On August 9, 1960, the Justices submitted the following answers to questions propounded to them by the Senate and the House of Representatives.
To the Honorable the Senate and the Honorable the House of Representatives of the Commonwealth of Massachusetts:
The Justices of the Supreme Judicial Court respectfully submit these answers to questions in an order adopted by
the Senate and by the House of Representatives on July 21, 1960, and transmitted to us on July 22, 1960. The order recites the pendency before the General Court of a bill, duplicate of a bill printed in Senate No. 634, a copy of which is transmitted with the order. The bill is entitled, "An Act concerning the development or redevelopment of blighted open areas, decadent areas and sub-standard areas by urban redevelopment corporations with special provisions for projects in the city of Boston." Senate No. 634 is a communication from the Attorney General which states that the bill is submitted to meet objections to a previous bill relating to the so called "Prudential center." See Opinion of the Justices, ante, 738.
The bill consists largely of amendments to G. L. c. 121A, entitled "Urban Redevelopment Corporations." Section 1 strikes out Section 1 of c. 121A, as originally enacted by St. 1945, c. 654, Section 1, and as amended by St. 1947, c. 15, St. 1953, c. 647, Section 1, and St. 1954, c. 73, Sections 1 and 2, and substitutes a new set of definitions. The former limitation of "Blighted open area," to one "which is to be developed for predominantly residential purposes," has been eliminated. A fundamental requirement, retained in substance, now reads, "a predominantly open area which is detrimental to the safety, health, morals, welfare or sound growth of a community because it is unduly costly to develop it soundly through the ordinary operations of private enterprise." Also retained in substance are enumerated possible grounds of undue cost. Among them are physical conditions, such as ledge, rock, and unsuitable soil; the expense of excavation, fill, grading, retaining walls, waterproofing structures, drainage, or flood control; "tax and special assessment delinquencies"; and "substantial change in business or economic conditions or practices." To these have been added expense of foundations, protection of adjacent properties and the water table therein, "building around or over rights of way through the area," and "an abandonment or cessation of a previous use or of work on improvements begun but not feasible to complete without the aids
provided by this chapter, or by reason of any combination of the foregoing or other conditions."
"Decadent area" is defined as one "which is detrimental to safety, health, morals, welfare or sound growth of a community" because of the deteriorated condition of buildings; "because much of the real estate in recent years has been sold or taken for non-payment of taxes or upon foreclosure of mortgages"; because buildings have been razed and their replacement is improbable; "because of a substantial change in business or economic conditions, or because of inadequate light, air, or open space, or because of excessive land coverage, or because diversity of ownership, irregular lot sizes or obsolete street patterns make it improbable that the area will be redeveloped by the ordinary operations of private enterprise, or by reason of any combination of the foregoing conditions." The references to "sound growth of a community"1 and the next to the last clause relating to the improbability of redevelopment by private enterprise are new.
"Sub-standard area" is defined as one "wherein dwellings predominate which, by reason of dilapidation, overcrowding, faulty arrangement or design, lack of ventilation, light, or sanitation facilities, or any combination of these factors, are detrimental to safety, health, morals, welfare or sound growth of a community." The only new language is the words "welfare" and "sound growth of a community." [Note p764-1]
"Project" is "any undertaking consisting of the construction in a blighted open, decadent or sub-standard area of decent, safe and sanitary residential, commercial, industrial, institutional, recreational or governmental buildings and such appurtenant or incidental facilities as shall be in the public interest, and the operation and maintenance of such buildings and facilities after construction." Formerly the definition was limited to "dwellings."
It will be noted that the definitions in the bill of "blighted open area," "decadent area," and "sub-standard area" differ from the definitions in G. L. c. 121, Section 26J, in the housing authority law, as amended through St. 1957, c. 613, Section 1.
Section 2 strikes out old Section 2, as appearing in St. 1953, c. 647, Section 1, and substitutes a new section. It declares, in substantial repetition of old Section 2, that "the redevelopment of land not only in sub-standard areas but also in blighted open and decadent areas in accordance with a comprehensive plan to promote the sound growth of the community is necessary in order to achieve permanent and comprehensive elimination of existing slums and sub-standard, decadent and blighted conditions and to prevent the recurrence of such slums or sub-standard, decadent or blighted conditions or their development in other parts of the community or in other communities; and that the redevelopment of blighted open areas promotes the clearance of sub-standard and decadent areas and prevents their creation and occurrence; that the menace of blighted open, decadent or sub-standard areas is beyond remedy and control solely by regulatory process in the exercise of the police power and cannot be dealt with effectively by the ordinary operations of private enterprise without the aids herein provided." Both the old and new sections state that "the necessity in the public interest for the provisions hereinafter enacted is hereby declared as a matter of legislative determination." The revised section declares in great detail the respects in which blighted open, decadent, or substandard areas are injurious to the public interest and retard "the provision of residential, commercial and industrial buildings and other improvements." It also refers to the existence of "a shortage of decent, safe and sanitary buildings for residential, commercial, industrial, institutional, recreational, or governmental purposes." The declarations of the old section, in these respects, primarily deal with the effect of blighted open, decadent, or substandard areas in retarding the provision of dwellings and upon an existing shortage of dwellings. There is an obvious misprint in line 1 of
new Section 2, which should read, "It is hereby declared that," and so forth.
