Edgartown doesn’t want to ‘gamble’ on Housing Bank

Town wants to see short-term rental tax revenue first.

2
Edgartown selectmen criticized the Martha’s Vineyard Housing Bank, calling it a “gamble” for the town. — Brian Dowd

Edgartown selectmen criticized the Martha’s Vineyard Housing Bank Tuesday, especially the warrant article asking each town for half of their expanded rooms excise tax — also called the short-term rental tax — to fund it.

Makenzie Brookes, the Housing Bank’s campaign manager, has been traveling to each Island town to explain the Housing Bank.

At annual town meetings in 2017, Islanders overwhelmingly supported the idea of a Housing Bank in a nonbinding vote.

Selectman Arthur Smadbeck and Margaret Serpa agreed there were “many” issues with the Housing Bank’s warrant article, and were concerned with how it would affect taxpayers. Selectman Mike Donaroma was absent.

Smadbeck felt the wording of the article did not make sense, and should be reviewed by town counsel. “It would be better if this was clearer,” Smadbeck said. “This is just not clean … this doesn’t work for us.”

“It doesn’t work at all,” Serpa added.

Selectmen also took issue with how the Housing Bank would be funded. The campaign has been using the momentum of the newly expanded local excise rooms tax, and is asking each town for 50 percent of the money they raise through the short-term rental tax, which now includes short term-rentals like Airbnb and VRBO along with hotels, motels, and bed and breakfasts.

Smadbeck said the town relies heavily on the tax money it has raised since 1987 in local receipts from hotels, which today is around $1 million. If the Housing Bank is signed into law, Smadbeck argued, the town would have to give at least $500,000 of that to the Housing Bank, and would need to raise another $1 million through the short-term rental tax just to break even. If the town didn’t raise an extra $1 million, taxpayers would have to make up the deficit.

Brookes said the short-term rental tax money would grow, based on estimates done by the Martha’s Vineyard Commission, but Smadbeck said those estimates were still just estimates.

“We support affordable housing in this town big-time,” Smadbeck said. “My point is that we have to do it in a fiscally prudent way and we have to do it properly.”

Town administrator James Hagerty said it is fair to estimate growth, but said the Housing Bank is asking the town to take a million-dollar gamble.

Smadbeck said the Housing Bank should wait a year or two to see how much money is actually raised.

“You’re asking the taxpayers to gamble,” Smadbeck said. “What I’m asking you is — put this off. We don’t know how much money it is. There’s no reason to rush this and say we’re going to gamble with the tax dollars in Edgartown.”

Brookes said the Island was in a “complete crisis” for housing its teachers, firefighters, town employees, and many others, and the Housing Bank aims to address that need as fast as it can. Brookes feared that if the town waits to fund the Housing Bank, then other things will be funded, and the Housing Bank, which she stressed as a critical Island need, would be left by the wayside.

But Smadbeck felt the campaign was going about the process the wrong way. “It does a disservice to everyone just because you were first in line with a petition. To take that money out of play before the town has a chance to determine whether this is fiscally prudent — I don’t agree with it,” Smadbeck said.

The town will be holding a listening session on the short-term rental tax on March 13 at 6 pm at the Edgartown library. The Housing Bank has also established a website, which can be found at housingbankmv.org.

In other business, selectmen approved spending $97,350 on the construction design services of Childs Engineering Corp. from Bellingham for repairs and restoration to Memorial Wharf. A construction estimate will be created by next fall.

Selectmen also approved several petitions from Eversource to do electrical work on Town Lot Road, 6th Street, and Edgartown Bay Road, pending notification to the Water Department.