Questions and answers about the Second Chance Program

Here are some common questions surrounding the Second Chance program. If you have any others, please use the comments button at the bottom of this post and I’ll do my best to answer them. Cheers. --Grant

Q. What is the goal of the Second Chance program?
A: There are two goals. One, to reduce the ultimate number of homes to be built on the island. Two, to add to our stock of affordable housing. In the proposed bylaw, all new second dwellings after January 1, 2010 would be affordable and available for sale or for rent under affordability guidelines.

Q. How will Second Chance reduce buildout?
A: The program eliminates the incentive of seasonal rentals. In addition, some people have no intention of building a second dwelling, so this bylaw ensures that when their property changes hands, the new owners can only build a second dwelling if it meets certain criteria.

Q. I have no intention of building a second dwelling. Why should I support Second Chance?
A: If you have no intention of ever building a second dwelling, you’re giving up nothing and gaining the knowledge that after you’re gone, your property will be less likely to have a second dwelling. And if it does, it will be affordable and able to help a year-round islander to live here more easily. This will add to the quality of life for everyone.

Q. I might want to build a second dwelling. Does this proposed bylaw take away my rights?
A: It restricts you in some ways, but not in others. You are free to build an unrestricted second dwelling until January 1, 2010. After that, you still have the opportunity to build a second dwelling as long as it is not created for seasonal rentals and meets affordability criteria set forth in the proposed bylaw. There are tax benefits, waived connection fees and exemptions for family members. Read further to learn more.

Q. I need to build a second dwelling to provide housing for my family. Does this article restrict me?
A: Not at all. In fact, under the proposed bylaw, you can build a second dwelling and rent it to a year-round family member for any amount (even one dollar) regardless of your family member’s income. Plus, your assessment will be less (under the Housing Needs Covenant, your house cannot be assessed for more than it’s potential sale price) so your property taxes will be lower.

Q. I already have a second dwelling. Does this effect me?
A: No. This proposed bylaw does not restrict any second dwelling that was built prior to Jan 1 2007. You still have the option of turning your second dwelling onto a covenant house if you so desire, however.

Q. Under Second Chance, can I rent my second dwelling for a period of time and then sell it under the Housing Needs Covenant Guidelines if I ever need the cash?
A: Absolutely.

Q. If I build a second dwelling in the next few years, does Second Chance have any affect on me?
A: No. Second Chance has been intentionally phased in to limit the impact on existing dwellings or anyone’s current plans to build a second dwelling.

Q. What about the building trades? Won't this article negatively impact local
builders?
A: Not likely. There are 200+ houses built on Nantucket each year. That’s double the amount from 2000. Today, we probably have more off-island builders than on-island builders. Most people agree that there will be plenty of building work to be done here for years to come.

Sales and Rental Questions

Q. Can I change my mind between renting my second dwelling to a tenant, selling it, or renting it to a family member under the proposed bylaw?
A: Yes. You may choose from any of the three options as your situation changes.

Q. Who is going to enforce the rental covenant to make sure they stay year round and affordable?
A: The Housing Authority or its designee, currently the Nantucket Housing Office are responsible to enforce the NHNC. In fact, they are enforcing them right now.

Q. Can I move out of my primary house and move into my secondary dwelling and sell or rent the primary when I’m older and may need the money?
A: Yes. If you income-qualify. That’s a primary benefit of the program.

Q. How can I compute the rent I could get under the covenant? I need to figure out whether I should vote for this or not.
A: Maximum allowable rental income is over $3,000 a month, under current guidelines, adjusted annually. Actual rent will be determined in the transaction between landlord and qualified tenant in the open marketplace. $3,000 is still higher than market rates which are currently sagging.

Q. If my renter starts to make more money than 150% of the area median income (Currently $120,825) does she have to move out?
A: No. The income requirement is only to qualify the renter initially. Second Chance is designed to help year-round residents get ahead. If your renter is gaining ground financially, that means it’s working!

Q. Who decides who rents my second dwelling?
A: You do. The Housing Office or Housing Authority will pre-qualify renters. You, as landlord, are free to select any qualified renter you wish.

Q. Can I build a new second dwelling and just rent to summer people?
A: Under the Second Chance plan, No. Rentals would need to be year round to a qualified renter.

Tax Questions

Q. What are the tax implications of the proposed new bylaw?
A: Your assessment is capped at the Nantucket Housing Needs Covenant (NHNC) limit (currently $445,164) or lower. And a reduced buildout for Nantucket in general will reduce future property tax increases for a host of things we won’t need to build like new roads, schools, etc.

Sewer Questions

Q. What about a sewer connection fee? I hear those may go up. Won’t any savings in taxes be offset by a high sewer connection fee?
A: No. Under Second Chance, sewer connection fees are waived for new second dwellings. A win-win situation.

Q. What impact will Second Chance have on sewer upgrade/expansion costs?
A: A positive one. By reducing the potential buildout, we reduce the size new plants need to be made and we lengthen the useable lifespan of existing plants. (Keep in mind, 75% of all potential buildable dwellings on Nantucket are second dwellings.)

Zoning Questions

Q. Why don’t we just ban second dwellings outright?
A: Many year-round islanders simply need second dwellings to make ends meet here. Second dwellings have allowed many Nantucketers an entrée into the housing market that was otherwise not possible. Others build second dwellings to make it possible for family to live here. Second Chance will not only ensure that these opportunities continue, but it also gives hope and opportunity to buyers in the $400,000 range who can buy under the Nantucket Housing Needs Covenant. (NHNC)

Q. Why don't we just re-impose the building cap?
A: A building cap may slow down building but it doesn’t lower the ultimate buildout potential. And, as we know, building caps can be repealed.

Q. This is America. What about my property rights?
A: Any zoning bylaw is, by definition, a limitation on property use. Currently, unless you live in a residential/commercial district, you can’t put a pizza parlor in your home, and you can’t rent your backyard out as a parking lot. Most of America doesn't even allow second dwellings. And keep in mind, this process is a wholly democratic one. Changes to the zoning bylaw require a supermajority of 2/3 at town meeting to go into effect. If the island does not want this change, it simply will not happen.

Have more questions? Email me: grant@yackon.com. Or post a comment below. Anonymous comments are welcome.

Nantucket first!