MONTAGUE — A proposal to create the first deed-restricted affordable housing in town in more than a decade took a step forward on Tuesday when the Planning Board voted to recommend the project to the Selectboard.

The idea, outlined by Pioneer Valley Habitat for Humanity, involves building “six all-electric, energy-efficient, detached single-family homes [on First Street] that would be sold to first-time home buyers with low incomes.” With unanimous approval from the Planning Board, the Selectboard is now expected to discuss the project during its regular meeting on Monday.

Habitat for Humanity’s proposal was the only one submitted during Montague’s request for proposals (RFP) period that ended Jan. 25. Planning Board members, agreeing that the proposal largely matched what the town had in mind for the First Street parcel, expressed hopes that the project could be completed within two to four years.

The targeted land on First Street in the village of Turners Falls is municipally owned and one of two parcels within the area’s “Subdistrict B,” with the other under private ownership. The 0.65-acre lot, which formerly contained row housing, is suitable for five to 12 new units, according to Assistant Town Administrator Walter Ramsey.

“Montague has a need to develop approximately 30 deed-restricted affordable housing units in order to meet the town’s 10% affordability goals,” Ramsey explained previously. “That’s defined under [Massachusetts] General Law [Chapter] 40B.”

The First Street subdistrict, along with the former Railroad Salvage site at 11 and 15 Power St., was zoned as a “Smart Growth Overlay District” during last year’s Annual Town Meeting to encourage affordable housing. Smart Growth Overlay Districts are defined by Massachusetts General Law Chapter 40R as “dense residential or mixed-use smart growth zoning districts, including … affordable housing units … in areas of concentrated development such as existing city and town centers, and in other highly suitable locations.” Such zoning changes encourage the development of residential or mixed-use buildings, of which at least 20% of the units would need to be considered “affordable.”

Megan McDonough, executive director of Pioneer Valley Habitat for Humanity, noted in her Tuesday presentation that the organization aims to style the buildings to be “typical of Turners Falls and fit into the neighborhood.” All homes would be two-story, three-bedroom houses, with the exception of one more accessible single-story, two-bedroom house. They would be accessible via the alleyway, with a curb cut on First Street connected to resident parking.

“I think that’s a really great fit,” Planning Board Chair Ron Sicard said of the concept. “I think that it’s what we all envisioned and talked about.”

“The final sale price of the home and mortgage amount will be set based on the income of the buyers so that their housing costs at the time of home purchase do not exceed 30% of their income,” the proposal states. Habitat for Humanity “will commit to a maximum sales price not to exceed $200,000 per home.” For budget purposes, the organization is assuming “a sales price of $125,000 and a down payment of $1,000 per buyer, for a net purchase price of $124,000.”

The project’s total cost is projected at just over $2 million, with each home costing $334,393 to build, according to the proposal. The cost of each building exceeds the intended sales price, so Habitat for Humanity intends to finance the project through the Federal Home Loan Bank of Boston’s Affordable Housing Program, collecting donations within the community and pursuing grant funding.

One major grant opportunity Habitat for Humanity intends to pursue is a MassHousing grant “that could possibly fully fund this project,” McDonough noted. The organization will learn whether it will receive the grant by early April.

Should Habitat for Humanity receive this grant, construction could begin immediately and the project could be completed in two years. Without the grant, although site work could begin immediately, buildout could be delayed while Habitat for Humanity raises money for construction. This could translate to a three-year to four-year completion window. The current projected timeframe for construction spans spring/summer 2023 through spring/summer 2026.

Town Planner Maureen Pollock confirmed that the proposal meets all “minimum threshold criteria” set by the town’s RFP. Each Planning Board member then ranked the proposal through a rubric of “Competitive Evaluation Criteria” on a scale from “highly advantageous” to “not acceptable,” with categories including development experience, developer financial capacity, feasibility of the proposed project, and site and unit design. Habitat for Humanity’s proposal was unanimously deemed “highly advantageous” in the first two categories; split midway between “highly advantageous” and “advantageous” regarding feasibility of the proposed project; and ranked by all but one member as “advantageous” in the “site and unit design” category. Planning Board member Matt Lord ranked the proposal as “not advantageous” in this category because he said it didn’t meet the requirement for “townhouse-style housing” set forth in the RFP.

Reach Julian Mendoza at 413-930-4231 or jmendoza@recorder.com.

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