Saturday, July 14, 2007

Bill to give developers municipal powers

Shirley Kressel from the Alliance of Boston Neighborhoods writes about a bill currently in the state senate to allow cities to designate "Local Improvement Zone" and give real estate developers sweeping powers in those districts to act like a government
IANAL and may be misunderstanding it, but as I read it, if a developer, or a group of developers, buys 80% of a district, they could apply to be a "Local Improvement Zone" and be given many of the powers the city government has including issueing tax-free bonds, creating and enforcing by-laws, and even assessing neighbors to pay for infrastructure. In other words, if you own a home, developers could buy up the land around it, declare it a Local Improvement Zone, and then send you a bill to pay for the infrastructure improvements they want to do. You would not be able to appeal to the city or have any vote in the process; it would be controlled entirely by a "prudential committee" setup by the developers.

1 comment:

  1. Anonymous3:42 AM

    Let’s all take a deep breath about Chapter 40T. Everyone is ignoring the forest for the trees. And even the trees are not described accurately. Let’s assume you are a resident of the Cape concerned about the estimated $2 billion that will be required to prevent pollution to Cape Cod Bay. You see almost the entire Cape is on septic systems and has poor soil conditions. Does anyone think that this staggering amount necessary to provide a modern sewer solution will be handed to us by the feds? Is the State going to come through with all the dough? I doubt there is the political will in our towns to undertake a series of Prop 2 ½ overrides to bond finance a significant portion of that sum. Local property tax payers have said enough! This is why I am intrigued by the proposed Chapter 40T. I learned a lot by participating in a wastewater financing seminar held this spring in Hyannis and attended by several hundred municipal officials.
    Ok, now let’s look at the forest. I think it is generally agreed that the biggest problem in Massachusetts is the high cost of housing that is driving out our young folks with the very skills we need to retain in this state. Part of this problem is the high cost of infrastructure such as roads, water, sewer and public transit. We have a huge backlog of unfunded infrastructure projects. At least 35% of the State’s households are on outmoded septic systems.
    Chapter 40T appears to provide a local option for property owners and our municipalities to self-assess the benefited property for the cost of the improvements. 40T will certainly not solve all our infrastructure requirements. However, it looks like it could be a valuable tool. Some people on this blog apparently think that the concepts embodied in 40T are new and threatening. This is not true. Please visit the Mass DEP site at You will see that DEP recommends that communities consider what it calls “Management Districts” using betterment fees or special assessments to fund at least part of our wastewater treatment needs. Chapter 40T is essentially a management district to finance infrastructure improvements through betterments. Betterment fees, by the way, are not subject to Proposition 2 ½.
    The US Census for 2002 says that we already have at least 400 districts in Massachusetts. Can anyone recall any problems with these districts? Some were created under General Laws and others by special legislation approved and requested by our cities and towns. They do their job quietly by borrowing and paying for improvements that benefit particular neighborhoods in a community.
    I assume that most of you are familiar with betterment fees. For years, under the General Laws our cities and towns have recouped the cost of roads, sidewalks, sewer and water improvements by charging a betterment fee charged only to the real estate benefiting from such improvements. Strangely, the critics of 40T miss the fact that this legislation requires a much more open, detailed and democratic approach to the imposition of betterment fees. Let’s see why.
    Under existing law, betterments can be charged against real estate by a board of selectmen or city council without any public hearing, without town meeting approval, in the case of a town, and without the consent of even one property owner! Contrast this with the much more stringent requirements of Chapter 40T. You must have:

    1. A petition signed by owners of at least 80% of tax parcels owners (and the 80% of the acreage) to start the process.
    2. A detailed Improvement Plan must be attached to the petition describing exactly what the infrastructure needs are, how they will be financed, what the assessments will be and the boundaries of the Development Zone, the area that pays for and benefits from the improvements. Any deviation requires that you begin the whole process again including a new public hearing etc.
    3. A fully noticed public hearing must be held.
    4. Even if you have 100% approval of the property owners, you need the board of selectmen’s or city council’s approval. Anything less than 100% consent requires town meeting approval.
    5. The town can reject the petition for any reason if it dislikes the project.

    There has been a lot of misinformation about lack of oversight if a Local Improvement District is used under 40T. In fact, there is a great deal of oversight. The Act provides that:

    1. The District must follow the detailed provisions of the Improvement Plan submitted with the petition, reviewed at a public hearing and approved by the town or city.

    2. Any deviation requires a new petition of the property owners, a new public hearing and a new approval by the municipality.

    3. The members of the Prudential Committee can be removed for cause by the municipality.

    4. New members are selected by the selectmen or the mayor.

    5. The District is subject to a standard municipal audit by the Commonwealth.

    6. The District is subject to the open meeting law, public records law and other statutes such as those dealing with public safety.

    7. Once in existence, any assessments or betterments levied by a Prudential Committee requires a properly noticed public hearing (Unlike betterments imposed by cities and towns under the General Laws).

    So let’s chill out folks and give property owners and our towns and cities a totally local option to finance badly needed infrastructure improvements. If you don’t like it, don’t use it! For more info on Chapter 40T, please visit


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