The Ghost of Site Plan Reviews Yet to Come

 

Bob Ruzzo 

Are these the shadows of the things that will be or are they shadows of things that May be, only?”

Charles Dickens, 

 A Christmas Carol

Holiday treats arrived early for REBA members prescient enough to attend Site Plan Review: The Ghost That Haunts Land-Use, a breakout session at the

Annual Meeting and Conference last month. That title is a riff on Judge Foster’s observation in Willis v. Nelson (No.19 MISC 0000041, WL 2180689, at *1 (Mass Land Ct. May, 2019)) that: “Site plan review is the unacknowledged ghost haunting land use law.” Conspicuously absent from the state Zoning Act (Chapter 40A), site plan review is nonetheless “present in nearly every municipality’s zoning bylaw or ordinance.”

 

The panel, moderated by former REBA president Kathleen M. O’Donnell, featured two knowledgeable presenters, Michel Wigney and Shawn McCormack, who blazed a path through the (extra-legislative) development of site plan review, beginning with its sanctioning by the Supreme Judicial Court in the Y.D. Dugout. Inc. case, right on through to an assessment of difficulties with the present application of site plan review practices in various municipalities. In keeping with today’s chosen theme, let’s refer to these two story elements as the ghost of Site Plan Reviews Past and the ghost of Site Plan Reviews Present, respectively; and let’s just say the entire presentation scared the dickens out of the Housing Watch.

 

Why? Well as land use practitioners are aware, the cities and towns of the commonwealth are painfully unique. Even at the peak of his influence, Chairman Mao only expressed a wish to let one hundred flowers bloom. Because site plan review lacks any anchor in Chapter 40A, we face the potential for as many three hundred and fifty variations on the site plan review theme. At first, one might be comforted by the notion that site plan review, when properly applied, is intended to constitute a “conformance review” of a structure allowed “as of right.” Properly utilized, it may have great value as a comment gathering exercise through which designs can be critiqued and then refined. Yet in practice, alarming disparities have arisen over such questions as: (1) whether a planning board may impose stricter dimensional requirements through site plan review; (2) just what the role of abutters is during a site plan review process; (3) how long the review period may extend; (4) what the standard of review is; and (5) most agonizingly, how to appeal a negative site plan review determination if the ordinance is silent on that issue.

 

That last point bears repeating. If a site plan review ordinance does not specify any method for appeal, the accepted practice today is to obtain a negative determination from the building inspector and then to appeal that negative determination to the appropriate permit granting authority. Only when the inspector’s denial is confirmed by such a body should one proceed with a court appeal.

 

Think about that for a moment. If a site plan review resulted in a negative determination, a proponent is highly unlikely to have taken the step of preparing plans and specifications suitable for obtaining a building permit. Yet the building inspector reviewing such a negative determination would arguably be justified in citing the lack of plans and specifications as an independent ground for denying a building permit. And that’s not even the scariest thing about site plan review.

 

As in the Dickens’ classic, the truly scary specter in all of this is the ghost of Site Plan Reviews Yet to Come. After all, the recently enacted new Section 3A of Chapter 40A purports to bring “as of right” multifamily housing districts to 175 “MBTA communities” subject only to “site plan review.” If this new legislation holds the key to a better housing future for Massachusetts, we need to start paying a lot of attention to the site plan review requirement now.

 

The final guidance for Section 3A deals gives “Site Plan Review” only a cursory mention. The present-day realities (nightmares?) reviewed by counsellors Wigney and McCormack are not addressed in any detail, although the guidelines do state that site plan review “should not unreasonably delay a project or make it infeasible or impractical to proceed with a project.” The  lack of clarity about appeal procedures and the absence of a time limit on the duration of site plan review is plainly inadequate. As the late judge Rudy Kass wrote in the Milton Commons decision back in 1982, “Delay is often as effective as denial” (see, note 2).

 

As a means of addressing the ample real-life challenges presented by working with site plan review in its current unwieldy form, the panelists suggested that a legislative addition to the Zoning Act could inject some much-needed uniformity. Ordinarily, the Housing Watch would caution against relying on a legislative solution any time soon. But in this case, the spirits may be able to do their work all in one session.

 

That’s because the communities seeking to comply with Section 3A will need to submit a compliance package to the Department of Housing and Community Development (DHCD). Included in that submission will be the text of their actual ordinance or by-law. DHCD still has time before the first submission deadline (December, 2023) to provide model provisions for site plan review addressing appeals, the standard of review, timing, and other procedural issues. Circulating such guidance early would prevent the inevitable last-minute frenzy that will accompany the deadline. Such guidance could also serve as a “first draft” for incorporating a new provision in Chapter 40A addressing site plan review as a whole.

 

Why that sounds distinctly like optimism! Well, as our friend Ebenezer once inquired: “Spirit…Why show me this, if I am past all hope?

