- Housing Secretary Stefan Pryor, thanks so much for joining me.

- Great to be with you, Steph.

- So I wanna start by asking you about the housing affordability crisis.

It's facing both, you know, renters and owners in Rhode Island.

Tell me what specific progress you have made so far as housing secretary on this front.

- Sure, mostly we're laying groundwork, because this is a problem that has accumulated over decades, but we're getting a lot going.

There are several aspects to the problem.

There's the problem of financing.

We've been under-financing compared to our fellow New England states, compared to the country, we've been under-financing housing.

So we're doing more around financing it.

We've been over-regulating housing, so there's been in the planning and zoning processes at the local level, there's really been some zigzag that has made it hard to comprehend and hard to navigate for project developers.

So we're working on making processes more efficient and developing partnerships with cities and towns.

And there's been very little leadership on housing in a coordinated way at the state level.

There wasn't a housing department until about nine months ago, fully and formally in the state of Rhode Island.

So we're getting that going too.

- So if we're under-financing housing, underfunding it, essentially, what is the dollar amount that we need to put a dent in the crisis?

- We're still estimating the dollar amounts that we think ought to be allocated over the longer term, but under Governor McKee, we've allocated well in excess of $300 million for the purpose.

- A lot of that from COVID relief funds, right?

- A lot of it from COVID-era funding, and that funding is flowing through the system.

You know, 98% of it is obligated or already being spent.

- So projects are moving, but has any of that money actually turned into housing that is available yet?

- Over a quarter is already under construction.

I think there may be a development that's moving towards completion or is being completed.

But Steph, it takes a couple of years to three years from the time you issue like a competitive solicitation all the way through to ribbon cutting and open the door.

- So gimme a ballpark.

Are we talking, is this a billion-dollar problem?

How much more money do you think we need?

- Well, it's something that should be measured over let's say a decade.

And we're working on those numbers, so I don't wanna put a dollar figure out today.

We need 2 to 3,000 units on an annual basis to tread water.

What our market is currently having introduced to it on an annual basis is 1,000 units.

- So we're way behind?

- So below status quo level of production.

- And that's just, you need 2 to 3,000 units a year just for the status quo.

But what about to meet the future demand?

We know that- - We need more.

- More people are moving into Rhode Island than are moving out.

- Yes, and to achieve greater affordability, you need more supply as compared to demand.

So we're not yet at that point.

So we've got a lot of work to do.

It's been decades in the making, this problem.

Now, are our leaders really at this problem?

Reason for optimism?

Very much so.

Yes, they are.

Governor McKee has proposed the largest-ever housing bond for Rhode Island out of general obligation bond funds, $100 million for the purpose, to get us further along than the federal funds have taken us, so we're not going off a cliff when the federal funds end.

- And tell me how far will that get us?

When will we get to the 2 to 3,000 units a year?

- It won't be enough.

It won't be enough.

And by the way, the dollars that the state spends mostly, mostly are dedicated to more affordable units.

But we need to unlock the market for all kinds of units, because at every price point, every income level of Rhode Islander, folks are having trouble.

They're struggling to find the kind of housing product that they are expecting out there.

Whether they're buying or they're renting, the prices are too high or they can't find what they're looking for.

So we need to yes, invest more, and I've emphasized that and we need to do that.

We also need to help cities and towns create the room for more housing.

- So one potential reform that we hear people talk about a lot is rent control or rent stabilization.

We're seeing rents continue to skyrocket.

The median price of an apartment in Providence is more than $2,000 now.

Do you support any sort of regulation on landlords in terms of how much they can raise the rent each year?

- Not as a first resort.

First of all, I understand the idea and understand what's behind it.

It makes a lot of sense that rents are rising too fast.

As a matter of fact, the Providence metro has the highest rate of growth in the country.

It's worth noting that Boston has the fourth highest rate of growth.

So there is something happening in New England, it is a regional problem, but still we don't want that dubious distinction.

We've gotta get out of it.

The main aspect to the solution to that problem is producing more housing.

- But as you said, that's gonna take years.

We're way behind where we need to be.

- And because it's been accumulating for decades, this problem.

