Bill
S 173
Creates a self-funded Downtown Vitality Fund using 0.75% of regular sales tax receipts to support district management, small businesses, and place-based revitalization with equity
Status: Introduced in Senate Jan 21, 2025; read twice and referred to Committee on Finance. Hearing scheduled for June 26, 2025. Referred previously to the Committee on Community Development and Small Businesses.
Purpose
- Establish a dedicated Downtown Vitality Fund to strengthen local commercial districts, Main Streets, and walkable mixed‑use areas across the Commonwealth by supporting district management, small businesses, technical assistance, and place‑based revitalization.
Key provisions
- Creates a new statutory section (proposed new Section 35TTT) establishing the Downtown Vitality Fund (the Fund) in Chapter 10 of the General Laws.
- Funding source: the Fund receives 0.75% of the Commonwealth’s “sales tax‑regular” receipts (state retail sales tax collections excluding meals, motor vehicles, cigarettes, fuels, alcohol, lodging, car rentals, and other special categories). Annual receipts credited are considered the Commonwealth’s full obligation for that fiscal year.
- Administration: the Executive Office of Housing and Economic Development (EOED), through the Massachusetts Downtown Initiative, administers the Fund. Amounts in the Fund are available without further appropriation and may include investment earnings.
- Authorized uses / grant categories:
- Grants to establish district management entities (e.g., business improvement districts, parking benefit districts, cultural districts or other approved district strategies).
- Operating grants to sustain existing district management entities.
- Technical assistance grants (including payments to third‑party providers) for studies or program launches.
- Multi‑year grants to communities in the Transformative Development Initiative (TDI), administered by MassDevelopment.
- Direct grants to municipalities or municipally‑endorsed third parties for local economic development plans, small business support, rapid response plans, or other commercial area strengthening activities.
- Grant priorities and guidelines: EOED will set award guidelines prioritizing:
- Small business districts in Gateway Cities and low‑income areas;
- Entrepreneurship among underrepresented communities;
- Protection and strengthening of cultural identity and prevention of cultural displacement;
- A required local match set proportionally to local market strength.
- Oversight and reporting:
- Annual report on grant dispersals to clerks of the House and Senate and the House and Senate Ways and Means committees.
- Secretary must file an annual report by September 1 to the Joint Committee on Community Development and Small Businesses and Ways and Means, covering grants in the prior fiscal year (ending June 30).
- Advisory board:
- Establishes a Downtown Vitality Advisory Board of at least 15 Massachusetts citizens, appointed by the Secretary for terms up to three years (unpaid).
- Board composition must include representatives from MassDevelopment, the Massachusetts Cultural Council, business improvement districts, cultural districts, Gateway City leadership, non‑Gateway municipal representation, and at least three small business representatives from underrepresented communities (including immigrants and people of color).
- Duties: advise EOED, review and recommend grant criteria and awards, and recommend legislative changes as needed.
Who would be affected
- Municipalities and local economic development entities, especially Gateway Cities and low‑income communities.
- District management entities (BIDs, cultural districts, parking benefit districts and similar structures).
- Small businesses and entrepreneurs—particularly those in underrepresented communities.
- Regional economic development organizations (e.g., MassDevelopment) when participating in TDI grants.
- EOED and the Massachusetts Downtown Initiative (administration and oversight responsibilities).
Fiscal and procedural notes
- The Fund is automatically credited with 0.75% of sales tax‑regular receipts each fiscal year and disbursements may be made without further appropriation, making the program self‑funded to the extent receipts are available.
- Actual dollar impact depends on the Commonwealth’s sales tax‑regular receipts; the bill does not specify a cap on annual transfers or grants.
- Regular reporting and an advisory board provide ongoing oversight and opportunities for legislative input.
Bottom line
S.173 creates a targeted, ongoing funding stream to support place‑based downtown and Main Street revitalization through district formation and support, technical assistance, and prioritized grants aimed at equity, cultural preservation, and Gateway City economic recovery.
Compiled from official sources — confirm details with the bill’s official record.
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