The short-term rental regulation bill that has passed both houses on Beacon Hill in the past two weeks will extend room occupancy taxes levied on hotels and motels to private short-term rentals, which are often booked via online platforms like Airbnb and VRBO.
The House and Senate bills both contain the provision, sponsored by Senator Julian Cyr and endorsed unanimously by Cape and Islands legislators, to create the Cape Cod and Islands Water Protection Fund (CCIWPF). While there are differences in the House version of the CCIWPF, and the Senate version, the substance is the same. Both versions enable Cape and Island towns to assess an additional 2.75 percent excise tax to fund the wastewater trust. The House version of the excise tax only applies to short-term rentals, the Senate version applies to short-term rentals and also to traditional hotels and motels. The CCIWPF will fund water pollution abatement projects only in municipalities that are members of the fund. Each municipality within Barnstable County is a member of the fund; towns on the Vineyard and Nantucket must vote to opt in.
On his visit to the Vineyard on Feb. 22, Cyr spoke to a well-attended information session held at the Martha’s Vineyard Commission, looking for buy-in.
On Friday, The Times spoke to a number of public officials about the wastewater trust. While reaction was decidedly mixed, it was clear Oak Bluffs will be a tough sell.
“In theory, it’s fine, but it’s not tailored to meet the needs of Martha’s Vineyard, as usual,” Oak Bluffs selectman and wastewater commissioner Gail Barmakian said. “We have a minority on a large board from Cape towns. The way it’s set up, our dollars are going to serve Cape infrastructure. I’m disappointed we weren’t part of the on-the-table part of the discussion when the trust was being developed. They presented it to us when it was a done deal. I would rather have seen a subtrust for the Vineyard so the tax dollars generated on the Vineyard stay on the Vineyard. It also appears to me to be geared more toward wastewater infrastructure and not funding alternatives.”
“My feeling is the tax base coming from Island rentals should be in a separate bank, dedicated to the Island,” Oak Bluffs selectman Brian Packish said. “As a town we lobbied for that, but we were unsuccessful. The bottom line is, when you get into a big pool competing for dollars with large-scale projects, there’s many times that there’s the perspective that we’re doing fine here on the Island and we don’t get the awards. We saw it with the Streetscape Committee. We were told we had a first-crack application, but then our need wasn’t as great as everybody else’s. When you get $50, $100 million projects, which is often the case with wastewater, the Vineyard ends up on the outside looking in.”
Selectman Greg Coogan is more receptive. “It’s not the perfect legislation, we wanted more control for the Islands, but it’s a step in the right direction,” he said. “People have been talking about short-term rentals for a long time, and it’s good we’re doing something about it. With the wastewater trust, I feel comfortable we’ll get a reasonable share, maybe not always what we want. If we have strong people on the board, we have six votes, I think our voices will be heard.”
Edgartown chairman of selectmen Art Smadbeck said more discussion at the town level would be the first order of business. “It’s going to have to work its way to the board of selectmen, and we’ll probably talk to town counsel about it,” he said. “We have to analyze it, and most importantly talk to our wastewater people. In the past, we’ve done pretty well getting subsidized funding for our wastewater plant through federal low-interest loan programs.”
“We’ve had some questions, some of the details are a little fuzzy,” Tisbury selectman Melinda Loberg said. “I think the biggest difference for us is that the Cape is under order under the 208 plan, and we’re not. To qualify, they said [Island towns] need a certified wastewater management plan (CWMP) approved by the DEP. Tisbury does not have one yet. We’ve been dragging our feet on it, but we’ve also been putting money into what we know are the solutions. We recently got a nice grant for piloting new technologies, and the early results are promising. In the next year or so, we may have better answers, so writing the CWMP will be a simpler task.”
Section 208 Areawide Water Quality Management Plan for Cape Cod was the result of a 2011 lawsuit by the Conservation Law Foundation against the EPA for failing to take actions to reduce harmful nitrogen pollution on Cape Cod. The Cape Cod Commission drafted the final 208 Plan Update, which was certified by Governor Charlie Baker in June 2015 and approved by the EPA in September 2015.
In a statement to The Times, Leslie Sandberg, senior advisor to Sen. Cyr, said the feedback they received from Islanders had a direct impact on the new legislation. Initially, all Cape and Island towns were participants, unless a town voted to opt out. After February’s meetings on the Island, that changed.
“There is no requirement for any town on Martha’s Vineyard to be part of the fund — each municipality on the Island will have the ability to opt in to the fund,” Sandberg wrote. “The opt-in process will be handled at the local level when officials decide whether to send wastewater management plans to DEP to be determined as a ‘suitable equivalent’ to a 208 plan. Municipalities on the Cape face a different criteria. Due to the CLF lawsuit, they are automatically members of the CIWPF, but can opt out by a vote at town meeting a year after the legislation takes effect … We also want to point out that the makeup of the management board of the fund is one vote for each town that is a member. All votes are weighted equally with all other towns that are members of the board. If all municipalities on the Vineyard were to join the CIWPF, they could have a substantial voting bloc on the board.”