Section 3 amends old Section 3, as appearing in St. 1953, c. 647, Section 1, by providing that in the case of a corporation formed for the carrying out of a project in the city of Boston, the project would be authorized and approved by the Boston Redevelopment Authority. A project in any other city or town would be authorized and approved by the State Housing Board, as is the case everywhere, including Boston, under old Section 3. Section 4 of the bill amends old Section 5 by confining applications to the State Housing Board to projects in municipalities other than Boston.
Section 5 inserts in G. L. c. 121A a new section, Section 6A. This states that once a project has been approved by the housing board, the corporation and the municipality "shall contract for the carrying out of such project in accordance with the application, the provisions of this chapter, and the rules, regulations and standards prescribed by the housing board for such project. Such contract may provide that, without mutual consent, any subsequent amendment of any such provisions, rules, regulations and standards shall not affect the project." The intended scope of this last sentence is not clear. Our interpretation of its meaning will be given in our discussion of questions 7 and 9. "Nothing in section ten [of c. 121A which provides for exemption of projects from local taxation under G. L. c. 59] shall prevent such contract from further providing for such corporation to pay to the city or town with respect to one or more years such specific or ascertainable amount in addition to the excise prescribed by section ten as may have been stated in the application."
By Section 14 of the bill the term "housing board" in Section 6A, as to projects in the city of Boston, means the Boston Redevelopment Authority.
Section 6 of the bill strikes out old Section 8, inserted by St. 1945, c. 654, Section 1, and inserts a new section. Construction of buildings shall be inspected by persons appointed by the housing board. "Every such corporation shall be deemed
to have been organized to serve a public purpose, [Note p767-1] and shall remain at all times subject to all reasonable rules and regulations applicable to its project. All real estate acquired by any such corporation and all structures erected by it shall be deemed to be acquired or erected for the purpose of promoting the public health, safety and welfare and shall be subject to the provisions of this chapter." If the housing board shall find that a corporation has violated any provision of c. 121A or the requirements as to the construction and financing of a project, or payments therefor, or the applicable rules and regulations, or that a project is not maintained in such a way as to carry out the purpose for which it was designed, or that there has been waste caused by unreasonable use, it may institute a proceeding in equity in its own name.
Other sections of the bill seek to amend c. 121A, Section 18, which deals with projects which insurance companies may undertake with the approval of the commissioner of insurance. Section 7 would allow an insurance company to undertake a project "on land owned or to be acquired by it." Section 8 would amend Section 18 (e), as appearing in St. 1953, c. 647, Section 8, so that the term "housing board" in c. 121A, Section 8, would mean the commissioner of insurance as to insurance company projects no matter where the project is situated. Section 9 would amend Section 18 (f), inserted by St. 1945, c. 654, Section 1, by adding, at the end of the following: "such company shall not receive or accept for its general purposes as net income from a project any sum in excess of six per cent of the amount invested by it in such project for each year in which it owns or has owned the project," the exception that, "if in any year it has so received a sum less than the aforesaid six per cent, it may so receive in a subsequent year or years additional sums not exceeding in the aggregate such deficiency without interest." Section 11
would add a new clause, Section 18 (g 1/2), and Section 12 would add a new sentence to Section 18 (h), inserted by St. 1945, c. 654, Section 1. These respectively provide that the term "housing board" in two sections of c. 121A shall mean the commissioner of insurance whether the project is in Boston or another city or town. Section 13 adds a new clause, Section 18 (i 1/2), which would compute the period of forty years for carrying on a project as provided in c. 121A, Section 10 (as amended through St. 1956, c. 640, Section 4); Section 16 (as amended by St. 1953, c. 647, Section 5); and Section 16A (inserted by St. 1953, c. 647, Section 5), from the date of the approval of the project.
Section 14 is not an amendment of the General Laws. It makes the Boston Redevelopment Authority the authority in the city of Boston to approve projects, abolishes the planning board of the city, and confers all its powers and duties on the Boston Redevelopment Authority. The appropriations and personnel of the planning board are transferred to the Boston Redevelopment Authority.
