New Housing Offers Fiscal Benefits to Communities

A study by Elise Rapoza and Michael Goodman shows that new housing construction in MA does not have an adverse affect on municipal or school budgets. And when it might, state funding covers the difference. This study contradicts the often heard argument against new housing development, especially multi-family housing, because it, the argument claims, it will have a negative fiscal impact on communities.

In the aggregate, development of new housing offers net fiscal benefit to both municipalities and the state. Additional analysis validates a second study which found that increased housing production does not predict enrollment changes in Massachusetts school districts. In the new study, a distinct minority of municipalities did incur net fiscal burdens—burdens that the net new state tax proceeds associated with the development of new housing are more than sufficient to offset.