MMA urges conference committee to support important investments in economic development bill

The Honorable Aaron M. Michlewitz
The Honorable Michael J. Rodrigues
The Honorable Mark J. Cusack
The Honorable Eric P. Lesser
The Honorable Michael J. Soter
The Honorable Patrick M. O’Connor
Conference Committee on H. 5034 and S. 3030, An Act Relating to Economic Growth and Relief for the Commonwealth
State House, Boston

Dear Chair Michlewitz, Chair Rodrigues, and Distinguished Members of the Conference Committee,

On behalf of the cities and towns of the Commonwealth, the Massachusetts Municipal Association is writing to share comments regarding the important investments and tax relief proposals in the historic economic development package that you are finalizing. We applaud the scope and importance of your work, and thank you for the many powerful investments in this impactful legislation.

As you work to reconcile the House and Senate versions of An Act Relating to Economic Growth and Relief for the Commonwealth (H. 5034 and S. 3030), we urge you to ensure the final bill continues to support and empower municipalities to catalyze economic development, without eroding vital sources of essential local aid and local decision-making in this important work.

We respectfully urge your attention to the municipal issues and concerns regarding the following outside sections, funding, and authorizations up for consideration in the final economic development package.

Outside Sections

Electronic Lottery (Sections 4A, 4B, 4C, and 4D of H. 5034)
As you know, the Massachusetts Lottery was created over 50 years ago for the exclusive purpose of providing local aid to cities and towns, and remains the primary funding source to fund Unrestricted General Government Aid (UGGA). “Support for Communities” is the cornerstone of the Lottery’s mission. We greatly appreciate the interest from the Treasurer’s office, as well as the House, in expanding its offerings via an iLottery, and what this could mean to ensure that Lottery revenues remain strong in the years ahead, as new forms of online and expanded gaming enter the marketplace as competitors.

Further, there is no question that expansion of the Lottery to online and electronic platforms would reduce revenues raised through the traditional in-person Lottery product. For this reason, online Lottery proceeds must be used for the Lottery’s singular focus, which is to support local aid. Artificially separating traditional and new online Lottery games into separate revenue streams would divert funds away from the mission to fund Unrestricted General Government Aid, since the traditional Lottery games would certainly generate significantly lower net revenue due to the shift of current players onto new online platforms.

The MMA strongly supports the creation of an electric lottery, but only if the current language contained in the House bill is amended to codify local aid as the primary beneficiary. This is consistent with the Lottery’s existing mission and is necessary to protect a vital revenue stream that accounts for the overwhelming amount of Unrestricted General Government Aid that cities, towns, and taxpayers rely on to fund essential municipal and school services and balance local budgets.

Accessory Dwelling Units (Section 46A of S. 3030)
The MMA recognizes that the development of accessory dwelling units (ADUs) is an important tool for communities to consider as they advance affordable housing solutions, which is why we actively supported the Housing Choice legislation in the last economic development bill to make approval of zoning changes to promote ADUs a simple majority vote by Town Meetings and city councils, instead of the previous two-thirds threshold. However, we oppose unilateral preemption of local zoning and decision making as proposed in Section 46A. A large number of municipalities already have local ordinances and bylaws around this issue, and language contained in the Senate bill would undermine and confuse these local zoning ordinances and authority.

Cities and towns have led in pioneering bold and innovative approaches to housing issues. The state has an essential role to play, and has done an effective job in advancing Housing Choice and providing resources to municipalities through MassWorks and MassDevelopment. Local officials need resources, tools, incentives, and flexibility to successfully deliver a community-driven vision for zoning and planning — not a broad state-imposed mandate. Section 46A would instead change and densify residential zoning in every city and town, with no input, deliberation, or discussion at the local level.

