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Tackling Our High Cost of Living at the Root

Written by Matt Rusteika

Letter to the Editor:

It’s not news that the expense of living in South Boston has become unmanageable. Average rent is about $3,000 per month. A home in Southie sells for around $790,000—a monthly payment of more than $3,600. That’s a difficult prospect even for a childless couple with no student debt, no medical bills, and no family care obligations.

I’ve experienced being priced out of the neighborhood myself, like dozens of other people I know. I graduated from Brown with my Master’s in 2011, and already there was no place for me in Southie. Rather than live in my mother’s house indefinitely, I moved into a place I could afford in Somerville.
I’m lucky to now be back home, raising a family with my wife. But I know the hurt and frustration of being dragged away from family and community by financial pressures beyond my control. If we’re serious about making room for working people in Boston, we should be considering how to tackle this problem at the root. Our cost of living is too high, and families make too little.

Transparency. We can’t begin to address our cost of living crisis without more transparency in the housing market. Look through the Register of Deeds website; you’ll find that many home sales involve an LLC, and often the owners of an LLC cannot be identified. Has a home been bought for use as an Airbnb hotel? Is it the next target for redevelopment? It’s hard to know. This opacity hurts our communities. As your State Rep, I’ll work to pull back the curtain on LLCs operating in the housing market. You can’t manage what you can’t measure.

Taxation. The rapid increase in housing cost has had a destabilizing effect on our community in many ways. One of the most egregious is that senior homeowners are taxed as though they bought a $1 million house, when in many cases they bought it decades ago for $90,000 in today’s dollars. There is a tax exemption for elderly homeowners, but it’s only worth $27 per month. Seniors may also defer their property tax payments until they sell their house or pass away. But family homes are the spine of our community in South Boston, and a $100,000 tax bill built up over 20 years of retirement would force many families to sell. For my part, I would be heartbroken if I were the one to sell the family house we’ve been living in for nearly a century. If elected, I’ll push for realigning our tax code to give seniors and their families a break.

Child care. Many young families in Southie are like my own: both parents work, but at least one child is too young for school. Ask anyone in this situation, and they’ll tell you that finding safe, affordable day care is difficult. When it can be found, it often comes at a cost equal to or exceeding the rent. This is a serious problem. Lack of access to day care keeps qualified women out of the workforce, exacerbating the gender pay gap. It also forces families from the community. Massachusetts currently provides limited child care subsidies for very low-income families. I want to see a study to assess the cost of expanding the number of people who are eligible for this existing program. I also strongly support the City’s ongoing effort to expand universal pre-K.

It’s our prerogative to decide whether people who don’t have access to a briefcase full of cash—in other words, most people—can remain in the City of Boston. I believe these measures are a good first step toward making our community more livable for working people. And as your State Rep, I’ll make sure they’re on the minds of every elected official and policymaker in the Commonwealth.

Matt Rusteika is a husband, father, 4th generation South Bostonian, and experienced policymaker running to represent South Boston and Dorchester at the State House. He holds a Master’s in Public Policy from Brown University and a Bachelor’s in Writing and Literature from Emerson College. He and his wife Katrina live on M Street with their son Simon and their dog Watson.

 

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  1. Not So New to The Hood says

    Matt – While housing costs are high, it is a natural result of supply and demand. Every developer in the area is doing as much as they can to build as much and as fast as possible.

    Here are the real problems regarding our housing / living cost crisis: Cost of Labor, NIMBYism & Boston Public Schools.

    Here are the solutions: Work with the labor unions to allow more non-union labor or have them move backwards on their absurd pensions and benefits, help pass developer friendly ordinances that don’t call for 5 abutters meetings and tens of sign offs from local officials, and there is no helping BPS, honestly, I don’t have any suggestions for helping BPS aside from moving to the burbs and avoiding them at all costs.

    • Not So New to The Hood says

      and I already know all the wise, wise OFS folk will say “to hell with the developers”….clearly you just don’t have a firm grasp on simple supply & demand economics. Everyone wants to live in the city now, and there’s just not enough space for everyone, hence why costs of ballooned so quickly. The elderly complaining about how high taxes are, are the same people constantly saying NO to new development. Can’t have your cake and eat it too….

