CHAPA Recommendations on Mandatory Mixed-Use Revisions to MBTA Multifamily Law

CHAPA applauds the additional guidelines issued by the Administration to the MBTA Multi-family zoning law (3A) that adds thirteen state funding programs communities will be eligible for upon achieving compliance under the 3A law. The additional guidelines also allow communities to offset the minimum multifamily unit capacity in certain mixed-use zoning districts that require first-floor commercial space.  

Because commercial requirements can drive up the cost of housing production and make projects unfeasible, communities are required to get approval from EOHLC before the community votes on the zoning proposal. CHAPA is advocating for the Executive Office of Housing and Livable Communities (EOHLC) to establish a list of criteria for approving mixed-use development districts.

The multifamily zoning requirement for communities served by the MBTA is a critical tool for meeting the housing needs of the Commonwealth, making it possible to meet the goal of producing 200,000 new homes with 40,000 affordable and 20,000 deeply affordable homes by 2030. Mixed-use development is vital to achieving these goals.

Prior to the recent changes made by EOHLC allowing communities to require commercial space in approved mixed-use districts, the guidelines provided communities with the ability to offer incentives for mixed-use development. Incentives, such as allowing increased density and height in exchange for first-floor commercial space make mixed-use development viable. The new guidance allowing communities to establish mixed-use districts with commercial requirements can push costs for development, maintenance, and operations of these buildings beyond what the market can bear for rents, home prices, and commercial leases; potentially making development unfeasible.

Clear criteria for mixed-use development districts will help communities determine which options within the 3A guidelines will work best for them. Clear and objective criteria will also help EOHLC make decisions that meet the goals of the law and support communities in fostering vibrant Main Streets.

Proposed Criteria for Approving Commercial Space Requirements in Mixed-Use Development Districts under MBTA Multifamily Zoning Law (3A)

• Require a Commercial Vacancy Rate Lower than 8% for Existing Commercial Spaces
  • Tying the approval to the existing commercial vacancy rate provides EOHLC with key data to understand the health of the commercial market, which impacts a developer’s ability to obtain financing to develop a project. Vacancy rates above 5-8% indicate a lower demand for commercial space. Allowing a commercial requirement in a district with a high commercial vacancy rate can result in less housing, vacant storefronts, or no new development until the market changes.
     
• Require an Approved Housing Production Plan (HPP)
  • The goal of the MBTA Communities Multifamily Zoning law is to make housing production possible. Housing Production Plans demonstrate the different strategies communities will use to foster housing production that meets identified needs.
  • Allowing communities to establish mixed-use development districts with commercial requirements can reduce housing production in mixed-use districts. If the commercial requirement hampers housing development in the mixed-use district, other strategies adopted by the community can advance housing production in other locations.
     
• Require Housing Choice Designation
  • This designation demonstrates that a municipality has put in place best practices established by the Commonwealth to support housing production. Like the Housing Production Plan, having multiple strategies and policies in place to support housing production provides a variety of ways to expand housing opportunities for people, advancing the purpose of the MBTA Communities Multifamily Zoning law.
     
• Require Assurance of Adequate Supporting Infrastructure
  • Similar to infrastructure requirements for Chapter 40R districts, communities must demonstrate adequate water/ sewer/ septic resources to support additional commercial spaces to ensure the viability of mixed-use developments.

CHAPA applauds key provisions included in the guidance intended to make mixed-use production possible, including requiring a broad mix of non-residential uses by right and prohibiting minimum parking requirements for non-residential uses. In addition, requiring communities to have mixed-use development districts pre-approved by EOHLC prior to the community’s vote provides the opportunity for EOHLC to determine where commercial requirements can support thriving mixed-use districts. To help communities make this determination, clear decision-making criteria are important. Requiring a market analysis would be most beneficial.

It is critical to demonstrate the strength of the commercial market to understand if a commercial space requirement will be subsidized by the housing component, driving up rents and home prices beyond what the market can bear. This can make housing more expensive and result in long-term commercial vacancies or make it too costly to produce housing. A market analysis would ensure that commercial requirements are determined with the same level of rigor as inclusionary zoning requirements that exceed the 10% allowed in the guidelines. With no market analysis required in the guidelines, CHAPA is requesting that EOHLC establish the above-mentioned criteria for approving mixed-use development districts. Please join these efforts and urge EOHLC to establish the criteria for allowing mandatory mixed-use in 3A districts.