 

Co-chair of the REBA affordable housing section, Bob Ruzzo is a former Massachusetts Deputy Secretary of Transportation. He also served as the Deputy Director/Chief Operating Officer at both MassHousing and MassDevelopment.  His column, “The Housing Watch…” will be a regular feature in REBA News and on the REBA Blog He can be reached at bob@bobruzzo.com. The views expressed are solely those of the author.

 

         

The Triumph of Hope Over Experience?

Robert M. Ruzzo

This August, when the Baker-Polito administration released long anticipated final guidelines for new Section 3A of the Commonwealth’s Zoning Act (Chapter 40A), optimistic assessments

of the new provision’s potential impact abounded. Section 3A requires 175 “MBTA Communities” to have at least one reasonably sized zoning district where multi-family housing is allowed “as of right.”

Such a reception should not have come as much of a surprise. Frustrated by the continuing failure of the legislative ball of purulence that is our current Zoning Act, housing advocates have chased moonbeams for decades in the hopes of boosting the state’s meager rate of housing production.

Like economists who have successfully predicted nine out of the last five recessions (maybe they are on track this time), housing advocates have consistently overestimated the change making ability of adopting new land use regulatory techniques. Two such examples for the would-be open space residential district (cluster) zoning and inclusionary zoning. These once bright shiny new tools were touted as the key to more sustainable and more affordable housing development in the Massachusetts. Please don’t misunderestimate the Housing Watch. It’s not that these tools aren’t valuable, they are; but they have not moved the dial one whit when it comes to the comparative affordability of our state’s housing when stacked up against other states competing to attract or grow the same companies.

Similarly, various legislative proposals such as Chapter 40R, Chapter 40S, and the starter homes zoning district initiative have been paraded through streets strewn with flower petals upon passage. One could even be forgiven for imaging a gaunt figure whispering “Memento Mori” as these enactments enjoyed their moment of triumph. Each was touted as a key to “bending the curve” and improving the affordability equation in Massachusetts.

The Housing Watch stands as guilty as the rest, particularly with respect to Chapter 40R. Despite uncertain funding sources, the tardiness in adding the Chapter 40S “school impact insurance” (to say nothing of the convoluted results of its formula), hopes for this zoning approach aimed at redevelopment and maximizing transit investments still burned brightly. Yet, as Bill Parcels (remember him?) used to say, “you are what your record says you are.” Candidly, the record says that Chapter 40R is not much. The latest statistics available (from 2019) on the DHCD website indicate that Chapter 40R has yielded only a total of 22,213 potential units, out of which a mere 3,759 have had a building permit issued.

Hopes were similarly high with respect to a common-sense starter homes district proposal in 2016. As things turned out, melding this initiative with the density driven minutiae of smart growth districts literally proved fruitless. No units have been produced as of today. A new proposal to move the starter homes district initiative into its own separate chapter (a proposed new Chapter 40Y) remains stalled (as of this writing) with the Economic Development bill that ran out of steam at the end of the formal legislative session in July. The Housing Watch wishes that effort all the best, but would caution against Dickensian expectations.

So, is the excitement over the issuance of final guidelines for “as of right” multifamily districts merely the triumph of hope over experience? Or are there legitimate reasons for believing this time will be different? Remember, Chapter 40R promised “as of right” approvals, yet the implementation of that statute became mired in an array of mind-numbing design standards and doubts about whether the money would be there for zoning incentive payments.

Still, there are at least two reasons for optimism.

First, unlike Chapter 40R, new Section 3A is mandatory, directing that municipalities shall create at least one reasonably sized multifamily as of right district. Section 3A, however, contains only modest explicit penalties for a failure to act (municipal ineligibility for the three grant programs, the most important of which is the MassWorks grant program). The new administration is likely going to have to do a lot better than that. If municipalities balk to any significant extent, assessing how “persuasive” the new administration is willing to be will be a litmus test for assessing its commitment to housing. Because it is at first blush difficult (though I'm sure not impossible) to imagine a scenario where a multifamily housing developer would have standing to challenge municipal obstinance in carrying out this mandate, providing the proper range of carrots and sticks for communities to act will likely be an almost exclusively administrative matter. So, the new administration has got that going for them….

Second, the animus of the times is different. The inter-relationship of transit investments and housing density is much more top of mind in Massachusetts than it was when Chapter 40R was enacted in 2004 (and the Housing Watch still has the bruises to prove it). Nationwide, notwithstanding the pandemic, automobiles seem on the road to becoming more of a service rather than an essential good. New generations are growing up with a distinct animus against what many Americans once viewed as their four wheeled birthright. That’s unlikely to change. The times and the technique may for once intersect. So, there is reason for some hope.

Otherwise, it could be back to the drawing board. Anyone up for another go at rewriting Chapter 40A? Or maybe, to paraphrase another Bill (one even more famous than Parcells), the fault may lie not in our statutes, but in ourselves.

