safe-harbor rule applied to land trusts
From: Stephanie Fassnacht (fassnachssc.wisc.edu)
Date: Mon, 19 Aug 1996 13:17:46 -0500
This is a somewhat esoteric subject, I'll have to admit.  You never
know what you'll be getting into when trying to develop cohousing!!!

Porchlight Cohousing (perhaps soon-to-be Troy Gardens Cohousing Assoc)
has been working with the Madison Area Community Land Trust (MACLT) to
try to gain control of a 15-acre property, 5 acres of which was/is to
be developed as cohousing.  MACLT is to be purchaser and perhaps developer
of the property.  Cohousing was/is to include residents of mixed
income.  The property will be developed as a PUD so that pedestrian
walkways can connect the buildings rather than streets.
 
We were told by MACLT that although having mixed-income residents on
land trust property was desireable, the legal basis for doing so was
unclear.  There is a safe-harbor provision of the law that presumably
would allow a
certain percentage of higher income residents to own units on
land-trust property in the interest of avoiding low-income ghettos.  

In looking into the safe-harbor rule, MACLT's attorney has discovered
that it is worded entirely in terms of rental property.  Apparently
trying to extend this rule to owner-occupied units is unprecedented.
Or, is it?   Does anyone out there have any experience with this?  Or,
if not, could anyone recommend appropriate resources?

Our core group consists of members whose income falls below 80% of
median as well as members whose income is above.  We would really like
to retain and expand our mixed-income membership, and all be able to
live together in one cohousing community.  We are really uncertain as
to how to deal with this latest uncertainty since MACLT could also
build an affordable-income condo instead of cohousing if having
cohousing were to prove legally too risky for them.  

We heartily welcome your suggestions.

Many thanks,

Stephanie Fassnacht
Porchlight Cohousing
Madison WI  
fassnach [at] ssc.wisc.edu

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