GLOSSARY OF AFFORDABLE HOUSING TERMS

MassachusettsHousingPartnership

HousingInstitute2014

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GLOSSARYOFAFFORDABLEHOUSINGTERMS

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AccessoryApartment

Asecondarydwellingunitcreatedwithinorasanextensionofanexistingdwellingthatcontains

separatebathandkitchenfacilities.

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AdaptiveReuse

The conversion of nonresidential properties such as mills, schools, hospitals, military bases, motels,

warehouses,officebuildings,etc.intoresidentialormixeduses.



AreaMedian

Income(AMI)

The estimated median income, adjusted for family size, by metropolitan area (or county, in non‐

metropolitanareas).AMIisupdatedannually bytheUSDepartmentofHousing andUrbanDevelopment

(HUD)andusedasthebasisofeligibilityformosthousingassistanceprograms.

www.huduser.org

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Brownfields

Anabandoned,idled,orunderusedpropertywhereexpansionorredevelopmentiscomplicatedbyreal

orperceivedcontamination.Brownfieldsitesincludeabandone d factories andotherindustrialfacilities,

gasolinestations,oilstoragefacilities,drycleaningstores,andotherbusinessesthatformerlydealtwith

polluting substances. Information about the state’s brownfields redevelopment

 fund can be found at:

www.massdevelopment.com

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Citizens’Housing&PlanningAssociation(CHAPA)

Established in1967,CHAPA is a statewide non‐profit umbrella organization foraffordablehousing and

communitydevelopmentactivities.CHAPA’smissionistoencouragetheproductionandpreservationof

housingaffordabletolow‐incomefamiliesandindividuals.

www.CHAPA.org

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Chapter40B

Thestate’sComprehensivePermitlaw,enactedin1969,establishedanaffordablehousinggoalof10%

for every community. In communities below the 10% goal, developers of low and moderate income

housingcanseekanexpeditedlocalreviewunderthecomprehensivepermitprocessandcanrequesta

limited waiver

 oflocalzoningandotherrestrictionswhichhamper construction of affordablehousing.

Developerscanappealtothestateiftheirapplicationisdeniedorapprovedwithconditionsthatrender

ituneconomicandthestatecanoverturnthelocaldecisionifitfindsitunreasonableinlightoftheneed

for

affordablehousing.(Chapter774oftheActsof1969;M.G.L.c.40B§20‐23).

www.mass.gov/hed/community/40b‐plan

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Chapter40R

AlsoknownastheSmart GrowthZoningOverlayDistrictAct (Chapter 149 oftheActsof2004), M.G.L.

Chapter40Rencouragescommunitiesthroughfinancialincentives tocreatedenseresidentialormixed‐

usesmartgrowthzoningdistrictswhichincludea highpercentageofaffordablehousingunits,located

near transit

 stations and/or in areas of concentrated development such as existing city and town 

centers.

http://www.mass.gov/hed/community/planning/chapter‐40‐r.html

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MassachusettsHousingPartnership

HousingInstitute2014

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CommunityDevelopmentBlockGrant(CDBG)

The Community Development Block Grant (CDBG) program is a federal program that provides

communities with resources to address a wide range of unique community development needs. The

Department of Housing and Urban Development (HUD) provides  funding either directly to larger

municipalities designated as entitlement communities or

 through the Massachusetts De partment of

Housing and Community Development’s CDBG program.

www.mass.gov/hed/community/funding/community‐development‐block‐grant

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CommunityEconomicDevelopmentAssistanceCorporation(CEDAC)

Aquasi‐publicagencycreatedbytheLegislaturein1978toprovidedevelopmentassistancetononprofit

developers in order to increase the supply of affordable housing and help revitalize chronically

distressedareas. Bystatute,itcanonlyprovideservicesto nonprofitcorporations.CEDACmaintains

a

databaseontheirwebsiteofover1,400propertiesstatewideatriskoflosingtheiraffordability.

www.cedac.org

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CommunityPreservationAct(CPA)/Chapter44B

The Community Preservation Act Enabling Legislation (Chapter 267 of the Acts of 2000). Allows

communities, at local option, to establish a Community Preservation Fund to preserve open space,

historicresourcesandcommunityhousing,byimposingasurchargeofup to3%onlocalproperty

taxes.