Section 15, which is not an amendment of the General Laws, consumes one hundred and fifty-nine lines unbroken by any numbered or lettered subdivisions. It makes provision for application to the Boston Redevelopment Authority as to projects in the city of Boston. The application shall specify the location of the project, shall state the reasons why it is necessary or desirable and the uses to which it is to be put, shall contain in general terms a description of the buildings, structures, and facilities which it is proposed to furnish, and shall be accompanied by a site plan and drawings of the buildings and other improvements adequate to show the nature and extent of the project. This is similar to the requirements of G. L. c. 121A, Section 5, inserted by St. 1945, c. 654, Section 1, with the differences that Section 5 requires the application (1) to contain the estimated cost of the project and the amount of capital it is proposed to furnish, and (2) to be accompanied by a site plan and typical building plan and typical elevations of the proposed buildings or structures. There is a provision for a public hearing following which the Authority shall make such determinations
as may be required by c. 121A, and shall determine whether conditions exist which warrant the carrying out of the project, whether in its opinion the project will be practicable, whether the project conflicts with the master plan for the city or would be in any way detrimental to the best interests of the public or city or to the public safety or convenience or inconsistent with the most suitable development of the city, and whether the project will constitute a public use or benefit. If its determination is adverse, the Authority shall disapprove the project. If the destruction of dwellings is involved, it must find that there is a feasible method for relocating displaced families. If the project includes land approved by the State department of public works for the extension of the Massachusetts Turnpike into Boston, the Authority shall not approve unless the Massachusetts Turnpike Authority determines that the project will not unreasonably interfere with the extension. The Boston Redevelopment Authority shall make a written report stating reasons for approval or disapproval. It may suggest changes. Whenever a project is approved, it shall embody in its report reasonable rules and regulations setting minimum standards for the financing, construction, maintenance, and management of the project in so far as these are not specified in the application. It may not issue a certificate of approval without the mayor's approval. The Boston Redevelopment Authority, with the approval of the mayor, shall have exclusive power to deviate from any zoning, building, health or fire law, code, ordinance, or regulation if it finds that the variance does not substantially derogate therefrom. Any person aggrieved by a vote of the Authority under Section 14 or Section 15, "or any municipal officer or board," may, within thirty days after proper filing of the approval with the city clerk, bring a petition for writ of certiorari against the Authority to correct errors of law. The time for bringing a petition for a writ of certiorari under G. L. c. 249, Section 4, as amended by St. 1943, c. 374, Section 1, as applicable to other corporations, is "two years next after the proceedings complained of." It is only by implication
that the bill requires filing of votes of the Authority with the city clerk. Nor does the bill state whether the provision for review by certiorari is exclusive so as to preclude use of other court procedures, such as a declaration of rights under G. L. c. 231A. See Madden v. State Tax Commn. 333 Mass. 734 , 736.
The questions are as follows:
"1. Is it within the competency of the General Court under Article IV of Section I of Chapter I of Part the Second of the Constitution of Massachusetts to exempt from taxation, subject to the provisions of Sections 10 and 15 of Chapter 121A of the General Laws, as amended, projects, as redefined in Section 1 of said bill, to be constructed in blighted open areas, decadent areas, and substandard areas as severally redefined in Section 1 of said bill?
"2. Will projects for commercial and industrial uses under said Chapter 121A, as amended by this act, be for public purposes?
"3. Would the answer to question 1 be the same for a project in Boston governed by the special provisions for public approval and regulation contained in Sections 14 and 15 of said bill?
"4. In view of Articles X and XXIII of Part the First of the Constitution of Massachusetts do the special provisions of Sections 14 and 15 of said bill for the city of Boston, transferring to the Boston Redevelopment Authority regulatory functions relative to urban redevelopment projects now vested in divers boards and officers, constitute a sufficient and adequate regulation by public authority for the purposes of Sections 10 and 15 of Chapter 121A of the General Laws?
"5. Do the special provisions of Sections 14 and 15 of said bill for the city of Boston transferring to the Boston Redevelopment Authority regulatory functions relative to urban redevelopment corporations now vested in divers boards and officers, constitute an unconstitutional discrimination in favor of projects in the city of Boston as
against projects in other cities and towns in the Commonwealth, or do such provisions deny equal protection of the laws to persons within such other cities and towns in contravention of the 14th Amendment of the Constitution of the United States?
"6. Is it constitutionally competent for the General Court under the equal protection clause of the 14th Amendment of the Constitution of the United States and Articles X and XXIII of Part the First, and Article IV of Section I of Chapter I of Part the Second of the Constitution of Massachusetts, to provide, pursuant to said bill, that the approval and regulation of projects to be undertaken in Boston by corporations other than insurance companies, savings banks and groups of savings banks shall be vested exclusively in the Boston Redevelopment Authority, subject to the approval of the Mayor of Boston?
