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Auditor calls key state housing law an ‘unfunded mandate,' raising prospect of more lawsuits

The office of State Auditor Diana DiZoglio issued an opinion late last week calling MBTA Communities an 'unfunded mandate,' citing a law that requires the Legislature to allocate funding for new laws that impose costs on municipalities. The Auditor's Division of Local Mandates issued the decision after several towns requested the office to weigh in, and determined that 'The MBTA Communities Act does not provide a funding mechanism for compliance with its provisions,' the office wrote. The decision effectively provides a new pathway for municipalities to challenge the law in court, though it is not clear how much weight the auditor's decision would hold in such a case. Related : Advertisement The opinion blindsided and enraged some housing advocates, who accused DiZoglio of standing in the way of a law that is meant to spark the production of much-needed homes in a state where housing prices 'It's very unfortunate that the auditor is throwing a wrench into a critical policy that is meant to see more housing built in Massachusetts,' said Marc Draisen, executive director of the Metropolitan Area Planning Council. 'We are decades behind in producing the homes that people need, and this law is one of the few times that the Legislature has chosen to address this issue.' The auditor's opinion, which comes four years after the law was signed by then-Governor Charlie Baker, came after three towns requested DiZoglio's office weigh in on the issue: Wrentham, Middleborough, and the auditor's hometown of Methuen. (DiZoglio, who was a state senator when MBTA Communities was passed, voted for State Auditor Diana DiZoglio. Erin Clark/Globe Staff Her office argued that the law constitutes an unfunded mandate under the Local Mandate law because the Legislature did not appropriate funds when it first passed the legislation in 2021, even though the state has since doled out millions of dollars in grants to towns to pay for consultants to help draft their zoning. Advertisement 'Establishment of the grant programs... did not occur contemporaneously with the enactment of [MBTA Communities],' the office wrote, which is a requirement of the Local Mandate law. DiZoglio's office said municipalities may be able to petition the Superior Court for an exemption with the opinion. Typically, in cases of unfunded mandates, the auditor's office conducts a fiscal analysis to precisely determine the burden of a mandate on cities and towns. DiZoglio's office did not do that analysis for MBTA Communities because it would require 'further data collection,' which it said it would conduct in the future. Related : Draisen, whose organization has provided funding and technical assistance aimed at helping communities write compliant zoning, rejected the notion that MBTA Communities is a fiscal burden on towns. The state, he said, 'has gone overboard to try and provide either funding or assistance to communities to help them with this effort.' Attorney General Andrea Campbell, who sued Milton last year after residents overturned an MBTA Communities zoning plan, pushed back against the opinion, saying that it does not carry any weight unless a court makes a similar determination. 'The Auditor's claim that the MBTA Communities Law is an unfunded mandate is wrong, and, more importantly, this letter has no effect whatsoever on implementation of the law,' Campbell said in a statement. 'If those who oppose housing affordability try to make a similar claim in court, the state will vigorously defend the law, and we intend to be successful, as we have been so far.' Advertisement Still, the opinion has empowered opponents in many communities, who see it as an opportunity to either secure an exemption for their town from their law, or undermine it statewide. The Select Board in Wrentham, Mark Germain, chair of the Middleborough Select Board, wrote on Facebook that 'the short version is, the State Auditor has ruled that the MBTA Communities Act is an unfunded mandate and is unenforceable.' Middleborough is one of six communities that the state now considers out of compliance with the law after it missed a February deadline to submit a plan to comply. Housing advocates and some developers said they're frustrated by the opinion because it give towns more runway to challenge the law in court, even after the Supreme Judicial Court issued 'Despite the modest progress to restore production, Healey and her team have worked very hard, and to have the Auditor attempt to throw a wrench into the process is grossly irresponsible,' said Jay Doherty, CEO of development firm Cabot, Cabot & Forbes, which has several projects planned under MBTA Communities. 'It's purely political.' Andrew Brinker can be reached at