Municipal Efficiency (Sections 25, 26, 74-77, 153 of S. 3030)
The MMA also supports several outside sections included in the Senate bill that are aimed at giving municipalities necessary tools they need to operate more effectively. These outside sections, developed by the Division of Local Services, include many technical corrections as well as language to operate more efficiently, modernize operations, and streamline timely services and support at the local level. These important provisions are incorporated in S. 3030 via Sections 25, 26, 74-77, and 153.

Unemployment Insurance Trust Fund (Section 143 of H. 5034)
We appreciate the importance of transfers to the Unemployment Insurance (UI) Trust Fund in both the House and Senate bills. These funds will in part be used to write off uncollectible overpayments and to offset the significant impact of waivers on employers, including municipalities all across the Commonwealth. Reimbursing cities and towns for faultless overpayments will have a sizable financial impact, and therefore the MMA supports the House’s funding level of $300 million.

Funding and Authorizations

Infrastructure (Account 7002-8048)
We greatly appreciate the inclusion of $400 million for MassWorks grants for local infrastructure projects in both the House and Senate bills. Every municipality in the Commonwealth can identify critical infrastructure projects that are shovel-ready, and this additional funding for MassWorks grants will provide much-needed assistance to propel these projects into the action phase.

Affordable Housing (Account 1599-6084 of S. 3030)
We greatly appreciate the provisions in both the House and Senate bills that make significant investments in the Affordable Housing Trust Fund and the Housing Stabilization and Investment Trust Fund. The Commonwealth is experiencing a severe affordable housing shortage, and these programs will help us maintain our region’s competitiveness, and provide economic stability. The MMA supports the Senate’s funding level of $403.5 million for housing, including $150 million for workforce housing programs, a crucial step in ensuring critical community workers can live in the same communities in which they work.

Clean Water Trust Fund Grants (Accounts 0640-1006 & 1599-6079 of S. 3030)
We also appreciate the House and Senate provisions that make significant investments in the Clean Water Trust Fund grants. The Clean Water Trust Fund helps communities build or replace water infrastructure, ensures the safety of drinking water, protects public health, and develops resilient communities. Through the Trust, municipalities can finance significant, complex and urgently needed water projects. Our municipalities are struggling to deal with aging and insufficient infrastructure systems, and at the same time more and more communities are identifying PFAS contaminants in their public drinking water supplies. Funds for water treatment will be put to quick and beneficial use. The MMA supports the Senate’s total funding level of $254 million.

Broadband (Account 7002-8049 of S. 3030 & 1599-6059 of H. 5034)
To help close the digital divide, investment in broadband infrastructure is essential. We greatly appreciate the House and Senate provisions authorizing $50 million in funding for broadband matching grant funds at the state level, in anticipation that these resources can be used to leverage new competitive programs at the federal level. The MMA supports the Senate bill’s language allowing for the funds to be payable to assist municipalities with debt service payments related to broadband infrastructure. Additionally, the MMA supports the House bill’s $50 million in separate funding via 1599-6059 for the Last Mile Infrastructure Grant program.

Summary

The MMA supports and appreciates the important investments contained in the House and Senate’s transformational economic development bills. These resources will greatly assist municipalities to reach long-term goals while immediately stimulating economic growth and development in all corners of the Commonwealth.

Thank you very much for your consideration and attention to these important issues for all 351 cities and towns. With your leadership, Massachusetts has been a national leader in navigating the pandemic, stabilizing our economy, and investing for the growth and renewal that will benefit all parts of the Commonwealth.

If you have any questions regarding our comments or require additional information, please do not hesitate to have your office contact me or Senior Executive and Legislative Director Dave Koffman at 617-426-7272, ext. 122, or dkoffman@mma.org, or Legislative Analyst Ali DiMatteo at 617-426-7272, ext. 124, or adimatteo@mma.org.

Sincerely,

Geoffrey C. Beckwith
MMA Executive Director & CEO

Cc:
The Honorable Ronald Mariano, Speaker of the House
The Honorable Karen Spilka, Senate President