News that developers have been illegally skimming excess profits from affordable housing projects built under the state's Chapter 40B law is a good reason to revise the law but does not justify an ongoing campaign to repeal it.
The Senate Post Audit and Oversight Committee last month released a report recommending changes that would help better track and audit 40B developments in the state. It also recommended that developers' profits be limited to between 15 and 20 percent.
The committee's recommendations were spurred in part by testimony from Inspector General Gregory Sullivan, who said millions of dollars in excess profits might be owed to cities and towns by developers who either failed to submit cost certifications or submitted erroneous or falsified certifications.
"Our communities have been defrauded of tens of millions of dollars by unscrupulous developers," said Sen. Robert L. Hedlund of Weymouth. "We should move swiftly to ensure that our communities are able to recover this money."
We agree. In most communities, the profit caps were lost in concerns over the ability 40B gives developers to bypass local planning bylaws. Most towns lack the staff or expertise to see through the accounting tricks developers can use to understate their profits.
But those who would use examples of abuse as fuel for a campaign to have the law repealed go too far - especially when they propose no alternative means to produce or encourage affordable housing.
The law has certainly been a thorn in the sides of municipal leaders and neighbors since it was enacted in 1969. It allows developers to circumvent local zoning regulations when less than 10 percent of a community's housing is deemed affordable by state standards. It has resulted in some poorly-planned developments, many upset neighbors and lots of ruffled feathers on planners who presume to dictate the terms on which anyone can build anything in their communities.
Chapter 40B has also resulted in the creation of thousands of units of affordable housing that would never have been built in places where resistance to residential growth effectively locked out anyone who couldn't afford a million-dollar home.
The dirty secret of Chapter 40B is that it is a cheap way for government to provide affordable housing without having to pay for it. In Massachusetts, government stopped building public housing in the '60s. Chapter 40B is a flawed alternative that saves taxpayers billions.
Its flaws can and should be addressed, beginning with a better system for making sure excess profits are returned to municipalities. We'd also like to see incentives adjusted to make Chapters 40R and 40S - which encourage "smart growth" development where infrastructure can accommodate higher density housing - more attractive to developers and communities.
Massachusetts must continue to promote the development of affordable housing. Repealing Chapter 40B alone would be to abandon that policy goal.
