Massachusetts 2025-2026 Regular Session

Massachusetts Senate Bill S1937 Compare Versions

Only one version of the bill is available at this time.

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1	1	1 of 1
2	2	SENATE DOCKET, NO. 1216 FILED ON: 1/15/2025
3	3	SENATE . . . . . . . . . . . . . . No. 1937
4	4	The Commonwealth of Massachusetts
5	5	_________________
6	6	PRESENTED BY:
7	7	Joanne M. Comerford
8	8	_________________
9	9	To the Honorable Senate and House of Representatives of the Commonwealth of Massachusetts in General
10	10	Court assembled:
11	11	The undersigned legislators and/or citizens respectfully petition for the adoption of the accompanying bill:
12	12	An Act enabling a local option for a real estate transfer fee to fund affordable housing.
13	13	_______________
14	14	PETITION OF:
15	15	NAME:DISTRICT/ADDRESS :Joanne M. ComerfordHampshire, Franklin and WorcesterAdam GomezHampden1/27/2025James B. EldridgeMiddlesex and Worcester1/31/2025Jason M. LewisFifth Middlesex2/4/2025Carmine Lawrence Gentile13th Middlesex2/4/2025Michael J. BarrettThird Middlesex2/5/2025James K. Hawkins2nd Bristol2/10/2025Mike Connolly26th Middlesex2/10/2025Cindy F. FriedmanFourth Middlesex2/10/2025Sal N. DiDomenicoMiddlesex and Suffolk2/12/2025Julian CyrCape and Islands2/14/2025Patricia D. JehlenSecond Middlesex2/19/2025Vanna Howard17th Middlesex3/9/2025 1 of 12
16	16	SENATE DOCKET, NO. 1216 FILED ON: 1/15/2025
17	17	SENATE . . . . . . . . . . . . . . No. 1937
18	18	By Ms. Comerford, a petition (accompanied by bill, Senate, No. 1937) of Joanne M. Comerford,
19	19	Adam Gomez, James B. Eldridge, Jason M. Lewis and other members of the General Court for
20	20	legislation to grant a local option for a real estate transfer fee to fund affordable housing.
21	21	Revenue.
22	22	[SIMILAR MATTER FILED IN PREVIOUS SESSION
23	23	SEE SENATE, NO. 1771 OF 2023-2024.]
24	24	The Commonwealth of Massachusetts
25	25	_______________
26	26	In the One Hundred and Ninety-Fourth General Court
27	27	(2025-2026)
28	28	_______________
29	29	An Act enabling a local option for a real estate transfer fee to fund affordable housing.
30	30	Be it enacted by the Senate and House of Representatives in General Court assembled, and by the authority
31	31	of the same, as follows:
32	32	1 SECTION 1. Section 55C of chapter 44 of the General Laws, as appearing in the 2022
33	33	2Official Edition, is hereby amended, by inserting after the word “fee,” in line 99, the following
34	34	3words:- transfer fee
35	35	4 SECTION 2. Said chapter 44, as so appearing, is hereby further amended by inserting
36	36	5after section 55C the following section:-
37	37	6 Section 55D. (a) For purposes of this section, the following words shall, unless the
38	38	7context clearly requires otherwise, have the following meanings:- 2 of 12
39	39	8 “Affidavit of transfer fee”, an affidavit signed under the pains and penalties of perjury by
40	40	9the settlement agent that attests to (i) the true and complete purchase or sale price of the transfer
41	41	10of the real property interest; (ii) the amount of the transfer fee owed or the basis, if any, upon
42	42	11which the transfer is exempt from the fee imposed by said transfer; (iii) the amount that the seller
43	43	12shall pay as required by the bylaw, ordinance or regulation; and (iv) the obligation of the
44	44	13settlement agent to make payment of the transfer fee to the city or town.
45	45	14 “Affordable housing purposes”, uses allowed by the municipal affordable housing trust
46	46	15fund or regional affordable housing commission fund into which funds are deposited hereunder,
47	47	16which shall include the acquisition, construction, rehabilitation and preservation of affordable
48	48	17housing for the benefit of low- and moderate-income households as defined in such municipal
49	49	18affordable housing trust fund or regional affordable housing commission fund, assistance to a
50	50	19housing authority as defined under section 1 of chapter 121B or other affordable housing
51	51	20purposes pursuant to regulations promulgated by the executive office of housing and livable
52	52	21communities.
