MA: Auditor calls MBTA housing law 'unfunded' mandate

The MBTA Communities Act is an unfunded mandate for cities and towns, according to a review by State Auditor Diana DiZoglio’s office, which could prompt new legal challenges from critics of the 4-year-old state law requiring local governments to develop multifamily housing near public transit.

In a letter to state leaders, the auditor’s Division of Local Mandates said a review of the law, also known as “3A,” determined that it “imposes direct service or cost obligations” on local governments that “amount to more than incidental local administration expenses” but “does not provide a funding mechanism for compliance with its provisions.”

DiZoglio’s office said it is conducting a review of the financial effects of the MBTA Communities Act that will outline the costs incurred by communities.

DiZoglio’s review was prompted by a request from the town of Wrentham, which argues that the requirements will force communities located along the MBTA system to cover the costs of updating zoning laws to comply with it.

But Attorney General Andrea Campbell, whose office is responsible for enforcing the law, said DiZoglio’s conclusion is wrong and said her letter has “no effect whatsoever” on implementation of the law. She vowed to defend the law in court if challenged.

“High housing costs burden our residents and stifle our economy — and responsible zoning is the solution to this crisis, as most of our communities understand,” Campbell said in a statement. “If those who oppose housing affordability try to make a similar claim in court, the state will vigorously defend the law, and we intend to be successful, as we have been so far.”

In the letter, DiZoglio’s office cautioned that its conclusions are based on an “interpretation and application of current law and judicial precedent and, accordingly, are subject to legislative or regulatory changes or judicial determination.”

At least 177 communities are subject to the MBTA Communities Act, which was passed in early 2021 by then-Gov. Charlie Baker with near-unanimous support from the Legislature.

The law requires so-called MBTA communities to establish multifamily zoning within a half a mile of commuter rail stations, ferry terminals, or bus stations. Under the law, the zoning districts must be suitable for families with children.

Locally, Gloucester, Rockport, North Andover, Methuen, Lawrence, and Newburyport are among communities along the MBTA’s system that are weighing or have approved plans to approve zoning changes to comply with the law. Some, like Haverhill, have been told they are in compliance. Others, like Marblehead, have rejected the plan.

In January, the state Supreme Judicial Court ruling sided with Campbell in a lawsuit her office filed against Milton, which challenged the law by arguing that it violated the separation of powers doctrine. Justices ruled that the AG’s office has the legal authority to sue cities and towns to force them to comply with the law.

Last year, a group of Rockport residents filed a legal challenge against the state arguing that the MBTA Communities Act was an unfunded mandate, but a state Superior Court judge in Lawrence rejected the lawsuit. An appeal has been filed.

The wrangling over the law comes as Gov. Maura Healey and legislative leaders are seeking to spur more home building amid a shrinking inventory that is edging first-time buyers out of the market and hurting the state’s economic growth.

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