Co-chair of the REBA affordable housing section, Bob Ruzzo is a former Massachusetts Deputy Secretary of Transportation. He also served as the Deputy Director/Chief Operating Officer at both MassHousing and MassDevelopment.  His column, “The Housing Watch…” is a regular feature in REBA News and on the REBA Blog. He can be reached at bob@bobruzzo.com

Massachusetts Must Rely on Chapter 40B

 Robert M. Ruzzo

The dog days of August mark the 53^rd birthday of M.G. L.c. 40B §§ 20-23 (“Chapter 40B,” the “Comprehensive Permit Law,” or the “Affordable Housing Law”). Even today, Chapter 40B continues to

punch above its weight in terms of delivering new housing throughout our Commonwealth. But, according to statistics recently updated by the Massachusetts Housing Partnership, the Affordable Housing Law may be edging toward premature retirement. Of the 101 communities within the Metropolitan Area Planning Council (“MAPC”) region, the total number of new housing units needed to achieve the magical “ten percent threshold” under Chapter 40B is less than 15,000 (subject to adjustment when the new 2020 census data is incorporated). Forty-three communities in the MAPC region are presently over that threshold. The only question now is do we congratulate ourselves, or do we come clean, admit we (arguably) got there by cheating, and repent? Given the projected need for 200,000 new housing units statewide over the next decade, do we really have any choice?

For a Commonwealth full of intelligent people, we in Massachusetts sure have a tough time counting. At least when it comes to counting affordable units on the state’s Subsidized Housing Inventory (“SHI”). The SHI is maintained by the Department of Housing and Community Development (“DHCD”) and is used to determine whether a municipality has met the most important of the three “statutory minima” under the Affordable Housing Law. Chapter 40B fans and foes alike know that 100 rental units built under a Comprehensive Permit (requiring 25 percent affordability) count as 100 units on the SHI, but an identical 100-unit condominium development built in the same fashion adds only 25 units to the SHI.

The lore behind this approach is that long ago in a commonwealth not far away, DHCD concluded that municipalities needed an incentive to accept rental housing developments. Actually, that’s not quite how things were at the very beginning. It was not until a 1981 Housing Appeals Committee (“HAC”) case, Cedar Street Associates v. Zoning Board of Appeals of the Town of Wellesley, that the HAC rejected, as “too zealous,” an existing regulation providing that “only those units … that are provided at below market rental or cost shall be counted…” for the purposes of the SHI (see footnote 17).

With the median house price for Greater Boston recently scraping the $900,000 mark, DHCD needs to re-examine this approach to counting. The Housing Watch does not advocate this change out of any animus against municipalities. To the contrary, if DHCD drives this shift, there is a reasonable possibility for an acceptable transition to “Chapter 40B version 3.0.” On the other hand, if litigation drives this change, expect the sort of chaos and confusion that followed the HAC’s decision in 1999 to recognize the New England Fund (“NEF”) of the Federal Home Loan Bank Board as a “subsidy program.” That decision sparked a Comprehensive Permit revolution and gave birth to what the Housing Watch calls “Chapter 40B 2.0.” All it took was more than a decade, a temporary shut-down of the program, the intervention of MassHousing, and the defeat of a referendum question to restore some sense of equilibrium to the Chapter 40B equation. No one needs a repeat of that.

And it does not take a genius to realize that litigation is coming. As fans of the Housing Watch (thanks to both of you, btw) know, the SJC considers the issue an open one, stating in Sunderland vs. Sugarbush Meadow (2013) (n.12), that “[w]e need not address whether the inclusion of non-subsidized housing units in the SHI is permissible under [Chapter 40B].” When the inevitable litigation comes, the language of the Comprehensive Permit Law won’t help a municipality’s case much. Section 20 of Chapter 40B provides that local requirements are “Consistent with local needs” if “low or moderate income housing exists which is in excess of ten percent of the housing units” in that municipality. That same section defines “Low- or moderate-income housing” as “any housing subsidized by the federal or state government.” It’s tough to argue that a $4,000/month rental unit in an NEF development is being subsidized by the government, but a $600,000 condominium unit in an NEF development is not, particularly when NEF funds are commonly not the cheapest source of financing, and developers have over the years consistently sought to drive down the percent of NEF funds required in their development financing plans.

As recent SJC cases involving Chapter 91—the Moot decision in 2010 and the Armstrong decision in July—demonstrate, even an agency with “a wide range of discretion in establishing the parameters of its authority” is subject to judicial oversight. DHCD’s current approach is entitled to deference to be sure, but the standard is “one of discretion, not abdication.” Counting the present way is the type of “arbitrary or unreasonable” interpretation that invites judicial intervention.

