Government Affairs Update – Third Quarter of 2017

Massachusetts State House - Freedom Trail Site - Boston, Massachusetts, USA

The third quarter of 2017 welcomes the General Court back from a brief summer break. At this point in the year, the annual budget has been mostly resolved and public hearings are continuing for the thousands of bills that were filed for this session. Here are a few of the highlights from the Realtor® perspective.

Housing Production Legislation

At the end of July, the Joint Committee on Housing redrafted H668 An Act to expedite multifamily housing and reported the bill favorably from committee. Chairman of the committee, Representative Honan, filed H668 at the request of MAR. The redraft of the bill supports the major components of the original bill, namely multifamily development, accessory dwelling units, and cluster development. Increasing housing production is necessary to combat the state’s housing affordability problem and this legislation would help significantly. MAR provided testimony to the Joint Committee on Housing which supported thisin support of this important piece of legislation.

Zoning Legislation Public Hearing

On September 28th, the Joint Committee on Community Development and Small Business held a public hearing to receive testimony on just one bill, S81 An Act promoting housing and sustainable development. MAR opposes the legislation because of the negative impact the bill would have on housing production and housing affordability in Massachusetts. Realtors® are joined in their opposition by NAIOP—The Commercial Real Estate Development Association, The Homebuilders and Remodelers Association of Massachusetts, and the Greater Boston Real Estate Board. MAR 2017 President Paul Yorkis and Legislative & Regulatory Counsel Justin Davidson provided testimony that focused on the current housing affordability crisis in Massachusetts and how this legislation would worsen the existing problem. Specifically, President Yorkis provided testimony and experience on the impact that inclusionary zoning laws can have on the cost of housing. Realtors® are joined in their opposition by The Commercial Real Estate Development Association, The Homebuilders and Remodelers Association of Massachusetts, and the Greater Boston Real Estate Board.

State Sanitary Code

The Massachusetts Department of Public Health recently released draft regulations to update the existing State Sanitary Code. The State Sanitary Code is the official minimum standards of habitability that all rental housing is required to meet. The proposed amendments are comprehensive and described as a long overdue update to the code. However, MAR submitted comments that raised concerns on three major changes in the code. The first change would require landlords to develop an integrated pest management plan and would additionally require quarterly inspections regardless of whether there have been any reports of pests at the property. Another new proposal would require landlords to provide mechanical ventilation in all bathrooms. Previously, bathrooms with windows did not require additional mechanical ventilation. Lastly, the new code would also require the local boards of health to inspect and report on the presence of mold in a unit.

Uniform Wetland Hearing

In September, the Joint Committee on Environment, Natural Resources, & Agriculture held a hearing that included H391, An Act providing for more efficient wetlands. Filed at the request of MAR, this bill seeks to eliminate those local wetland regulations that are stricter than the state Wetlands Protection Act and have no scientific basis. MAR President Paul Yorkis and Legislative & Regulatory Counsel, Justin Davidson testified in support of the legislation. The testimony highlighted the concern that communities continue to use local wetland regulations to restrict growth in their communities. Realtors® support conservation efforts, but those efforts must be rooted in science and, not a desire to restrict housing growth.

Transfer Taxes

On August 3rd, the Joint Committee on Revenue advanced two bills that seek to add transfer taxes in the towns of Provincetown and Nantucket. The imposition of this type of new sales tax on homes could have serious implications for the Massachusetts economy and set the wrong precedent for the Commonwealth’s tax policies. Transfer taxes would increase the bottom-line price of many homes by thousands of dollars and unfairly single out homebuyers and sellers.

Lead Paint Regulations

At its meeting on September 13th, 2017, the Massachusetts Department of Public Health Public Health Council approved the promulgation of amendments to 105 CMR 460.000: Lead Poisoning Prevention and Control. The revised regulations will become effective on December 1, 2017. The changes lower the threshold blood level defining lead poisoning and thereby expand enforcement of the Lead Law. The amendment adopts the United States Centers for Disease Control suggested lead poisoning level in children with a venous blood lead level of 25µg/dL or greater to a blood lead level of 10µg/dL or greater. Additionally, the amendments remove the de-leading standard for a small number of surfaces, specifically some surfaces currently considered “accessible/mouthable,” which could substantially reduce de-leading costs. No changes were made to the disclosure requirements or process for home buyers and sellers, and no changes were made to the obligations for real estate brokers and salespersons.

Federal Issues

On October 18th, the National Association of Realtors® launched a member-wide call for action to urge Congress to preserve the mortgage interest deduction, the state and local tax deduction, and Section 1031 Like-Kind Exchanges. Realtors® are asked to remind Congress that tax reform must not dilute the current real estate tax provisions vital to the housing market and the economy. In addition to tax reform issues, NAR is strongly urging Congress to pass a long-term extension of the National Flood Insurance Program. Without Congressional action, the current program is set to expire on December 8th, 2017. Flood insurance is essential for many property owners in Massachusetts and across the nation. Without an extension, thousands of transactions will be at risk.