Andrew Mikula
It’s a fiscally challenging time for cities and towns in Massachusetts. Many of them face rising fixed costs – including employee pensions and healthcare – and ultimately Proposition 2½ overrides that place the burden squarely on the backs of taxpayers.
Independent research has concluded that, in many contexts, new residential development (an exception to the Proposition 2½ levy limits) could obviate the need for property tax hikes by broadening the tax base and helping use existing infrastructure more efficiently.
But reality is more complicated than that. Some communities have public utilities infrastructure that is essentially already operating at capacity, seemingly preventing new development from providing fiscal relief without an immense investment in first expanding that infrastructure.
That’s where some policy innovations are in order.
Mass. Towns’ Underground Problem
Most communities with older infrastructure – e.g., sewer pipes that were laid out decades ago – have blatant inefficiencies that, if resolved, could help free up additional capacity.
Sump pumps and other equipment used to prevent flooding in basements and yards may be illegally connected to wastewater systems, which results in what engineers call “inflow” to the sewer system. Clean water and stormwater can also enter sewer pipes through cracks or separations, a phenomenon known as “infiltration” of the system.
The net result is an unnecessary increase in the amount of discharge a wastewater treatment plant needs to process, sometimes by orders of magnitude. The town of Needham has estimated that, on average, 66 percent of its sewage flow volume is from inflow and infiltration, and up to 82 percent during major storm events.
Reducing unnecessary discharge to free up additional sewage system capacity could facilitate new development and save municipalities money, with no upfront costs to the taxpayer. That’s because, as with most infrastructure upgrades, developers themselves can pay for programs to prevent inflow and infiltration, offsetting the additional sewage flows their projects generate in real time.
Developers Sometimes Foot the Bill
Dozens of Massachusetts municipalities already have inflow and infiltration reduction programs designed to protect the environment and save money. Many of these programs are funded with Massachusetts Water Resources Authority grants, not solely by new development. These “I&I” programs often exist not to facilitate housing production, but rather to comply with state and federal regulatory requirements aimed at preventing sewer system overflows.
Many communities already use I&I programs to facilitate new development without a massive expansion of infrastructure. Since 2002, Burlington has awarded “sewer credit” to developers who pay to redirect illegal sump pump flows from sewer mains to drainage infrastructure. Many communities also have involuntary “sewer mitigation fees” for new development tied to I&I program funding.
Of course, developers are not always enthused about paying these fees, even if the realistic alternative is that the municipality doesn’t allow much new development at all. Sewer mitigation fees for new residential development typically exceed $1,000 per bedroom.
Rising construction costs have also caused these fees to skyrocket in recent years – between 2014 and 2025, Somerville’s per-gallon-per-day I&I fee for new development increased by 123 percent.
Reforms Could Help Housing Production
Additional reforms can help better align these fees with I&I program costs and reduce risks for developers.
First, municipalities should structure the I&I mitigation as a formulaic payment, not a scope of work that the developer is responsible for completing. This will help make costs more predictable.
Second, municipalities should be required to use actual projected flows to calculate I&I fees, not the standard design flow for a residential septic system (110 gallons per bedroom per day) that appears in Title 5 of the state environmental code. Most large multifamily properties have actual flows of no more than 70 gallons per bedroom per day.
Third, state regulations require that, for developments generating at least 15,000 gallons per day in new sewage, “four gallons of infiltration and/or inflow be removed for each gallon of new flow” under I&I programs. Municipalities frequently apply an even higher ratio.
The Massachusetts Department of Environmental Protection (MassDEP) should study whether there are some cases, especially for smaller projects, that justify a lower removal/new flow ratio for residential developments and provide guidance to municipalities accordingly.
While reforms are needed, inflow and infiltration programs are important tools for creating sewer capacity to accommodate new development before long-term strategic solutions (like MWRA network expansion) can come to fruition. More communities should have I&I programs.
Lastly, it’s worth noting that similar solutions are available to expand capacity in public water systems. Developers can be made to pay to fix leaky pipes or facilitate graywater recycling in public buildings as a condition for construction, which ultimately offsets new water demand. The bottom line is that infrastructure constraints are not insurmountable obstacles to new housing development in most communities. Surmounting them just takes political will.
Andrew Mikula is the chief housing economist at the Pioneer Institute in Boston.