Make no mistake, municipalities will howl that DHCD would be “moving the goalposts;” point taken, but DHCD would only be moving the goalposts back to where they were originally, and even the hidebound NFL has done that. More to the point, kindly take a look around and please tell the Housing Watch if you honestly believe that the housing affordability goalposts haven't already moved in the years since the Cedar Street ruling. To ease the pain of transition, DHCD could phase the new counting rules in over a number of years. DHCD already has numerous regulatory mechanisms (Housing Production Plans, “Safe Harbor” Rules, etc.), that serve a similar function. Second, if DHCD still wants to promote rental housing, it could programmatically provide that affordability restrictions for ownership units “burn off” after a number of years, opening up real opportunity for individuals from underrepresented communities to enjoy the full benefits of homeownership. To promote adoption of “as of right” multifamily zoning districts in MBTA communities, DHCD could provide more favorable treatment to municipalities adopting such changes, or to those that do more than the bare minimum required by the new law.

If all of us are in this together, then there should also be a willingness to incorporate legitimate municipal grievances into any new DHCD approach, and to distinguish between good municipal actors and others. A municipality that plans for housing, closes a Chapter 40B hearing in an expedited fashion, and does not appeal if a developer successfully challenges an uneconomic condition at the HAC, can and should be treated differently from a municipality that takes a diametrically opposite approach. Greater discretion should also be exercised by the subsidizing agencies in denying project eligibility letters, since not every housing proposal in every community merits a project eligibility letter, an attitude that seems to have been lost in translation somewhere along the path from Chapter 40B 1.0 to Chapter 40B 2.0.

Changing DHCD’s approach to counting represents a momentous challenge for our incoming governor, even though it does not require any legislation. But litigation is almost certainly the alternative. And then everybody loses.

Co-chair of the REBA affordable housing section, Bob Ruzzo is a former Massachusetts Deputy Secretary of Transportation. He also served as the Deputy Director/Chief Operating Officer at both MassHousing and MassDevelopment.  His column, “The Housing Watch…” will be a regular feature in REBA News and on the REBA Blog He can be reached at bob@bobruzzo.com. The views expressed are solely those of the author.

Free Advice, Well Worth the Price.

Robert M. Ruzzo

Despite the relative dearth of political headlines at the time of this writing (mid-spring), Massachusetts

is actually in the throes of a Governor’s race this year. The Housing Watch does not wish to back a particular candidate in this fight, but will always grab the opportunity to put housing in any headline. Given the fact that pandemic shortages and supply chain price pressures are now being coupled with interest rate increases aimed at curbing inflation, there are storm signals all along the housing horizon. Compelled by this confluence of events, your humble correspondent dares to share some thoughts about housing as a campaign issue and, more importantly, housing as a priority for any incoming administration, regardless of its political stripe.

We’re Number One?

Occasionally, it’s helpful to at least consider the experiences of those who have gone before you. And in all candor, this column does not recall the outgoing governor focusing much on housing during the halcyon days of the 2014 election cycle. Governor Baker campaigned as an experienced manager with financial and health care management credentials. To be candid, he came into office bringing with him the sympathies of a Swampscott selectman when it came to the demands being placed on the municipal level of government by the state. Not exactly the profile of your typical housing stalwart. All of this was swiftly overshadowed by the great "Snowmaggedon” and its aftermath, particularly its impact on the MBTA. While transit service is irrevocably intertwined with housing (hope you’ve been paying attention), the priority was, to borrow a health care term, simply to get the patient (the MBTA) ambulatory first. Then, during the second term, there was this little matter known as Covid 19. 

That's why it was particularly revealing to hear the governor, in his final speech before the Greater Boston Chamber of Commerce (somewhat akin to a commencement address) identify housing as the "principal headwind" facing the Commonwealth in the future. It's not quite the same as an outgoing President Eisenhower warning about the military-industrial complex, but it should make everyone think. Housing needs to be the priority for any incoming administration. That's not The Housing Watch talking, that’s the voice of hard-earned experience.

Build, Baby, Build!

No, The Housing Watch hasn’t “gone rogue,” but the harsh truth is current housing production levels are half of the already inadequate levels from thirty years ago. Rising construction costs and interest rates aren’t going to make things any easier. We need to focus both on the construction process itself, including exploring prudent means of greater reliance on modular construction in a way that does not irrevocably alienate union sensibilities and we need to focus intensively on the permitting/preconstruction side of the equation, seeking out what will really motivate municipalities to welcome more housing and what land use regulation techniques will deliver that production efficiently. Implementation is the most difficult stage of any policy, so that means, in particular, focusing on implementation of the new Section 3A of Chapter 40A, and its authorization of “as of right” MBTA multi-family zoning districts. Tweaking broader issues related to that goal, such as the consequences for failing to comply with new Section 3A, should be prioritized, notwithstanding The Housing Watch’s sympathy with the notion of adopting the “as of right” multi-family zoning concept state-wide.

