Mayor Martin J. Walsh last week celebrated the passage of legislation that will provide the City of Boston with more flexibility to leverage the strong development market to fund affordable housing and workforce training programs.
Originally introduced by the Mayor as a Home Rule Petition in January 2019, he signed “An Act to Further Leverage Commercial Development to Build Housing, Create Jobs, and Preserve Inclusionary Development” with the support of the City Council in September 2019, and the legislation was sponsored by Representative Kevin Honan at the State House. The legislation was signed by Governor Baker on Thursday, January 14, 2021.
“In Boston we will continue to use every tool that we have to make sure that Boston’s strong growth is reaching all of our residents by creating affordable housing and investing in workforce training,” said Mayor Walsh. “This historic legislation will strengthen Boston’s Inclusionary Development Policy and linkage program, and allow us to continue to leverage millions of dollars in funding for programs that positively impact the lives of Boston’s residents. I thank the many advocates, the Boston City Council, and the Legislature for helping us reach this milestone.”
In December 2019, the Mayor testified at the State House alongside residents and workers in support of the legislation.
“This is an incredible opportunity to step up on the production of affordable housing in our City and meet the challenges that have been underscored by the pandemic,” said Vanessa Calderon-Rosado, CEO, Inquilinos Boricuas en Acción (IBA). “I’m grateful to the Mayor for his leadership in keeping this measure front and center, and to the State legislature and Governor Baker for taking it through to the finish line.”
Boston’s Linkage program provides funding for affordable housing and workforce training through payments by large-scale commercial real estate development. While previously, the Boston Planning & Development Agency (BPDA) was only allowed to adjust Linkage every three years based on the Consumer Price Index (CPI), the new law will allow Boston to adjust the required payment and program guidelines, including annual adjustments, allowing for Linkage to be more closely aligned with the market and offering additional opportunities for the creation of affordable housing and workforce development.
Currently, commercial developments over 100,000 square feet pay $10.81 per square foot, of which $9.03 is for housing and $1.78 is for jobs Linkage. The money collected is made available through competitive funding rounds administered by the Neighborhood Housing Trust and the Mayor’s Office of Workforce Development.
Since 2014, new development has generated over $80 million in linkage to support affordable housing and job training, and provided industry-recognized job training to over 2,000 Boston residents annually. Since the onset of the COVID-19 pandemic, the Neighborhood Jobs Trust has dedicated $2.4 million to emergency supports for workforce and education programs, as well as specialized job training for workers preparing to enter the IT/tech industry.
Since inception in 1986, linkage has produced more than $200 million for affordable housing and workforce training.
•Inclusionary Development Policy Updates
The new law will also allow Boston to codify its Inclusionary Development Policy (IDP) into the Boston Zoning Code. Under the current policy, IDP requires that developers of buildings with 10 or more units seeking zoning relief or building on City of Boston-owned land set aside a percentage of their on-site units as income-restricted, create off-site income-restricted units, or make a payment to the IDP fund.
As the BPDA completes comprehensive planning in Boston’s neighborhoods and updates Boston’s existing zoning, more market-rate residential projects may become ‘as of right’ and be exempt from IDP requirements. The legislation would allow Boston to strengthen its IDP as a strategy to capture affordable housing units and funding from projects which are zoning compliant, expanding the work under Mayor Walsh to create and preserve Boston’s affordable housing.
The IDP has led to the creation of 2,917 units of stable, income-restricted housing, and $89.2 million in contributions to the IDP Fund since its inception in 2000. When combined with other affordable housing resources, the IDP has supported the completion or preservation of 1,847 additional units of income-restricted housing. In total, 4,764 income-restricted units have been created through the IDP.
Under Mayor Walsh, the BPDA is leading an unprecedented number of planning studies, each guided by Imagine Boston 2030 the first city-wide master plan in 50 years aimed at guiding growth. In 2020 alone, new development approved by BPDA is generating 2,826 income-restricted units, over $5.4 million in new Inclusionary Development Policy (IDP) funds, over $43.2 million in Linkage fees to support affordable housing, and over $8.5 million in Linkage fees to support job training programs. This legislation will allow the BPDA to further leverage development to increase these streams of funding.