Cantabrigians Keep Close Eye on Cape Cod Land Bank

In his second-floor office above the columned entrance of the Curious George Goes to Wordsworth bookstore on JFK Street, Fred Meyer, owner of University Real Estate, says he has witnessed the stresses that go along with buying and selling property throughout his 35-year career.

Because it is an already stressful process, Meyer says property buyers and sellers should not have to bear the additional burden of real-estate transfer taxes designed to pay for community needs like open space, low-income housing and historic preservation.

"Virtually everyone [supports such causes]," Meyer says. "But for any good cause, you have to look at funding fairly."

Echoing Meyer's sentiments, voters in Cape Cod last week rejected such a transfer tax.

The Cape land bank proposal exposed the dilemma of how to pay for open space, and, in Cambridge, may jeopardize the passage in Cambridge of similar taxes aimed at local concerns like low-income housing and historical preservation.

If last week's vote is any indication of how such future real-estate-transfer tax bills will fare, Meyer will have his wish.

The Bills

The Cape land bank proposal would have established a one percent tax on all real-estate transactions, to be paid by the seller. The first $100,000 of the sale price would have been exempted.

The money from the tax would have been distributed to the 15 towns in Barnstable County, to pay for the preservation of open space and to help protect the region's water supply from overdevelopment.

The Cape land bank proposal is similar in structure to two other proposals that may affect Cambridge--the Community Preservation Act, sponsored by State Sen. Robert A. Durand (D-Marlboro) and the Cambridge Transfer Tax Bill, sponsored by State Rep. Alvin E. Thompson (D-Cambridge).

According to Durand's office, the Community Preservation Act would enable communities across the state to choose by local ballot referendum to adopt a transfer tax of up to 1 percent on the purchase of real estate.

Depending on their needs, communities would be able use revenue from the tax to pay for open space preservation, affordable housing, historic preservation, brownfields redevelopment and septic system improvements.

In Cambridge, revenue from such taxes is being eyed for affordable housing--a major municipal concern since rent control regulations expired on Jan. 1, 1997.

The act is currently under study.

The Cambridge transfer tax, according to Thompson's office, would ask for a fee of one percent on sales in excess of $300,000. This fee would be paid to the City of Cambridge and allocated to the Cambridge Affordable Housing Trust Fund.

Thompson says this bill is necessary to make certain that people of diverse economic backgrounds can live in the city.

Thompson is currently trying to get the bill to the legislative floor.

Cape Bill: A Death Blow?

After the failure of the Cape land bank proposal, State Rep. Eric Turkington (D-Falmouth), the sponsor of the bill, is pessimistic about another real-estate tax bill--for the Cape or for any other part of the state--passing any time soon.

"It will hurt [the Community Preservation Act], no question," Turkington says.

Although some are more emphatic than others, Cambridge representatives say the recent Cape vote will affect issues on their agenda.

Kathleen L. Born, a Cambridge city councillor and a proponent of taxes on real estate for low-income housing, groans when she thinks about how the fate of the Cape Cod bill will affect her housing agenda.

"Let's put it this way, it's bound not to look good. There was a wide groundswell of support [in the Cape], but it obviously wasn't enough," Born says. "It's not encouraging."

However, State Rep. Alice Wolf (D-Cambridge), a supporter of real estate taxes, says real estate tax bills in general are "uphill battles."

Wolf is currently shepherding a nontransfer tax alternative bill through the state legislature.

Thompson tries to maintain an optimistic demeanor, arguing that the failure of the Cape bill will actually give more incentive to Cantabrigians to pass his measure.

Referring to the Cape failure as a landlord-versus-tenant issue, Thompson says that unlike the Cape, Cambridge has many tenants--voters who are sure to support the transfer tax.

"If the advertising is right, we can win the vote on referendum," he says.

The Root of The Problem

Margo Fenn of the Cape Cod Commission says that the problem is not actually about the issue of open space.

"We're certainly convinced there's a need for a land bank," Fenn says. "Even our opponents came out and said [there's a need]."

Susan Nickersen of the Association for the Preservation of Cape Cod puts the failure of the Cape bill in perspective.

"The problem is the funding mechanism, not the bill," she says.

Indeed, State Rep. Thomas George (R-Yarmouth), the one Cape legislator who opposed the measure, also says he believes in land banks.

However, George says that activities should be governed on a town-by-town, rather than a county or state basis, because the locals know where they want to place the emphasis. Furthermore, he says that the locals should pay for it themselves.

While acknowledging that there was an exemption on the first $100,000 of the sale price, George insists that "a good number" of his constituents are "elderly, retired and on a limited income" and that having a sales tax would hit them hard.

"The proponents lost sight of the fact that 300, 400, 500 dollars mean a lot to these people. People can't afford to pay it to some charity, especially when moving out. The majority of these people moveoff-Cape, maybe off-state. Why should they leave alump sum of money as a thankyou?" George asks.

Will it Make A Difference?

The central question which arises from thecontroversy is how useful trying to pass such realestate taxes would actually be toward addressingsuch issues as preservation of open space andlow-income housing.

On this issue, there is some consensus betweenthe opponents and the proponents of the realestate transfer bills.

John Dulczewski, the communications director ofthe Massachusetts Association of Realtors, forone, does not believe that the transfer tax is arealistic way to pay for open space or low-incomehousing.

