Ruling protects taxpayers, homeowners, renters, and communities from a damaging housing policy

The Fiscal Alliance Foundation today praised the Supreme Judicial Court’s decision removing the proposed statewide rent control question from the November ballot, calling it a major victory for taxpayers, homeowners, renters, and communities across Massachusetts.

“Today’s decision is a major victory for the people of Massachusetts,” said Paul Diego Craney, Executive Director of the Fiscal Alliance Foundation.  “The Court found this ballot question could not legally proceed and the Commonwealth is better off because of it. Rent control has failed wherever it has been tried and this proposal would have brought one of the most damaging versions of that failed policy to every community in Massachusetts. At a time when our state desperately needs more homes, this ballot question would have made it harder to build, harder to maintain rental housing, and more expensive to own a home.”

The Supreme Judicial Court ruled Tuesday that the initiative petition could not proceed because it impermissibly related to religion and religious institutions, matters that are excluded from the state’s initiative petition process. The proposal included an exemption for units operated for educational, religious, or nonprofit purposes, and the Court found that the religious exemption made religion a factor in the proposed law.

The Fiscal Alliance Foundation said the ruling spares Massachusetts from one of the most extreme rent control proposals in the country and protects the Commonwealth from a policy that would worsen the housing shortage, discourage investment in new rental housing, reduce the value of rental properties, and shift higher property tax burdens onto homeowners.

Earlier this month, the Fiscal Alliance Foundation released a study authored by Jared Walczak titled “Rent Control Raises Taxes on Homeowners.” The study found that rent control would not only damage the rental housing market but would also shift higher property tax burdens onto owner-occupied homes.

Under statewide averages, the study found that rent control could increase the property tax burden on the median single-family homeowner by $312 per year, with larger increases in many communities, including an estimated $1,117 in Boston.

The study explained that when rent control reduces the value of rental properties, those properties carry a smaller share of the local property tax levy. Because Massachusetts property taxes are budget-driven, the tax burden does not disappear. It shifts onto other taxpayers, including single-family homeowners and condominium owners.

“Our study made clear that rent control is not just a problem for landlords or developers. It is a problem for homeowners, renters, taxpayers, and anyone who wants Massachusetts to become more affordable. When rental properties lose value under rent control, the tax burden gets shifted onto everyone else. That means homeowners can end up paying more in property taxes because of a policy that also makes the housing shortage worse,” said Craney.

The Foundation’s study also pointed to real-world examples from other communities. In Portland, Maine, where voters approved rent control in 2020, an analysis found that rent control had already reduced total property valuation by 3.2 to 5.4 percent, resulting in an estimated tax shift costing the median homeowner $224 to $379 per year. In St. Paul, Minnesota, rental properties lost roughly 12 percent of their value shortly after rent control was adopted, while multifamily housing permits dropped sharply after the law took effect.

Massachusetts voters repealed the state’s last remaining rent control law by ballot initiative in 1994. The Fiscal Alliance Foundation said the evidence since then has only grown stronger that rent control reduces housing supply, discourages maintenance and investment, and fails to solve affordability.

“Massachusetts has already tried rent control, and voters were right to repeal it. The evidence since then has only confirmed what voters understood decades ago. Rent control reduces the quantity and quality of rental housing, drives investment away, and shifts costs onto homeowners. Today’s ruling gives lawmakers a chance to focus on real housing solutions, including building more homes, reducing barriers to construction, and making Massachusetts a place where families can afford to live,” closed Craney.