HYANNIS — When Gov. Charlie Baker signed off on a bill Monday to distribute $4 billion in American Rescue Plan Act fund money and state budget surplus dollars, about $4.8 million came to the Cape and Islands to deal with the region's affordable housing crisis. 

"What we do on housing in the next several years will determine whether or not we will have year-round communities here," said state Sen. Julian Cyr, D-Truro, who co-sponsored a bill with state Sen. Susan Moran, D-Falmouth, that resulted in a big chunk of the ARPA and state surplus money, almost $3.25 million, going to the Housing Assistance Corp.

While $2 million of that money was dedicated to two affordable housing projects in Orleans and Bourne that will create a total of 56 units, it takes years to design, permit and build such developments.

But it's the $500,000 in the bill that is dedicated to what are called accessory dwelling units (ADUs) that has housing advocates hoping for quicker relief from a high-priced, low inventory rental market that is sending the working class over the bridge in search of stable, affordable housing.

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"For the people who work here to live here, we probably need around 4,500 rental apartments," said Shawna Moos, vice-president of strategic initiatives for HAC. Moos was citing numbers from a Cape Cod Commission housing report that was already in need of updating as the pandemic really juiced the region's housing market.

HAC cites Cape and Islands Association of Realtors data showing the median sales price for a single-family home in Barnstable County rose by 23% between 2020 and 2021 to $640,000. Housing inventory dropped by 38% for single-family units and 40.7% for condominiums. 

"This has been a crisis for the past 20 years. What the pandemic did was to put the crisis on steroids. It is now an untenable situation where unless you are fortunate to have family that own a place here or you are wealthy, you can't afford to live here," Cyr said. "Working people can't afford property on Cape Cod and the lack of rental housing is compounding the problem." 

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There's little land left to build a way out of the crisis, as HAC cites data showing 87% of the Cape's land is already developed and 82% has single-family dwellings. That's why the bill contains $250,000 for the Cape Cod Commission to research vacant land in Barnstable County that might be appropriate for affordable housing.

"The waitlist for affordable housing is high and the turnover is low," Moos said. ADUs alone can't solve the rental problem, she said, but they are the fastest, easiest solution and can be permitted and built in months — not years — without a lot of public money invested. 

"We don't have a lot of diversity of housing here," said Moos, with most housing as single-family dwellings on a single lot. Diversity in rental housing is needed for the young to get a start while they're still working lower paying jobs, for workers who are having trouble meeting the high price of home ownership, and for seniors who want to downsize, she said.

"They're not for one particular group of people," said Moos.

ADUs are one- or two-bedroom additions or standalones added to an existing dwelling. They've been widely referred to as "in-law" apartments, where traditionally a parent or parents might live as they age, with family to look after them in the main dwelling. 

In recent years, as the region's housing problems worsened, a dozen Cape towns created accessory dwelling unit bylaws that allow the creation of additional dwelling space of between 600 and 1,200 square feet. But for various reasons not a lot of units were created, and few years ago HAC offered a $1,000 stipend for homeowners who created year-round affordable units on their property. 

That didn't get a lot of response and surveys showed the incentive needed to be larger to attract interest, Moos said.

The $500,000 will largely go to fund forgivable loans of up to $10,000 to homeowners who want to build an ADU. Homeowners may not have the income to undertake a building renovation or new construction to build an apartment on their property. HAC worked with the Cooperative Bank of Cape Cod, Cape Cod 5 and First Citizens Bank to develop new loans that allow them to count a portion of their projected rent as part of their income qualification.  

Moos said details of the program are still being worked out, but requirements would likely include that it be a year-round rental and be rented for a certain period of time, say five years, for the loan to be forgiven.

She said homeowners who want information on their ADU programs can go to Housing Assistance Corp.'s website haconcapecod.org/adu. Moos said HAC will work with the homeowner to help them understand zoning and wastewater regulations in their town to determine what they can build. She encouraged people to contact HAC to do that first.

Moos said news of a higher stipend had already triggered inquiries from homeowners.

"We could end up with several hundred ADUs on line pretty quickly," she said.

Contact Doug Fraser at dfraser@capecodonline.com. Follow him on Twitter: @DougFraserCCT.