Champlain Housing Trust

Established in 1984 (Burlington, Vermont)

Profile contributed by Brenda Torpy (2015)

The Champlain Housing Trust (CHT) was born in a small city with a big idea: by creating a stock of permanently affordable housing everyone could have access to a decent, affordable home, regardless of income. This was the grand vision of a newly elected progressive government led by Mayor Bernie Sanders who came into office in 1981, the same year as Ronald Reagan began his own two-term presidency.

The Reagan Revolution forced the Sanders’ administration to develop innovative solutions for Burlington, Vermont’s housing problems within the context of the federal withdrawal of needed funding from affordable housing and community development programs.  Equally challenging were double-digit mortgage rates that prevailed during the early 1980s, the threatened gentrification of Burlington’s traditional working class neighborhoods, and the long-standing neglect of housing quality and affordability issues by previous mayors, who had favored downtown commercial development and bulldozed low-income neighborhoods in the name of urban renewal.

A cornerstone of the progressive agenda was to open up city hall and to all citizens – especially those who had been previously excluded – in decisions about city planning and public funding.  The CLT model discovered by a Progressive Party alderman named Terry Bouricius looked like a good fit.  The model’s democratic structure and its commitment to permanent affordability made a lot of sense in a city where housing costs seemed to rise in every economic cycle, where a lack of code enforcement and the absence of landlord-tenant law made low-income tenants nearly powerless in the overheated housing market, and where proposed waterfront development adjacent to the city’s lowest-income area, the Old North End, threatened further gentrification.

When Mayor Sanders created the Community and Economic Development Office (CEDO) in 1982 to help implement his progressive agenda, work on establishing a community land trust soon got underway.  CEDO sent three employees to the first national CLT gathering in Voluntown Connecticut, hosted by the Institute for Community Economics.  Included in this CEDO delegation were Michael Monte, the city’s community development director, and Brenda Torpy, the city’s housing director.  At the Voluntown conference, they met John Davis who was a technical assistance provider on ICE’s staff.  A few months later, CEDO contracted with ICE to bring him to Burlington to introduce the CLT idea to Burlington’s citizens and to see if it would take root.

CEDO saw its primary role as engaging citizens to address their own needs and problems and then supporting them with funding and technical assistance.  So it was for the CLT effort.  People heard about this new approach to affordable housing and very quickly embraced it.  These stakeholders included tenant rights activists and neighborhood leaders, affordable housing experts, and other advocates for social and economic justice.

The Burlington Community Land Trust was incorporated in 1984 after thousands of hours of volunteer work.  Recruited and coordinated by CEDO staff, these volunteers formed by-laws, developed policies, and fashioned strategies for funding the organization and for producing housing.  Among the BCLT’s incorporators was Howard Dean, the state’s future governor, and Sara Carpenter, the future director of the Vermont Housing Finance Agency.  The Old North End was chosen as the BCLT’s first designated Target Area.

In addition to the assistance received from CEDO staff and from the ICE staffer assigned to Burlington under a CEDO contract, the city supported the fledging CLT effort with a $200,000 seed grant for operations, a pair of million-dollar loans from the Burlington Employee Retirement Fund, and a negotiated loan-pool from a local bank.  The BCLT later received regular municipal funding for its operations and projects through federal funds that passed through the city’s hands, including monies provided by the CDBG program and the HOME program, and from local funds disbursed by Burlington’s Housing Trust Fund.

The Burlington Community Land Trust was the first municipally supported CLT in the United States, a direct result of the City of Burlington’s general embrace of permanent affordability as the only socially equitable and fiscally prudent way for the public to create and to sustain affordable housing.  Bernie Sanders and his immediate successor, Mayor Peter Clavelle, were outspoken champions of decommodified housing.  Both administrations acted to codify this principle into municipal policy and municipal ordinances.  Their goal was to ensure that any public investments in affordable housing would go primarily – even exclusively – into housing that would be kept permanently affordable.

