Analysis
To further study this recommendation, the City retained consulting firm RKG Associates to conduct an analysis of the potential impacts of this initiative on Somerville’s real estate market and its contribution to the City’s affordable housing resources. The analysis found that the proposed transfer fee program could potentially raise between $6.6 million and $9.1 million annually, depending on real estate conditions and exemptions such as for owners facing a loss on the sale of their property or for long-time homeowners.
The Mayor convened a Real Estate Transfer Fee Task Force in December 2016 to study the issue in greater depth and provide a report for the Administration, the City Council, and the public. A report from Housing Director Michael Feloney on the recommendations of the Task Force along with a draft Home Rule Petition were submitted to the City Council on January 11, 2018.
Opportunity for Community Input: Full Community Process
Under state law, the City cannot institute a transfer fee without the permission of the State Legislature. Therefore, the City is first seeking the approval of the City Council to submit a Home Rule Petition to the Legislature to seek this general permission. If the Legislature approves the petition, the fee will not automatically go into effect. Rather at that time--once it is known whether the City has the option of establishing a transfer fee--it is the City's intent to launch a broader community discussion on this issue. The outcomes of that discussion would guide the deliberations about any final ordinance. The details of the fee including the types of exemptions and other requirements would then be determined after public feedback is gathered via the community process including an additional City Council public hearing (or hearings) together with deliberations by the Board.
BOA Public Hearing April 4, 2018
The Home Rule Petition process does require that some details that cannot be changed at a later time be determined before submitting the Petition. For this reason, the City Council held a public hearing on the matter prior to submission of the Home Rule Petition. The Board is currently reviewing and revising a draft Petition, submitted by the Mayor as a starting point, but not intended as the final version. At the hearing, the public was given the opportunity to voice support for or against the fee overall, as well as comment on a range of issues such as exemptions. Official written comment for the record to the City Council was accepted through Friday, April 6, 2018, at 5 p.m. the City Council will vote on the details of the final draft and whether to submit it to the Legislature.
Public Comment at State Level
If the City Council approves the petition and it proceeds to the Legislature, community members can once again voice their opinions and provide feedback as part of the State legislative process. As more information about opportunities for public comment at the State level become available, they will be posted here.
Next Steps
- State Legislature to vote on whether to approve the Transfer Fee Home Rule Petition.
- If approved, the City will host a community process to discuss details of a potential ordinance.
- City will follow the framework of rules established by the Home Rule Petition to develop a detailed ordinance setting the final fee and criteria for what transactions are subject to the fee.
- The Administration would submit a draft Transfer Fee ordinance, within the framework approved by the legislature, to the City Council for deliberation.
- The City Council would hold a public hearing or hearings on the proposed ordinance before voting on any amendments and final approval.
Stay Informed
The adjacent tabs on this page contain the draft ordinance, previous drafts, minutes of the meetings at which it was discussed by the City Council’s Committee on Legislative Matters, the RKG analysis, a memo from Housing Director Mike Feloney reporting on the work of the Transfer Fee Task Force, the Sustainable Neighborhoods Working Group Report, and other relevant materials. Feel free to contact your City Councilor, one or more of your four City Councilors-at-Large, or Sustainable Neighborhoods Coordinator Hannah Carrillo in the City's Housing Division with any questions. You can reach Hannah at hcarrillo@somervillema.gov or 617-625-6600 x2575.
