Waterbury Housing Trust Fund grants aim to spark small-scale housing growth

November 2, 2025 | By Lisa Scagliotti

Waterbury property owners looking to add new rental housing units to their properties now have a chance to apply for a local grant to help pay for the improvements, thanks to Waterbury’s recently created Housing Trust Fund. 

The Waterbury Select Board created the trust fund in August 2024 and made the first allocation to it last fall, using $100,000 of the $230,000 in revenue generated by the town’s local option sales taxes that went into effect in July 2024. 

Now the Waterbury Task Force has partnered with the nonprofit housing agency Downstreet Housing & Community Development to oversee a grant program called the Waterbury Housing Improvement Program that will distribute the trust fund sum in the form of grants of up to $30,000 per project. 

The grants will support the creation of Accessory Dwelling Units (called ADUs for short) that are located either within an existing home or built as a stand-alone structure on a current residential property. 

Recent updates to the town zoning bylaw pertaining to the downtown section of Waterbury south of Interstate 89 were revised to make it easier for property owners to add units to existing residentially developed neighborhoods. 

Key requirements for the grants are that the new units be long-term rental housing and that tenants meet income guidelines. 

In a June presentation to the select board about details of the grant program’s criteria, Waterbury Housing Task Force Chair Joe Camaratta said he went back to watch recordings of select board meetings in 2024 regarding the creation of the Housing Trust Fund and the intentions for how the fund would be used. He said he heard a strong message to help “increase the capacity for affordable housing” in town that would serve traditional low-income tenants, as well as what’s more recently been referred to as “workforce housing.” 

The goal is to create more housing options so that “people who work in the community are able to afford to live in the community,” Camaratta said. 

The task force through Camaratta advocated for creating the grant program, and the select board gave its approval in June based on the trust fund’s allowable uses.

The task force modeled the new grant program after the state-run Vermont Housing Improvement Program, known as VHIP, which provides loans for rehabilitating vacant housing units or constructing new units at owner-occupied properties. The state loans are forgiven if the new units meet affordability requirements for a minimum of 5 or 10 years, depending on the duration of the loan.

The Waterbury program was timed to accept applications after the state program closed its application period. And it differs in that the funding awarded will be grants, not loans that must be repaid, the task force notes. 

The grants will work on a reimbursement schedule where the property owner will document construction progress on the project and receive grant funds in installments, according to the program description by the task force. 

“This is a specific program for small-scale development,” Camaratta explained. 

Downstreet’s role will run the gamut from reviewing applications and deciding grant awards to working with property owners to ensure their construction projects comply with guidelines and that leases and tenant choices follow the program rules. Camaratta said the task force looked at wage data for school teachers, food service, retail and construction workers to inform those details.  

Based in Barre, Downstreet Housing & Community Development owns and operates several multi-unit affordable housing properties in Waterbury – senior apartments in the Stimson and Graves building on Stowe Street, the South Main Apartments, and the Green Mountain Seminary apartments in Waterbury Center. It’s also developing the new three-story 26-unit apartment complex at 51 South Main Street. 

In June when the select board agreed to create the grant program, board Chair Alyssa Johnson acknowledged that its capacity will be limited, offering opportunities for individual property owners to add one new unit at a time. She credited Camaratta for dedicating “enormous time, energy, and expertise” on the town Housing Task Force to establish this program that town officials will watch with interest to see if it catches on with homeowners. Johnson also answered yes when asked whether the select board would wait to determine whether the grant program is successful before adding more funding to the trust fund for grants. 

Addressing the affordable housing shortage has been a priority for town officials who have been working on multiple fronts to create opportunities for both developers and individual homeowners to create new homes. 

In addition to the 51 S. Main project, the town is in discussions with a developer interested in building approximately 90 apartments near the intersection of Randall Street and Park Row in downtown Waterbury. The Select Board on Monday will discuss next steps for what is being referred to as the Stanley-Wasson project, named for state buildings previously on the site that’s still owned by the state but promised to the town in a purchase-option agreement. The town also is seeking grant funding and working on a potential project that would replace the town garage and add housing units to the town-owned property behind Brookside Primary School.

Since he joined the select board in 2023, Vice Chair Kane Sweeney has been a strong advocate for affordable housing in Waterbury and was a proponent of creating both the volunteer Housing Task Force that’s appointed by the select board, and the Housing Trust Fund. 

“I’m going to be watching the program very closely,” Sweeney promised in June as the board voted to create the grants for ADUs. “And should it not be successful, I’ll be the first one to point it out.”

At the Oct. 20 select board meeting, Town Manager Tom Leitz noted that Downstreet was on board and the grant applications were to open soon. 

“To see [this program] get off the ground and be at an open applications phase – I’m excited to see how many apply,” Sweeney said. “This is what the housing trust is designed for, and I’m hoping to see affordable housing construction in Waterbury funded by this program.” 

Applications are open with a Jan. 31 deadline for this first grant round. An information session for potential applicants will be held on Tuesday, Nov. 18, at 6:30 p.m. in the Steele Community Room at the municipal complex. More information and the application are on the program’s page on the Town website.