A new housing group is hoping to harness the momentum of the short-term rental tax bill to tackle the Island’s housing issues.
The Martha’s Vineyard Housing Bank has its sights set on the potential revenue generated by the rental bill, recently signed into law by Gov. Charlie Baker, which offers a suite of taxes on short-term rentals in Massachusetts cities and towns.
The Housing Bank is an extension of the citizens committee, a group of housing advocates from around the Island, who presented a nonbinding resolution asking voters about the need for a housing bank at each annual town meeting in April 2017. There was an overwhelming response, with 70 percent of voters from five of the six Island towns in support of a Housing Bank. Edgartown did not hold a vote because selectmen at the time balked because the plan presented to them asked for the use of Community Preservation funds.
“Our Housing Bank will be structured and administered as an Island-wide entity that can permanently provide for the creation and preservation of year-round housing throughout Martha’s Vineyard,” Makenzie Brookes, campaign manager for the Housing Bank, said.
The Housing Bank is currently made up of a campaign of 16 people involved with affordable housing on-Island.
While the Housing Bank would be modeled after the Martha’s Vineyard Land Bank, there would be significant differences.
Its funding would not come from a percentage of real estate sales, but be funded by a percentage of the newly passed rental bill. Members of the Housing Bank’s campaign are headed to annual town meetings in April with warrant articles asking each town to allocate 3 percent of the newly expanded tax and dedicate the revenue to the Housing Bank.
In its warrant article, the Housing Bank states it would need a minimum of three Island towns to sign on, but its intention is to be an Island-wide effort.
Brookes said a Housing Bank could generate $5 million a year, based on rough estimates from studies done by the Island Housing Trust and the Martha’s Vineyard Commission.
With the rental bill’s passage, short-term rentals will be automatically taxed the same 4 percent as hotels, motels, bed and breakfasts, and lodging houses in most Island towns, increasing towns’ revenue streams. The new bill allows towns to increase that tax up to six percent. Tisbury and Oak Bluffs already charge six percent.
This revenue would be a dependable, virtually guaranteed, income for the Housing Bank. “It just makes perfect sense.” Brookes said. “One of the reasons we have a housing crisis on Martha’s Vineyard is because of these short-term rentals.”
Brookes added that no one would lose money. Even if each town agreed to give a half, a third, or a fourth of the revenue from the expanded rental tax, they would still be making money.
“It’s the time,” she said. “We have this momentum. We had over 70 percent of voters say, ‘Yes, we need a housing bank. We need an Island-wide solution.’ Just two years ago. Now we have this money, so let’s just go for it.”
Housing projects funded through the Housing Bank would get approval by the housing advocates in whichever town the project takes place, and towns would be given the ultimate say on whether projects can be done. Any housing projects would be deed-restricted so they are always for year-round affordable units, and can’t just be rented out again. The Housing Bank would be made up of a seven-member commission: one elected member from each Island town, plus one member appointed by the Dukes County Regional Housing Authority. Terms would be staggered every three years
Sen. Julian Cyr, D-Truro, and Rep. Dylan Fernandes, D-Falmouth, are in support of the Housing Bank.
“Attainable housing is among the steepest challenges that Islanders face in making a life on Martha’s Vineyard,” said Cyr. “I’m encouraged to see Vineyarders exploring how the recent expansion of room occupancy to short-term rentals can help realize a sorely needed housing bank for the Island.”
“Lack of affordable housing is forcing local young people, working families, and seniors who built this community off the Island that they grew up on and love. An Island-wide housing bank will bring Vineyarders together to solve one of our most urgent challenges and create a more sustainable future,” Fernandes said.
Daniel Seidman, a member of the Dukes County Regional Housing Authority and several other housing programs on Island, told The Times the Housing Bank would not be an unfunded mandate, and operations such as administrative costs would be funded by its own revenue stream.
Seidman said short-term rentals such as Airbnb can make a positive difference on the Island. “Money that wasn’t being charged in the past is now going to be charged. And the person that’s going to pay it is the person that’s visiting … they are the problem, and they are also the solution,” Seidman said.
With warrant article deadlines approaching and annual town meetings on the horizon, members of the Housing Bank’s campaign are spreading the word.
“We can all work together,” Seidman said. “We’re not asking our taxpayers, we’re not adding to our real estate tax, we’re not asking you to pay more sales tax, we’re not adding anything to you who live here year-round. We’re saying, ask these people who come here and benefit, enjoy their time here, and we love to have them. They spend the money, it’s good for the Island, it’s good for employment. The opposite effect of that is it creates this problem where we don’t have sufficient housing.”