Legislative Update from Preti Strategies for April 2024

By a joint House and Senate rule, full formal sessions, where larger controversial issues can be debated and voted on, ends on July 31, 2024.  With the clock ticking, and the debate over a tighter-than-normal annual state budget looming, Governor Maura Healey's housing bond bill is making its way through the legislative process and is expected to be considered first by the House of Representatives in early Spring.  The $4.1 billion bond authorization bill contains an additional 28 policy proposals, some of which are good, and some of which are bad from SPOA’s perspective.  When the bill was heard before the Joint Committee on Housing in January, SPOA testified against one of the bad ones—the so-called “transfer tax.”  This provision allows any city or town to impose additional fees on certain real estate transactions.  In testimony to the committee, SPOA outlined its opposition, stating: "[The transfer tax] runs counter to the bill's broader goal of increasing the supply of housing for the simple reason that this will further constrain the housing market in a time of adverse economic conditions."Also concerning, the housing bond bill allows for expanded record sealing.  SPOA has long opposed any attempt by the legislature to seal rental history records because we believe landlords need full transparency when making decisions.  Last session, a less-than-perfect, but much improved, eviction-sealing bill died at the end of the session.  Some of the most egregious sections that would have allowed for the sealing of cases where the tenant committed illegal activities were stripped from the bill after feedback was received from SPOA.  With that same compromise version having been re-filed by the governor as part of her housing bill, we were surprised to see a new version emerge from the House Judiciary Committee.  The new version is actually a giant step backwards and brings new challenges in terms of potential liability to small landlords.  We will have more on this later, but clearly there is a lot of work left to do on this issue.On the positive side, the governor’s bill will make it much easier for accessory apartments to be brought online as the bill overrides local zoning ordinances and requires communities to approve these new units provided minimum standards are met.  We applaud the governor for this initiative which will bring thousands of new rental units into the marketplace. Finally, we are deeply concerned about Boston Mayor Michelle Wu’s proposal to dramatically increase the tax liability for commercial properties.  Not only could this be a devastating blow to rental property owners, but it could also severely hamper efforts to revitalize the downtown area and slash overall commercial tax revenues even further.  From a state-wide perspective, Wu’s proposal must get legislative proposal to move forward.  Our concern, and the reason we will be watching this process closely, is that any effort by the legislature to allow Boston an exception to the rule could embolden other communities to ask for the same thing.  SPOA will continue to update the membership as this proposal moves through the local and state legislative processes. by Jim Eisenberg