Council mulls tax hike for housing, preservation

Boston voters in November may be asked to implement the Community Preservation Act, an action that would result in a property tax surcharge to be used for historic preservation, housing, and parks.

City Councillors Michael Flaherty and Andrea Campbell are sponsors of a measure to accept the CPA’s provisions. At the council meeting last Wednesday, Flaherty said the measure was a timely resource and one that was long overdue. “As Boston is experiencing an era of economic development and unprecedented growth, I felt it was appropriate to at least have this discussion,” he said.

The 2000 law has been adopted by 160 cities across Massachusetts, including Cambridge, Somerville, and Quincy, setting up surcharges between 0.5 percent and 3 percent. A 2001 referendum on the CPA in Boston that would have implemented a two percent surcharge was voted down.

Since then, Flaherty said, “we have basically lost out on close to $300 million of very necessary funds.”

The proposal now under discussion sets a one percent surcharge, which would boost property tax bills across the city by an average of $23 a year, although Campbell said some neighborhoods would see no spike at all.

Exemptions are noted for low-income and elderly homeowners and affordable housing developments. The first $100,000 in valuation on homes and most commercial property would also be exempt, although the largest impact would likely be on larger commercial properties and those that have gained substantial value in recent years.

“This is something that District 4 residents in particular care deeply about, as the city continues to seek creative tools and ways in which to increase the availability of affordable housing,” Campbell said at the meeting. “This is one of those creative tools that offers additional funding if it gets adopted.”

The Massachusetts Association of Community Development Corporations has advocated for the CPA in Boston for years and also testified in favor of the state matching at least 50 percent of the locally generated funds.

The legislation would raise an estimated $13 million from the direct surcharge, matched with another $6 million to $7 million from the state. Flaherty said that money would go a long way toward meeting “the aggressive affordable housing goals that our mayor has set.”

Mayor Martin Walsh’s administration has not officially taken a position on the measure, although housing chief Sheila Dillon said they are looking forward to the public discussion and evaluating the respective burdens as well as the state fund matching.

“We did recognize that we need to increase our resources for the construction of affordable housing and we want to examine this as a potentially useful tool,” Dillon said. At the moment, she said, “we’re really just kind of getting our head around the bill and what it would mean for the folks who are paying and what it would mean for affordable housing production.”

Landlords and developers may well be feeling the strain from this and other recent measures toward increasing affordable housing stock. Changes to the city’s Inclusionary Development Policy in December altered affordable housing requirements for new developments.

Councillor Bill Linehan said at the meeting that the weight on property tax owners had expanded and increased to almost “an unfair burden.” The CPA “seems to me something we should be extremely cautious about going forward,” he said.

Boston voters are currently paying into the broader CPA program, although they are not directly benefitting from it, Campbell said. Of the $180 million generated statewide this year by the fund, Boston has contributed $11.4 million, she said.

Bostonians should have another swing at reaping some of those benefits and considering the costs, she added. “What’s great about this is an opportunity for voters and residents to decide. “We simply have to give them that choice.”