"7. Is it within the competency of the General Court under Article IV of Section I of Chapter I of Part the Second of the Constitution of Massachusetts to authorize cities and towns to contract, as provided in Section 5 of said bill, that, without mutual consent, a project under Chapter 121A of the General Laws shall not be affected by any subsequent amendment of said Chapter 121A or by any subsequent amendment of any rule, regulation or standard regulating such project?
"8. Is it within the competency of the General Court under Article IV of Section I of Chapter I of Part the Second of the Constitution of Massachusetts to authorize a city or town to contract with an urban redevelopment corporation, bank or insurance company, as provided by Section 5 of said bill, for such corporation, bank or company to pay to a city or town with respect to one or more years such specific or ascertainable amount in addition to the excise prescribed by Section 10 of Chapter 121A as may have been stated in the application?
"9. In view of the several powers granted to the General Court by Article IV of Section I of Chapter I of Part
the Second of the Constitution of Massachusetts, will contracts entered into by cities and towns as provided in Section 5 of said bill, be binding upon the Commonwealth so that as to any particular project, any subsequent amendment of Chapter 121A, including Section 10 thereof, without provision for adequate compensation, shall not be applicable to such project?
"10. Is it constitutionally competent for the General Court in view of Article II of the Articles of Amendment of the Constitution of Massachusetts and of provisions of Sections 26KK and 26ZZ of Chapter 121 of the General Laws and the provisions of Section 7A of Chapter 121A to abolish the planning board in the City of Boston and transfer its powers and duties to the Boston Redevelopment Authority subject to the approval of the Mayor of said City and to transfer the powers and duties of the State Housing Board in Boston under said Chapter 121A to the Boston Redevelopment Authority subject to the approval of the Mayor of said City as provided in Section 14 of the proposed bill?
"11. Is it constitutionally competent for the General Court under Article LX of the Articles of Amendment of the Constitution of Massachusetts to permit the Boston Redevelopment Authority subject to the approval of the Mayor to grant permission for deviation from a zoning law as provided in Section 15 of the proposed legislation?"
The first question seeks an opinion under the Constitution, Part II, c. 1, Section 1, art. 4, wherein the General Court is given a power "to impose and levy . . . reasonable assessments, rates, and taxes, upon all the inhabitants of, and persons resident, and estates lying, within the said commonwealth . . .." More definitely, the opinion sought is the legislative power to exempt from taxation projects, as redefined in Section 1 of the bill, to be constructed in blighted open areas, decadent areas, and substandard areas, all as redefined in Section 1 of the bill. The question directs our attention to G. L. c. 121A, Sections 10 and 15, as amended, two sections
which are not sought to be amended further by the bill.
Section 10 (as amended through St. 1956, c. 640, Section 4) provides that, for forty years after its organization, each corporation formed under c. 121A, Section 3 (as amended by St. 1953, c. 647, Section 1, and as proposed to be amended further by Section 3 of the bill), "and all its real and personal property . . . shall be exempt from taxation and . . . shall not be required to pay any tax, excise or assessment to . . . the commonwealth or . . . its . . . subdivisions," except excises provided in Section 10 itself and in Section 15 (as amended through St. 1953, c. 647, Section 4), motor vehicle and gasoline excises. If the corporation enters into a contract for improvements with the municipality under Section 14, inserted by St. 1945, c. 654, Section 1, it may agree therein to make payments in lieu of betterments and special assessments. Instead, Section 10 requires that during the forty year period each corporation annually "shall pay . . . an excise equal to the sum of . . . [a] five per cent of its gross income in . . . [the] preceding calendar year, . . . and [b] . . . ten dollars per thousand upon . . . the fair cash value as of January first in the year in which the excise becomes payable of all real and tangible personal property of such corporation." The proceeds of the excise are to be distributed to the city or town in which the project is located. The excise is not to be less than a minimum computed by a somewhat complicated formula, which we need not set out in detail. In the case of a project carried out by an insurance company, the provisions of c. 121A "shall, so far as apt, be applicable to such company" subject to various exceptions, which include in Section 18 (g) a statement that Section 10 "shall apply to an insurance company only with respect to a particular project or . . . projects, and such company shall remain subject to all other taxation . . . with respect to its other activities." Section 18 (g), as proposed to be amended by Section 10 of the bill, will provide for computing the rental value of space in such a project occupied by a company itself to be used in computing the gross income of the project.
