Leigh Davis Testifies Before Joint Committee on Housing in Support of Affordable Homes Act

— The Berkshire Edge / Peter J. Most, January 22, 2024

“Last Thursday, Great Barrington Selectboard Vice Chair Leigh Davis went to Beacon Hill to testify before the Joint Committee on Housing in support of Governor Healey’s Affordable Homes Act. Ms. Davis testified regarding the particular housing challenges facing Great Barrington and to speak in favor of and request tweaks to one aspect of the bill: the Local Option Transfer Fee. Let’s hope Ms. Davis’s message was heard and her suggested tweaks adopted.

To loosely paraphrase Woody Allen, a town is like a shark. It has to constantly move forward (with housing), or it dies. And I think what we got on our hands is a dead shark. Ms. Davis has been working both in her professional and elected positions to advance housing opportunities to ensure our town moves forward with housing and does not die. This is not hyperbole. If we are unable to house the folks that work here, if we are unable to attract families to live here, we are on the road to ruin.

Let me share a portion of Ms. Davis’ prepared testimony with you because (i) it should be heard and (ii) assuming the Affordable Homes Act becomes law, we will each need to support its implementation at Town Meeting:

‘This bill is a once-in-a-generation opportunity to build the equitable, affordable, and sustainable Commonwealth that our residents and communities deserve. My testimony will focus on amendments to the Local Option Real Estate Transfer Fee policy proposal.

Great Barrington is the hub of south Berkshire County—home to many cultural assets such as Tanglewood, Jacob’s Pillow, and the Norman Rockwell Museum. Voted “Best Small Town” by Smithsonian Magazine, Great Barrington is a seasonal community with a population of just over 7,000. Blessed with natural beauty and an abundance of shops and restaurants, we even have a local hospital, Fairview, named one of the top 20 critical access hospitals in the country. It all sounds great, doesn’t it? But it’s not. We are drowning.

Great Barrington’s economic future—the economic future of the Berkshires—is hanging in the balance. There is simply not enough affordable housing to sustain our communities. As a tourism-driven region, the Berkshires depend on the service industry to drive our economy, but many who work here are no longer able to afford to live here. And they’re leaving.

In their wake, businesses large and small are finding it impossible to staff service positions. Even Fairview Hospital, a safety net for the Great Barrington community for more than a century, is struggling to house its workers—many jobs left unfilled. As we speak, Fairview Hospital has 48 openings—all attributable to a lack of housing. And as Fairview explained, this is medical staff that it desperately needs to hire due to our aging population.

The housing crisis Great Barrington is facing presents many other challenges as well: The average renter working a typical minimum wage job needs to work 80 hours a week in order to afford a one-bed, market-rate apartment in Great Barrington, 141 hours a week if they require two bedrooms. And that’s if they are lucky enough to find housing.

The average rental vacancy rate across the Commonwealth is three percent, and across the nation, it is five percent. In Great Barrington, it’s zero percent.

Our town has also seen its housing affordability gap surge to over $400,000—the median home price in Great Barrington —$783,000—the average resident only able to afford $350,000. And in 2022, cash buyers made up roughly half of the sales across Lenox, Great Barrington, and Williamstown. Adding to Great Barrington’s housing pressures is the fact that between 2015 and 2020, Great Barrington saw a stunning 67 percent increase in properties used as second and third homes, not counting the full impact caused by the pandemic—many prices paid well above the $440,000 single-family home median value.

The housing stock is both not affordable and rapidly disappearing, and it’s dragging the local economy down, taking our soul with it… As well as the many other hats I wear in the community, I speak today also as a member of Great Barrington’s Community Preservation Committee. Great Barrington has consistently appropriated the majority of CPA funds to affordable housing despite competition from historic preservation, conservation, and recreation. Last month, our town’s committee recommended to Town Meeting that two-thirds of CPA funding go to affordable housing. The town is using all the resources at its disposal to increase our affordable housing stock, including passing a Short-Term Rental bylaw two years ago to try to pump the brakes on investors targeting our community. But it’s not enough. We need a tool to generate funds.

The Local Option Real Estate Transfer Fee is that tool. However, for this tool to be accessible to communities like ours, two critical amendments are needed in the bill. Currently proposed, this local option fee would be applied on only the portion of home sales over $1 million, effectively denying the western region—and other regions as well—the use of this tool altogether. I urge your adoption of an amendment so the fee is on the total transaction for sales over $1 million—not only the portion over $1 million.

In addition, the requirement for the seller to pay the transfer fee, rather than leaving this up to the municipality, is problematic in towns like Great Barrington, where many longtime residents depend on the sale of their homes to fund their retirement. The seller paying the full fee simply won’t pass at many Town Meetings. Local officials understand their communities better than anyone else, and it is critical that municipalities have the ability to structure this fee to meet local conditions and needs. I urge your adoption of an amendment that removes the requirement for the fee to be borne entirely by the seller.

Waiting for the outcome of this bill, the Great Barrington Joint Selectboard and Planning Board Housing Subcommittee, which I chair, has agreed to table our pending Home Rule Petition. We recognize the urgency of our community’s housing crisis and are hopeful that the final transfer fee legislation is flexible enough to meet the needs of diverse communities such as ours.

In sum, I request your favorable report of this bill with the requested modifications as soon as possible.’

Ms. Davis is advocating that it be permissible for the transfer fee to be split between buyer and seller (the current bill has the seller paying the entire fee) and, for good reason, that the fee be assessed against the entire transaction amount, not just that portion over $1 million. While the median home value on Nantucket is $3.4 million, with homes listing for as much as $35 million, Great Barrington’s median home price was $783,000 in October, with relatively few homes trading above $1 million. Thus, Nantucket can expect to fill its affordable housing trust coffers while Great Barrington will maybe get a few beans for its trust. By equitably splitting the fee on the total transaction amount, Great Barrington will have a far better opportunity to contribute to its housing trust and support housing initiatives.

No one likes to be assessed a fee, or even half a fee as proposed by Ms. Davis. And real estate professionals are likely to oppose any fee that may dampen housing sales (which this won’t); of course, their 5 percent fee over the entire transaction amount remains sacrosanct. But the issue is bigger than what part of one percent should be paid by whom. If Great Barrington is not able to align its housing and employment needs, in the long run, no one will want to live here, vacation here, or maintain a second home here. Surely real estate professionals appreciate that five percent of an inactive market is even less attractive.

Much like the frog in heating water, let’s not ignore our heating housing crisis. The “help wanted” signs plastered around town. The fact that nearly everyone that works at our gem of a hospital travels to get there. Teachers are turning down positions because of the housing affordability crisis. The signs are there, they are real, and they are accumulating. When it is our chance to support the Local Option Transfer Fee, I hope we all will. It is another tool we need to get our housing stock back on track and give our community an opportunity to continue to thrive.”

Editor’s note: Davis said in her original testimony that Fairview Hospital had five job openings attributable to a lack of affordable housing. On January 23, Davis wrote to The Berkshire Edge that the number now stands at 48 job openings.

Subsequently, Fairview Hospital representative Lauren Smith contacted Peter Most and provided the following statement:  “There are 48 overall job openings at Fairview Hospital, and anecdotally the five that were referenced did have as a factor the lack of affordable housing options, but we cannot tie that issue directly to the total number of openings.

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