Housing Bank Backers Renew Efforts to Pass Legislative Bill

By IAN FEIN

An ad-hoc group of Vineyard housing advocates have decided to
continue their pursuit of controversial legislation that would tax
Island real estate transactions to fund affordable housing projects.

The group decision came two weeks ago, some four months after the
Massachusetts House of Representatives defeated an earlier version of
the bill by a vote of 91-64. Approved in concept by Vineyard voters in
spring 2005, the housing bank bill this summer sparked debate in both
chambers of the state legislature, where opponents called the initiative
an unfair impediment on home ownership.

Vineyard Haven resident Abbe Burt, who worked as a full-time
administrative assistant for the ad-hoc housing bank coalition two years
ago, said the group was committed to seeing their vision through.

"We strongly believe that the Vineyard housing situation only
worsens annually," Ms. Burt said this week. "And so we feel
it is vitally important to secure stable, long-term funding for
community housing."

Coalition members waited until after the state election last month
before deciding how to proceed. They have since met with state Sen.
Robert O'Leary and spoken with Rep. T. Eric Turkington, both of
whom agreed to refile the special legislation in mid-January along with
a parallel initiative on Nantucket.

Modeled after the Island land banks, the housing bill would generate
funds for affordable housing projects by taxing Island real estate
sellers one per cent of their transaction price. The first $750,000 of
the purchase price would be exempt on the Vineyard, and the first $2
million would be exempt on Nantucket.

Senator O'Leary and Representative Turkington maintained from
the start that the transfer tax faced an uphill battle on Beacon Hill,
where earlier this year it saw heavy lobbying opposition from the
Massachusetts Association of Realtors. But both lawmakers said this week
that Democratic gains, a new governor, and familiarity with the bill
from the last legislative session could help its chances. Senator
O'Leary noted that 15 house votes would swing the bill toward
approval.

"We came close, very close," said Senator O'Leary,
who shepherded a 23-14 passage of the housing bank bill in the state
senate before it reached the house last summer. "It is something I
believe can happen," he added.

"We've been through this once, so we know what all the
questions are," Representative Turkington said this week.
"Now we need to come up with the answers."

The ad-hoc housing group at this point is leaning away from the
political advice of Senator O'Leary, who recommended that they
bring the housing bank question back before town meeting voters this
spring. The senator said the 2005 nonbinding ballot initiative was
recent enough to proceed with at the state house, but said frankly that
another round of Island approvals would help its chances. He said a
strong showing of community support would be a powerful response to
critics in the state legislature.

"What's important here - what needs to be
understood - is that it must be an effort by the community,"
Senator O'Leary said. "To the extent we can emphasize that,
we strengthen our argument."

Representative Turkington warned that housing bank advocates should
not focus all of their efforts on Beacon Hill because, if passed by the
legislature, the proposal would still require another vote of approval
from each Vineyard town. Islandwide the housing bank concept received 58
per cent approval in its spring 2005 ballot initiative, but the level of
support varied from town to town, and passed in Edgartown by only 26
votes.

The housing bank bill also has the official endorsement of only one
Vineyard public organization - the Martha's Vineyard
Commission, which itself recommended last fall that the ad-hoc group
seek votes of support from Island town boards. Housing bank advocates on
Nantucket have endorsements from a number of government, business and
community groups, including selectmen, the Nantucket Planning &
Economic Development Commission, the Nantucket Association of Real
Estate Brokers and the Nantucket Builders' Association.

Nantucket voters at a special town meeting in October also approved
the housing bank concept as a home rule petition.

Ms. Burt this week said the Vineyard housing bank coalition is
confident of its support on the Island.

"After the 2005 vote, we feel we have a mandate to carry this
as far as we can," Ms. Burt said. "The vote wasn't
overwhelming, but we do think we have strong public support that will
only grow and increase."

Ms. Burt said the Island Affordable Housing Fund, a nonprofit
housing organization in Vineyard Haven, has again pledged to provide
lobbying money for the housing bank initiative, though it does not
intend to spend as much as it did in the last legislative session. Prior
to the house vote this summer, the housing group spent roughly $120,000
on lobbying and consulting fees for the bill. The year before, the group
spent more than $85,000 in a six-month campaign leading up to the spring
2005 town meeting and ballot votes. That year, aside from the nonbinding
housing bank question, four Vineyard towns also adopted the Community
Preservation Act - which raises funds for affordable housing, open
space and historic preservation through a property tax surcharge and
matching state funds.

Advocates admitted that the money spent on both campaigns could have
gone toward actual housing projects, but argued the expenditures were
justified because they would create millions of dollars a year in stable
funding for affordable housing.

Their projections for such funding, however, now appear to be in
question.

When advocates said the Community Preservation Act would bring in
about $2.5 million each year for affordable housing, they assumed that
75 per cent of collected funds would go toward affordable housing, and
that the state would fully match the local contributions for five to ten
years.

The Island Affordable Housing Fund this week sent a letter to town
community preservation committees expressing surprise and concern that
town officials are looking to spend a majority of preservation funds on
non-housing projects. Meanwhile, the Massachusetts Department of Revenue
recently announced that next fiscal year may be the last time the state
matches 100 per cent of the local community preservation contributions.

State community preservation funds are drying up because more
Massachusetts towns have enrolled in the program (voters in nine more
communities approved the Community Preservation Act in the state
election last month, bringing the total of enrolled municipalities to
118 - or about one-third of the commonwealth), and also because of
an overall decline in the statewide real estate market. The commonwealth
collects its community preservation funds from transaction fees at
registry of deeds, where the total number of transactions in recent
months has dropped steadily.

The stagnant real estate market on the Vineyard will also affect
projections on the housing bank legislation, which advocates said would
bring in more than $2 million per year of Island housing. That estimate
was based on 2005 Martha's Vineyard Land Bank revenues, which have
also dropped precipitously. Through the first five months of the current
fiscal year, land bank revenues are down roughly 30 per cent.

Ms. Burt this week said a cooling real estate market was not a cause
for concern.

"These things go in cycles," she said. "I'm
sure those numbers will pick up again next year."