ADU — Accessible Dwelling Unit Funding Program

Thinking of Adding an Accessory Dwelling Unit (ADU) To Your Home?

VHIP 2.0 applications are currently being created! We will have them available as soon as possible, we appreciate your patience. To learn more about the new version of the program, you can visit the state’s website

What is an ADU?-  According to State Statute an ADU is a smaller, independent unit that is located on the same lot as the owner’s single-family primary residence. An ADU may be built within the interior of the existing structure of the home, as an addition to the home, within an attached/detached barn/garage, in an outbuilding on the property lot, or a new unit built on the property’s lot. An ADU does have some spatially defining limits in that an ADU is a unit that does not exceed 30% of the total habitable floor area of the single-family dwelling or 900 Square feet, whichever is greater. There may also be limitations on your public or private water, sewer, and electrical services. Also, each town can create by-laws to add to the definition of an ADU but cannot further limit the state basic definition. To learn more about Vermont State ADU policy, you may visit this web page: https://legislature.vermont.gov/statutes/section/24/117/04412

The program is pausing applications temporarily as the funds transition from federal funding to state funds. If you have a project ready to go in Windham or Windsor county and have read the program details and requirements, please fill out this short form to be added to the waitlist.

How to get started:

  • Property owners should reach out to their local town Zoning/Planning board to learn about any town requirements regarding set-backs, water/sewer, and any other zoning and/or planning limits that might be in the by-laws of the town.
  • If, after a conversation with the town, you are ready to move ahead with an ADU project, and would like to be approved for a VHIP grant you should complete a WWHT application (if you are located in Windham or Windsor Counties):
    • A complete application includes the following accompanying documents:
      • A completed eligibility form
      • a copy of the deed (not a photo)
      • a copy of most recent tax form/receipt
      • a W9 form- find them HERE,
      • a copy of property insurance
    • a scope and sequence of the project. The Scope and Sequence should include and overall project description, the steps that will be needed to get to the completion of the project, a list of contractors that will be required. The Scope will be reviewed and altered if the property is on or eligible for State or National Historic Register, or to meet specific town zoning or planning ordinances. Some details a Scope and Sequence should include:
      • Will the ADU be added inside the home, a barn or another place on the property?
      • How many bedrooms will the ADU include?
      • Will you be hiring a GC?
      • What contractor services will be needed to complete the project? (IE: insulation, foundation, carpenter, plumber, and so on)
      • Will you need to upgrade your well or septic?
      • Is there an existing kitchen or bath?
      • Do you have any contractors lined up for the project?
      • Have you spoken to the town, and are there local permitting needs?
      • Are there any major structural challenges that will need to be addressed?

Please fill out this short contact form and we will be in touch in the early months of 2024 for next steps. 

Once All of the application materials are received:

  • Program Coordinator will review all materials for completeness, and accuracy
  • A site visit will be scheduled to discuss the project, and to determine feasibility. Feasibility is based on the following:
  • Shovel ready status – Is it feasible to complete the full scope of the rehab be completed and apartment leased by deadline?
  • Geographic Distribution
  • The overall condition of the property
  • Will the scope of work achieve the goal of creating or restoring an ADU as written

 

Program Eligibility & Compliance:

  • Property owner must not have outstanding Vermont or Federal tax liens or be delinquent on property taxes, sewer/water, or building be in foreclosure.
  • Property owners must maintain HUD Fair Market Rent for five years; this commitment includes signing a Housing Subsidy Covenant, and a Grant Agreement on the ADU.
  • Property owners need to submit an annual Form to Department of Housing and Community Development annually to show rental rate verification
  • Property owner must match 20% of the total grant amount, and may be asked to show evidence of the ability to do so, or must submit a contract to WWHT to meet this requirement with in kind services and/or material purchases that contribute to the completion of the project.
  • If property is sold or transferred, the DHCD must be notified, and the buyer is held to the program requirements. The buyer can remove the program requirements by notifying DHCD of their intent, and reimbursing the DHCD at 20% of the grant amount for each year remaining in the Rental Agreement.

The current HUD Fair Market Rent* does adjust every year. Current figures for Windham and Windsor Counties are:

Windham Windsor
Studio/Efficiency $803 $841
1- Bedroom $945 $982
2-Bedroom $1,150 $1,129
3-Bedroom $1,426 $1,536
4-Bedroom $1,545 $1,542
  • *The above HUD FMR rates are considered gross rent amounts and do include heat, hot water, electric, cooking fuel, and trash removal. If the property owner does not include these utilities in the rent, a Utility Allowance must be made for each utility not included, and the maximum rent will be reduced according to the unit size.

Windham & Windsor Housing Trust’s Role:

  • Review and equitably evaluate all applications received from property owners and award grants that maximize State of Vermont goals for the Vermont Housing Improvement Program
  • Ensure accountability for property owners receiving funds
  • Attend an initial site visit of the property/units with Property Owner and Contractor(s)
  • Review proposed scope of work and budget
  • Approve or Deny grant applications
  • Verify that all permitting and compliance with local, state, and federal regulations are satisfied
  • Verify that feasible contracts are in place that allow work to be complete and apartments leased by deadline
  • Inspect repair work during the project and provide grant payments upon milestone completion
  • Oversee match requirements, obtain documentation
  • Conduct final inspection to ensure all repairs have been completed
  • Collect and verify all program documents; pre-work, during-work, post-work as required
  • Prepare and issue program Covenants and Grant Agreement
  • Make grant payments according to program guidelines

 

Other Information & Resources:

 

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