The deal, announced this week, ends a four-month standoff between the city and Minnesota-based Pulte Homes on special permit conditions for the Trapelo Road development known as Wellington Crossings.
Since January, the Building Department has held back occupancy permits for the project after the city filed a civil suit in Middlesex Superior Court alleging violations of the developer's special permit agreement, which allowed them to build about twice as large a development as the city's zoning guidelines permit. The city began turning over the occupancy permits Friday after both parties signed the agreement.
"We're pleased that we were able to resolve our differences with the city and happy to allow our homeowners to close and move into their new homes," said Reid Blute, vice president of land for Pulte Homes.
The battle originated from a special permit issued to the previous developers, JPI. In exchange for the permit, JPI agreed to several conditions the council imposed. Pulte Homes took over the project in 2005.
Under the special permit, the developers are required to set aside 10 percent, or 27 of the total 268 units, as affordable. They must also reserve 118 of the units for people 55 and older, with 12 of the 27 affordable units guaranteed for elderly persons.
The court found Pulte in violation of the special permit agreement because the affordable units were "sub par" to the quality of the market-rate units including "countertops, cabinets, flooring, fixtures, faucets, etc." The square footage of the affordable apartments was also less than the average square footage of all the units in the development.
Pulte Homes agreed to upgrade the affordable apartments to meet the special permit quality standards. In addition, the developers are paying $600,000 to the Housing Trust Fund because they did not designate any of the townhouse-style apartments as affordable, as was required by the special permit which said affordable units should be evenly distributed among the different types of housing.
"We (the city) proposed they make this donation as somewhat of penalty for not including the townhouses," said Housing Director Janet Barry.
Barry said the money could be used toward any affordable housing project in the city.
The biggest part of the city's complaint had to do with pricing of the affordable units. The special permit was originally signed in 2003, at a time when the state Department of Housing and Community Development (DHCD) had a different standard for what qualified as "affordable."
Pulte set its affordable prices according to HUD HOME program standards at $219,000 for a one-bedroom and $279,000 for two-bedroom apartments. But DHCD now sets affordable prices by the Local Initiative Planning (LIP) guidelines which set a maximum of $125,000 for one-bedroom units and $150,000 for two bedrooms. These are the prices cities must set to qualify the housing as affordable under Chapter 40B.
The city wanted Pulte to adjust its prices to comply with the new guidelines and the developers maintained their prices suited the language of the special permit. For the agreement, Pulte compromised to set three of the 27 affordable units - in buildings still under construction - at the $150,000 price. The other 24 units will remain at Pulte's original prices.
"It's just unfortunate," said Barry, about the difference in "affordable" standards. "It was no one's fault really, it was the wording of the special permit."
Mayor Jeanette A. McCarthy said she was pleased with the agreement overall, which sets a deed restriction to keep the affordable unit prices from rising any further. She also said any future special permit agreements will use the term "Chapter 40B eligible" to define affordable housing.
"I'm pleased with the settlement by Pulte and the city," McCarthy said. "It (the court judgement) provides a mechanism to resolve disputes among the parties in the future."
Blute said the market-rate condominiums range in price - depending on style, view, and amenities offered - from $347,900 up to $424,900 for two bedrooms and $314,900 to $319,900 for one bedrooms.
Of the 268 units, 112 have been completed so far, Blute said. Pulte Homes plans to finish construction on the project by May 2009.
Nicole Haley can be reached at nhaley@cnc.com or 781-398-8004.
