vermonters have similar incomes to the rest of the U.S., but median home prices in Vermont exceed the national level by $20,000.
VHCB will target proceeds from the bonds towards eligible projects that rehabilitate or construct affordable housing while conserving Vermont’s natural resources and history. VHCB will ensure that at least 25% of the housing will be affordable to very low-income households with incomes below 50% of the area median and at least 25% to households with incomes between 80% and 120% of the area median. Median income in Vermont in 2017 was $69,300 for a family of four, according to estimates from the U.S. Department for Housing and Urban Development.
“The bond sale exceeded expectations due to the VHFA’s hard work, the support of the Legislature and commitment of the Scott administration,” said Gus Seelig, Executive Director of VHCB. “The $37 million is already creating more homes for workers and housing for vulnerable Vermonters in communities across the state. We are reviewing a stream of applications and encourage those with potential projects to contact us soon.”