ThestateprovidesmatchingfundsfromitsownCommunityPreservationTrustFund,generatedfroman

increase in certain Registry of Deed’s fees.The Community Preservation Coalition (CPC) works  with

communities,andadvocatesandsupportsthepassageofCPA.

www.communitypreservation.org

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CongregateHousing

Housing accommodation that offers separate rooms or apartments but provides shared activities of

dailylivingwithotherresidents.

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ConservationEasement

Alegalagreement,oftenusedtopreserveruralareasorgreenfields,inwhichagovernmentornonprofit

canpurchaseapropertyinreturnfortheguaranteeof

preservingitfromdevelopment.

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Co‐operative(co‐op)

Aformofsharedownershiphousingwhereallresidentsownstockinthecorporationthatownsthe

property.Theydonotowntheirunits,butco‐opshareownershipentitlesaresidenttoalong‐term

leaseonaunitanda

voteinthegovernanceoftheproperty.Limitedequitycooperativesareaformof

affordable,resident‐controlledhomeownershipinwhichtheindividualsharepurchasepricesarevery

lowsothattheresidentdoesnotneedmortgagefinancingtobuyin.Likerentalproperties,co‐opsmay

besyndicatedtoraisemoney

fortheconstruction.

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CottageHousing

CottageHousingisgenerallydefinedasagroupingofsmall,singlefamilydwellingunitsclusteredaround

acommonareaanddevelopedwithacoherentplanfortheentiresite.Theyha vegainedpopularityin

recentyearsasatypeofinfilldevelopmentonsmallsites,

withinexistingdevelopedareas.Thecottage

unitsmayhaveothersharedamenities.Thesharedcommonareaandcoordinateddesignallow

densitiesthatarehigherthantypicalsinglefamilyneighborhoods,whileminimizingimpactsonadjacent

residentialareas.

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MassachusettsHousingPartnership

HousingInstitute2014

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Deferredloan(a.k.a.deferredpaymentsecondmortgageorsoftdebt)

Debt (borrowed money), often from a public or charitable source, repayment of which may be

postponed for a specified period of time, indefinitely, of forgiven entirely, if the property maintains

certain levels of affordability for a defined time period.Most deeply

 affordable housin g  needs some

typeofdeferredloaninordertobefeasible.

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DepartmentofHousingandCommunityDevelopment(DHCD)

MassachusettsDHCDisthestate’sleadagencyforhousingandcommunitydevelopmentprogramsand

policy.Itoverseesthestate‐fundedpublichousing,administersrentalassistanceprograms,includingtax

credits, provides

funds for municipal assistance, and funds a variety of programs to stimulate the

developmentofaffordablehousing.

www.mass.gov/hed

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DepartmentofHousingandUrbanDevelopment(HUD)

The U.S. Department of Housing and Urban Development’s mission is to create strong, sustainable

communities and quality affordable homes.HUD administers hundreds of programs targeting

communitiesfromurbantorural.

www.hud.gov

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EntitlementCommunity

A city or urban county of at least 50,000 in population making it eligible for Community Development

BlockGrant(CDBG)fundsdirectlyfromHUD.



ExpiringUseRestrictions

Refersto affordablehousingwheretherestrictionsonrents and/orincomesofoccupants couldorwill

expire in the near

future if owners prepay their publicly assisted mortgages and convert the units to 

market rate housing. The units were built with federal and/or state subsidies  (such as low cost

mortgages, interest subsidies, rent subsidies and loan guarantees). While mortgages and other

assistanceoftenhadtermsaslongas30‐40years,

manygaveownerstheoptiontoprepaythemortgage

after20yearsandthusremoveuserestrictionsontheproperty.AlsoseeCEDAC.