Closely related to c. 121A, Section 10, is Section 15, which provides for what is essentially contingent additional taxation of a
project in the event that its gross receipts in any year shall exceed the aggregate of certain specified expenses, permitted transfers to reserves, and amortization. The city or town in which the project is situated is to receive these excess receipts unless they exceed the difference between (a) the taxes which would have been paid in that year, were it not for the tax exemption under Section 10, and (b) the excise under Section 10 actually paid in that year. Any balance of excess receipts may, with the approval of the housing board (in Boston, the Authority), be applied to the reduction of the project's debt or to its improvement.
It is thus apparent that Section 10 provides for each project an excise in lieu of local property taxes from which the project is to be exempt. The total tax and excise burden of a project will probably be less than it would be if not so exempt, although this difference may be reduced or eliminated, under Section 15, to the extent that in any year the project has excess income, or by a contractual arrangement under new Section 6A to pay more than the minimum excise as a contribution to the community.
Senate No. 634 differs materially from the bill relating to the Prudential center recently considered in Opinion of the Justices, ante, 738. That bill outlined one particular project, but without sufficient clarity to enable us to determine whether it was for a predominantly public purpose. We pointed out at page 759, "The project must be demonstrably of a character reasonably justifying separate classification and treatment for tax exemption." Senate No. 634, by amending general legislation, purports to delegate to administrative bodies power to approve projects -- in Boston to the Boston Redevelopment Authority and in other municipalities to the State Housing Board. "If there is to be a delegation of authority to approve,  the details or standards for approval must be specified, and  any action must be made subject to review of the adequacy of compliance with standards." Opinion of the Justices, ante, 738, 759.
What are the details or standards for approval which would obtain should S. 634 be enacted?
A. For municipalities other than Boston these would continue as at present under c. 121A, Section 6. The planning board (or the mayor or selectmen if there is no planning board) in its report must determine (1) whether the plan is a project as defined in Section 1; (2) whether it is within a decadent, substandard, or blighted open area as redefined in Section 1; and the following particulars as required in Section 6; (3) whether the project conflicts with any master plan for the municipality; (4) whether it is in any way detrimental to the best interests of the public or the municipality or the public safety and convenience, or inconsistent with the most suitable development of the municipality; and (5) whether it will constitute a public use and benefit. (6) If dwellings are involved, other findings must be made. The State Housing Board, if it receives a certificate of approval from the mayor or the selectmen, and the planning board (if any), must make these findings: (1) that "the conditions exist which warrant the carrying out of the project"; (2) that in its opinion the cost of the project has been correctly estimated; (3) that it will be practicable; and (4) that the construction and use of the project will not be in contravention of any zoning, subdivision, health, or building ordinances or by-laws or municipal regulations, or the standards fixed by the housing board under Section 4.
B. In Boston, the approval of projects would be by the Boston Redevelopment Authority, to be concurred in by the mayor and not by the housing board. As we read Sections 14 and 15 of the bill, the Authority would make most of the findings required for projects outside Boston. It would make findings in the six numbered categories (supra) required of planning boards and in categories 1 and 3 (supra) required of the housing board. It also necessarily would find whether the project complied with the requirements of Section 15 of the bill. There is no provision, as under Section 6 of c. 121A, that it state its opinion whether the cost of the project has been correctly estimated, although, as a practical matter, this seems to be comprehended by other required findings. In Section 15 of the bill no finding is required that
there will be no contravention of zoning, subdivision, health, or building ordinances. On the contrary, "the authority with the approval of the mayor . . . shall have exclusive power, both before and after the approval of a project, to grant from time to time permission . . . to deviate" from any zoning, building, health or fire law, code, ordinance, or regulation in described circumstances. If the project includes land approved for the extension of the Massachusetts turnpike, the Massachusetts Turnpike Authority must determine that the project will not unreasonably interfere with the extension.
We conclude that the details or standards for approval both without and within the city of Boston, although capable of more definite expression, are nevertheless sufficiently definite for the exercise of delegated legislative authority.
Our decisions thus far have upheld slum clearance under the housing act (G. L. c. 121, as amended) as a public purpose (Allydonn Realty Corp. v. Holyoke Housing Authy. 304 Mass. 288 ) even though restrictions be imposed which might preclude residential use of the cleared area when sold or leased for development. Papadinis v. Somerville, 331 Mass. 627 , 633. The Papadinis case concerned an area which was "decadent" and "substandard." In Opinion of the Justices, 334 Mass. 760 , 763, the opinion was expressed that the redevelopment of a "blighted open area" was likewise a public purpose.
