Special to the Record
City Manager Fidel Maltez has made modifications to his proposed amendments to Chelsea’s Inclusionary Zoning Policy. The proposed amendments, which come as the City faces significant financial pressure, preserve the City’s commitment to affordable housing but remove barriers to housing development, so the City can raise the revenue needed to ensure School and City services can be funded without disruption. If the proposed changes pass, Maltez says more housing developments would allow the City to grow its tax base without asking current residents to pay more in property taxes.
Chelsea is facing a school budget deficit caused by an enrollment loss of 350 students. This, combined with uncontrollable rising costs—including a $1 million year-over increase in healthcare premiums for City and School employees and a $4 million year-over increase in debt obligations to the new regional vocational school and charter schools—makes it critically necessary for the City to identify new revenue sources.
Maltez said, “Chelsea currently holds the third highest level of affordable housing in Massachusetts—a record that must be protected. But the current policy has made it difficult for Chelsea to raise new growth revenue because it creates too many barriers for new housing development projects. Growing the tax base through new development is the most sustainable path forward. Without policy changes, projects that could generate housing and revenue are stalled and the city risks being forced into cuts to schools, public safety, and infrastructure.”
Under Massachusetts’ Proposition 2½, the City’s ability to raise revenue through taxes is fundamentally limited. Growing the tax base through new development is a sustainable path forward.
The core purpose and structure of the inclusionary zoning policy will remain fully intact. Chelsea’s commitment to affordable housing will be preserved—affordability restrictions will still be permanent, units will still be required to serve income-eligible households, fair housing requirements remain in place, and the city will continue to actively pursue and support 100% affordable housing developments. The affordable housing trust fund, deed restrictions, monitoring requirements, and tenant protections all remain unchanged.
During a City Council Subcommittee meeting on March 30, City Manager Fidel Maltez proposed his original set of four targeted amendments to Chelsea’s Inclusionary Zoning Policy (IZP). Since that meeting, Maltez revised updates to incorporate feedback from residents and City Councilors. Maltez has asked the City Council to accept the proposed amendment, refer it to the Planning Board for a public hearing, and schedule its own public hearing and vote.
Revised Proposed
Amendments
(as of April 1, 2026)
Change the policy to apply to projects with 50 units or more. The current policy applies to projects of 10 units or more. We initially proposed raising this threshold to 100 units or more, and the Council desires a more gradual change that will be evaluated more often. We believe that raising this threshold to 50 strikes that balance. We believe that this change will unlock a tremendous amount of projects, particularly in our downtown area.
Change the required number of affordable units and connect it with the level of affordability. We propose having two options: 10% of Units at 80% AMI or 7% of Units at 60% AMI. This matches the inclusionary zoning in Everett.
Change the Fees-in-Lieu to Affordable Housing Units to $200,000. This changes the current policy that allows developers to pay the City $400,000 in place of complying with inclusionary zoning. Our current policy requires that the City Council approve through a vote acceptance of this payment. In 9 years we have not received any funds. These payments could be used for anti-displacement work, such as rental assistance for existing residents, first time home buyer programs, or contributing to 100% affordable housing projects.
Review the policy every two years. It is critical that our government moves with the situation on the ground. We commit to hire a third party firm, like MassHousing Partnership or the Metropolitan Area Planning Council, to review the data from the effects of this policy change. If new growth explodes in Chelsea, the Council may choose to modify the policy, and opposite if the economic situation worsens, the Council may choose to act accordingly.
Community members are encouraged to share feedback on these proposed changes by emailing [email protected], attending future public hearings, including the Planning Board’s and City Council’s future public hearings (dates to be announced).