(The Center Square) – A new state investment in Massachusetts is aimed at affordable housing creation.
The Massachusetts Community Climate Bank will be the nation’s first green bank dedicated to housing, Gov. Maura Healey said. The program will use seed funding of $50 million to leverage federal funding and private sector opportunities to create affordable, decarbonized housing.
The funding will stem from the Department of Environmental Protection and will be used to maximize investments in reducing greenhouse gases from the building sector.
“The Massachusetts Community Climate Bank will be our financial engine for moving forward on our climate goals, relieving the pressure of high housing costs, and creating good jobs and healthier communities,” the Democratic governor said in a statement. “This first-of-its-kind initiative is going to make our state more competitive, affordable, and equitable – and it’s going to show that in Massachusetts, we can lead the world by leading with our values and leaving no community behind.”
According to a release, the bank’s primary goal is attracting private sector capital and federal funding available under the Inflation Reduction Act to finance building retrofits. The retrofits must align with Massachusetts’s long-term climate goals, along with decarbonization in new buildings.
According to a release, the bank’s focus is the affordable housing market, as those residents shoulder a disproportionate burden in climate impacts and energy pricing. It will also promote equitable energy transitions, meeting the needs of the environmental justice sector.
The climate bank will be housed within MassHousing, and Massachusetts is the first state to include it with the Housing Finance Agency, which will work to aim the initiative at new housing. The climate bank will work in unison with the Massachusetts Clean Energy Center and MassDevelopment.
“Decarbonizing the commonwealth’s housing stock is a critical component of our work to build cleaner, healthier communities while meeting our ambitious climate goals,” MassHousing Executive Director Chrystal Kornegay said in a statement. “The Massachusetts Community Climate Bank will allow us to pursue this important work at scale, accelerating our progress toward a net zero future and centering equity for low- and moderate-income households and Environmental Justice communities.”
According to a release, the climate bank will offer low-cost capital and innovative deal structuring to incorporate clean energy and associated efficient technologies in affordable housing creation and preservation. The bank will also provide mortgage products for associated home improvements.
According to a release, the initiative will also put Massachusetts in a positive where it can compete for National Clean Investment Fund dollars under the Inflation Reduction Act. It will also spur engagement with other federal finance opportunities with the U.S. Department of Energy Loan Program Office.
According to a release, the state’s Clean Energy and Climate Plan calls for a 49% reduction in greenhouse gases through residential heating by 2040 and a 95% reduction by 2050.
Boston Mayor Michelle Wu said the “work is critical” and “will complement efforts in Boston to retrofit housing while creating opportunities for small property owners “to build and renovate greener, healthier buildings” for residents.
