Waterbury Housing Improvement Program
A grant program for Waterbury property owners supporting rental ADU construction
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About the program
A collaboration with Downstreet Housing & Community Development, the Waterbury Housing Improvement Program offers assistance grants of up to $30,000 to Waterbury residents who want to construct an accessory dwelling unit (ADU) on their property—either within the current home or as a detached structure.
The goal of this program is to empower local property owners to participate in shaping the local housing landscape and increasing affordable long-term rental stock.
Background
Grants are funded through Waterbury’s Housing Trust Fund, which was established by the Town on August 19, 2024 to directly support its goal of increasing the local rental housing supply—with affordable options—by 1% each year for the next 8 years. At the November 18, 2024 Select Board meeting, the Town allocated $100,000 from the 2024 Local Options Tax revenue to the Housing Trust Fund. Projects and programs that directly advance the the Trust Fund’s mission and meet the following guidelines are eligible for funding:
- Funds will remain in a Town-managed account.
- Programs will be administered by a qualified third-party affordable housing organization.
- Any funds not immediately used will stay in the fund and be available for future affordable housing projects.
Downstreet Housing serves as the third-party administrator of the current ADU program.
For more details about the allowable uses of the housing trust fund, click here.
In the context of the Housing Trust Fund, affordable housing refers to housing that is priced to be accessible to individuals and families earning up to 120% of the area median income (AMI) for rental or purchase. Grant recipients will be required to rent the ADU at or below 110% of the HUD Fair Market Rents (FMR) for a minimum of 5 years.
For 2026, the 100% HUD FMR for Washington County* is:
| 0-Bedroom | $1,122 per month with all utilities included |
| 1-Bedroom | $1,129 per month with all utilities included |
| 2-Bedroom | $1,482 per month with all utilities included |
| 3-Bedroom | $1,824 per month with all utilities included |
| *Multiply by 1.1% to determine program rent requirements |
These numbers change annually on/around December 5th.
The Collective Household income for tenant (anyone 18 and older) selection must also not exceed 100% AMI. A link can be found here; https://housingdata.org/profile/income-employment/area-median-income.
This is a reimbursement program; we will need paid invoices with matching proof of payment. As a requirement of the program, you will need to make a 20% contribution before any funds are disbursed. Expenses incurred 6 months prior to the signing of the grant agreement are generally eligible for reimbursement towards the matching requirement.
- Initial Disbursement of 35% occurs once a 20% contribution is made to the project.
- 2nd Disbursement of 25% occurs once there is proof of the previous 35% disbursement has been used towards the project and is subject to a 50% completion inspection.
- 3rd Disbursement of 25% occurs once there is proof of the previous 25% disbursement has been used towards the project and is subject to a 100% completion inspection.
- Final Disbursement of 15% occurs once there is a total of $36,000 in paid invoices with proof of payment and a signed lease agreement with a tenant.
More information and how to apply
Join us on November 18 at 6:30 p.m. in the Steele Community Room for an information session and Q&A opportunity.
If you have questions about the application, please contact Ryan Carpenter at Downstreet Housing and Community Development at rcarpenter@downstreet.org or 802-477-1330.
Applications will be open until 2/1/26 or we have allocated all funding.