By William C. Shelton

(The opinions and views expressed in the commentaries of The Somerville Times belong solely to the authors of those commentaries and do not reflect the views or opinions of The Somerville Times, its staff or publishers)

In October, Mayor Curtatone announced “Sustainable Neighborhoods,” an initiative to maintain Somerville’s housing affordability and economic diversity. The good news for me is that the city will finally mobilize the full range of tactics that Mayor Capuano’s Affordable Housing Task Force recommended sixteen years ago.

The bad news is that the plan sets a goal of building 9,000 new housing units in Somerville over the next sixteen years. The 2012 SomerVision plan had previously set a goal of 6,000 new units, which was bad; 9,000 would ensure that our city becomes less affordable and diverse than it is today.

I like dense urban life. I loved living in Manhattan for two years. But Somerville is already New England’s densest city. Among Massachusetts’ 351 cities and towns, we have the worst jobs-to-workers ratio and the least amount of open space per 1,000 residents.

If we’re going to increase our total housing stock by 27% over sixteen years, we ought to have good reasons. Maintaining housing affordability and population diversity are not credible ones.

The rationale for explosive housing growth seems to be that (1) increasing the supply of available units relative to demand will ease price pressure, and (2) other elements of the Sustainable Neighborhoods plan, like expanded inclusionary zoning requirements, will make a significant portion of the new units “affordable.”

The problem with the first assumption is that the affordable housing crisis is regional. There is no amount of market-rate new units that could realistically be crammed into our city over sixteen years and be sufficient to equilibrate supply and demand at prices lower than we see today.

The problem with the second assumption is that adding 9,000 units would worsen the city’s structural fiscal deficit to the point that we could not pay for other elements of the Sustainable Neighborhoods plan, or for all the other municipal services that sustain affordability.

The City of Somerville is on welfare. Our property and excise tax collections cover only 64% of what we spend. We are one of Massachusetts’ needy municipalities, relying on state aid to cover 24% of our budget.

A gross imbalance between the amounts of residential and commercial property in the city fully explains our deficit. Residential property is taxed at 61% of the rate at which commercial property is taxed, but it generates twice the rate of city expenses. The total assessed value of Somerville’s taxable commercial property is only one-eighth the value of its taxable residential property, and the trend is in the wrong direction.

As Somerville deindustrialized, previous city administrations allowed factories and other commercial properties that had hosted jobs and generated higher taxes to be converted to housing. More recently, city officials blessed a wave of condo conversions, multi-unit projects forced onto protesting neighbors, and large high-priced residential developments.

Collectively, these policies reduced the stock of family housing and rental housing while escalating housing prices. Unbalanced by vigorous growth in commercial property, each new housing unit incrementally widens the structural deficit.

The rationale for these policies, though never publicly stated, is that residents of the expensive new units probably won’t have children, and therefore won’t contribute to our schools’ costs, which make up 30% of the city budget. So they won’t have as much of a negative fiscal impact as adding lower-cost and family housing units would.

But a consequence of this policy is that childless occupants of the pricy new units tend to be transient and much less likely to involve themselves in the life of the community. There are some wonderful exceptions, and I’ve written a series of columns about them. But they remain exceptions, while the snowballing displacement of long-term residents who are priced out of Somerville continues to unravel the fabric of our community.

A good portion of affluent newcomers who do choose to remain will eventually reproduce. So they will either leave the city, increasing transiency and housing price escalation, or buy into our diminishing stock of family housing, outbidding and displacing ‘Villens.

Either way, the residential/commercial imbalance continues to worsen, with dire consequences. One of them is that we have two working residents for every job, while Boston and Cambridge have two jobs for every worker.

The best affordable housing program is a job that pays enough for a worker to afford market-rate housing. Building affordable housing is expensive. Preparing young people and limited-skilled workers for available jobs is less expensive.

Because of Boston’s and Cambridge’s commercial/residential property balance, their spending on city services is 40% and 83% more per resident, respectively, than ours is. Those cities can not only provide more training, education and placement to people who need jobs, they can pay for more services that support housing affordability.

If Somerville allows construction of 9,000 new housing units, it will have a very hard time paying for the most basic of municipal services, much less those proposed in the Sustainable Neighborhoods plan.

The Somerville budget amounts to a little over $6,300 per housing unit in the city. Residential property taxes bring in about $3,100 per unit. That’s a difference of $3,200.

If we were to add 9,000 units, the increased budget gap might well be less than $3,200 per new unit, because some existing costs will remain fixed as we grow, and others are nonlinear. But we would have to build new schools to accommodate a couple thousand additional kids who would live in the new units. We might require a new fire station in addition to the one that we already need but don’t have. We would require additional infrastructure.

So for the sake of argument, leave the budget gap at $3,200 per new unit. That’s a $29 million shortfall, with no identifiable revenues to make it up.

Or, if you think that this calculation is to simplistic, assume that the shortfall is only half of what I suggest. Making the cuts or ratcheting up property taxes to fill that gap would make Somerville much less affordable than it already is.

Critics will point out that SomerVision calls for a lot more commercial development and job creation to balance housing growth. It does. And it’s not happening.

Our big new increase in commercial property is the Partners Healthcare campus. As a nonprofit, Partners will make much smaller payments to the city than the city will spend to provide municipal services to Partners.

So my response to city officials who dismiss the foregoing analysis is this: If you’re serious about ensuring that commercial development in the “transformational areas” will achieve SomerVision’s goals, then ration the issuance of permits for unaffordable housing, based on one new unit for every five new jobs created in taxable developments. Maintain that policy until our commercial/residential and jobs/workers inequities are rebalanced.

Correction:

The column states that Somerville Schools’ costs make up 30% of the city budget. I arrived at that figure by taking the School Department line item in the FY 2015 municipal budget as a percentage of the whole. I have since discovered that benefits for school personnel, as well as salaries and benefits for municipal workers who maintain our schools, are included in other budget line items. When all these costs are factored in, the proportion of the budget that the city spends on schools is closer to 50%.

This makes the trade-off between expanding housing stock for affluent childless transients and maintaining and expanding housing for families who participate in the life of the community all the more acute. The only way to heal that tension is through a massive expansion of our commercial property tax base, as I suggest in the column’s conclusion.

— Bill Shelton