GOV. CHARLIE BAKER’S bill to fund climate change adaptation would allow the state to assist private property owners and it includes a revenue source – two features that are not included in the so-called Greenworks bill backed by House Speaker Robert DeLeo, which is on track for a floor vote in the next couple months.
After hearings on both bills on Tuesday, the speaker’s office said the House would take up his climate change bill this summer and expressed reservations about the governor’s approach.
For his part, the governor was quite deferential about the Greenworks bill.
“I would never say that anything that I propose is necessarily any better than anything that’s proposed by anybody else in this building,” Baker said in a response to a question about why he thinks his bill is better than the speaker’s. “Good for him for stepping up and proposing a significant program here.”
The Greenworks bill would sidestep the governor’s authority on controlling state borrowing, devoting $1 billion over 10 years in matching grants to municipalities, similar to the MassWorks infrastructure program.
The governor’s bill would be financed by a controversial increase in the tax on real estate transfers, and it would also give the state more leeway in how the money is spent, Baker said.
“Bond money, which is the approach the speaker took, you can’t use it alongside private money. You can’t use it to support private property. It has very defined terms in state finance law with respect to what you can use it for,” Baker said after testifying before the Revenue Committee.
The governor’s bill, which is projected to generate nearly $140 million annually, is “agnostic” about whether the funding would be primarily grants or loans, but it would not be purely competitive grants, said Energy and Environmental Affairs Secretary Kathleen Theoharides.
As climate change increases the risks for flooding both along the seashore and inland, the scale of need is vast, Theoharides explained to the committee. She said there are 370 miles of barriers along the shore; 3,000 dams throughout the state, including 300 deemed highly hazardous; and more than 25,000 culverts, which can harm wildlife and create liabilities.
A significant number of the dams are privately owned, and having the flexibility to aid private property owners would be necessary for the state to make improvements or remove them. Theoharides said the funding could be put to work in other ways as well.
“It could be used for a wide range of private properties. I think there would be constraints there that we set ourselves around what it could be used for,” Theoharides told reporters.
The speaker’s office said it wants to clarify how the money would be spent and the program implemented if lawmakers are going to be asked to vote on a tax increase.
“The House will continue to monitor the governor’s bill as those details are made available and as it goes through the committee process,” a spokeswoman said.
The Baker administration didn’t take a hard line on how exactly the funding would be disbursed.
“We want a lot of input on the best way to equitably distribute the funds,” Theoharides said.
The proposed increase in the real estate sales tax, which would go up by 50 percent, is one of only a few areas where lawmakers or the governor are giving serious consideration to hiking taxes. Legislative leaders are planning to discuss revenue proposals to provide more transportation funding later this session, and the governor is also participating in multi-state talks about instituting a cap-and-invest program that would likely increase the cost of driving a gas- or diesel-powered vehicle. Last week, a joint session of the House and Senate voted overwhelmingly to advance a constitutional amendment that would place a surtax on the state’s highest earners to fund transportation and education.
The governor said he understood people don’t want to pay more in taxes, but he thought the financing in his climate change bill makes sense.
“This really is fundamentally about property protection, and that’s part of the reason we did it this way, because if you do it this way, the resources that are generated by it can be used to support, fortify and provide resilience to private property and public property,” Baker told the committee. “We decided the best way to go at this was through something that was related to property.”
Climate and housing activists have banded together with some lawmakers to propose doubling the real estate sales tax hike included in the governor’s bill, and then devoting half of that money to housing programs.
The governor wasn’t won over by that idea when told about it on Tuesday afternoon.
“I’m really interested in this climate initiative,” Baker said.
“I think this is just a win-win opportunity,” said Sen. Joanne Comerford, a Northampton Democrat and Revenue Committee member who supports doubling the tax and using half of it to fund housing initiatives.
Marc Draisen, the executive director of the Metropolitan Area Planning Council, supports the governor’s bill, and sounded intrigued by the idea of expanding upon it in the way Comerford described.
“We do think it is an idea that is worthy of very serious consideration. We need the money for climate. We need the money for housing. Both are property-related issues so it would be a reasonable tax to pay for those two costs,” said Draisen, who said he would wait until legislation is filed before taking a firm stand on the idea.