Community-Contributed Housing Blog

You may have heard that Medford City Council have proposed a significant re-zoning of Medford’s residential areas. This proposal is currently under review by the Community Development Board, who are soliciting feedback from the public before returning their own proposal for review by City Council in October. The rezoning would allow more residential density in most of Medford, with different levels of density targeted for different areas. The re-zoning proposal builds off of Medford’s comprehensive plan (2023) and housing production plan (2021).

To put it lightly, zoning is complex. At its core, zoning is about what is allowed to be built in certain areas. If you’ve played games like SimCity or Cities: Skylines, you may be familiar with some of the rudiments of zoning. You, as the planner, decide what zones go where, but you don’t do most of the building yourself. And based on the zoning rules, the citizens of your city will only build certain things in certain areas.

Real-life zoning involves many more factors, regulations, and considerations, and undertaking rezoning like the one being proposed in Medford is a task that requires a lot of consideration.

One concern that has been voiced frequently in the public discussion of Medford’s rezoning proposals is the impact on the city’s infrastructure. This blog post will attempt to delve into the infrastructure question. The key point to make in this regard is that new development pays for new infrastructure. The extent to which it does that, however, requires explaining.

First, new development yields new revenue sources for the city. Due to the existence of Proposition 2½, which makes no allowances for inflation, cities have limited opportunities to increase their property tax revenue.

One way is through an override, which Medford did in 2024 to fund increases to the school and Department of Public Works (DPW) budgets. This consists of increasing the city’s levy by more than 2.5% by way of a ballot initiative. Almost all cities in Massachusetts have had to do one since the proposition was passed. Medford’s 2024 override was its first.

The other way to increase municipal revenues is through new development. This new growth allows an increase in the city’s levy limit because it adds to the total value of assessed property. This new development includes residential and non-residential development, so it benefits a city to allow increased commercial and industrial development as well. Commercial development is one of the reasons cities like Cambridge and Somerville have never had to do overrides, yet still enjoy far healthier tax bases than Medford.

This is where zoning comes in. While zoning itself doesn’t build anything (remember the SimCity example), zoning allows things to be built. And when zoning allows denser, more walkable, and especially mixed-used neighbourhoods, these typically result in significantly more net tax revenue than exclusively single family development. This is because the costs to the city for maintaining the infrastructure (per unit) are typically smaller, while the revenues are similar or higher. The effects are clear across many American cities—density and mixed use lead to more revenue-positive development. And rezoning to allow this density is key to building a financially sustainable city.

An analysis by Urban3 of the revenue balance for different types and densities of property development in Eugene, OR (image from NotJustBikes).

But there are other contributions that come from new development as well. In Medford, certain residential, commercial, and industrial developments pay what are called linkage fees. Linkage fees are paid by developers to ensure that new development pays for the added burden it puts on city services. Some cities call these “development charges” or “impact fees.” These fees are allowed to be levied in Medford according to a special act that dates from 1989. The money collected in linkage fees goes into four trusts, related to parks and recreation, water and sewer, roads, and police and fire. You can find the details on Medford’s linkage ordinance here. 

The 1989 special act authorizes a fifth trust for affordable housing. But no linkage fees are associated with this trust yet, because (until this year) Medford never conducted the nexus study required to establish the fee. Once the study is completed (see below), the linkage fee ordinance and fee structures will be updated in order to begin charging specific fees that go into the affordable housing trust (which was established last year).

The fee schedule for linkage in Medford hasn’t been updated in 35 years, and hasn’t kept pace with inflation. If it had, the fees would nearly triple overnight. However, studies are needed to update these linkage fees (called nexus studies), and they are complex. They analyze impacts of new development in terms of added residents, added jobs, impacts to infrastructure, and so on. Performing this study would allow Medford to update its fees to ensure that higher-density development (commercial, industrial, or residential) contributes adequately to city infrastructure funds, as well as allowing the addition of a new category of linkage which would fund the affordable housing trust. The review of these fees was called for in the Medford Comprehensive Plan.

In addition, a state bill would allow these linkage fees to keep pace with annual inflation without requiring new nexus studies, significantly simplifying things in the future. The home rule petition for this bill was submitted by Medford City Councillor Matt Leming in September 2024.

Somerville and Cambridge both had nexus studies done in the last ten years for non-residential development (i.e. gauging the impact on the city by addition of new businesses, which also impacts residential demand, housing affordability, and so on). These were primarily geared towards their affordable housing trusts. Cambridge’s non-residential linkage has generated $6.4 million annually since 2015!

It’s important to note that these linkage fees are primarily levied for higher-density developments. In Medford, non-residential developments over 10k square feet, residential developments over six units, subdivision to create six or more units or buildable lots, and a few other types of development are subject to linkage. These fees offset the capital cost of the infrastructure demands that come from denser new development. As an example, between 2018 and 2022, ten projects in Medford contributed a total of $1.26M in linkage fees (source). The upcoming redevelopment of Medford Square is expected to net the city about $1.1M in linkage fees alone. 

Finally, in terms of planning and building infrastructure, zoning comes first. The DPW does not build sewer lines, water mains, roads, and other infrastructure for imagined or aspirational scenarios. Zoning allows development, and development pays for new infrastructure. The DPW builds infrastructure when new development is actually proposed, and they fund it with linkage fee revenue and tax revenue–the latter of which, as we saw, increases with new development. This means that it would not make sense for Medford to upgrade all of its infrastructure prior to rezoning–because zoning on its own does not build anything (yet again, recall the SimCity example). Zoning and development projections help to inform the capital plan, and the capital plan guides DPW work. 

Additionally, many aspects of what the DPW does are informed by other concerns (fire code, climate change and weather patterns, and so on). “Capacity” is not always the primary design or capital improvement driver. In a recent CDB discussion with Commissioner of Public Works Tim McGivern this was discussed at length. One example is that the water mains for most of Medford are being upgraded from 6” diameter to 8” due to fire code requirements, though this also means they will have higher capacity. 

I wanted to write this to help show that while all development places demands on city infrastructure, there are mechanisms in place to balance those demands. Between the linkage fees which help to cover capital costs, and the lower inherent operational costs of denser development, it should be clear that the infrastructure impacts of residential rezoning are being taken into account on multiple fronts. With some additional study and state legislation, Medford should be well-equipped to handle any new density that comes from this rezoning effort.

Nick is a process chemist with a passion for local politics, sustainability, and community building. He lives in Medford with his partner and two children.