Real Estate & Property Law

Stuborn is Alive and Well - New England Fund is a Subsidy for 40B

By Stephen E. Meltzer, Esquire

In a significant decision today, the Supreme Judicial Court, in upholding a Superior Court decision, parted with the Appeals Court analysis and expanded the understanding of a "Subsidy" for purposes of Chapter 40B affordable housing projects.  The SJC has wholly adopted the Housing Appeals Committee's finding in Stuborn Ltd. Partnership v. Barnstable Bd. of Appeals, Housing Appeals Committee, No. 98-01 (March 5, 1999)

In Stuborn, the Housing Appeals Committee had determined that the 40B sudsidy requirement needed to be read expansively and that the New England Fund (NEF), part of the Federal Home Loan Bank of Boston, a Federally subsidized banking consortium, qualified because it "had sufficient characteristics of a government agency to qualify as a Federal program."

When examining this issue on the first go-around, the Appeals Court twisted through some fabulous intellectual calisthenics in order to conclude that the NEF qualified because it is subsidized by the Federal government, and, consequently, could ultimately provide loans at a lower rate. 

The SJC, instead, wholly adopted Stuborn's expansive definition of a subsidy.

The case is Town of Middleborough v. Housing Appeals Committee, and the text of the Slip Opinion can be found HERE.

Full post as published by Meltzer Law Offices on July 20, 2007 (boomark / email).