  2. Edward says

    Just because there are people who want to move here doesn’t mean we need to build units until the demand is satisfied. Yeah, I get the price goes up but this issue is not as simple as a supply/demand equation which assumes we always need to satisfy demand for the sake of new buyers and renters. Existing home owners are the only people left out of the simple supply/demand argument you make. At some point the rights of the people who own property and pay the property taxes that make the city go need to be considered. Stop the over developing and let the prices go up. Southie is already too dense. The idea of ‘developer friendly’ ordinances?–the ZBA is one big developer friendly ordinance in and of itself. They override existing regulations regularly.

    • Not So New to The Hood says

      Existing homeowners are in the equation…they demand to stay in the home they are currently in, which is a choice. Rising costs & gentrification are a fact of life and it is naturally occurring. Yes, their tax bill may have doubled in the last decade, but so has the equity in their home. Many residents have made the logical choice and sold out for affordable areas, just because a certain subset of the population hasn’t made that logical choice doesn’t mean they should get protected for doing so. We all pay taxes one way or another, whether it’s a direct payment to the city or in the form of rent.

      • Edward says

        OK, “they demand to stay in the home they are currently in, which is a choice”….??? Nobody’s making any demands to stay in their home they own. I own it–I don’t have to demand anything. I just go there and turn the key. With all due respect, that’s completely illogical statement. I own my home…no issue with paying for it or my taxes. Not sure what you are trying to get at there.
        Making a “logical choice” to move is a huge generalization. That only applies to people who for some reason are in financial trouble. I think you are painting everyone who owns a home in Southie with the same brush to make your arguments. and lastly, again your comment about people asking for protections??? You have to have a certain slice of the population in mind when you say that. I and everyone else I know who owns a home is not asking for any protections.

      • Edward says

        (thought I already responded to this but it didn’t show up)
        Your entire comment assumes that an existing homeowner is struggling financially? i.e. “demanding to stay in their home”? Demanding what to whom? There are many people, I would say the majority who own their home, have no problem paying for it and the taxes that go along with it and want the development to stop not for cost or price reasons–just for livability. It’s too dense. That is the part left out of your equation.. You paint a broad and inaccurate stroke when you assume all home owners are struggling with taxes and demand “protections”.

        • Not So New to The Hood says

          1. You are part of the “demand” in the supply/demand equation as an existing homeowner. You demand to be in the home you own.

          2. “Too dense” is extremely subjective. Yes, Southie is dense, but in my opinion it’s not overboard yet.

          • Edward says

            1.) That’s completely incorrect……I am not demanding to be in my own home. I’m already there. “Demand” in economics represents someone looking for the item ( ‘util’ if you like from economics 101) – wanting to consume one that they do not already posses

            2.) Fair enough. Reasonable minds can disagree I guess

  3. Just a Thought says

    Matt,

    You seem to have forgotten that some, if not most, of the readership of CIS are the same transplants to South Boston who are driving the demand to live here and frankly making it a better place. Just as a heads up, we get to vote too.

    Just to recap your sob story here. You left home to go to school for six years and were dumbfounded that you couldn’t immediately purchase a home where you grew up. “[A]lready there was no place for me in Southie”, such drama. You then lived with your parents for a while, presumably got a decent paying job, moved to where you could find more affordable housing for a few years, then moved back into your family home on M Street. (source: CIS article from April 12, 2018).

    Out of curiosity, did you buy your family home or was it gifted to you? “We need a State Representative who lives the challenges that families face in this district every day”. We should all be so lucky.

    Where is the issue here? You and I are the same age, I couldn’t afford to buy a house where I grew up either after I graduated from college, welcome to the real world. You, like everyone else who is moving to Southie, wanted to live in one of the most desirable areas in Boston, just because you grew up here doesn’t make you special, sorry. The days of buying a place for “$90,000 in today’s dollars” are long gone and that’s true everywhere, not just South Boston.

