Island towns can opt in to join the Cape and Islands Water Protection Fund that is a part of Massachusetts’ new expanded short-term rental law.
In a forum at the Martha’s Vineyard Commission Monday, state Sen. Julian Cyr, D-Truro, and state Rep. Dylan Fernandes, D-Falmouth, spoke about the fund and its potential impacts on the Island in front of several Island selectmen, town administrators, real estate professionals, and other stakeholders.
The short-term rental law goes into effect July 1, and introduces several expanded taxes on short-term rentals such as Airbnb and Vacation Rental By Owner properties. The tax is already in effect for hotels and bed and breakfasts. One of the taxes municipalities can levy is an additional 2.75 percent tax that will go into one large fund made up of contributions from all participating towns and used for water pollution abatement projects in those towns.
The fund will be controlled and operated by a management board made up of one member from each participating town. The board is planning to begin meeting in April or May.
To join the water protection fund, towns must complete a 208 wastewater management plan or a plan deemed as a suitable equivalent by the state Department of Environmental Protection (DEP). Fernandes and Cyr made it a priority for Island towns to have the option to join, as opposed to Barnstable County municipalities, which are automatically opted into the fund.
Fernandes and Cyr both said no one knows how much money will be generated, but the expanded tax will generate “millions” of dollars. Cyr did say it may take up to two years to get accurate estimates on how much money is generated for the fund.
Brian Dudley, a DEP environmental engineer, said the DEP is still working on suitable wastewater management plan equivalents for Island towns, but it all boils down to shared watersheds. Since watersheds cross town lines, Dudley said the easiest way for Island towns to join the fund would be to work cooperatively.
Normally, towns would pay for wastewater infrastructure through town meeting funding articles which could require property tax increases. Fernandes said along with the environmental benefit, the fund’s biggest sell is having tourists — not Island taxpayers — pay for wastewater projects through the tax.
Fernandes and Cyr also held a legislative forum at the Katharine Cornell Theater in Vineyard Haven.
“We hope that this is a tool that is really going to help address wastewater moving forward, and it’s going to save the towns significant dollars that otherwise you would have to pay,” Cyr said.
The short term rental tax will kill the golden goose. Fewer and fewer tourists will come and stay and pay the 15% rental tax. The ones that do come will spend less and less money at the stores and restaurants. Be prepared for a huge slowdown and reduction in dollars spent on the Island in the summer of 2020. The effects won’t be as apparent this summer as most rental leases were written prior to the 1/1/19 implementation of the tax.
The Vineyard is a difficult and expensive place to visit – ferries are hard to book, rents on the Island are high, the cost of food is astronomical compared to the mainland. There are limits to everyones price limit. We have already reached that limit and now the government wants to increase the cost by 15% ? Crazy.
The smart thing to do is to repeal all these taxes. How does a ballot initiative get placed on the Towns agenda ?
Taxing homeowners for rentals will have unintended consequences and will drive an even blacker market. Democrats who tax everything that moves should have learned painful lessons as all the big blue cities are broke.
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