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FairHousingAct/MAFairHousingAct

Federallegislation,firstenactedin1968andexpandedbyamendmentsin1974and1988,thatprovides

theSecretaryofHUDwith

investigationandenforcementresponsibilitiesforfairhousingpractices.The

law prohibits discrimination in housing and lending based on race, color, religion, sex, national origin,

handicap, of familial status. There is also a Massachusetts Fair Housing Act, which extends the

prohibition against discrimination to sexual orientation, marital status, ancestry, veteran status,

children,andage.Thestatelawalsoprohibitsdiscriminationagainstfamiliesreceivingpublicassistance 

orrentalsubsidies,orbecauseofanyrequirementoftheseprograms.



FairMarketRents(FMRs)

Maximum rents allowed by HUD in the Section 8  rental assistance program. Updated and published

annually, FMRs represent HUD’s estimate of the

 actual market rent for an apartment in the

conventionalmarketplace.HUDsetsFMRsbyunitsize(0bedroom,1bedroom,etc.)andregions within

each state. The current FMRs are posted on HUD’s website:

http://www.huduser.org/portal/datasets/fmr.html

.

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MassachusettsHousingPartnership

HousingInstitute2014

 4

FederalHomeLoanBankofBoston(FHLBB)

Oneofthe12districtbanks,theFHLBBcoversthe6NewEngla n dstatesandisownedbymorethan460 

NewEnglandfinancialinstitutions.Awholesalebank(abankforbanks),itprovidesaccesstocreditfor

itsmembersandadministersseveralgrant

andloanprogramstopromotecommunitydevelopmentand

expandaffordablehousing.



FederalHomeLoanMortgageCorporation(FHLMC)orFreddieMac

Congressionally chartered agency established in 1970 (and privatized in 1989) to buy qualifying

residential mortgages from originating lenders. The loans are either kept in portfolio of packaged and

soldas

securities.FreddieMacalsooffersprogramswithmoreflexibleunderwritingguidelinesforlower

income homebuyers. With Fannie Mae, the corporation’s activity has helped to create an enormous

secondarymortgagemarket.



FederalNationalMortgageAssociation(FNMAofFannieMae)

Createdin1938topurchaseFHA,andlaterVAandconventionalmo rtgages,

FannieMaeisnowprivately 

ownedandmanaged, federallycharteredcorporation,thelargestsourceofhomemortgagefundsinthe

UnitedStates.Itbuysqualifyingresidentialmortgagesfromoriginatinglendersandeitherkeepsthemin

portfolio orpackagesandsellsthemassecurities.Fannie Mae alsooffersprogramswithmoreflexible



underwritingguidelinesforlowerincomehomebuyers.



501(c)(3)

Section of the Internal Revenue Code  that grants status as a nonprofit corporation and entitles

organizationstoreceivetax‐exemptstatusandtax‐d eductibledonations.



GeographicInformationSystems(GIS)

A computerized system that stores and links spatially defined data in a way

that allows information

display and processing and production of maps and models. GIS is a powerful planning and analytical

tool.



GreenBuilding

A whole‐building and systems approach to design and construction that employs building techniques

that minimize environmental impacts and reduce the energy consumption of buildings while

contributingtothe

healthandproductivityofitsoccupants.



GreenDevelopment

Development that uses environmentally friendly building practi ces and ener gy efficiency. There are a

numberofpublicandprivateincentivesforgreendevelopment,andincreasingly,nonprofitdevelopers

usegreenconstructionasawayofincreasingtheexpendableresourcesoflowerincomepersons.



Greenfields

Undevelopedland. Smartgrowthprinci plesdictatethatnewdevelopmentbesteeredaway

from greenfields to the maximum extent possible and toward sites where infrastructure and public

transportation already exist, or to contaminated and/or underutilized sites that can be reclaimed to

accommodatenewdevelopment.

MassachusettsHousingPartnership

HousingInstitute2014

 5

HOMEInvestmentPartnershipProgram(HOME)

A federal program run by HUD which provides annual grants on an entitlement basis to states, large

citiesandconsortiaofsmallercommunitiesforaffordablehousingactivities,includinghomeownership,

rentsubsidies,housingdevelopmentandrehabilitation.SimilartoCDBGfunds,somecommunitiesare

part of a consortium

 and receive HOME funds directly from HUD and distribute in their communities.