It's About the Infrastructure, Stupid!

Speaking of zoning, there's more than one kind of infrastructure. Hard infrastructure, such as utilities (particularly water and sewer) are obviously vital to greater production and density. And that’s a great rationale for fostering ever more multi-family housing in the Commonwealth’s Gateway Cities where the infrastructure likely needs a solid upgrade rather than full scale installation.  

But there's a second kind of infrastructure and that's land use regulatory infrastructure. Here’s where Massachusetts falls down miserably, due largely to our notoriously outdated zoning enabling act, compounded by our snowflakish desire to proliferate local environmental regulations. If we are going to continue to go beyond state-wide environmental standards, better training at the local level is simply a must.  

The Housing Watch supports a dual track approach. And yes, that means tackling full scale zoning reform. But it also means first improving the carrot and stick tools we have such as Chapter 40R and Chapter 40B (more about that next time) and implementing the new Section 3A. If these tools can be tweaked enough to make continued opposition to housing production at the local level sufficiently burdensome, the eternal optimist can see an opening for the large-scale zoning reform that the Commonwealth really needs. 

Affordable Housing Doesn’t Need to Be this Complicated.

Every Affordable Houser has a horror story (or ten) about mixing multiple sources of subsidy from different entities in order to make an affordable development work. Long ago, Massachusetts’ subsidizing agencies wisely banded together to produce a “uniform” set of documents (known as “MassDocs”) to make legally tracking the requirements imposed by these various sources comprehensible. That’s been very helpful, as far as it goes, but since we have an Affordable Housing Trust in this state, one that can accept “donations” by the way, wouldn’t it be easier to “launder” (excuse me, “funnel”) the various sources through the Affordable Housing Trust and then have the subsidizing agencies provide simplified form and content for the restrictions? 

Ownership Equals Opportunity. 

Our time grows short. But this may be the most important point of all. More simply has to be done on the homeownership front in affordable housing (beyond the federal proposal for a homeownership tax credit). This may mean experimentation with the once heretical notion of “burning off” affordability restrictions on resale over time, even if that means fewer affordable units in theory. The Housing Watch is fascinated by the proposal made by the My City at Peace-HYM Investments team with respect to the P-3 parcel in Roxbury. It raises the possibility of affordable homeownership units with restrictions that fall away after fifteen years. The Housing Watch will keep a lookout for similar experiments. If we can change the municipal mindset on housing production, we can generate both new restricted units and a new generation of middle class, particularly among traditionally underrepresented communities. 

We also need to encourage new thinking about incentivizing the private sector to integrate housing assistance into the employee compensation equation.

One Last Thing. 

Can our new governor please get behind the notion of expediting (not eliminating, but really expediting) abutter (not municipal) appeals involving affordable housing developments? 

Please? 

Until next time.

Co-chair of the REBA affordable housing section, Bob Ruzzo is a former Massachusetts Deputy Secretary of Transportation. He also served as the Deputy Director/Chief Operating Officer at both MassHousing and MassDevelopment.  His column, “The Housing Watch…” will be a regular feature in REBA News and on the REBA Blog He can be reached at bob@bobruzzo.com. 

 

MBTA Multi-Family Zoning Districts: The “Reasonably Sized” Revolution?

Robert M. Ruzzo

Many believe that a brief three paragraph provision buried deep in a dense economic development bill passed by the legislature last January has the makings of a true

revolution in Massachusetts land use regulation. The legislation added a new section (3A) to Chapter 40A, the Commonwealth’s doddering, wizened zoning enabling act. By offering municipalities incentives to create transit friendly “as of right” (no variance or special permit required) multifamily housing zoning districts, the measure potentially represents the greatest incursion upon local control over land use decision making since the passage Chapter 40B in 1969. It appears the Massachusetts Municipal Association (MMA) thinks so. Media reports at the time of the bill’s passage indicated the MMA unsuccessfully urged Governor Baker to veto the measure.

Just what does this new Section 3A actually do? The tersely worded insert provides that any “MBTA Community” (a term not defined by the statute) “shall have” a local zoning regulation that “provides for at least one district of reasonable size in which multifamily housing is permitted as of right.” Not much to hang one’s hat on there. The only statutory attributes ascribed to these districts are that they must: (1) have a minimum gross density of 15 units per acre (subject to limitations of the Wetlands Act and Title V); (2) be located within 0.5 miles of a commuter rail station, subway station, ferry terminal or bus station: and (3) contain no age restrictions and “be suitable for families with children.” The state’s Affordable Housing Law (Chapter 40B), once described by one of its own drafters as “vague, even obtuse” seems positively verbose by comparison. This lack of statutory specificity will not be an excuse for municipalities; those that do not comply with the law’s requirements will not be eligible for state funding from the Local Capital Projects Fund, the Housing Choice Initiative, and most importantly, the hefty “MassWorks” infrastructure grant program, a program that has awarded between $66 and $72 million in grants to municipalities in each of the last three fiscal years

No doubt exhausted by its labors, the legislature tasked the Department of Housing Community Development (DHCD) in consultation with the MBTA and the Massachusetts Department of Transportation (MassDOT) with developing guidelines to determine community compliance with the new statute. In December, DHCD issued draft guidelines that are open to public comment until the end of this month (March 31, 2022).

