Garry Censorio leaves the front entrance of his new home on Block Island. “It’s a hard thing to believe that we’re gonna have a house,” says Censorio, a co-owner of G.R. Sharkey’s Restaurant.

The Providence Journal / Andrew Dickerman

BLOCK ISLAND — Garry Censorio closes each day with a trip to a hillside path off West Side Road. From there, he watches contractors work on the Cape Cod-style house he will soon call home.

“It’s a hard thing to believe that we’re gonna have a house,” says Censorio, a co-owner of G.R. Sharkey’s Restaurant, a popular dining spot in the heart of the 3-by-7-mile island.

Censorio and his family have lived in his in-laws’ house on Pilot Hill Road for 18 years. Five rooms have made tight quarters for six people, especially when Censorio’s two sons grew to be teenagers. Dylan and Tyler, now 20 and 18, still share a room when they return from college to help with the restaurant each summer.

Garry and his wife, Sheila, learned at a lottery drawing two summers ago that they would be among the families to get 20 affordable houses now under construction on a sloping property near the Great Salt Pond. They celebrated by parking lawn chairs on their quarter-acre, drinking cold beers while watching the sun set from where they imagined the living room would be.

The work site has been off limits since construction began, so Garry gauges progress from the footpath at the edge of the property. Sometimes he makes the trip three times a day, plotting where the deck will be.

“I’m crawling out of my skin,” Censorio says.

This holiday season should prove extra sweet for the Censorios and the other soon-to-be residents of West Lane, who greet each other in the grocery store with “Hi, neighbor.” They are slated to close on their homes soon after the start of the new year.

“It’s like, woo hoo!” says Jennifer Keane, 44, whose family’s name was also drawn. “I could never buy a house out here — you just can’t do it.”

The West Lane project is also remarkable in another sense. It pushes Block Island past the state’s goal that 10 percent of housing in each community be affordable to families with household incomes of less than $60,000. Rhode Island’s cities hit the target, but Block Island is the only town now surpassing it. (Middletown did, but then slipped behind as new houses were built.)

It was a feat for a community with the state’s highest housing costs, not to mention the complications associated with being 12 miles out to sea.

“If we can do it on Block Island, we should be able to do it anywhere in the state,” says Susan E. Bodington, deputy director for programs for Rhode Island Housing, an agency that advocates for affordable housing. “It’s more of a challenge there than anywhere else.”

WHAT SET THE island apart from other communities, Bodington says, was its early exposure to an escalating housing crisis and its commitment to addressing the problem. Many forces combined to make West Lane a reality: conservationists, land-use boards and town leaders.

“What makes it unique is the cooperation of everybody on the island,” Bodington says.

Two-thirds of the island’s houses are owned by summer residents. The remaining 300 or so are owned or rented by nearly 1,000 year-round residents. The gap between wages and costs makes it the least affordable community in the state. So far this year, with just two houses selling, median single-house sales rank at $1.25 million.

You have to be a millionaire to have a house here, Censorio says. The Censorios and the Keanes have been lucky; both already have year-round housing.

It’s estimated that a third of the residents do the Block Island shuffle. Teachers, waitresses and police officers live in comfortable, even palatial, accommodations in the winter, only to lose their housing in the summertime when seasonal residents return or opt to rent their places more lucratively to vacationers. Some move in with friends or family; others have been known to camp, crowd in with dozens of summer workers or live in cars.

“There were so many people who had been here for so long, looking for housing,” says Mary Jane Balser, general contractor for the West Lane project. “All of them were working. They just needed a home.”

THE REAL ESTATE market began exploding on the island in the 1980s, pushing a house beyond the reach of many families. At the same time, the town imposed a 2-percent tax on real estate sales to be dedicated to land preservation.

The Nature Conservancy declared the island one of The Last Great Places in the Western Hemisphere, deserving of protection along with the Florida Keys and other exotic locations. The emphasis on conservation made the island even more desirable, Balser said, and housing prices spiked.

The housing dilemma had caught the community’s attention. The Block Island Economic Development Foundation, a nonprofit interested in the island’s economic well-being, began focusing on providing affordable housing for year-round residents.

The foundation, financed primarily by grants, oversaw the construction of 31 houses.

“The community has understood the need,” Balser says. “They are all the people who work to keep the island going. To be a viable community, one needs diversity.”