DHCDadministersHOMEfundsatthestatelevel.



HousingAppealsCommittee(HAC)

A quasi‐judicial body within DHCD, which hears appeals by developers, local zoning boards on

comprehensivepermit(Chapter40B)decisionsbylocalZoningBoardsofAppeal.



HousingConsumerEducationCenters

A statewide information and referral network that assists tenants, landlords, current and prospective

homeownerswiththeirhousingproblems.TheCentersarelocatedatagenciesthatprovideavarietyof

housingservicesthroughoutMassachusetts.

www.masshousinginfo.org



HousingStabilizationFund

The Housing Stabilization Fund (HSF) is a program available through DHCD to support co mprehensive

neighborhood redevelopment efforts and to help developers and municipalities acquire,  preserve and

rehabilitate affordable housing. The state legislature  placed a special emphasis on reusing foreclosed

anddistressedpropertiesandoncreatingaffordablehomeownership

opportunities.



HousingToolbox/WelcomeHomeMassachusetts

MHPandtheCitizensHousingandPlanningAssociation(CHAPA)createdanonlineaffordablehousing

strategywebsitethatisdesignedtobeaone‐stopresourceforlocalhousingofficialsandvolunteers.

CalledtheMassachusettsToolbox,thesitefeaturescontentdesignedtohelplocalofficials

and

volunteersmovelocally‐initiatedaffordablehousingdevelopmentsforward.

Thetoolboxprovideseasyaccesstostrategiesandbestpracticesrelatedtothepreservationand

productionofallvarietiesofaffordablehousing.

http://housingpolicy.org/index_MA.html



InclusionaryZoning

Alocalzoningordinancethateitherrequiresorencouragesadevelopertoincludeaffordablehousingas

partofadevelopment,orcontributetoafundforsuchhousing.Thebylawmayprovideincentivessuch

as increased density, reduced parking requirements, or expedited per mitting in exchange for the

affordable

housing.



InfillDevelopment

The practice of building  on vacant or undeveloped parcels in dense areas, especially urban and inner

suburbanneighborhoods.Promotescompactdevelopment.



LimitedEquityHomeowne rship

Ownershiphousingwhereresalevaluesarerestrictedinordertomaintainthelong‐termaffordabilityof

the units. A technique often used

for housing developed with public assistance in order to reduce

development costs (e.g. funding, relaxed zoning regulations, discounted sale of public land). Can take

theformofacooperative,acondominiumorfeesimpleownership.



MassachusettsHousingPartnership

HousingInstitute2014

 6

LocalandRegionalHousingAuthorities(LHAs)

Ahousingauthoritysetupbyacityortown,orgroupoftowns,inaccordancewithstatelaw,M.G.L.Ch.

149toprovidelow‐incomefamilyorelderlyhousing.



LocalHousingPartnership

Alocalhousingcommitteeappointedby themunicipalitywith thepurpose

ofpromoting opportunities

toproduceandpreserveaffordablehousing.



LocalInitiativeProgram(LIP)

A state program under which communities may use local resources and DHCD technical assistance  to

developaffordablehousingthatiseligibleforinclusionontheStateHousingInventory(SHI).LIPisnota

financing program, but the

DHCD technical assistance qualifies as a subsidy and enables locally

supported developments, that do not require other  financial subsidies,to qualify for inclusion on the

SubsidizedHousingInventory.



Low‐IncomeHousingTaxCredit(LIHTC)

Federaltaxcreditfordevelopers ofaffordablehousing.Statesreceivean annualdollarvalueofcredits

which

theythenallocatetoqualifyingprojectsbasedonprioritie sestablishedinastateallocationplan. 

DHCDistheallocatingagencyforMassachusetts.



