1. It Was Boring Until it Wasn’t

I’d say about 2/3 of the meeting was fairly dull. No one topic generated much in the way of the fodder one kinda/sorta needs to write a blog post on a Wednesday morning. I even pulled a meme of the Sleepytime Tea bear:

However, things picked up a bit when we got to a motion to “reconsider” the sagging ADU ordinance:

C. Leahy – Motion To Reconsider – “C. Drinkwater/C. Yem – To Add Language To Section 3J Of The Proposed ADU Ordinance So That The Section Would Apply With The Adoption Of The Home Rule Petition, Which Mirrors Salem, Ma., Granting Rate Reductions And Tax Relief For The Proposed Units”.

As you probably already know, the council has been batting around an ordinance that would allow the construction of Accessory Dwelling Units (“ADU”), by right, throughout the city – subject to certain requirements and restrictions. In the (purported) interest of making the initial proposal “better,” the council has been slapping on a number of conditions that served to make the ordinance more restrictive and ultimately unworkable. Of note, Councilor Robinson sought a provision whereby an ADU must have a maximum rent that is 30% below Fair Market Rent.

On September 6 Corey Williams, the City Solicitor, issued a memorandum warning that such a provision could run afoul of state law:

An ordinance with this type of language triggers an analysis under the Massachusetts Rent Control Prohibition Act C’MRCPA), M.G.L. c. 40P $ 1-5et seq. The statutory language specifically states, “No city or town may enact, maintain or enforce rent control of any kind, except that any city or town that accepts this chapter may adopt rent control regulation…”

Further:

The statute then goes on to discuss the 3 necessary requirements for a municipality to enact a rent control regulation. Generally speaking, these requirements being that any rent control restriction becomes voluntary after six months from the date of the initial adoption of the
rent control regulation, and municipalities that impose rent control must compensate the landlord, out of the municipal general fund. the difference between the fair market rental value and the rent-controlled rent. See M.G.L. c. 40P Sec. 4

In the alternate,

[T]he city could use a home rule petition whereby the municipality is asking the legislature to pass a bill that allows them to do something that the law currently does not (i.e. restricting rent via an ADU ordinance).

The City of Salem, MA filed a home rule petition in December of 2021 that was passed and took in effect in the fall of 2022. (See attached) This House Bill allows Salem to restrict the amount of rent ADU landlords can charge tenants (Maximum rent shall not exceed 70%o of Fair Market Rent). The House Bill also has language that states ADU’s in Salem will be exempt from taxation.

This brings us to last night’s motion to do essentially the same thing Salem did. Councilor Robinson cited the City of Salem’s ADU ordinance when arguing in favor of the “70%” rent controls on ADUs. Thus, one would think that a motion that would seek to closely mirror what was done in Salem would be met with little opposition.

However, Councilor Robinson described Councilors in favor of this motion as spouting “long-winded nonsense.” Councilor Robinson took particular exception with the provision permitting tax relief to homeowners constructing the ADU (a feature of the Salem Ordinance). Councilor Robinson argued that this provision operates as an ADU subsidy paid for by non-ADU owning citizens.

Councilor Drinkwater pushed back on this argument, noting that the construction of an ADU would increase the value of a home, and thus, lead to more revenue to the City. Further, the ADU ordinance requires owner-occupancy. As such, if the ADU owner were only allowed to charge 70% of fair market value, they would be unfairly penalized where your average out-of-town absentee apartment-owning landlord would not (Ex: A Westford resident can charge $2,000/mo on their Lowell investment property, while the Lowell ADU-owner can only collect $1400 on the same hypothetical unit)

Councilor Gitschier cited the increase to city services such as water/sewer, trash, schools, police, etc. that would not be offset by the increase in tax revenue. Councilor Yem opposed this argument by citing other developments in the city (ex: Acre Crossing), that would also increase the need for city services but have not received the same level of push-back that ADUs do.

This is when things got spicy. Councilor Gitschier shot back at Councilor Yem, suggesting that he did not know what he was “talking about” nor, the meaning of the term “by right” and cited engineering studies performed on projects like Acre Crossing. Councilor Gitchier suggested that Councilor Yem should go to the DPD and learn about what “by right” means. Further, Councilor Gitschier suggested that Councilor Yem hadn’t read council agenda packet material on projects like Acre Crossing. It should be noted that the engineering studies referenced by Councilor Gitschier do not address some of the areas of concern he cited – such as the burden increased population places on police services or the school system. As such, I took the comments leveled against councilor Yem as disproportionate to the scope of their disagreement and largely out of line.

Councilor Scott added that she also took exception with tax relief for ADU owners if some hypothetical non-ADU landlord offered rent at 70% of fair market value.

As we were going around in circles, Councilor Rourke asked to “move the question” (vote) – which received a second – however, Mayor Chau hadn’t yet had an opportunity to speak (in general, the Mayor usually allows everyone to have their say before speaking). Mayor Chau ceded the podium to Vice Mayor Gitschier and took to the floor. However, when Mayor Chau started to get into the substance of the original Motion by way of questioning to CFO Baldwin on the impact of ADUs on the tax levy, Vice Mayor Gitschier tried to cut him off citing Councilor Rourke’s motion on the floor to “move the question.” After some chippy back-and-forth, the Mayor was allowed to finish his remarks.

This was followed by a roll-call vote. The motion passed 7-4 with Councilors Gitschier, Mercier, Robinson and Scott voting in opposition. Thus, we can expect a draft of what will hopefully be the final version. 

Somewhere in the discussion, Councilor Rourke observed that he thought that “we are trying to make a bigger deal out of this than what it is.” I tend to agree. As I’ve written (too) many times – we need to change the way we live to address our housing needs. I saw ADUs as a low-key, incremental change to our zoning laws. In my opinion, this attempt at change was met with outsized opposition. With the various restrictions that have been tacked on over the past few weeks, the ordinance that we will likely end up with is needlessly restrictive and I would bet that we’re not going to see any meaningful number of ADUs brought online in the coming years. Moreover, I can assure you that we will continue to bang our heads against the wall about why there are so few housing units available.

Really looking forward to that next housing production report though!

2. The Rest:

1. Manager Golden was not present
2. Traffic Transportation Engineer, Elizabeth Oltman was on-hand to discuss a Motion Response relative to an unpopular 4-way stop sign on Aiken Street by LeLacheur Park that has drawn significant criticism. This portion was notable in that Ms. Oltman seemed to take the critique of the trial personally, when the intent was merely to improve safety.
3. Smith Baker Center one step closer to becoming a surface lot.
4. Interesting discussion on the cons of privatization ignited by a citizen-speaker. Looking forward to the city response as to how much money the city actually saves or wastes with our outsourcing contracts. Although I would caution that the bottom line budget # does not tell the whole story of what we get and/or give up with these deals.