Speaker Voices Support For Real Estate Transfer Tax
House Speaker Ronald Mariano has expressed initial support for a proposal contained in Governor Healey’s Housing Bond Bill that would allow individual cities and towns to adopt a local option increase to the real estate transfer tax in order to fund the development of affordable housing. Under the proposal, communities would be allowed to impose a fee of 0.25 to 2 percent on the price of a property sale over $1 million. Mariano echoed the Governor’s concern that too many young adults are leaving the state due to the lack of affordable housing. Mariano noted that the 2 percent ceiling for the tax may be too high which could in turn inhibit new construction projects.
The Speaker cautioned that he needs to talk to his House colleagues to determine if there is widespread support for the Governor’s proposal. An alternative to the Governor’s transfer tax has been filed by Senator Julian Cyr which would limit the availability of the new transfer fee only to those communities that have already met the 10 percent affordable housing threshold under Chapter 40B and have approved a multi-family zoning district. Mariano pointed to the softening of state tax collections as a reason why local communities should be allowed to seek additional sources of revenue. The Committee on Housing recently voted to approve the bond bill without any recommended changes. A redraft of the bill is likely to emerge from the House Committee on Ways and Means after the House passes the FY 2025 Annual State Budget in late April.
Speaker Supports Expansion of MWRA to Increase Housing Construction
Speaker Mariano has proposed expanding the geographic scope of the Massachusetts Water Resources Authority as a means to provide much needed water supplies for the construction of new housing developments. Mariano pointed to a lack of an available water supply for the stalled construction of housing in his district at the former South Weymouth Naval Air Station. He estimates that making a new source of water available to the Town of Weymouth could result in the construction of 6,000 new homes.
The MWRA has more water capacity available than previously projected and the agency has been looking at plans to expand their services to the south and north shore communities and to regions in northern Worcester County. Legislators from the western part of the state have also urged the MWRA to expand services to the communities surrounding the Quabbin Reservoir which is the source of the MWRA’s water supply. The proposed expansion projects would require billions in new funding and would likely take decades to complete. The MWRA currently provides water and sewer services to 3.1 million people in 61 communities in eastern and central Massachusetts.
House Bill Bans Use of Credit Reports for Employment
The House of Representatives has passed and sent to the Senate legislation that would ban the use of credit reports as a basis for hiring employees. Employers would be prohibited from requesting a credit report or from asking a prospective employee about their credit history. The bill exempts those positions where the review of a credit report is required by either state or federal law. This bill does not affect an employee’s right to conduct criminal, academic and employment history background checks. The sponsors of this legislation believe the use of credit reports adversely impacts low income and minority applicants and believe this legislation will help address the bias against those applicants. They describe a “catch-22” cycle where persons with bad credit cannot improve their economic standing when they are shut out of the job market. They point out that many workers suffer damage to their credit rating due to circumstances beyond their control. Several employers testified that the use of credit reports limited the pool of qualified applicants and the reports were not a good predictor of employee behavior. This bill will now be considered by the Senate before the end of the legislative session that ends on July 31st.
Governor Healey Seeks Increase in Migrant Work Permits
Through the end of 2023 the federal government has approved work authorizations for 2,700 new migrants in Massachusetts but has not issued any new permits in the first 3 months of 2024. The Governor has called on federal agencies to continue their efforts so that more of the migrants can obtain employment and move out of emergency shelters. However, with a tight housing market it is unclear whether persons employed at entry level positions at lower wages will be able to obtain affordable housing. It is estimated that the state is paying close to $1 billion a year to operate state housing shelters. The system has a cap of 7,500 families and 780 families remain on the waiting list as of early March. The Legislature has proposed limiting the time a family can remain in a shelter to no more than 9 months.
State Commits Funds for Cape Cod Bridge Replacement
The state recently entered into an agreement with the Army Corps of Engineers to earmark $700 million towards the replacement of the Sagamore Bridge. The Corps has agreed to allocate $600 million towards the project and the state has applied for a $1 billion federal Bridge Investment Program grant to close the gap on the estimated $2.25 billion cost of replacing the bridge. The state will seek to replace the Bourne Bridge after work on the new Sagamore Bridge is completed. The memorandum of understanding signed between the state and the Army Corps of Engineers will transfer ownership of both bridges from the Corps to the state. Both bridges are 88 years old and are considered structurally deficient and functionally obsolete.