53	53	22 “Affordable housing restriction", a recorded instrument held by a qualified holder which
54	54	23encumbers or restricts a real property interest so that the real property interest is perpetually or
55	55	24for a term of at least 30 years limited to use as a residence occupied by a low- or moderate-
56	56	25income household with area median income, as defined by the United States Department of
57	57	26Housing and Urban Development, not to exceed the income limits to which the municipal
58	58	27affordable housing trust fund or regional affordable housing commission fund is subject.
59	59	28 “Member cities and towns”, cities or towns that are members of a regional affordable
60	60	29housing commission. 3 of 12
61	61	30 “Municipal affordable housing trust fund”, a municipal affordable housing trust fund
62	62	31established pursuant to section 55C, or any other municipal trust fund established pursuant to a
63	63	32law of the commonwealth providing for the creation and preservation of affordable housing in a
64	64	33particular city or town for the benefit of low- and moderate-income households or for the
65	65	34funding of community housing, as defined in and in accordance with chapter 44B.
66	66	35 "Purchaser", the transferee, grantee or recipient of any real property interest.
67	67	36 "Purchase price" or “sale price”, all consideration paid or transferred by or on behalf of a
68	68	37purchaser to a seller or the seller’s nominee, or for the seller’s benefit, for the transfer of any real
69	69	38property interest, and shall include, but not be limited to: (i) all cash or its equivalent so paid or
70	70	39transferred; (ii) all cash or other property paid or transferred by or on behalf of the purchaser to
71	71	40discharge or reduce any obligation of the seller; (iii) the principal amount of all notes or their
72	72	41equivalent, or other deferred payments, given or promised to be given by or on behalf of the
73	73	42purchaser to the seller or the seller’s nominee; (iv) the outstanding balance of all obligations of
74	74	43the seller which are assumed by the purchaser or to which the real property interest transferred
75	75	44remains subject after the transfer, determined at the time of transfer, but excluding real estate
76	76	45taxes and other municipal liens or assessments which are not overdue at the time of transfer; (v)
77	77	46the fair market value, at the time of transfer, of any other consideration or thing of value paid or
78	78	47transferred by or on behalf of the purchaser, including, but not limited to, any property, goods or
79	79	48services paid, transferred or rendered in exchange for such real property interest.
80	80	49 “Qualified holder”, a governmental body or charitable corporation or trust which
81	81	50qualifies under the terms of chapter 184 to hold an affordable housing restriction. 4 of 12
82	82	51 "Real property interest", any present or future legal or equitable interest in or to real
83	83	52property, and any beneficial interest therein, including the interest of any beneficiary in a trust
84	84	53which holds any legal or equitable interest in real property, the interest of a partner or member in
85	85	54a partnership or limited liability company, the interest of a stockholder in a corporation, the
86	86	55interest of a holder of an option to purchase real property, the interest of a purchaser or seller
87	87	56under a contract for purchase and sale of real property and the transferable development rights
88	88	57created under chapter 183A; but shall not include any interest which is limited to any of the
89	89	58following: the dominant estate in any easement or right of way; the right to enforce any
90	90	59restriction; any estate at will or at sufferance; any estate for years having a term of less than 30
91	91	60years; any reversionary right, condition, or right of entry for condition broken; and the interest of
92	92	61a mortgagee or other secured party in any mortgage or security agreement.
93	93	62 “Regional affordable housing commission”, a regional planning and land use commission
94	94	63created by any general or special law with authority to prepare and oversee the implementation
95	95	64of a regional land-use policy plan for a region of the commonwealth comprising at least one
96	96	65county, and whose membership includes all of the cities or towns in such region; provided, that
97	97	66the regional commission’s statutory purposes and authority shall include promoting the creation
98	98	67of fair affordable housing for low-income and moderate-income persons; provided further, that a
99	99	68regional affordable housing commission may be an agency within the structure of a regional
100	100	69government, including, but not limited to the Cape Cod regional government, known as
101	101	70Barnstable county; and provided further, that said regional government may require additional
102	102	71procedures for member cities and towns to adopt a transfer fee that are not inconsistent with this
103	103	72section, including, but not limited to procedures for adopting bylaws and ordinances, establishing 5 of 12
104	104	73a transfer fee and administering the collection of a transfer fee established pursuant to this
105	105	74section.