This article will focus on how the guidelines define exactly what a “reasonably size” is for such a zoning district. Working our way through this exercise first entails understanding that the guidelines define an "MBTA community" more broadly than just a municipality with a transit stop of some kind. The definition also includes municipalities adjacent to communities with such a transit stop. When these “MBTA adjacent communities” are taken into account, a total of 175 cities and towns are impacted by the new law.  

Reasonableness is then addressed in two components. The first is the area of the district. The guidelines define reasonable size as “not less than fifty contiguous acres of land;” but the inquiry does not end there. DHCD will also examine the district’s “multi-family unit capacity.” Loosely translated, that means DHCD wants to know how many units of multifamily housing can be developed within the new as of right district.  How will DHCD do that? By looking at both the size of the community (defined by existing housing units) and the nature of each municipality’s transit service. 

A municipality's total number of existing housing units is determined by decennial census figures. That number is then multiplied by a percentage determined by the type of transit service in or within 0.5 miles of the subject community. The percentage utilized is far higher for “subway or light rail communities” (25%) than it is for “MBTA adjacent communities” (10%), with bus (20%) and commuter rail (15%) communities falling in between. To calculate capacity, let’s use Melrose as an example.

The city’s total of 12,614 existing housing units is multiplied by 25%, since Melrose falls into the “subway or light rail” (rapid transit) cohort of municipalities. Thus, a “reasonably sized” as of right zoning district in Melrose needs to be large enough to yield 3,154 new units. (12,614 x .25=3,614). Subdistricts with different densities are permitted. Note that for smaller communities, the minimum multi-family capacity number can never dip below 750 units. For additional nuance, please examine the guidelines.

The draft guidelines also answer many (but not all) of the questions left open by the statute. Got questions about how to deal with parkland or public rights of way? Wondering when these guidelines become effective? Good questions. Check out how the guidelines address these issues. Got war stories about how a seemingly straightforward “site plan review” process became an ulcer inducing exercise? Then by all means comment on the guidelines and perhaps suggest the inclusion of a reasonable time limit for the site plan review process discussed therein.

What will be the ultimate impact of new section 3A? Is it truly revolutionary? Probably not. Remember, as the guidelines painstakingly note, the determination of a district’s housing capacity “is not a mandate to construct a specified number of housing units” (emphasis in original). Some communities may simply forgo (or continue to forgo) competing for MassWorks grants and other state assistance. Other municipalities may well be able to draw districts that require little or no new housing to be built in order to satisfy the guidelines.

Past land use “revolutions” have not lived up to their press clippings.  Neither cluster zoning nor Chapter 40R (ouch!) turned out to be the panaceas that they were initially touted to be. Yet each is a useful tool. Given the decades it has taken to work our way into our current housing production conundrum, the new Section 3A at least has us focusing on the most rational way to begin building our way out.

Co-chair of the REBA affordable housing section, Bob Ruzzo is a former Massachusetts Deputy Secretary of Transportation. He also served as the Deputy Director/Chief Operating Officer at both MassHousing and MassDevelopment.  His column, “The Housing Watch…” will be a regular feature in REBA News and on the REBA Blog He can be reached at bob@bobruzzo.com.

 

 

 

 

 

 

 

The Housing Report Card 2017: The Dickens, You Say

By Bob Ruzzo

“It was the best of times; it was the worst of times...”

Charles Dickens, A Tale of Two Cities

The Greater Boston Housing Report Card is an annual “must-see” housing event providing, as it does, an annual scheduled opportunity to step back from the project centric trees and observe the overall state of the larger housing forest.  The most recent Report Card marks the 15^th time that the Boston Foundation and Northeastern University have collaborated on this effort, with valuable sales and ownership information being provided by the Warren Group. Even if one on occasion quarrels with or has a quibble about some of the conclusions reached in the Report Card, this report is a true civic gem and these organizations are to be congratulated and thanked for their continuing diligence (and stamina) on this issue.

As the Dickensian reference suggests, we in the Massachusetts housing sector have much to be thankful for amidst the abundant challenges that confront us.  First, the Massachusetts economy continues to chug along.  As noted in the Report Card, “real inflation-adjusted gross domestic product has increased so fast in the Commonwealth that in 2016, Massachusetts ranked first in the nation in per capita output – up from sixth place in 2015.” Non-farm seasonally adjusted unemployment has reached an all-time high.

