PROVINCETOWN — A legislative push by towns on Cape Cod, Martha’s Vineyard, and Nantucket and in the Berkshires and metro Boston for the right to impose a transfer fee of 0.5 to 2.0 percent on the portion of residential and commercial real estate sales over $1 million, with the revenue raised being dedicated to housing, came to an end on Beacon Hill last week when the state Senate approved a $5.4-billion housing bond bill that did not include the measure.
Provincetown has sent a home-rule petition requesting such a transfer fee during every legislative session since 2010; Truro first endorsed it in 2019, and Wellfleet and Chatham did so in 2021.
The six towns on Martha’s Vineyard, where transfer fees have funded the purchase of conservation land for decades, first requested a real estate transfer fee dedicated to housing in 2004.
Gov. Maura Healey had included a “local-option” transfer fee in her draft housing bond bill in October, but in early June the House passed a $6.5-billion bill without the fee.
State Rep. Sarah Peake of Provincetown told the Independent in June that, despite the failure of the local-option transfer fee to pass in her chamber, where she is second assistant majority leader, there was still hope that state Sen. Julian Cyr might be able to “work his magic in the Senate.”
After the Senate also dropped the policy, Cyr told the Independent that the transfer fee is dead for this year but not forever.
“The message I heard very clearly is not that we’ll never do a transfer fee ever, and we’re set back a decade or more — it’s that we’re not going to do a transfer fee in this legislative vehicle,” Cyr said.
“It’s clear to me that we’re going to be doing at least one housing bill in every legislative session for the foreseeable future,” he added. “I think we’re going to get a local option transfer fee at some point — but we weren’t certain we had a strong majority to get it into this bill and then keep it coming out of conference committee.”
The conference committee in which the House and Senate will reconcile their competing housing bond bills will consist of three legislators from each chamber. Now that both chambers have dropped the real estate transfer fee, the largest difference between the two bills is a $1-billion authorization in the House version for an expansion of the Mass. Water Resource Authority’s freshwater supply to 21 towns on the north and south edge of metro Boston — including Weymouth, which House Speaker Ron Mariano represents.
The Senate did not include money for the water expansion in its version of the bill.
State Sen. Jo Comerford, who represents Amherst and Northampton and who is assistant vice chair of the Senate Ways and Means Committee, told the State House News Service last week that 10 towns in her district are studying the real estate transfer fee, and that “we’ll be back to work on this again.”
Seasonal Communities
Cyr said that another piece of the housing bill will be important for Cape Cod towns: a “seasonal communities designation,” a seasonal communities advisory council, and an office under Secretary of Housing and Livable Communities Ed Augustus that will have the ability to develop new policies for vacation towns across the state.
Any town in which more than 35 percent of the residential units are second homes or vacation homes — including Provincetown, Truro, Wellfleet, Eastham, Orleans, Chatham, Harwich, Brewster, and Dennis — could ask to be designated a “seasonal community,” Cyr said, which would authorize them to implement a basket of policies.
The Senate bill would allow seasonal towns to buy year-round-occupancy deed restrictions, to set aside housing for town employees, to create year-round market-rate rental housing trusts, and to expand their residential tax exemptions beyond 35 percent, Cyr said.
Seasonal communities would be required to conduct a housing needs assessment every two years and to make certain zoning changes, including providing for “tiny homes” in their zoning bylaws, Cyr said.
Both versions of the housing bond bill make accessory dwelling units legal by right across the state. The House bill includes a seasonal communities advisory council but does not define which policies it should allow.
“This is basically taking every innovative idea from across the region and making sure every community can do them” without having to approve numerous home-rule petitions for each town, Cyr said.
The Senate’s bill also includes a statewide commission that would look at Community Preservation Act reform, zoning reform, and the real estate transfer fee, Cyr said — though he added that coalition-building, rather than an official commission, would likely determine the future of that policy.
“Orleans passed a resolution supporting a real estate transfer fee at its spring town meeting, and Falmouth passed a home-rule petition this spring as well,” Cyr said.
“Provincetown and Nantucket have been asking for this for more than a decade,” he added, “but the rest of the state is really just now zeroing in on this tool.”