Senate No. 634 extends the scope of the definitions of projects to include the erection of commercial, industrial, and other types of buildings. If an area is found to fall within any of the three types of areas redefined in Section 1 of the bill, the project would not fail as a public purpose merely because the cleared area is to be rebuilt with buildings which are not dwellings. Taking as an example the area which was the subject of the Opinion of the Justices, ante, 738, if the Back Bay land there described should be found to constitute any type of area redefined in Section 1 of the bill, its rehabilitation would not, on balance, necessarily become
a private purpose because the project, which may be given favorable tax concessions, embraces the construction of buildings which are wholly or largely not residential. There is no constitutional requirement that a blight, for example, if removed in the course of urban redevelopment, particularly if it is found to be one not about to be eliminated by private capital, must be replaced by residential buildings.
The elements, some public in character and others private, which are material to determining whether a given project is preponderatingly one or the other, are to be judged on their relative weight by a public body or official charged with the duty of making that determination and by the courts having the duty to review. On the one hand, consideration must be given to any loss of tax revenue from new construction, the use and possible gain accruing to private interests from a completed project, and any other factors (see Allydonn Realty Corp. v. Holyoke Housing Authy. 304 Mass. 288 , 292-293), tending to show a private character. Against these considerations are to be weighed the public advantages to be gained and the necessity of resort to the provisions of c. 121A as affected by the bill (rather than waiting for private enterprise to act) in order to achieve those advantages. If the Prudential center again is used as an example, there are many public advantages to be considered. These would include the elimination of grave doubts as to the future use of a great area, now largely vacant or occupied by a nearly obsolete, unsightly railroad freight yard; covering over a railroad right of way; improvement to neighboring properties; the encouragement of prompt action unlikely to be undertaken by private enterprise in the foreseeable future; stimulation of other building and opening a new opportunity for urban growth at what might be a time which is appropriate but of short duration; and new facilities made available to public use.
We think that a sufficient procedure has been provided for review of the delegated action as to its adequate compliance with the prescribed standards. In the city of Boston
Section 15 of the bill allows a petition for writ of certiorari to be brought against the Boston Redevelopment Authority by an aggrieved person, and (as we read Section 15) also by "any municipal officer or board," in order to correct errors of law in any vote of the Authority under Section 14 or Section 15. Expressly made applicable are the provisions of G. L. c. 213, Section 1D, and G. L. c. 249, Section 4, both as amended. [Note p778-1] The latter statute permits the contention that "the evidence which formed the basis of the action . . . or . . . of any specified finding or conclusion was as matter of law insufficient to warrant such action, finding or conclusion." See DiMaggio v. Mystic Bldg. Wrecking Co. Inc. 340 Mass. 686 , 691. There is no provision in c. 121A or S. No. 634 for a review procedure outside Boston. Nevertheless, c. 213, Section 1D, and c. 249, Section 4, would, on general principles, be applicable. Board of Health of Woburn v. Sousa, 338 Mass. 547 , 553. As to whether other procedures also might apply both in Boston and in other municipalities, we have no present occasion to express an opinion.
We next give attention to the issue whether the projects operating under c. 121A, as amended by the bill, are subject to adequate public regulation.
In Opinion of the Justices, 334 Mass. 760 , 763, it was stated that since "urban redevelopment corporations, although in a sense private corporations, perform functions for the public benefit analogous to those performed by various other types of corporations commonly called public service corporations, property owned by them and used in such service may receive favored treatment in the matter of taxation," in that instance (see p. 764) "so long, not exceeding forty years, as the project continues to be operated under public regulation and for the public benefit." The Justices, in advising that the tax exemption contained in what is now c. 121A, Section 10, would be valid if enacted, laid some emphasis upon the provisions of c. 121A, Section 8, "Every such corporation shall be deemed to have been organized
to serve a public purpose, and shall remain at all times subject to reasonable rules and regulations of the housing board." That opinion thus treats as important, as a factor sustaining the proposed tax exemption, the continuing regulation of urban renewal projects by a public body, in much the manner in which public utilities remain subject to regulation. With respect to projects outside Boston, regulation, as provided in c. 121A, by the housing board and the insurance commissioner, in their respective areas, will remain substantially unchanged by the present bill. Boston projects, although regulated by the Authority (and the insurance commissioner in those matters relating to insurance company projects committed to him) rather than by the housing board, also will be under substantially the same regulation as is applied to all projects by c. 121A.
