HomeMy WebLinkAboutAC - Growth in Lexington in the Coming DecadeGrowth in Lexington in the Coming Decade
Appropriation Committee, Town of Lexington
June 13, 2025
Preface
The Committee's charge is to provide guidance to the Members of Town Meeting and this memorandum is
intended to inform Town Meeting about upcoming budget issues. We believe these issues are also of interest
to the Town staff, the Select Board and the Planning Board, and we share this memorandum in a spirit of
cooperation.
The goal of this memorandum is to extend and deepen the discussion of the financial impact of expected
increases in housing and population in Lexington during the coming decade following the adoption of the
MBTA Communities Act.
We have made our own projections regarding anticipated population growth, and this is an area where
opinions may differ regarding the timing, size and distribution of new housing developments. Ultimately,
we will all have to wait and see how development progresses in Lexington, but we believe it is vital to
begin considering how the Town could respond to this growth, and doing so requires us to make some
meaningful assertions about the changes that we anticipate.
Background
To comply with the MBTA Communities Act, Town Meeting approved Article 34 at the 2023 Annual Town
Meeting. Article 34 created ten new zoning overlay districts and added a new section 7.5 to the Town's
Zoning Bylaw. These zoning changes allowed by -right development of multifamily housing in the overlay
districts with significantly relaxed dimensional controls and no direct limitations on density.
Over the next eighteen months, the rate and number of applications for high-density MBTA projects
submitted to the Planning Board significantly exceeded expectations, with approximately 1,100 new units
proposed by the end of 2024. Other recently adopted zoning provisions and projects, including special
residential developments and the all -affordable project on Lowell Street, also allow for higher density and
will contribute to an increase in the number of dwelling units and population over time.
In December 2024, a petition for a Special Town Meeting (STM) was submitted seeking to amend Section
7.5 of the Zoning Bylaw, reducing the capacity of the MBTA Communities Act overlay districts. The STM
was scheduled for March 17, 2025 to allow the Planning Board to conduct public hearings.
On February 14, 2025, the Appropriation Committee issued a memorandum, META Community Zoning—
Financial Considerations, which examined the potential impact on the Town's finances of Section 7.5. The
memorandum projected unprecedented population growth and cautioned that the Town budget would have
difficulty accommodating the increase in school enrollment and the rising demand for other services.
A month later, on March 13, 2025, the Committee published a report on Article 2 of the 2025-1 STM. The
final motion was a compromise that was developed with the support of the Planning Board. It proposed
changes that would reduce the number of MBTA Act overlay districts and add dimensional controls and
density limits, reducing the new housing unit capacity created under Section 7.5 by approximately half. Our
report included projections of potential growth and related financial impacts, both with and without the
proposed changes.
The 2025-1 STM approved Article 2 on March 17, 2025.
On March 19, 2025, the Select Board received a draft report commissioned by the Town Manager, Impact
Analysis of Multi-Farnily Housing Development on Lexington, Massachusetts, from Fougere Planning +
Appropriation Committee: Growth in Lexington in the Coming Decade
Development in association with Jeffery Donohoe Associates (Fougere Report). The Fougere Report
addressed the financial impact of the approximately 1,100 new units already submitted to the Planning
Board (in the "pipeline"), but it did not consider additional growth beyond those units.
Observations on the Fougere Report
In regard to projections for near-term growth of population and school enrollment, the Fougere Report is
largely in agreement with the analysis presented in our February 14 memorandum and in our Report to the
2025-1 STM.
In addition, the Fougere Report contains useful information about the financial impact of housing and
population growth based on an in-depth review of information provided by municipal and school
departments, including:
• Summaries of interviews with department heads about potential financial impacts.
• Estimates of the number of school children likely to reside in new multifamily developments
currently in the pipeline, based on data from existing apartment buildings and condominiums, and
taking into account bedroom counts and distinctions between affordable and non -affordable units.
• Projections of increases in Chapter 70 state aid and circuit -breaker reimbursements based on
changes in school enrollment.
• Estimates of possible additional hiring needs in public safety and municipal services based on
projections from current demand.
• Estimated incremental revenue from property taxes, local fees for EMS calls, and motor vehicle
excise taxes generated by additional dwelling units
The Fougere Report was limited to considering 1,117 new units, but this represents less than half of the
total growth that can be anticipated under the current Section 7.5 zoning bylaw, and other intangibles were
not considered. For example, a new high school building will almost certainly attract more families with
high school students to Lexington. In the near term, this will affect the grade level distribution of incoming
students and the types of school staffing that will be needed.
