AN ACT ESTABLISHING A SURCHARGE ON SPECIFIC COMMERCIAL DEVELOPMENT ACTIVITIES FOR THE PURPOSE OF FUNDING THE CREATION OF COMMUNITY HOUSING
Be it enacted by the Senate and House of Representatives in General Court assembled, and by the authority of the same, as follows:
SECTION 1. In order to mitigate the impact of the increased demand for housing generated by employees of new commercial development wanting to live within the town of Lexington, a commercial linkage fee, referred to in this act as "the community housing surcharge" or "the surcharge," shall be added by the town of Lexington to all commercial construction building permits issued by said town for non-municipal structures with a gross floor area more than 30,000 square feet. The surcharge shall apply only to the floor area of new construction or modification to existing structures in excess of 30,000 square feet, referred to in this act as “excess gross floor area”. For building permits that authorize modification of existing structures, the building commissioner of the town of Lexington shall determine the applicable excess gross floor area. If the building permit authorizes both commercial and residential uses, the square footage of the structure dedicated to residential use shall not be included in the calculation of excess gross floor area for purposes of this act.
SECTION 2. The select board of the town of Lexington shall determine the amount of the community housing surcharge, which shall be applied on a dollars-per-square-foot basis on the certified total excess gross floor area of the structure or structures permitted by an applicable building permit. The select board shall prepare a study to determine the initial surcharge rate range and shall set an initial surcharge rate within 12 months of the effective date of this act. The select board or its designee shall adjust the rate of the surcharge annually for inflation.
SECTION 3. The town manager of the town of Lexington or their designee shall prepare a study every 5 years to determine the suitability, effect and amount of the surcharge and recommend to the select board any possible changes necessary to address changing demand for community housing. The town manager or their designee shall also prepare and issue an annual report that identifies surcharge receipts, quantifies the attributes of community housing projects funded by the community housing surcharge and evaluates the impact of said housing projects.
SECTION 4. The select board of the town of Lexington may adopt additional requirements, exemptions and regulations to implement or enforce said community housing surcharge, consistent with this act.
SECTION 5. The community housing surcharge required by this act shall be paid in 3 equal installments, with amounts to be determined at the time of levy, with 1 payment required per annum. The building commissioner of the town of Lexington shall not issue a certificate of occupancy for real property subject to this act before the first installment of the community housing surcharge has been paid. The second and third installments shall be paid annually on the anniversary of the first payment or the next business day if that date falls on a weekend or federal, state or local holiday. The building commissioner of the town of Lexington shall levy fines for development that is not in compliance with this act and shall consider each day of noncompliance as a separate offense.
SECTION 6. All surcharges and fines received pursuant to this act shall be deposited into the town of Lexington Affordable Housing Capital Stabilization Fund or a municipal affordable housing trust fund established by the town pursuant to section 55C of chapter 44 of the General Laws or any special act.
SECTION 7. For the purposes of this act, “community housing” shall mean as defined under section 2 of chapter 44B of the General Laws.
SECTION 8. This act shall take effect upon its passage.
Approved, January 8, 2025.