As Islanders continue facing critical affordable housing shortages, towns are now looking at new, creative ways to alleviate the local housing crisis.
In just a few weeks, Chilmark’s housing committee will be requesting that $200,000 of the town’s short-term rental tax collections be allocated to the town’s affordable housing trust on an annual basis.
The proposal will be presented at a public hearing during a Chilmark Select Board meeting; the goal is to get the request onto next year’s town meeting warrant.
If approved, Chilmark would become the first Vineyard town to allocate that tax revenue directly to affordable housing projects on an annual basis.
Though Chilmark — and the Island’s other five towns — had initially waited to observe room occupancy tax trends before allocating the revenue, the town is at a point where its officials feel comfortable with making use of the money, Bill Rossi, select board representative to the town’s housing committee, told The Times, adding that they also hope to get the support needed to go forward.
“We’re trying to do some things in town for affordable housing, and make it work with people’s ideas of what Chilmark should be,” he said. “It’s a little bit of a balancing act.”
Although committee members had discussed whether to allocate all the revenue to housing, Rossi said the $200,000 proposed “seemed like a safe number” to start with, considering Chilmark is expected to collect around $500,000 per year from the tax.
But the first step is to get a feel of how Chilmark residents think about the proposal at the upcoming hearing. Assuming it will be met with a positive response, “we’re agreeable to put it to the voters,” Rossi said, “to see if they want to put some of that money into the Molly Flender Affordable Housing Municipal Trust.”
The committee is also proposing an increase to how much the town can collect on short-term rental tax.
With the state’s rental tax law, short-term rentals — such as Airbnb — are taxed by the state of Massachusetts in the same way as hotels and inns — at a 5.7 percent rate. Administering local tax on short-term rentals is optional, with tax rates being set at the discretion of town governments, not to exceed 6 percent.
Tisbury, West Tisbury, Oak Bluffs, and Aquinnah collect the maximum, while Edgartown and Chilmark had opted to impose a 4 percent charge.
At their annual town meeting earlier this year, Aquinnah residents voted overwhelmingly in support of raising that local rate to 6 percent.
Chilmark residents will be presented with the same proposal on Tuesday, Sept. 26, at 5 pm in the Chilmark Town Hall.
Trust reps say that the idea to raise its rental rates stems from the current efforts made by local legislators to enact a local-option transfer fee for towns throughout the commonwealth.
One bill in particular, sponsored by State Sen Julian Cyr (D-Truro) and filed in February, looks to allow municipalities to impose a fee on high-value real estate transactions in order to support affordable housing projects.
If approved, the legislation would be the funding mechanism for the Island’s housing bank.
But Cyr’s bill states that towns won’t be eligible for the transfer fee if they can’t show they’ve been taking steps on a local level to create and preserve local housing.
Out of seven provisions included in the pending legislation, four must be complied with — something that no town on Martha’s Vineyard can yet demonstrate.
One of those provisions, perhaps one of the easiest to meet, involves towns taking a large chunk of their room occupancy tax receipts and allocating it to projects that advance affordable housing development.