We enumerate the principal features of such continuing regulation. (1) For each Boston project, the Authority (Section 15 of the bill) must prescribe in its approval of the project rules and regulations, applicable to that project, setting minimum standards for its financing, construction, maintenance, and management. Projects outside Boston are subject to the housing board's rules and regulations promulgated under c. 121A, Section 4. (2) Under c. 121A, Section 8, as to be modified by Section 6 of the bill, the construction of buildings of a project is to be inspected by the appropriate public authority to ensure conformity with the application. In the event that violations are found to exist of the provisions of c. 121A, of the requirements with respect to construction and financing, of the applicable rules and regulations, or of applicable requirements as to maintenance and use, the bondholders of the project and the trustee for them are to be notified. The appropriate public authority, in addition to other remedies, may bring a bill in equity to prevent such violations. (3) The income return from a project is limited to six per cent dividends by c. 121A, Section 9, as affected in the case of insurance companies by Section 9 of the bill. The provisions of c. 121A, Section 9, are closely related to the provision, already mentioned, for
additional payments, in lieu of taxes, to be paid (as provided in c. 121A, Section 15) if there is gross income from a project in any year in excess of the project's expenses, limited dividends, amortization, and other allowable deductions. Neither c. 121A nor the bill makes specific provisions with respect to accounting methods. Accounting requirements are usual in public service company regulations. We think that such requirements are authorized (if, indeed, not required by implication) as a part of the regulations to be issued under c. 121A, Section 4, and under Section 15 of the bill. Without such regulations, enforcement of the additional payments in lieu of taxes (c. 121A, Section 15) and of the limited six per cent return (c. 121A, Section 9) would hardly be possible. It may be expected also that regulations will deal with the allocation to each project of expenses incurred with respect to that project where an insurance company is concerned. See c. 121A, Section 18 (a), and (f), as amended by Section 9 of the bill.
These provisions for continuing regulation, taken together with the regulations for the original approval of projects, would lend further support to a legislative declaration that such projects are for a public purpose. See Opinion of the Justices, 334 Mass. 760 , 763-764; Cabot v. Assessors of Boston, 335 Mass. 53 , 65-68.
The first question is too general to answer without qualification. In Opinion of the Justices, ante, 738, 748-749, we said that "the development of constitutional principles in this Commonwealth has made the determination whether a given project is predominantly for a public purpose dependent upon the circumstances of each individual case." To the first question, if qualified as containing a proviso that each project is properly found (in accordance with c. 121A as amended by the bill) to be for a public purpose, we answer, "Yes."
Question 2 is much too broad for a categorical answer. Projects for commercial and industrial uses may be for a public purpose, but each must be found (in accordance with c. 121A as amended by the bill) properly to be for such a purpose. We beg to be excused from further answering question 2.
Question 3 seeks to learn whether the answer to question 1 would be the same for a project in Boston governed by Section 14 and Section 15 of the bill. The answer to question 3 is comprised in our answer to question 1. To question 3, qualified by the same proviso as we suggested to question 1, the answer is "Yes."
The answer to question 4, which is also comprised in our answer to question 1, is "Yes."
Question 5 asks whether the special provisions of Sections 14 and 15 of the bill, transferring to the Authority important duties and powers with respect to Boston projects, "constitute an unconstitutional discrimination in favor of" Boston projects as against projects elsewhere, or deny equal protection of the laws to persons in other cities and towns, in contravention of the Fourteenth Amendment to the Constitution of the United States. Question 6 we interpret as presenting essentially the same question, confined to corporations other than insurance companies and savings banks. If question 6 is intended to present any other issue, it is not apparent to us what that issue is.
The equal protection clause of the Fourteenth Amendment does not prevent reasonable classification of subjects of legislation. It also does not preclude legislative action providing treatment of problems in one community, different from the treatment of those problems in another community, in a manner having a reasonable relationship to the objects of the legislation. Different treatment is justified if the conditions in these communities differ sufficiently so as fairly to give rise to the legislative belief that such different treatment is desirable in the public interest, and if the legislation operates equally within each geographical area with respect to persons similarly situated. See Brest v. Commissioner of Ins. 270 Mass. 7 , 14-19; Goodale v. County Commrs. of Worcester, 277 Mass. 114 , 149-150; Connor v. Metropolitan Dist. Water Supply Commn. 314 Mass. 33 , 37-38; Century Cab Inc. v. Commissioner of Ins. 327 Mass. 652 , 660-665; Doherty v. Commissioner of Ins. 328 Mass. 161 , 164; Williams v. Eggleston, 170 U.S. 304,
310; Mason v. Missouri, 179 U.S. 328, 334-335; Hadacheck v. Chief of Police of Los Angeles, 239 U.S. 394, 409, et seq. In arranging and rearranging governmental subdivisions and the powers and duties of their officers and boards, the Legislature has comprehensive powers. See Commonwealth v. Plaisted, 148 Mass. 375 , 383-387; Broadhurst v. Fall River, 278 Mass. 167 , 171; Moore v. Election Commrs. of Cambridge, 309 Mass. 303 , 314-322; Mayor of Gloucester v. City Clerk of Gloucester, 327 Mass. 460 , 464. See also cases referred to below in our answer to question 10.
