Be it enacted by the People,
and by their authority,
SECTION ONE. The General Laws are hereby amended by inserting after chapter 40N the following chapter 40 O: `tuc Chapter 40 O The Massachusetts Rent Control Prohibition Act
Section 1. Title. This chapter shall be known as "The Massachusetts Rent Control Prohibition Act."
Section 2. Purpose. The purpose of this chapter is to establish a uniform statewide policy that broadly prohibits any regulatory scheme based upon or implementing rent control, except where, following an initial 6-month period, compliance with such a scheme is voluntary and uncoerced on the part of property owners. Even when voluntary, rent control should be severely restricted in scope. This policy is based on the belief that the public is best served by free-market rental rates for residential properties and by unrestricted home ownership. The terms of this chapter shall be liberally construed to effect this purpose.
Section 3. Definition of Rent Control. For the purposes of this chapter, the term "rent control" shall mean:
(a) any regulation that in any way requires below-market rents for residential properties; and
(b) any regulation that is part of a regulatory scheme of rent control as defined in subsection (a), including the regulation of occupancy, services, evictions, condominium conversion and the removal of properties from such a rent control scheme; except that
(c) this definition does not include the regulation of, or agreements affecting, publicly owned housing, publicly subsidized housing, federally assisted housing, or mobile homes.
Section 4. General Prohibition; Exception. No city or town may enact, maintain or enforce rent control of any kind, except that any city or town that accepts this chapter may adopt rent control regulation that provides:
(a) after six (6) months from the date of the initial adoption of rent control regulation by a particular city or town, compliance on the part of property owners as to the rent control regulation or any subsequently adopted rent control regulation shall be entirely voluntary and uncoerced, and the property of a person or entity declining to have his or its property subjected to such regulation shall be wholly unaffected by any aspect of the rent control regulation or any subsequently adopted rent control regulation;
(b) such regulation may not include the regulation of occupancy, services, evictions, condominium conversion or the removal of properties from such regulation, nor may such regulation apply to any rental unit that is owned by a person or entity owning less than ten rental units or that has a fair market rent exceeding $400; and
(c) a municipality adopting such regulation shall compensate owners of rent-controlled units for each unit in the amount of the difference between the unit's fair-market rent and the unit's below-market, rent-controlled rent, with such compensation coming from the municipality's general funds, so that the cost of any rent control shall be borne by all taxpayers of a municipality and not by the owners of regulated units only.
Section 5. Preemption. Because rent control is a matter of statewide concern, this chapter shall preempt, supersede or nullify any inconsistent, contrary or conflicting state or local law.
Section 6. Severability. The provisions of this chapter are severable. If any provision of this chapter or its application is held invalid, the remainder of this chapter shall continue to be valid and in effect.
SECTION TWO. Effective Date. This act shall become effective on January 1, 1995.