BOSTON – Governor Maura Healey announced plans on Friday to introduce reforms that would enable municipalities with more options in a range of areas, including local option taxes.
Healey said her proposal, the Municipal Empowerment Act, would provide cities and towns with enhanced resources for maintaining and delivering essential services, streamlining operations, and attracting skilled workers to local government.
The Act’s key features include expanding revenue-generating options for municipalities. The bill also proposes giving municipalities more control over liquor license issuances and making permanent several COVID-era allowances, such as hybrid public meetings, outdoor dining permits, and to-go cocktail sales.
The key provisions in Healey’s proposal are in three categories.
Local Revenue Options
- Increasing the maximum local option lodging tax on hotel, motel and other rentals from 6 percent to 7 percent of the price of a room (6.5 percent to 7.5 percent for Boston);
- Increasing the maximum local option meals tax from .75 percent to 1 percent of the sales price of a meal at a restaurant or local store; and
- Adding a new 5 percent local option Motor Vehicle Excise surcharge, a fee charged by every city and town on vehicles registered in their communities based on the vehicle’s value
Fiscal and Staffing Stability
- Creating new property tax exemptions for seniors to allow cities and towns to adopt a Senior Means Tested Property Tax Exemption for qualifying seniors and to increase existing senior property tax exemptions;
- Addressing long-term benefit funding pressures by establishing a new OPEB Commission to take a fresh look at opportunities to address unfunded liabilities from non-pension employee benefits;
- Allowing the creation of Regional Boards of Assessors to allow municipalities to create streamline duties and reduce significant staffing challenges;
- Creating additional flexibilities in post-retirement employment by expanding the process for seeking exemptions to post-retirement employment rules
Procurement Law Reform
- Clarifying that groups of cities and towns can award multiple contracts through an RFP process under Chapter 30B and purchase both supplies and services from collectively bid contracts;
- Equalizing 30B thresholds for advertised procurements to $100 k for all municipal purchasing – not just schools;
- Eliminating the requirement to publish notice of invitations for competitive bids on COMMBUYS; and
- Streamlining procurement for electric school buses and charging infrastructure by allowing single procurements for both under Chapter 30B.
Other Reforms
- Enforcement of double pole removal after 90 days by giving municipalities enforcement authority, with penalties for utilities that fail to comply.
- Establishing central valuation of telecom and utility property through the Department of Revenue’s Division of Local Services (DLS) to relieve cities and towns of the cost of individually hiring experts and consultants.
- Updating borrowing rules for school projects to increase from 30 years to 40 years the bond term to more closely reflects the life expectancy of the project.
“From day one, our administration has been committed to giving them the support and resources they need to build strong communities and grow their economies,” said Governor Healey. “The Municipal Empowerment Act proposes multiple reforms that municipal leaders have asked for to improve the services they can provide to their communities and make operations more efficient.”
Healey also outlined the local aid support expected in her upcoming Fiscal Year 2025 budget proposal. The budget proposal includes a three percent increase in Unrestricted General Government Aid to $1.31 billion and full funding for the fourth year of the Student Opportunity Act, raising Chapter 70 aid to $6.86 billion. The total Local Aid in the budget will amount to $8.7 billion, representing a 3 percent increase from the current fiscal year.
The administration also plans to file a two-year, $400 million Chapter 90 bill to support long-term municipal project planning. This funding will be augmented by an additional $100 million for local road and bridge repairs and $24 million dedicated to rural communities.