106	106	75 “Regional affordable housing commission fund”, a fund established by general or special
107	107	76law for the creation and preservation of affordable housing, as defined in the general or special
108	108	77law establishing such fund, in a particular region comprising at least one county.
109	109	78 "Seller", the transferor, grantor or immediate former owner of any real property interest.
110	110	79 “Settlement Agent”, an escrow agent, real estate attorney or representative of a lender or
111	111	80title company that conducts the closing or settlement of the sale or transfer of a real property
112	112	81interest including the coordination of the attendance and document signing for all the parties,
113	113	82verification that each party to the transfer has performed their required responsibilities as
114	114	83outlined in the contract and the disbursement of all funds, along with the title and deed, to the
115	115	84appropriate parties after checking that all conditions are met at the close of the transfer
116	116	85transaction.
117	117	86 "Time of transfer", the time at which a transfer of a real property interest is legally
118	118	87effective as between the parties thereto, and, in any event, with respect to a transfer evidenced by
119	119	88an instrument recorded with the appropriate registry of deeds or filed with the assistant recorder
120	120	89of the appropriate registry district, not later than the time of such recording or filing.
121	121	90 “Transfer fee”, a fee, to be paid by the seller pursuant to this section, upon the transfer of
122	122	91a real property interest between a seller and a buyer.
123	123	92 (b) (1) A city or town that has established a municipal affordable housing trust fund, or a
124	124	93regional affordable housing commission that has established a regional affordable housing 6 of 12
125	125	94commission fund, as applicable, may, pursuant to subsection (e), impose a fee upon the transfer
126	126	95of any real property interest in any real property situated in the city or town, or real property
127	127	96situated in the member cities and towns, as described and as subject to conditions and
128	128	97exemptions described herein; provided, that a city or town that is an MBTA community as
129	129	98defined in section 1A of chapter 40A shall not impose a transfer fee pursuant to this section
130	130	99unless such city or town has been determined by the executive office of housing and livable
131	131	100communities to be in compliance with section 3A of chapter 40A; and provided further, that
132	132	101member cities and towns shall not impose a fee pursuant to this section if a transfer fee is in
133	133	102effect pursuant to the adoption of such fee by the applicable regional affordable housing
134	134	103commission under subsection (e).
135	135	104 (2) A city, town or regional affordable housing commission, as applicable, may establish
136	136	105different transfer fee rates for different classifications of properties, defined by the tax
137	137	106classification of such properties, and the purchase price of a property; provided, however, that
138	138	107any transfer fee shall be not less than 0.5 per cent and not more than 2 per cent of either (i) the
139	139	108full amount of the purchase price of such real property interest, (ii) the portion of the purchase
140	140	109price of such real property interest in excess of the exemption threshold established pursuant to
141	141	110paragraph (1) of subsection (c), or (iii) a different amount between (i) and (ii) at the discretion of
142	142	111the city, town or regional affordable housing commission, as applicable.
143	143	112 (3) The city, town or regional affordable housing commission, as applicable, shall have
144	144	113the authority to designate whether the transfer fee shall be borne by the purchaser, the seller or
145	145	114how it will be allocated between the two. 7 of 12
146	146	115 (4) The seller or settlement agent shall, in advance of the time of transfer, request and the
147	147	116city or town or regional affordable housing commission, as applicable, shall provide to said seller
148	148	117or settlement agent in advance of the time of transfer a certificate indicating the dollar amount of
149	149	118the transfer fee owed based on the agreed upon purchase price as evidenced by an executed
150	150	119purchase and sale agreement, contract for sale or other document evidencing the agreed upon
151	151	120purchase price or that the transfer is exempt from the transfer fee, stating the basis for the
152	152	121exemption.
153	153	122 (5) Whenever the transfer of a real property interest will occur at or about the same time
154	154	123as a conveyance of personalty related thereto, the calculation of the fee with respect to such
155	155	124transfer shall be determined by the city or town or regional affordable housing commission, as
156	156	125applicable; provided, that the allocations of payments between real estate and personalty agreed
157	157	126to by the purchaser and seller shall not determine the calculation of the transfer fee due pursuant
158	158	127to this section.
