BOSTON (State House News Service) – Backers of legislation allowing property owners to group together into community benefit districts to obtain extra services thought they’d found a way to allay Gov. Charlie Baker’s concerns.
But for the second year in a row, Baker took issue with the proposal after it lawmakers approved it.
The annual state budget lawmakers sent Gov. Charlie Baker earlier this month included language authorizing the creation of community benefit districts, through which property owners in a neighborhood establish a nonprofit board to procure additional services — like added security, signage, beautification efforts or cultural activities — funded through an assessment on the district members.
Baker vetoed similar language from an economic development bill last summer, and this year returned the budget section to the Legislature with an amendment proposing a new text.
“I’m hopeful that we will work this out and make this law one way or another so that the communities can take advantage of really kind of determining in their own right what is important and what the important issues are,” said Sen. Eileen Donoghue, who sponsored the community benefit district amendment.
Donoghue, a Lowell Democrat, said she and others who backed the districts thought they had addressed Baker’s concerns. “Apparently there were other issues that the administration raised in the latest amendment,” she said.
Specifically, the budget section responded to Baker’s concerns that tax-exempt entities and homeowners who are entitled to tax abatements would have to pay district assessments. It states that nonprofits and others with tax-exempt status would not be required to pay the assessment, but could elect to do so.
“I commend the Legislature for addressing issues relating to tax exempt entities and residential property owners who are entitled to tax abatements,” Baker wrote in a message to lawmakers. “The proposal as written provides adequate protection for these groups. However, the third issue I raised last summer, the need for majority support before the tools of government may be used to take money from property owners, remains unaddressed. In addition, a number of clarifications to the statutory language could make it easier for municipal officials and other proponents to implement this law if it is enacted.”
Among other changes Baker’s amendment (H 3823) requires a majority vote by property owners to form a community benefit district and requires that assessments “be reasonably proportionate to the benefit received.” It also makes the nonprofit board members subject to state ethics laws.
Asked if she could support what the governor proposed, Donoghue said, “I’ve taken a look at the language. I certainly support what we passed in the budget. I’ll leave it at that.”
Andre Leroux, executive director of the Massachusetts Smart Growth Alliance, said Baker’s amendment gives municipalities more control over the districts, which he said represents a “fundamental shift” from what lawmakers originally proposed and could discourage nonprofits and the private sector from getting involved.
“You simply can’t have local government meddling in the affairs of independent nonprofit organizations, and you don’t want to politicize every single thing they do,” Leroux said.
Community benefit districts are similar to business improvement districts that already exist under state law, but allow more flexibility, according to Donoghue. Leroux said five business improvement districts exist in the state, and said people might be wary because they are unfamiliar with the concept.
“We just don’t have a lot of experience with this, and people I think are afraid of what it is,” he said. “It’s not a tax, although people treat it like some kind of added tax. It’s more like a condo association.”
Municipal officials from New Bedford, Salem, Worcester, Revere, Somerville, Medford, Melrose, Fitchburg, Arlington, Littleton, Lowell, Winchester, Lexington, Easton, Plymouth, Andover, Framingham, Natick, Newton and Dedham signed onto a June 26 letter to Baker asking him approve the budget language.
“I think the real challenge is that we’ve had the last 12 months to work on language and to get all new language now is difficult when a lot of these communities, like Somerville for example, like New Bedford, they’re waiting for this tool,” Leroux said. “They were hoping it would be in place by the end of the month.”
Baker’s amendment is now before the House Committee on Bills in Third Reading.
A separate Donoghue bill (S 82) establishing community benefit districts is before the Joint Committee on Community Development and Small Businesses, which solicited testimony on it in May.
“I remain hopeful and optimistic that this becomes law in the not-too-distant future,” Donoghue said.