ManufacturedHomes

A home buil t entirely in the factory to a federal building code administered by HUD. The Federal

ManufacturedHomeConstructionandSafetyStandards(commonlyknownas

theHUDcode)wentinto

effectJune15,1976.Manufacturedhomes  maybe single‐ormulti‐sectionandare transportedtothe

site and installed. The Federal standards regulate manufactured housing design and construction,

strengthanddurability,transportability,fireresistance,energyefficiency,andquality.



MassachusettsAffordableHousingTrustFund(AHTF)



ArevolvingtrustfundestablishedbytheMassachusettsLegislatureasSection227ofChapter159ofthe

Actsof2000,andnowknownasChapter121D.AdministeredbyMassHousing,AHTFfunctionsasagap

filler, the last  funding piece necessary to make an affordable housing development financially feasible

andsustainable

forthelongterm.Fundingistypicallyintheformofdeferredloans.



MassDevelopment

A quasi‐public agency created in 1998 by the merger of the Government Land Bank of the

MassachusettsIndustrialFinanceAgency.MassDevelopmentoffersavariety ofprogramsin supportof

economicdevelopment,largescalereal‐estate

developmentprojectsandbrownfieldclean‐upincluding

pre‐development assistance,  loans, loan guarantees, mortgage insurance and taxable and tax‐exempt

bondfinancing.Itsprogramscanalsobeusedformixedcommercialandresidentialprojects.

www.massdevelopment.com



MassHousing(formerlytheMassachusettsHousingFinance Agency,MHFA)

Aquasi‐public agency created in 1966tohelpfinance affordable housing programs. MassHousing sells

both tax‐exempt and taxable bonds to finance its many single‐family and multi‐family financing

programs.TheAgency overseesandregulatesthepropertiesithasassisted,

andrunsanumberofother

programs,someonbehalfofHUDandDHCD.

www.masshousing.com



MassachusettsHousingPartnership

HousingInstitute2014

 7

MassachusettsHousingInvestmentCorporation(MHIC)

A private, non‐profit corporation thatprovides loans for affordable housing, equity funds for low‐

income housing tax credit (LIHTC) developments and loan guarantees for lead paint abatement loans.

Created in 1991 by a consortium of banks, MHIC also administers a bridge financing program for tax



creditprojectsinconjunctionwiththeMassachusettsHousingPartnershipFund.

www.mhic.com



MassachusettsHousingPartnership(MHP)

A quasi‐public agency created by the state legislature in 1985 to support affordable housing and

neighborhooddevelopment.Itisfundedbystate‐mandatedcontributionsfrominterstatebanksandhas

received state funds  as well. It is governed by a seven‐member board appointed by the

governor and

the state’s banking industry. MHP provides,below‐market financing and bridge loans for affordable

rental housing, runs the “One Mortgage” program for first time homebuyersand provides technical

assistancetocommunitiestosupportaffordablehousing.

www.mhp.net



MassachusettsRentalVoucherProgram(MRVP)

A state‐funded rental assistance progra m begun in November1992, as a revised version of the state’s

previousrentalassistanceprogram(Chapter707).Ithas bothaproject‐basedcomponentandatenant‐

basedcomponent.



MixedIncomeHousingDevelopment

Developmentthatincludeshousingaffordabletovarious

incomelevels.



MixedUseDevelopment

Projectsthatcombinedifferenttypesofdevelopmentsuchasresidential,commercial,office,industrial

andinstitutionalintooneproject.



MunicipalAffordableHousingTrust

Passed into law in Massachusetts in 2005, allows for the creation of a  trust created as part of local

government for the purpose

 to administering funds and managing a range of real estate activities

relatedtoaffordablehousing.



NeighborhoodRevitalizationStrategyArea(NRSA)

Communities with HUD‐approved NRSAs are offered enhanced flexibility in undertaking economic

development,housingand public serviceactivitieswith  their CDBGfunds. This flexibility isdesignedto

promoteinnovativeprograms

ineconomicallydisadvantagedareasofthecommunity.

www.hud.gov



NewEnglandFund(NEF)

An affordable housing program run by the Federal Home Loan Bank of Boston (FHLBB) NEF provides

loanstomemberfinancial institutionstofinanceaffordablehousing.NEFisawidelyusedprogramfor

thedevelopmentofmixedincomehousingundertheCh.40BComprehensivePermit. 