We recommend that the Town update this report within next three to five years. An updated report should
consider the following issues:
The evolving relationship between population and school enrollment. The school's annual
enrollment review captures much of this information, but it would be helpful to assess how the
changing mix of housing has affected enrollment trends.
• The drivers of escalating costs in our public school system:
o The school budget has increased by about 4% per year over the last five years, even as
enrollment decreased by about 1.5% per year. We know that a large part of this increase is
driven by the demand for special education services.
o Lexington's per -pupil spending for general education exceeds the state's "foundation
budget" by about 86%. As a result, we believe the Fougere report materially underestimated
the impact of new enrollments.
o The report should consider the full cost of school staffing, including health benefits funded
under the shared expenses budget.
• A key factor in the Town's future housing developments is the possibility of large-scale housing
developments in the Hartwell Ave overlay districts. New housing in the Hartwell Ave. districts
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Appropriation Committee: Growth in Lexington in the Coming Decade
would also result in the conversion of commercially zoned land to residential use, thus lowering
the long-term tax revenue potential of the land.
What Changes Should We Consider?
The Boston metropolitan region has experienced a serious regional housing shortage for decades, creating
a situation where many families are overly burdened by the cost of housing (and forcing other families to
relocate beyond the region). As a part of this metropolitan region, Lexington has seen continued increases
in local prices of housing and in the rents charged by landlords. New housing construction in the region and
in Lexington is coming and may help to address those price increases.
As a result of the projected new housing construction, Lexington will enter a phase of growth that will
continue for at least five to ten years. We have a rough idea of the scale of that growth, but uncertainties
remain due to political, social, and economic factors. We have projected an overall population growth of
6,500 to 10,000 people, including an influx of 1,200 to 1,900 students entering LPS.
Capital investment for our school system has been part of the Town's long -tern capital plan for many years,
particularly the new high school project. Renovations to the Bridge and Bowman Elementary Schools are
also on the horizon. Responding to new enrollment needs could require new capital projects, such as adding
modular classrooms, building additions to one or more existing buildings, or even constructing an entirely
new school. It is too soon to say whether the Town will need to pursue any of these options, but we suggest
that the Town adopt guidelines about when school overcrowding should prompt a discussion on additional
capital spending.
Lexington has invested in many systems that support government services, including information
technology, networking, communications, voting, and emergency preparedness. The town should continue
to explore ways of providing expected levels of service more cost effectively.
The Town's public works infrastructure will need to grow, though not all of the associated expenses will
directly impact the Town budget. Water and sewer systems are essentially self-funded using enterprise funds
that hold money from ratepayers, and the Town also has access to zero -interest loans from the MWRA for
water infrastructure projects. This could still result in higher water and sewer rates, but the cashflow is
isolated from the main operating and capital budgets. We understand that trash removal services for
condominium complexes and apartment buildings must be provided through private contractors.
As always, the Town will have to ensure that roads, traffic controls, public transit, bike lanes, and sidewalks
are adequate. While developers will bear much of the burden for these needs within their developments, the
Town may also have to respond to issues caused by increased traffic.
The Town may want to invest in new or upgraded recreation areas.
The Town will see increased demands on public safety departments (police, fire, ambulance), as well as
other outward -facing departments, particularly Human Services and the Cary Memorial Library.
We might need to add an ambulance, which would involve additional capital spending for the vehicle and
operating expenses for added staffing.
At some point, a new satellite fire station might be necessary maintain acceptable response times.
How Can We Prepare for Change?
It would be particularly helpful to identify thresholds (or inflection points) at which new capital investment
may be required. This is particularly relevant to school enrollment, but it also applies to public safety, roads,
water and other Town services.
Appropriation Committee: Growth in Lexington in the Coming Decade
Schools
The Town needs a more reliable estimate of the marginal cost per student in order to budget for new
enrollment.
The Town would also benefit from a clear policy governing the hiring of new teaching and administrative
staff due to changing enrollment and special education needs. This policy should cover several tiers of
growth in enrollment, including points where new administrative staffing would be desirable.
Public Safety
The Fougere Report suggests that staffing needs for Police and Ambulance services scale linearly with the
population. We are aware of upcoming staffing studies for the Police and Fire Departments, and we hope
they incorporate the potential impact of new housing developments.
Roads, Traffic Controls, and Sidewalks
As traffic near new housing developments increases, the Town should anticipate increases in congestion
and continue to explore public transit improvements and alternatives to automobiles that will mitigate the
need for potentially more costly traffic management solutions.
Conclusions
The Town should be pro -active about the anticipated growth by monitoring the development of new housing
and regularly updating estimates for the timing and magnitude of financial impacts.
We are confident that the Town staff and citizen volunteers will address these issues.
EI