Balser was the town’s finance director when the General Assembly passed a law in 1991 requiring towns to ensure that at least 10 percent of all housing units were affordable to low- and moderate-income households. At the time, that meant a house had to sell at $80,000 or under. Today, it equals $196,000 — a far cry from market housing prices.

Block Island had set a goal of preserving half of its land as open space to protect salt ponds and its water supply, she said. Now, it had a mandate to work on housing.

While town leaders recognized the importance of housing, she says, they didn’t want taxpayers to bear the burden.

“The question always is, how much is it going to cost the town,” Balser said.

THE TOWN COUNCIL in 1998 advanced a loan to buy land on Pilot Hill, across from Block Island School. The town used Community Development Block Grant money to build three houses and renovate a fourth. The loan was repaid through the house sales, Balser said.

Balser was serving on the Block Island Housing Board in 2005, when she became fixated on 5.4 acres on West Side Road. The land was next to the economic-development foundation’s E. Searles Memorial Housing, which features 16 affordable rental apartments, and fell within reach of the municipal sewer line. It was next to a commercial zone.

“The land was there, in the right place,” Balser said.

Rhode Island Housing, then called the Rhode Island Housing and Mortgage Finance Corporation, agreed to buy the property with a $2-million grant. Balser stepped down from the housing board and volunteered to manage the project.

While Balser, who was serving as a Republican town councilwoman at the time, has been a hard-charging force behind West Lane, it’s taken the community’s will to see it through.

THE LAND FELL in a residential zone where lots had to be at least 3 acres in size. The economic-development foundation donated the .65 acres — with an estimated value of $800,000 — needed to bring the lot to 6 acres.

The Planning and Zoning Boards and Town Council agreed to incorporate the property into the New Harbor commercial district. The zoning ordinances were changed to increase the size of any allowed subdivision from 16 lots to 20. With the land-use boards’ nod, the housing density on that site would be doubled to 20.

The Sewer Commission and the council extended the sewer district to include the land.

“The town was going to see it through,” Planning Board Chairwoman Margie Comings said. “We did work to get it through as quickly as possible so they could start construction.”

In addition, the Block Island Land Trust paid $60,000 to protect land along the hillside path next to the housing site. The town and state waived all fees, equaling about $40,000.

More financial help came from state and federal agencies. The project was awarded $500,000 in federal grants; Rhode Island Housing gave $3.2 million.

Add to that $227,500 from the U.S. Department of Agriculture for water and sewer, plus $38,000 from the Champlin Foundations, and $30,000 in private donations.

BALSER RATTLES THE figures off as she fingers four-inch-thick grant applications she keeps in the office above her family’s business, the Block Island Grocery.

“People in these communities have to have the desire to provide for everyone in their community,” Balser said. “We love our land. We love our open space. We also love our people.”

In addition, Block Island voters two years ago approved a 1-percent tax on summer rentals that goes into a fund dedicated to building affordable housing.

A total of 115 households submitted applications for the West Lane homes, equaling 221 residents. To be eligible, applicants had to have lived on the island for at least four years and had to be first-time homebuyers.

To make the figures work, the houses would be sold for $130,000 to $280,000, Balser said. Money from the sales and grants would be used to repay the original $2-million Rhode Island Housing loan. The houses would remain available to low- and middle-income residents forever, with the town reserving the right of first refusal.

The applicants were winnowed to 40. A team from Rhode Island Housing; The Washington Trust Company — which is handling 14 of the mortgages; and the U.S. Department of Agriculture determined which price scale the applicants fell in.

In June 2005, the Old Harbor Baptist Church’s pastor, Patricia Harrison, drew names from a basket. In the more than two years since, one individual became ineligible when he exceeded income limits upon getting married. Some had worried their spots could be in jeopardy if their incomes grew over the two years it took for the project to unfold, but Balser said last week that their incomes still fell within the limits.

The new owners watched their modular homes arrive by barge last winter. They selected carpets, cabinetry and other fixtures.

Jennifer Keane, who was drawn to the laid-back pace of island life eight years ago, isn’t one to drive by her new home. She just waits, patiently.

For others, not so.

Maureen Flaherty, a high school English teacher who’s moved five times in her 11 years on the island, roams the aisles at Home Depot and Target stores on the mainland. She has planned the morning glories, cosmos, tomatoes and cucumbers she will plant on her property, which boasts views of the ocean and the Great Salt Pond. She plans to get two dogs, maybe pugs.

For her, 2008 can’t come soon enough.

kmulvane@projo.com