Lebanon mulls easing add-on apartments for homeowners to alleviate housing crunch

Valley News Staff Writer
Published: 10/28/2021 6:23:03 AM
Modified: 10/28/2021 6:23:11 AM

LEBANON — More than five years ago, the Revs. Michael and Susan Thomas decided to convert a horse barn at their home on Eastman Hill Road into an apartment.

The couple obtained approval from the city of Lebanon for what is known in the housing and zoning world as an “accessory dwelling unit,” an apartment added by the owner of a single-family home. They completed a renovation and now rent out the loft one-bedroom apartment for about $1,700 a month, which includes heat and air conditioning, basic cable and internet. Their tenants mainly have been employees at Dartmouth-Hitchcock Medical Center.

“We knew we were going to be retiring in a few years, and we knew we were going to have some additional income (from the apartment),” Michael Thomas, a retired Lutheran chaplain at Dartmouth College, said Wednesday.

Now municipal officials and planners around the Upper Valley are looking to encourage the construction of more ADUs, noting they can help make a dent in the region’s housing crunch.

Both Vermont and New Hampshire have passed laws saying municipalities can’t prohibit ADUs, though they can regulate them. In Lebanon, they were first enabled in 2013 and now are a permitted use where homeowners just have to apply for a building permit. City officials are currently proposing some zoning changes that would make it even easier to build such apartments.

 “What is attractive about accessory dwelling units is this is a way to increase density where housing already exists, and it provides homeowners with a way to generate income off their property,” said City Councilor Karen Liot Hill.

She also noted that the studio or one-bedroom apartments would boost the housing supply “in a way that does not compromise the character of a neighborhood.”

“I see this as hitting a lot of goals at the same time,” she said.

The proposed zoning changes in Lebanon would allow detached ADUs to be located in non-conforming structures and lots by special exception, rather than requiring a variance, making it easier to convert an outbuilding near a property line into an apartment; allow a detached ADU to be taller than the principal dwelling by special exception, which would mean a peaked-roof garage next to a single-story ranch could be converted into an apartment; and eliminate requirements that ADUs share water and sewer connections with the existing home and have an interconnected fire alarm system.

Another proposal would exempt ADUs with a gross living area of under 500 square feet from the one-time impact fees for new construction in Lebanon, saving a homeowner who creates a small unit almost $1,400.

In Lebanon, at least one of the units has to remain owner-occupied.

“It’s definitely an opportunity to create some additional housing that is smaller, and presumably more affordable, and also to do it in a way that doesn’t dramatically alter a neighborhood,” David Brooks, Lebanon’s director of planning and development, said of ADUs. He said about six have been built in Lebanon since January 2020, and if just 5% of the 7,000 housing units in the city added an ADU, that could create 350 more apartments without requiring a big housing complex.

Brooks said the package of zoning amendments — which also would make regulations for West Lebanon’s central business district consistent with those for downtown Lebanon and clear the way for an additional dozen more mobile homes at the Currier Mobile Home Park near the Enfield line — will be reviewed by various city boards next month. They then would go back to the City Council, where they were presented earlier this month, which would likely hold a public hearing early next year. Brooks said these zoning amendments could just require City Council approval, but the panel could also opt to send them to voters in March as well.

Meanwhile, Vital Communities and other planning groups are sponsoring a public discussion on Zoom to provide more information about ADUs titled “ADUs: How Homeowners Can Become Home Creators,” at 5:30 p.m. Nov. 3 (register at vitalcommunities.org/ADUs). A “Keys to the Valley” report last spring found that about 10,000 new housing units are needed by 2030 to meet the growing demand in the Upper Valley.

Mike Kiess, workforce housing coordinator at Vital Communities, said the forum will help people understand some of the legal hurdles and other potential obstacles — such as a hefty investment to build an apartment — to create an ADU.

“There are a lot of people who have a resource that is not in play, and that is existing homeowners who have affordability needs as well,” said Kiess, who said some key town officials in Woodstock and Hartford are also interested in encouraging more ADUs.

In Thetford, Nick Clark, a Selectboard member and president of the Hanover Coop board, recently converted a two-car garage into a one-bedroom ADU at the 200-year-old Thetford Center home he owns with his long-term partner, Hannah Smith. Clark said they invested close to $50,000 in the project and rent it through Airbnb, which a friend told them is what traveling nurses at DHMC use to find housing.

“We wanted to support people working at the hospital,” Clark said. “We are getting a lot of Hitchcock employees.”

They are averaging about $2,000 a month in rental income, he said.

“Part of it is the unit does help us with housing costs, and part of it is there’s just this absolute shortage of housing, so that any unit is good,” Clark added.

In Lebanon, Michael Thomas said he and his wife “have enjoyed everyone that we rented to,” but they may also eventually consider listing their ADU on Airbnb, rather than primarily as a longer-term rental, in part to provide more flexibility when their adult children visit with their families.

In some communities, short-term rental sites like Airbnb have been seen as adding to the housing crunch for middle- and lower-income workers. Asked about Airbnb and ADUs, Brooks, the Lebanon planner, said, “Ideally, we would like to have them be long-term rentals, since that is where the need is. That said, short-term rentals is on our list of topics to be looked into more thoroughly in the future.”

John Gregg can be reached at 603-727-3217 or jgregg@vnews.com.

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