159	159	128 (6) The transfer fee shall be paid within 7 days of the time of transfer by the settlement
160	160	129agent to the city or town, or its designee, or to the regional affordable housing commission or its
161	161	130designee, as applicable and shall be accompanied by a copy of the deed or other instrument
162	162	131recorded or registered with the registry of deeds for the county in which the real property interest
163	163	132is located, or the assistant recorder for the registry district of the county in which the real
164	164	133property interest is located, and a copy of the affidavit of transfer fee. The city or town, or its
165	165	134designee, or the regional affordable housing commission, or its designee as applicable, shall
166	166	135promptly thereafter execute and issue a certificate indicating that the appropriate fee has been
167	167	136paid. 8 of 12
168	168	137 (7) Upon receipt of a transfer fee by a city or town, the treasurer of the city or town shall
169	169	138deposit the transfer fee in the city or town’s municipal affordable housing trust fund. Upon
170	170	139receipt of a transfer fee by a regional affordable housing commission, or its designee, the
171	171	140regional affordable housing commission, or its designee, shall deposit the transfer fee into the
172	172	141regional affordable housing commission fund.
173	173	142 (c) (1) The following transfers of real property interests shall be exempt from a transfer
174	174	143fee established pursuant to this section;
175	175	144 (i) Transfers for less than the lesser of $1,000,000 or 100 per cent of the median single
176	176	145family home sales price for that county; provided, that a municipality or regional affordable
177	177	146housing commission, as applicable, may adopt a higher threshold pursuant to this section. The
178	178	147county median sales price for a single-family home shall be determined annually by April 1 of
179	179	148each calendar year by the executive office of housing and livable communities.
180	180	149 (ii) Transfers made as gifts with consideration of less than $100;
181	181	150 (iii) Transfers from the government of the United States, the commonwealth and any of
182	182	151their instrumentalities, agencies or subdivisions, including but not limited to transfers from the
183	183	152city, town, local housing authority or regional housing commission;
184	184	153 (iv) Distributions by the trustees of a trust to the beneficiaries of such trust;
185	185	154 (v) Transfers to the trustees of a trust in exchange for a beneficial interest received by the
186	186	155seller in such trust;
187	187	156 (vi) Transfers between family members as defined by bylaw, ordinance or regulations
188	188	157adopted by a city, town or regional affordable housing commission, as the case may be; 9 of 12
189	189	158 (vii) Transfers which, without additional consideration, confirm, correct, modify or
190	190	159supplement a transfer previously made;
191	191	160 (viii) Transfers by operation of law without actual consideration, including but not
192	192	161limited to transfers occurring by virtue of the death or bankruptcy of the owner of a real property
193	193	162interest;
194	194	163 (ix) Transfers made in partition of land and improvements thereto, pursuant to chapter
195	195	164241;
196	196	165 (x) Transfers to any charitable or religious organization, as defined pursuant to section 5
197	197	166of chapter 59; provided, however, that the real property interest so transferred will be held by the
198	198	167charitable or religious organization solely for affordable housing-related uses that are consistent
199	199	168with the uses allowed by the municipal affordable housing trust fund or regional affordable
200	200	169housing commission fund, as applicable; and provided, further, that such housing shall be subject
201	201	170to an affirmative fair housing marketing plan approved by the executive office of housing and
202	202	171livable communities;
203	203	172 (xi) Transfers to a mortgagee in foreclosure of the mortgage held by such mortgagee, and
204	204	173transfers of the property subject to a mortgage to the mortgagee in consideration of the
205	205	174forbearance of the mortgagee from foreclosing said mortgage;
206	206	175 (xii) Transfers consisting of the division of marital assets under the provisions of section
207	207	17634 of chapter 208 or other provisions of law; and
208	208	177 (xiii) Transfers of an interest in real property containing not less than 3 residential units
209	209	178in which not less than 1 residential unit or 25 per cent of the residential units, whichever is 10 of 12
210	210	179greater, is governed by affordable housing restrictions; provided, however, that if less than 100
211	211	180per cent of the residential units are governed by affordable housing restrictions, the exemption
212	212	181shall apply only to the portion of the property that is governed by affordable housing restrictions
213	213	182and the transfer fee imposed pursuant to this section shall be proportionately reduced based on
214	214	183the percentage of residential units subject to affordable housing restrictions, as compared to the
215	215	184total number of units located on that property.