The benefits of this economic strength continued to be skewed in their distribution, and the extremely high cost of housing in the heart of the Greater Boston economic engine complicates the ability to house badly needed workers and becomes a factor in corporate decision-making about expansion and re-location; high-class problems, to be sure, but vexing hurdles nonetheless.

Obtaining and reading the Report Card itself is highly recommended, and here are some initial tidbits to add to your own reflections:

1. Higher Priced Housing Is On The Move and coming soon to a working-class community near you.  Continued price increases in the urban core (Boston, Cambridge and Somerville) are not surprising, but the uptick in housing costs in a number of locations further out from the core is in some cases, startling.  Over the last two years, the median home price in Lawrence is up 14.2%, higher, in percentage terms, than either Brookline or Newton.  Granted, we are dealing with significantly different starting points, but this trend carries with it long-term implications for our multi-modal transportation network.

2. Boston Continues To Lead The Way.  In terms of Housing Permits issued in the five-county Greater Boston Region, the city proper, which “makes up 0.62% of the total land mass of the region and… 9.4% of the region’s population”, was responsible for 29% of the building permits issued in the region in 2016.  Other communities in the region have not kept up, on a proportionate basis, with Boston’s increased housing production.

Thus, we come upon the annual quibble: while the Report Card was subtitled “Ideas from the Urban Core,” it reads somewhat more like a “Plan for the Urban Future,” recommending a 10 step plan to develop a substantial number of “21st Century Villages,” a laudable goal that does carry with it a number of statewide policy points.

One suggestion: a straightforward “idea from the urban core” may be expressed in two simple words: Boylston Street.

Fifteen years ago, the Fenway stretch of Boylston Street was an unloved asphalt mix of muffler shops, fast food options, and deteriorating commercial space.  A committed group of residents realized that with this as the base condition, and given the inherent advantages of the area-a number of large, fixed institutional resources (including, but by no means limited to Longwood Medical Area), it was possible to do much better.  While the high-rise (and high cost) approach of Fenway’s Boylston Street is not replicable (nor desirable) everywhere, it demonstrates the tremendous “recycling” opportunities that exist in “fully built out” communities throughout the Commonwealth.  Customizing the approach (and not necessarily the result) to individual communities is a path we should continue to follow.

3. The Power of Inclusionary Zoning.  Folks who were unable to attend the rollout session at the Boston Foundation missed this one, which was presented by Sheila Dillon, the Chief of Housing & Director of the Department of Neighborhood Development in the post-presentation discussion.  She provided statistics indicating that over the last year, the number of affordable units produced through inclusionary zoning actually outstripped the number of affordable housing units added through more traditional financing techniques such as tax credits, tax-exempt debt and “soft loans.”  That’s a true testament to the power of increased density in a highly desirable market and a topic well worth further discussion.  (And it wins the nomination for this year’s “most underplayed issue” to emerge from the Report Card process).

4. Speed Helps.  A discussion of increased production within the city of Boston would not be complete without noting the dramatic reduction in the time it takes to obtain a building permit.  Average wait times for a single family home permit were shaved from 472 days in 2014 to 74 days in 2016.  The average wait time from application to permit for a Multi-family (5 or more units) development permit was also trimmed from 425 days in 2014 to 119 days in 2016.

5. Homeownership Rates Continue to Fall.  Last year’s nominee for the most underplayed issue.  As indicated in this space last year (“Don’t Look Now, But the Homeownership Rate Keeps Falling”), the drop in homeownership among the upper reaches of “prime age households” (aged 25 to 44) is particularly noteworthy.  To its credit, MassHousing has taken the first steps in a pilot program to try to identify potential new homeowners from the ranks of renters in its affordable housing portfolio.

That’s all that time allows. Pick up a copy of the Greater Boston Housing Report Card and peruse it yourself. It is well worth the effort.

“The Housing Watch” is a regular column from Bob Ruzzo,  senior counsel in the Boston office of Holland & Knight LLP.  He possesses a wealth of public, quasi-public and private sector experience in affordable housing, transportation, real estate, transit-oriented development, public private partnerships, land use planning and environmental impact analysis. Bob is also a former general counsel of both the Massachusetts Turnpike Authority and the Massachusetts Housing Finance Agency; he also served as chief real estate officer for the turnpike and as deputy director of MassHousing.”  Bob can be contacted by email at robert.ruzzo@hklaw.com.

As the Transit Oriented Development World Turns…

By Robert Ruzzo

“The pessimist complains about the wind; the optimist expects it to change; the realist adjusts the sails.”

                                                                         William Arthur Ward

Sometimes, reality can get a little daunting if one is not sufficiently careful. Witness two recent presentations touching upon the present

state of rail transportation, particularly commuter rail, and Transit Oriented Development (“TOD”) development opportunities associated with our commuter rail system.