As they worked to create new resources for the development of affordable housing, therefore, they also worked to ensure the lasting affordability of any housing produced with those resources.  This twin commitment to expanding the supply of housing and to preserving the affordability of that housing was woven into the Housing Trust Fund, capitalized through a penny increase on the property tax rate; the Inclusionary Zoning ordinance, where the affordability of all IZ units had to be preserved for 99 years; and ordinances regulating the conversion of rental housing to condominiums and the loss of existing housing because of demolition or conversion to commercial uses.

Creating these laws required the active participation of many of the same neighborhood activists and housing advocates who had come together to create the BCLT in 1984.  The board and staff of the BCLT were actively involved in all of these legislative efforts to expand funding for affordable housing, as well as several unsuccessful campaigns to enact ordinances to protect the rights of vulnerable renters, including an anti-speculation tax and just cause eviction.

There continued to be considerable overlap between city government, the Progressive Party that had helped to elect Bernie Sanders, and the BCLT, during the latter’s early years.  The BCLT’s first executive director was Tim McKenzie, a neighborhood activist who had helped to mobilize voter support for Bernie’s first successful campaigns for mayor.  Gretchen Bailey, an Assistant City Attorney who had been one of Bernie’s first hires, conducted much of the legal research that enabled the BCLT to craft a ground lease compatible with Vermont law.  The first board president of the BCLT was Brenda Torpy, who continued to serve as the city’s housing director, until moving into a job at the Vermont Housing Finance Agency.  She was succeeded in the housing director’s job by John Davis, the ICE employee who had assisted CEDO in establishing the BCLT.

Although Burlington was the fulcrum and the leader of the effort in Vermont to make permanent affordability the cornerstone of all housing policy, overheated market conditions throughout the state and a friendly administration in Montpelier, led by Governor Madeline Kunin, helped the state’s housing advocates to bring the CLT model and other progressive solutions to the attention of the Vermont legislature and to incorporate a priority for permanent affordability into an increasing number of state laws and plans.  Vermont began experiencing a wave of speculative development in the 1980s that threatened its traditional agricultural landscape.  Conservationists and housing advocates found themselves united in their opposition to the threat of unfettered land speculation, luxury development, and gentrification.  Vermont was also one of the states hit the hardest by the loss of federally subsidized, privately owned rental housing as the affordability restrictions expired on these projects.

One powerful outcome of this convergence of issues was the creation of the Vermont Housing and Conservation Board (VHCB), funded by a portion of Vermont’s property transfer tax to preserve open space, farms, historic landmarks, and affordable housing.  The priority recipients of the grants disbursed by VHCB were to be a network of nonprofits doing land conservation or affordable housing that would be called upon to steward these land-based resources permanently.  VHCB helped to sustain the operations and projects of community land trusts not only in Burlington, but throughout the state.  Indeed, a new crop of CLTs became the principal means by which VHCB sought to accomplish its affordable housing mission.

The Burlington Community Land Trust was able to grow and to thrive in this policy environment where government embraced the principle of permanent affordability and directed capital toward sustaining the residential projects and nonprofit organizations that turned that social principle into the sticks and bricks of new housing.  The BCLT has also benefited, along with other CLTs in Vermont, from the unusual degree of cooperation that exists in Vermont among housers, conservationists, and preservationists.  Such solidarity has helped to ensure on-going funding for VHCB, a primary source of capital for the housing developed by the BCLT and by the state’s other CLTs.

BCLT’s founding real estate strategy was twofold: to expand homeownership by creating a resale-restricted, leased-land homeownership product/program that would be accepted by public funders, private lenders, and prospective homebuyers; and to improve the Old North End, a neighborhood with an aging housing stock that was in poor condition but losing its affordability for the city’s lower income citizens because of its proximity to the downtown, the waterfront, and the University of Vermont.

On the homeownership side, the first challenge was to gain acceptance for the CLT model and, in particular, its separation of land and improvements.  This dual-ownership model scared lenders and daunted appraisers.  There were few other CLTs to point to in the early 1980’s.  Thus there was no track record to reassure skeptical lenders and public leaders that, first, there would be a market for limited equity homes on leased land, and second, that the benefits would outweigh the risks to either buyers or lenders.  Even Bernie Sanders worried that this might be “second class homeownership for working people.”