But we need to be careful not to undertake solutions that can exacerbate the problem.

And what I mean by that is, for a long time there have been studies of rent control measures and of the precise types of rent control that have been undertaken in other places, frequently you see that landlords have a disincentive to invest in their properties.

So the conditions of these properties can deteriorate.

We don't want that either.

- I wanna ask you about the Superman building.

In your previous job as commerce secretary, you negotiated the deal for the Superman building to be developed by a private developer into apartments but using some taxpayer funds.

Construction has been delayed way beyond the initial estimates.

Are you concerned that this project isn't gonna happen?

- Concerned, yes.

Like most major projects in the United States, I'm concerned.

I care about the ones in Rhode Island.

I'm concerned they're all facing the interest rate volatility, the inflation challenges, the supply chain disruptions.

So they're not immune at the Superman building.

But I'm also optimistic in the sense that I know that the project team is working closely with us here in the state, working closely with the city of Providence, working with the building trades, and also together with the housing department helping, we've been reaching out to the feds to see whether any of the recent-vintage dollars that are being released from the federal government could be applicable to these changing market scenarios for a building like Superman.

- So is the original framework and the amount of private financing versus public financing, that is no longer going to happen?

- Well, like most projects, that's a good foundation.

So most projects are taking a look at their original project budget and saying, There's some good features of this budget, the framework still works, but we need to find some new sources of financing or we need to enhance our financing in some way, shape, or form."

So that's similar here.

- Another big project you, of course, were involved in was the Tidewater Landing soccer stadium in Pawtucket.

That project, the cost of that has soared since you left your job as commerce secretary, but it was also supposed to include some housing.

And there are questions about whether the housing portion of the project is going to go forward at all.

What do you know about that?

- We don't know much yet.

That's understandable, because the team, the Fortuitous organization, was focused on getting that stadium deal done.

So they've done that and put that behind us.

We've just, in essence, reconnected and started a conversation.

Nothing formal yet, nothing detailed yet.

Very, very, very preliminary.

But I know that they are moving in the direction of that next phase.

- Potentially more public funding could go into the Tidewater Landing?

- Could be some.

There could be some.

Obviously, they'd need to contribute equity, they'd need to seek private debt.

They'd need to put a whole pro forma together, a whole project budget together.

They'd have to have a credible developer.

Maybe Fortuitous would play that role.

Maybe they'd partner for that purpose.

All these things need to be discussed, need to be expressed, need to be shared.

- I wanna move on to homelessness.

Do we currently have enough shelter online to accommodate all of the homeless individuals in Rhode Island?

- It's very hard to precisely say how many beds you need for everyone who is experiencing homelessness.

I will say this, we set out for this winter compared to last winter, we set out to increase our number of shelter beds by 30%.

We looked at the conditions for Rhode Islanders experiencing homelessness.

We looked at the shelters as they were, and we thought we need to increase it by 30% We're up 338 beds, or 32% for the winter that has just been completed.

- Pryor said there are 1,300 shelter beds currently available for people experiencing homelessness.

That includes at the former Charles Gate Nursing Center, which the state is acquiring and is now housing 60 families.

Soon to come are 45 beds in these new experimental pallet shelters in Providence dubbed Echo Village.

But there are still more than 500 Rhode Islanders unsheltered, sleeping outside, according to the Rhode Island Coalition to End Homelessness.

Seems like every winter the state is scrambling to find emergency shelter ahead of the winter.

I mean, when will we get to a point where there's not a scramble?

- The honest answer is you'll never have zero scramble.

The reality is that we are being much more planful.

We have much more of a system.

But will there come a time when we're no longer looking for spaces for shelter?

I doubt that day will come.

The reason is that sometimes we use temporary spaces because they are inexpensive, they're cost-effective for the taxpayer.

So for example, we're at Zambarano Hospital in some cottages on the state Zambarano campus, where in Kingston, at a state-owned building that has been loaned to us, these particular structures have longer-term uses that are not with the housing department.

So we're going in because it's very cost-effective and we'll come back out and we'll open up in another location.

So that will be part of the process for a long time.

- Housing Secretary Stefan Pryor, thank you for the time.

- Thank you, Steph.