The first, as reported in Commonwealth magazine, was a gathering of eight experts from around the country and the world that had been convened by Congressman Seth Molson and assembled by the Urban Land Institute to spend an intensive week “gathering information on the North South Rail Link and the region’s transportation infrastructure.” Kudos to the Massachusetts Competitive Partnership for funding this study.

Part of the discussion focused on the state of TOD at commuter rail locations. As reported by Commonwealth, Robert Ravelli, a director at Contemporary Solutions in London, was quoted as saying the panel members saw the “commuter rail system as an untapped resource… a lost opportunity.” He urged close examination of TOD possibilities at all commuter rail stations, many of which, in the words of the Commonwealth article, “are just rudimentary stations with big parking lots next to them.”

On the other hand, one week later at a Regional Real Estate Development Leadership Council meeting of the Greater Boston Chamber of Commerce, a Mass DOT/MBTA presentation noted past successes, current projects and future potential for just the kind of development called for by the ULI Study group. In a candid assessment examining both successes and failures, development projects on publicly owned land were examined in some detail. A number of these developments included the transformation of either commuter rail or end of the line park and ride facilities, including Arbor Point at Woodland station in Newton, the Carruth at Ashmont Station, Forest Hills, Mattapan High Speed Rail, Beverly Depot, and Greenbush station. Those developments run the gamut from completed to proceeding apace to struggling, but still chugging along.

How can both the (relatively) optimistic picture offered by MassDOT and the critique of the ULI study both ring true?

Three factors are worth remembering. 

First, the universe is a pretty big place. The MBTA alone has more than 300 rapid transit, commuter rail, and bus rapid transit stations. Within a half-mile radius of these stations, you will find 25% of the region’s housing and 37% of the region’s jobs, all on about 5% of the region’s total land area. Regional transit authorities add further to the number of potential TOD locations. There is plenty of room within that universe for MassDOT to report its hard won successes and for others to clamor for more to be done.

While it is the belief here that within the soulless cracked asphalt of every “park-and-ride” lot, there beats the heart of a “live and ride” community yearning to breathe free, that is not going to happen overnight. But it does have to happen.

Second, every opportunity a developer envisions at a commuter rail stop brings an operational challenge with it. Operational issues, much like an offensive line in football, really only get the attention they truly deserve during periods of failure (real or perceived).

Construction, however, is by nature a disruptive event, and commuting habits are just that, habits. A disruption to the anticipated availability of parking due to construction brings with it the potential to raise the ire (and change the habits) of an (unquestionably) impacted ridership. And unlike, for example, escalator maintenance, construction period impacts have an extremely extended duration. It is therefore not surprising that many of the TOD successes to date have occurred at locations were there was in fact a surplus of parking.

Third, the MBTA is in fact frequently in competition with its neighbors. Typically, though not always, park-and-ride facilities are in a premier location with respect to the transit location; however, adjacent parcels in private hands nonetheless represent advantageous development opportunities, ones that come: (1) without the public procurement obligations and (2) blissfully removed from operational concerns. 

And, for good measure, you can add in the customary challenges any development encounters in the entitlement process in Massachusetts. For example, the “friendly Chapter 40B” process that resulted in Arbor Point at Woodland Station came at the end of a ten year development effort.

What would help?

Greater planning resources for both the MBTA and host communities alike would be useful in site prioritization and co-ordination of the interests of competing properties, particularly in exploring potential temporary or “swing space” parking solutions.

While the attributes of our Comprehensive Permit Law (including its robust potential as a redevelopment tool), are routinely applauded in this space, TOD locations would benefit most from a thoughtful planning process and planning-based zoning amendments thereafter, including but not limited to Chapter 40R Overlay Districts.

Despite all of its challenges, interest in TOD continues unabated. In many respects, TOD is riding a third great transit wave.  The first wave arrived upon the electrification of previously horse drawn streetcars and the resulting proliferation of streetcar suburbs; the second sizzled during the war years of the 1940s (representing the transportation equivalent of ‘the last days of disco” before the onset of suburban supremacy), and now the third wave continues to build as the combined result of animus against further development of green fields and exasperation with the congested state of the nation’s highways.

TOD’s future? As a Commonwealth, we are in it for the long haul. Let’s adjust the sails and continue forward.  

“The Housing Watch” is a regular column from Bob Ruzzo,  senior counsel in the Boston office of Holland & Knight LLP.  He possesses a wealth of public, quasi-public and private sector experience in affordable housing, transportation, real estate, transit-oriented development, public private partnerships, land use planning and environmental impact analysis. Bob is also a former general counsel of both the Massachusetts Turnpike Authority and the Massachusetts Housing Finance Agency; he also served as chief real estate officer for the turnpike and as deputy director of MassHousing.”  Bob can be contacted by email at robert.ruzzo@hklaw.com.