216	216	185 (2) Any city, town or regional affordable housing commission, as applicable, may,
217	217	186through local ordinance or bylaw, exempt certain other transactions from a transfer fee
218	218	187established pursuant to this section, including but not limited to:
219	219	188 (i) transfers to first-time homebuyers;
220	220	189 (ii) transfers to or from persons eligible for the senior circuit breaker tax credit
221	221	190established in paragraph (2) of subsection (k) of section 6 of chapter 62; and
222	222	191 (iii) transfers from taxpayers that are subject to the residential tax exemption pursuant to
223	223	192section 5C of Chapter 59, or who otherwise would meet the requirements of said exemption.
224	224	193 (3) The payor of the transfer fee shall have the burden of proving that an exemption
225	225	194applies to a transfer of real property interest pursuant to this section; and provided further, that
226	226	195any otherwise exempt transfer shall not be exempt in the event that such transfer, by itself or as
227	227	196part of a series of transfers, was made for the primary purpose of evading the fee established
228	228	197pursuant to this section.
229	229	198 (d) The city or town’s treasurer, or the treasurer or other person designated by the
230	230	199regional affordable housing commission, as applicable, shall keep a full and accurate account 11 of 12
231	231	200stating when, from or to whom, and on what account, money has been paid or received relative
232	232	201to the activities of the municipal or regional affordable housing trust fund.
233	233	202 (e)(1) The adoption of any transfer fee pursuant to subsection (b) shall be determined by
234	234	203either (i) a majority vote by the city or town’s legislative body or (ii) with respect to a regional
235	235	204affordable housing commission, by the terms of, or in accordance with, the procedures
236	236	205established by such commission; provided, that member cities and towns may adopt a transfer
237	237	206fee pursuant to clause (i) if a transfer fee is not in effect for the applicable regional affordable
238	238	207housing commission pursuant to clause (ii); and provided further, that a transfer fee adopted by
239	239	208any member cities and towns shall have no force or effect upon the effective date of a transfer
240	240	209fee adopted by the applicable regional affordable housing commission pursuant to clause (ii).
241	241	210The adoption of a transfer fee pursuant to subsection (b) shall take effect on the first day of the
242	242	211calendar quarter following 30 days after its acceptance pursuant to this subsection or on the first
243	243	212day of a later calendar quarter as the city or town or regional housing commission, as applicable,
244	244	213may designate.
245	245	214 (2) A city, town or any of the member cities or towns of a regional affordable housing
246	246	215commission may provide for the enforcement and collection of a transfer fee established
247	247	216pursuant to this section, including, but not limited to the denial, revocation or suspension of local
248	248	217licenses and permits pursuant to section 57 of chapter 40 and the authority to impose a lien on
249	249	218real property pursuant to section 58 of chapter 40.
250	250	219 (3) A city, town or regional affordable housing commission enacting a real estate transfer
251	251	220fee pursuant to this section, may issue rules, policies and procedures to effectuate its terms. 12 of 12
252	252	221 (4) A city, town or regional affordable housing commission that adopts this section shall
253	253	222submit an annual report to the executive office of housing and livable communities and the
254	254	223department of revenue detailing the total fees collected and the amounts used or planned to be
255	255	224used for affordable housing purposes in accordance with this section.
256	256	225 (5) A city, town or regional affordable housing commission that adopts this section shall
257	257	226adopt a bylaw, ordinance or regulation, as the case may be, which establishes a procedure by
258	258	227which an aggrieved person may appeal the transfer fee amount, in whole or in part, or the denial
259	259	228of an exemption.
260	260	229 (6) Any person aggrieved by a denial of relief pursuant to a bylaw, ordinance or
261	261	230regulation established pursuant to paragraph (5) may, within 60 days from the receipt of the
262	262	231notice of such denial, petition the appellate tax board under the provisions of chapter 58A.
263	263	232 (f) The executive office of housing and livable communities, in consultation with the
264	264	233department of revenue, shall promulgate regulations to carry out the provisions of this section,
265	265	234which shall include, but not be limited to regulations that provide for the forfeiture of revenue
266	266	235collected pursuant to this section to said executive office if such revenue has not been used for
267	267	236affordable housing purposes within a reasonable amount of time.