Is Boston Still “Bound”?

Is Boston Still “Bound”?

In 2007, Harvard Law School professors Gerald Frug and David Barron published a report entitled “Boston Bound”, comparing Boston’s legal structure to six other major United States cities: Atlanta, Chicago, Denver, New York, San Francisco, and Seattle. The authors argue that Boston’s comparatively restrictive structure prohibits the City from generating significant revenue outside of property taxes and state aid. This paper examines the during- and post-Financial Crisis period to determine whether Boston confronts the same comparative challenges in revenue generation and remains less competitive. Boston’s reliance upon property taxes actually provided the City economic stability during the Financial Crisis. Yet, the City confronts the same legal restrictions as in “Boston Bound”.
At the same time, Boston’s property supply restrictions and demand from high employment, especially in high-wage STEM fields, favor higher property prices. The economic fundamentals driving high property prices suggest that, should Boston loosen its restrictions on property tax revenue generation, it will be less “bound” in the future. However, with no foreseeable legal changes, Boston continues to seek taxable base expansion centered on new business development. Long term, the City might be well served by also focusing on the spending side of its budget to secure its financial future and competitiveness.

Annie Meyjes