SHSO Structure and Funding
A Shared Housing Services Organization has three major players: the host organization or lead community, the service provider and the member communities. The roles and responsibilities of each of these entities are spelled out in an Inter-Municipal Agreement (IMA) that is entered into by all member communities.
- The lead community, or host entity, plays a key role in administering the SHSO. The lead community initiates the IMA allowing for intermunicipal collaboration, receives the funds from the member communities, and pays the staff and expenses (staffing, rent, supplies). The lead community may also house SHSO staff, provide office facilities and IT support. The lead community will also hire or procure staff, whether through the issuance of RFPs for contractual consultant services or by hiring employees. Whichever model is selected, the lead community will be responsible for overseeing the work of the service providers.
- The service providers are those persons with the technical expertise to deliver the SHSO services. Service providers can be external contractors or consultants, municipal staff, or contracted staff housed on-site. It is helpful to explore these options at a leadership level early in the process of creating an SHSO.
- The members are those municipalities that will be receiving the shared housing services. Member community interest could start at the staff and board level, or be driven at the executive level (Mayor, Council, or Board of Selectmen). The original RHSO was formed by the executive leaders of the founding municipalities, which was a strong endorsement. From there, buy-in by the Planning and Zoning staff and boards, as well as the affordable housing trusts and partnerships was sought. However the effort is initiated, only the Chief Elected official has the authority to sign an Inter-Municipal Agreement and officially become a part of the collaborative.
The three eastern Massachusetts SHSOs are governed by an inter-municipal agreement (IMA). The IMA formally defines the organization's terms, including the scope of services, governing structure and oversight, host municipality and host responsibilities, annual fees, a mechanism for payment, and process for fee adjustment. It also explains the procedure for joining or withdrawing from the SHSO.
The IMA is a single document adopted and signed by each municipality's chief elected official (Selectboard, Mayor, City Council). The IMAs are effective for either two or three years, at which point any necessary changes can be made and, and the agreement can be renewed. While renewal is not required annually, communities in the Concord-based RHSO reaffirm their support for the arrangement on an annual basis. A community can withdraw from the SHSO after a vote by its chief elected official. The IMA may stipulate a specific time when withdrawal becomes effective, for example, at the end of the IMA’s fiscal year.
Each SHSO establishes an advisory body, typically comprised of one representative from each member municipality. The advisory committees of each of the existing SHSO meet regularly quarterly. However, the MetroNorth SHSO typically meets every two months because members have found the meetings a useful venue for shared learning. In advance of each committee meeting, the lead municipality, in partnership with SHSO staff, prepares a status report that provides an overview of recent RHSO activities and a detailed accounting of hours spent by the municipality.
A sample of an inter-municipal agreement can be found on DHCD's website.
SHSO member communities fund their participation differently depending on available resources. Many towns that have adopted the Community Preservation Act (CPA) utilize these funds to support SHSO participation. Communities with inclusionary zoning provisions that allow for a Payment in Lieu can dedicate those funds as well. Other towns might allocate funding from their operating budget or use revenue from permitting fees.
Host community's role in funding
The host municipality is responsible for establishing a dedicated fund for the SHSO, which receives member fees and disburses funds for SHSO expenses. This fund may take the form of a revolving fund approved by the Town Meeting. At the start of the SHSO’s fiscal year, the host municipality invoices the member towns based on the IMA fee schedule. Invoices for additional services are issued as needed.
The fees paid by member municipalities vary widely. Each IMA includes a fee schedule that projects the number of hours SHSO staff will spend to deliver core services to each municipality. This estimate is based on the level of core services defined in the IMA and the scale of each municipality’s need, including the number of units on a town’s housing inventory and the size and number of local programs the RHSO will administer. Therefore, a town with 500 units on the SHI will pay a proportionately higher fee than a town with 50 units on the SHI. A town that requires support for monthly board meetings will pay a proportionately higher fee than a town that needs quarterly board meeting support.
Because the fee schedule is an estimate, the IMA includes provisions for reconciliation. If a community’s SHSO hours go unutilized, those hours might be refunded or rolled over into the next year. The MetroNorth SHSO tracks the number of hours utilized by each participating community to make fee adjustments throughout the year if necessary. If a community needs more work than expected, they may purchase additional hours throughout the year or swap hours with municipalities whose hours are underutilized.
Each municipality’s fee should be adjusted annually. For example, significant budget changes associated with an increase in the SHSO’s core services are discussed in-depth and typically made every two or three years when the inter-municipal agreement is revised.
Each member town’s fee should include administrative costs for the SHSO, including website maintenance, office space, equipment, IT support, and time for reporting and other administrative tasks. Also, each of the three host communities assesses an administrative fee that pays for coordination between SHSO members and SHSO staff and, if applicable, the costs of hosting SHSO staff on site.
For the SHSO, the challenge is accurately estimating the costs of performing selected tasks. One approach could be to estimate the time required to perform specific tasks over the course of a year and cost out requested tasks based on an hourly rate.
An overview of the funding and payment structures at the existing three SHSOs was prepared by DHCD in 2019 SHSO Structure and Payment Schedules.
The three existing Shared Housing Services Providers have three different management and staffing approaches:
- The Concord-based SHSO is staffed by four independent contractors who each contract with the Town of Concord on an annual basis. The Town of Concord provides office space, IT/Website hosting, and contracting.
- MetroNorth services are provided by a full-time Housing Coordinator employed by the Town of Reading, with member communities each paying a portion of the salary/benefits.
- Metrowest Collaborative Development was selected as the contractor for the Assabett Regional Housing Consortium following a competitive RFP process; the lead Town of Hudson is the contractor and fiscal agent, but it does not provide office space to the SHSO.