Senate budget chief has ‘concerns’ with real estate transfer fee backed by Wu, Healey

A top Senate budget writer expressed “concerns” with a proposed fee on high-value property sales that was dropped from a massive borrowing bill earlier this month, a signal that the controversial measure could face more pushback on Beacon Hill.

Senate Ways and Means Chair Michael Rodrigues, a Westport Democrat who often has a say in how high-profile bills are crafted, did not say when a $6.5 billion borrowing bill focused on spurring housing development in a starved Massachusetts market could come up for a vote.

But he did offer a cool reaction to an effort that would allow cities and towns to opt-in to a tax on top-dollar real estate deals, a policy backed by Mayor Michelle Wu and Gov. Maura Healey.

“I have some concerns about it,” Rodrigues told reporters Wednesday afternoon without elaborating.

Healey originally pitched a fee of between 0.5% and 2% on the portion of a property sale over $1 million, or the country median home sale price, with the revenue generated from the tax directed to affordable housing development.

Some communities, including Boston, have been clamoring for state lawmakers to approve the measure as the cost of housing has dramatically increased and number of affordable units dwindled.

Sen. Lydia Edwards, a Boston Democrat who co-chairs the Housing Committee, said the Senate is still “working out what is feasible.”

“We’re still trying to figure out that conversation overall,” the former Boston city councilor told the Herald just outside Senate President Karen Spilka’s office. “I want a policy or a bond bill that reflects the Senate’s wills and wants and what’s realistic.”

The proposal’s path on Beacon Hill has been a twisting one.

House Speaker Ron Mariano, a Quincy Democrat, initially expressed openness to the idea but later soured on it, telling reporters this month that it was “not as universally appealing as I thought it might be.”

“It’s a patchwork attempt to provide resources for housing that isn’t even supported by a study done by the administration that put it in the original bond bill,” he said. “It’s so inequitable. You raise a ton of money in Nantucket and you raise next to nothing in Lawrence, and it’s hard to have effective housing policy that’s going to spur development when there’s that much of a difference.”

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Pols & Politics: The twisting tale of a local option transfer tax might not be over just yet

House Democratic leadership’s rewrite of Healey’s housing bill cut the idea out of the proposal and with now with Rodrigues’ skepticism on the Senate side, advocates of the fee may find themselves facing a challenging path forward.

Lt. Gov. Kim Driscoll said the administration’s version of the housing bond bill has many resources communities need, including the transfer fee.

“We’ll obviously see what comes out of the Senate, what we finally get after they have a conference committee. We would love to have as many resources as we can for communities to support more housing and more affordable housing, in particular,” she told the Herald while walking the halls of the State House.

Senate Minority Leader Bruce Tarr said the Senate should not include the transfer fee in their version of the housing bond bill.

“I don’t think the solution to making housing more affordable in Massachusetts is increasing the cost of it by adding a tax,” he said as he walked out of his office. “We have a multi-billion dollar bond bill on the table to provide literally billions of dollars to invest in housing. Resorting to a tax I don’t think is the appropriate way to go.”

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