"Real estate is a traditionally cyclicalmarket, it's not ideal if you're looking to have asteady stream of funding. So the amount of revenuefrom the tax might be okay sometimes, but not atother times," Dulczewski says.

Draining The Hourglass

While legislators and activists scramble toreposition in the aftermath of the land bank billfailure, both the Cape and Cambridge's low-incomehousing crisis continue to grow.

According to Turkington, 10,000 acres have beendeveloped on the Cape since 1990. At the sametime, the Cape Cod's 15 towns were only able toset aside 800 acres.

"We're the fastest growing area of the state,and have been for a couple of decades," he says."At the rate we're going, within 30 to 40 years,we won't be having this discussion [about openspace] because we won't have anything to save."

Bob Wilkinson, a Cape realtor who favored theland bank bill, says it's already too late.

Wilkinson, who served as spokesperson and chairof the Friends of Cape Cod Landbank Bill, saysthat after a 14-year battle just to bring the landbank proposal to a referendum, they have now lostthe struggle to maintain the Cape's "specialatmosphere."

"I think it's over," he says.

Cambridge, Not New Haven

Back in The Square, Meyer tries to make theargument that instead of taxes on real estatetransactions, the most equitable Cape Cod billwould have had those living near the open spacepay for its preservation.

As for Cambridge, keeping neighborhooddiversity is a complex issue, Meyer believes.

"The issue in Cambridge is not as simple aspeople would like to believe. It's not just aboutkeeping low-income people, there's plenty oflow-income people. What we also need is to keepmiddle-class people," Meyer says.

Meyer thinks Cambridge's diversity should bemaintained by subsidies, not by "sales taxestargeted to real estate."

"New Haven pursued a policy some would arguefor Cambridge [focusing on low-incomehousing]..and New Haven has suffered greatly sinceI graduated [from Yale]," says Meyer, who left NewHaven in 1959.

According to Gordon Gottsche, the executivedirector of Just A Start, a nonprofit communityhousing organization, however, the problem is thatthere simply are not enough resources for themaintenance of Cambridge's low-income housing.Real estate taxes or city subsidies help, but theydo not solve the problem.

"Presumably, the real estate tax would gotoward buying buildings...but the private sectorhas a hell of a lot more money to buy thosebuildings for increasingly expensive condominiumsthan us," Gottsche explains.

As for the Community Preservation Act and theCambridge Transfer Tax bill, Gottsche has noillusions.

"Will [they] pass? Your guess is as good asmine," Gottsche says

Will it Make A Difference?

The central question which arises from thecontroversy is how useful trying to pass such realestate taxes would actually be toward addressingsuch issues as preservation of open space andlow-income housing.

On this issue, there is some consensus betweenthe opponents and the proponents of the realestate transfer bills.

John Dulczewski, the communications director ofthe Massachusetts Association of Realtors, forone, does not believe that the transfer tax is arealistic way to pay for open space or low-incomehousing.

"Real estate is a traditionally cyclicalmarket, it's not ideal if you're looking to have asteady stream of funding. So the amount of revenuefrom the tax might be okay sometimes, but not atother times," Dulczewski says.

Draining The Hourglass

While legislators and activists scramble toreposition in the aftermath of the land bank billfailure, both the Cape and Cambridge's low-incomehousing crisis continue to grow.

According to Turkington, 10,000 acres have beendeveloped on the Cape since 1990. At the sametime, the Cape Cod's 15 towns were only able toset aside 800 acres.

"We're the fastest growing area of the state,and have been for a couple of decades," he says."At the rate we're going, within 30 to 40 years,we won't be having this discussion [about openspace] because we won't have anything to save."

Bob Wilkinson, a Cape realtor who favored theland bank bill, says it's already too late.

Wilkinson, who served as spokesperson and chairof the Friends of Cape Cod Landbank Bill, saysthat after a 14-year battle just to bring the landbank proposal to a referendum, they have now lostthe struggle to maintain the Cape's "specialatmosphere."

"I think it's over," he says.

Cambridge, Not New Haven

Back in The Square, Meyer tries to make theargument that instead of taxes on real estatetransactions, the most equitable Cape Cod billwould have had those living near the open spacepay for its preservation.

As for Cambridge, keeping neighborhooddiversity is a complex issue, Meyer believes.

"The issue in Cambridge is not as simple aspeople would like to believe. It's not just aboutkeeping low-income people, there's plenty oflow-income people. What we also need is to keepmiddle-class people," Meyer says.

Meyer thinks Cambridge's diversity should bemaintained by subsidies, not by "sales taxestargeted to real estate."

"New Haven pursued a policy some would arguefor Cambridge [focusing on low-incomehousing]..and New Haven has suffered greatly sinceI graduated [from Yale]," says Meyer, who left NewHaven in 1959.

According to Gordon Gottsche, the executivedirector of Just A Start, a nonprofit communityhousing organization, however, the problem is thatthere simply are not enough resources for themaintenance of Cambridge's low-income housing.Real estate taxes or city subsidies help, but theydo not solve the problem.

"Presumably, the real estate tax would gotoward buying buildings...but the private sectorhas a hell of a lot more money to buy thosebuildings for increasingly expensive condominiumsthan us," Gottsche explains.

As for the Community Preservation Act and theCambridge Transfer Tax bill, Gottsche has noillusions.

"Will [they] pass? Your guess is as good asmine," Gottsche says