    Who are these generic “working people in Boston” you refer to that you’re “serious about making room for”? My wife and I both work, we found room right here in Southie. Would I like to live on Beacon Hill, sure but I can’t afford to, that’s reality. It seems as though you are trying to reverse the tides of gentrification, if you can’t fulfill your promise it’s best to keep it out of your platform.

    Your apparent distaste for the free market is amusing. God forbid a developer want to buy and sell property where they can make the most money. Already in the six years I’ve lived here I’ve seen whole streets improved, dilapidated houses renovated and store fronts reopened. Where do you think the money for this is coming from?

    Death and taxes, good luck preventing either. You’re also running to represent Dorchester, correct? I think folks there have more concerns than increased taxes on their “family house”; that’s worth more now than could have been imagined 20 years ago. If you can’t afford the taxes, sell your million dollar home and buy something further from the city, literally rich people problems.

    Just to pour it on here, lines like “Lack of access to day care keeps qualified women out of the workforce, exacerbating the gender pay gap”, are politically reckless. Not all women necessarily want to work and not all people who stay at home with the kids are necessarily women, it’s 2018.

    While you pander to the old guard, you are neglecting the many newcomers that have moved here to live and raise families too. In your own words, “[The] sense of being part of something is what has made this area such a desirable place to live.” Well, Matt, there are new people in town and we are just as much a part of that “something” as you.

    Good luck in politics, bud.

  4. Andrew W. says

    Specifically with regard to the Limited Liability Company (LLC) discussion under the topic of “Transparency,” this information is already publicly available on the Secretary of State’s website using a Corporations Division search. LLCs must list the address of the office where the records are maintained, the name and address of the registered agent (for service of process), and the names and addresses of any managers/individuals authorized to sign in the name of the LLC. I suppose technically you might not be able to determine the beneficial “owners” of an LLC (LLC Members) but you can absolutely identify the name and address of those with control of decision making in the LLC (LLC Managers).

    Additionally, formation of an LLC is not necessarily evidence of sneakiness, we hold our unit in a single asset entity LLC because it was the most flexible vehicle to facilitate co-ownership by multiple members of our family and allows for the filing of taxes like a partnership. Limited liability (at least of the kind statutorily created by Massachusetts General Laws, Chapter 156C) is also a nice feature, but was not a primary motivator.

    In the interest of full disclosure, I am a friend and supporter of Dave Biele, but I appreciate the dialogue and just wanted to highlight the fact that this information is available.

    • Edward says

      Matt R said: “and often the owners of an LLC cannot be identified”

      You said: “I suppose technically you might not be able to determine the beneficial “owners” of an LLC (LLC Members)”

      🙂 I do admire the positive and honest approach you took to your post though and supporting your candidate in a positive way without lobbing insults – unlike some others on this thread.

      • Andrew W. says

        Thanks Edward, I think the conversation is important!

        Just to clarify, and I apologize in advance for heading down a corporate governance rabbit hole, the “owners” of an LLC (LLC Members) would be the capital contributors. They may not be identifiable but they also are not involved with decision making, which is the LLC Managers’ job. LLC Managers would be the group to which you would put the question, “What is the planned use of this property?” Oftentimes they are the same individual and it would be a moot point, but if there is bifurcation of roles, the LLC Managers would be the ones accountable (which is why they must be listed on the Secretary of State’s website).

  5. ND says

    A little transparency would be great, however your knowledge of how some of this works is dismal.

    A. If one owner occupies the house, they also qualify for the residential exemption knocking about $2500 off their tax bill. A little more than your claim of $27/mo. Taxes can still be too high for seniors, but let’s not cherry pick scenarios and let’s admit that this only helps home-owners and does nothing for the renters that are the bulk of the people getting squeezed out. Sure, not inheriting the family home is a bummer, but I’m pretty sure you’ll be able to find a place to live and be ok; whereas renters are SOL.

    B. All LLCs can be searched online with the Secretary of State’s office. I can find out in about 1 minute who is behind an LLC, the nature of their business, and their address.

    If you can’t get these two basic things straight, how can you manage, craft, and vote for laws in the House representing us?