MassachusettsHousingPartnership

HousingInstitute2014

 8

OneStopApplication

AdetailedapplicationforpublicfundingsourcessubmittedtoDHCDby affordablehousingdevelopers.

This compre hensive funding application ensures that funders  are reviewing the same information  and

have complete financial information for a development project. Most public financing for affordable

housingisobtainedthroughDHCDwhichholdspublicfunding

roundsonceortwiceayear.



RegionalPlanningAgencies(RPA)

There are twelve Massachusetts regional planning agencies.They are public organizations that serve

the local gov ernments by dealing with issues and needs that cross city, town and county boundaries,

through planning, policymaking, advocacy and technical assistance. Different RPAs have different

strengthsandfocuses.

www.apa‐ma.org



RequestforProposal(RFP)

A process for soliciting applications for technical or consulting services or for project developers when

funds are awarded competitively. In Massachusetts, public bodies securing goods and services and/or

acquiringordisposingofrealpropertyaresubjecttoM.G.L.Ch.30BandshouldconsulttheOfficeof

the

InspectorGeneralforrequiredproceduresandinformationaboutRFP’s.



Section8

A HUD program (officially  called the Housing Choice Voucher Program) providing funding for rental

assistance to low‐income households.Participating tenants typically  pay 30% of their income for

housing(rentandutilities)andthefederalsubsidypaysthe

balanceoftherent.



SingleRoomOccupancy(SRO)

Efficiencyunitswhichmayormaynotincludeseparatebathroomorkitchenfacilities.



SmartGrowth

Anapproachtoplanning anddevelopmentthatpromoteamoreefficientuseof landtoreduce sprawl

usingcompactdevelopmentpatternsthatarelessdependenton

theautomobileandincludearangeof

housingoptionsandimprovethebalanceofjobsandhousingwithinthecommunityortheregion.



OneMortgageProgram(formerlySoftSecondProgram)

The State’s first time homebuyer mortgage program operated by the Massachusetts Housing

Partnership.ONEMortgagefeatureslow,fixed‐ratefinancingand 

asstate‐backedreservethatrelieves

homebuyersfromthecostofprivatemortgageinsurance.Eligiblebuyersobtainabankmortgagefrom

participatingbanks.

www.mhp.net/homeownership



Subsidy

Typicallyreferstofinancialassistancethatfillsthegapbetweenthecostofaffordablehousing

development/operationsandthemortgageorsalesincomesupportedbyincomerestrictedrentalsor

homeownershipsales.Affordablerentsandhomesalespricesaredeterminedbyfinancingprogram

eligibilityrequirements.Often,multiplesubsidiesfromvarioussources

areneeded,referredtoasthe

“layering”ofsubsidies,inordertomakeaprojectfeasible.Inthestate’sLocalInitiativeProgram(LIP),

DHCD’stechnicalassistancequalifiesasasubsidyandenableslocal ly supporteddevelopmentsthatdo

notrequireotherfinancialsubsidiestousethecomprehensivepermitprocess.Also,“internalsubsidies”



MassachusettsHousingPartnership

HousingInstitute2014

 9

referstothosedevelopmentsthatdonothaveanexternalsource(s)offundingforaffordablehousing,

butusethevalueofthemarketunitsto“crosssubsidize”theaffordableones.



TransitOrientedDevelopment(TOD)

Mixed‐use higher densi ty development centered on existing or new transportation facilities including

bus,rail,bicycle

andpedestrianpathways.



TransitionalHousing

Ashorttermhousingoptionforfamiliesorindividualsthatdonothavepermanenthousingbutbenefit

frommorestabilitythanthatofanemergencyshelter.



UniversalDesign

Buildingdesignthatcreatesaccessibleandusable spaceforeveryone,includingpeoplewithdisabiliti es.