The BCLT also faced the wrath of private realtors and for-profit developers who objected strenuously to the removal of land and housing from the speculative market.  Some of them organized Homeowners Against the Land Trust (HALT) to oppose a proposed BCLT development in which single-family detached houses were to be built on donated land.  They picketed City Hall, singing “Oh give me a home with land that I own,” set to the tune of Home Home On the Range.

It was a stark reminder that what the BCLT was committed to doing was a scary departure from business as usual.  Burlington’s progressive government may have embraced permanent affordability as a necessary response to the inequities of a profit-oriented housing market and as a way to retain the value of the public investment in housing, but that didn’t mean that the private sector – or the NIMBYees surrounding BCLT housing – were ready to do so.

The BCLT looked to the state’s Housing Finance Agency (VHFA) for help, appealing to their public mission and offering a new tool at a time of double-digit mortgage rates.  After much hemming and hawing, VHFA accepted the CLT model, but only half-way.  Their solution to getting their participating banks to chance this new thing was to create a rider to the ground lease that gave the bank the option to take the entire property (land and home) if BCLT did not cure a default in a specified time.  The BCLT reluctantly agreed to this bargain and began to engage with local bankers who did, in time, become ardent supporters of the community land trust – especially when they realized there were virtually no foreclosures among the low-income homeowners being served by the BCLT.

The first home purchased by the BCLT was a vacant, single-family house.  It had been spotted by a single mother, an assistant librarian named Kathy Neilson who had happened to attend a public forum at the library introducing the BCLT.  Kathy wanted a decent and secure home in which to raise her two daughters and volunteered to be the “guinea pig” for the new model of tenure that the BCLT was trying to establish.

As the BCLT’s founders continued to worry their way through all the structures and policies for the new CLT and continued to negotiate with VHFA to create a mortgage product for resale-restricted homes on leased land, Kathy and her daughters cleaned up the site of what she hoped would be her new home.  By autumn, she told the new BCLT board:  “I mowed the grass all summer, and I’m raking the leaves now, but I will not plow the snow unless I am living there.”

Goaded by this passionate, prospective homebuyer who was growing a bit impatient with how long it was taking to put a roof over her head, the BCLT’s leaders speeded up their efforts to get this deal done.  All the pieces were pulled together and BCLT had its first closing in 1985.  Kathy Neilson got her home at last.

The Vermont Housing Finance Agency went on to create a favorable product for CLTs.  It has since written over $80M in mortgages for BCLT/CHT homes.  VHFA’s support introduced the model to all of the banks that use their funds and integrated the CLT mortgage into local lending.  To date, 41 different lenders have made mortgages to BCLT/CHT homebuyers.  The organization now has a portfolio of 540 owner-occupied houses and condominiums (as of 2015) – in addition to approximately 2100 homes that are owned and managed as rental or cooperative housing.

Another boost to the BCLT’s homeownership program came in 1997, when the BCLT joined the NeighborWorks Network.  This allowed the BCLT to access resources of the National Homeownership Campaign for the CLT’s homebuyers.  At that time, NeighborWorks was not known for its support of shared equity homeownership.  The BCLT was one of the voices that helped to change their position by demonstrating that a homeownership model like the BCLT’s could be successful, productive, and highly sustainable.

On the neighborhood development side of its mission, the BCLT quickly evolved beyond its initial anti-gentrification commitment to the Old North End.  At the outset, the BCLT had strategically purchased multi-family properties in the Old North End to avert tenant displacement.  The initial plan was to convert these properties into small, limited equity cooperatives, but ultimately this model was not successful.  Most residents preferred a social landlord to self-management and reverted back to a rental structure after experimenting for awhile with co-op ownership and management.  Today, the surviving cooperatives are the larger ones, mostly zero-equity co-ops financed with Low Income Housing Tax Credits.

By the 1990s, the BCLT had resigned itself to the reality of possessing a growing portfolio of rental housing and had accepted the necessity of building an internal capacity to be a good social landlord.  At first, it managed a relatively small number of scattered-site, rehabilitated rental properties, primarily in Burlington’s Old North End.  It also gradually assumed the broader community development role in the neighborhood.  Throughout the decade, the BCLT redeveloped polluted sites and returned abandoned and blighted properties to community use, including residential properties, a pocket park, a food shelf, a multi-generational community center, and buildings for nonprofit offices.

Also in this decade, the BCLT expanded its service area beyond the City of Burlington area to encompass all of Chittenden County and, later, all three northwest counties of Vermont, bordering Lake Champlain.

The BCLT’s greatest change and biggest leap came in 2005, when the leaders of another nonprofit housing organization, the Lake Champlain Housing Development Corporation (LCHDC), invited the staff and board of the BCLT to explore a more formal alliance and, possibly, a merger.  By that time, decades of HUD cutbacks and a draconian shredding of the social safety net by a succession of federal administrations were putting both nonprofits at risk.  It was no longer feasible for LCHDC and the BCLT to share a relatively small service area of 200,000 people and to compete for a scarce supply of dollars, sites, and political support.  LCHDC possessed a large rental portfolio of 1,200 apartments.  The BCLT had a portfolio of 700 homes, divided equally between rental and ownership.  Neither was large enough to be truly sustainable.

After nearly a year of conversation, negotiation, and planning, the two organizations decided to merge into one.  The BCLT was chosen to be the surviving corporation due to its strong membership base, broad donor support, and diversity of programs and funding sources, including those resources available through the BCLT’s membership in NeighborWorks. The name chosen for the newly merged corporation was the Champlain Housing Trust.

The model of membership and governance of a “classic” CLT was embraced by both boards during the negotiations leading up to the merger, but that structure was modified slightly to incorporate LCHDC’s strong link to the municipal governments that had come together to create LCHDC back in 1984.  The Champlain Housing Trust has continued to be structured as a membership organization with a tri-partite board.  A third of the governing board’s directors are homeowners, renters, or coop members who live in one of the 2,650 homes in CHT’s portfolio.  A third of the board is made up of representatives of CHT’s general membership: people who live within CHT’s service area and support CHT’s mission, but who do not live in a CHT home.  A third of the board is made up of officials from the public sector, drawn from various municipal governments and regional bodies within CHT’s three-county service area.

The production, management, maintenance, and stewardship of CHT’s ever-expanding portfolio of permanently affordable housing currently occupies a staff of 90 exployees, headquartered in Burlington.  This portfolio serves CHT’s vision of providing a diverse continuum of housing options for low-income and moderate-income households, ranging from shelters for the homeless, community homes with built-in services, conventional rentals, limited equity cooperatives, limited equity condominiums, co-housing, and resale-restricted houses on leased land.  CHT’s staff also provides a rich mix of services for homeowners and renters alike in order to help them to succeed in the housing that is theirs and, when possible, to move along this continuum to achieve the type and tenure of housing that is best for them.

CHT continues to be a leader in state-wide housing coalitions in Vermont, as well as being heavily invested in activities of the National CLT Network and other national groups advocating for affordable housing legislation and funding.  In 2009, CHT received the United Nations World Habitat Award for the Global North, recognizing the fiscal, environmental and social sustainability of CLT model.  This brought international attention and acclaim for CHT’s distinctive approach to the decommodification of housing and helped to hasten the spread of the CLT model to other countries, including Australia, Belgium, and the United Kingdom.

To learn more about the Champlain Housing Trust, past and present:

• Champlain Housing Trust website
• John Emmeus Davis, “Building the Progressive City.” Pp. 165-200 in J.E. Davis (ed.), The Affordable City (Philadelphia: Temple University Press, 1994).
• John Emmeus Davis and Alice Stokes, Lands in Trust, Homes That Last, Champlain Housing Trust, 2008.
• Kenneth Tempkin, Brett Theodos, and David Price. Shared Equity Homeownership Evaluation: Case Study of Champlain Housing Trust.  Washington, DC: The Urban Institute. 2010.
• Brenda Torpy, “ The Community Land Trust Solution: The Case of the Champlain Housing Trust.” Pp. 64-66 in Christopher Niedt and Mark Silver (eds.), Forging a New Housing Policy: Opportunity in the Wake of Crisis (National Center for Suburban Studies, Hofstra University, 2010).