The treatment proposed for projects in Boston differs from that for the rest of the Commonwealth in the following principal respects: (1) The Authority, subject only to the approval of the mayor, is itself to operate as a planing board for Boston and is to exercise the powers which the local planning board and the State Housing Board now do and still would exercise in the case of a project outside of Boston. (2) The Authority (see the bill, Sections 14, 15) may prescribe regulations applicable to Boston projects different from those prescribed by the State Housing Board under c. 121A, Section 4. Certain of the Authority's regulations may be embodied in the approval of the project rather than being of general application, as are regulations under c. 121A, Section 4. (3) Deviations from zoning, building, health, and fire laws may be authorized by the Authority with the approval of the mayor (see bill, Section 15) rather than by proceedings as contemplated in c. 121A, Section 6, subject to and in accordance with generally applicable statutory provisions for obtaining such deviations (see G. L. c. 40A) which contain important safeguards for affected public and private interests. (4) The requirements for applications under c. 121A, Section 5, for projects outside Boston, are somewhat more comprehensive than for applications relating to Boston projects under Section 15 of the bill.
Boston has frequently been the object of special legislative attention. It has been excluded from the operation of various general laws, and the same subject matter has been covered by special legislative provisions applicable only in
Boston, enacted presumably with a view to meeting special conditions there and dealing more appropriately with its special requirements. See, for example, various provisions of the municipal finance act, from the operation of which Boston is excluded, or by which a special provision is made for Boston. G. L. c. 44, Sections 2, 7, 31, 31A, 32. The Legislature may reasonably conclude that the largest city in the Commonwealth, in the heart of a great metropolitan area, may be subject to problems and conditions not found in comparable degree in other communities. It may reasonably determine also that a separate Boston board, familiar with Boston conditions, to deal with redevelopment there, will be more suitable than one also charged with similar problems elsewhere, and that different procedures for approval and administration of projects in Boston, and to facilitate their execution, will better serve the public interest. In the absence of some specific showing that there is no reasonable basis for the proposed separate classification and different treatment of Boston projects, or that in some manner it operates unequally in respect of those to whom it is applicable, we perceive nothing in the proposed procedural provisions governing Boston projects as compared to those governing projects elsewhere which denies to any person the equal protection of the laws.
Subject to the foregoing discussion, and in the light of our interpretation of question 6, we answer question 5 in the negative and question 6 in the affirmative.
Question 7 asks whether the Legislature, by the proposed new Section 6A of c. 121A, may authorize cities and towns to provide by contract that a project is not to be affected by any subsequent amendment either of c. 121A or of any rule, regulation, or standard regulating such project. Question 9 presents the closely related issue whether such a contract, if made, will so bind the Commonwealth that subsequent amendments of c. 121A, especially of Section 10 which provides tax exemption, will not apply to the project. These two questions are considered together.
Cities and towns, as agencies of the State, may be given, subject to constitutional limitations, such functions and
powers, including power to make contracts, as the Legislature may determine. See Commonwealth v. Plaisted, 148 Mass. 375 , 386; Opinion of the Justices, 293 Mass. 589 , 599, 603. See also Commonwealth v. Hudson, 315 Mass. 335 , 345; Berube v. Selectmen of Edgartown, 331 Mass. 72 , 74; Atherton v. Selectmen of Bourne, 337 Mass. 250 , 255-256. The Legislature, however, has no power to make, or to delegate the power to make, a contract "which in effect is a surrender . . . of the sovereign powers of the Commonwealth. The right to exercise the police power cannot be relinquished even by explicit stipulation." See Opinion of the Justices, 293 Mass. 589 , 599-601, in which the Justices advised (pp. 602-606) that it was beyond the power of the Legislature by statute to limit for an indefinite period its own future authority to change the statutory powers of management, the method of appointment, and the tenure of public officers of the Boston Metropolitan District as then proposed to be established, and in other important respects to impose "stringent, if not permanent, restrictions on the competency of the General Court to legislate for the public welfare concerning" the Boston Elevated Railway system.
On the other hand, in Opinion of the Justices, 261 Mass. 523 , 553, it was said that "the sovereign power itself may in certain conditions for the public welfare make a binding contract as to exemptions from taxation." In that opinion a proposed contractual tax exemption affecting the Boston Elevated Railway, to be embodied in a statute, was stated not to "be subject to revocation and amendment without the consent of the railway company." Cf. Massachusetts Gen. Hosp. v. Belmont, 233 Mass. 190 , 200. In Boston Elev. Ry. v. Commonwealth, 310 Mass. 528 , it was held (p. 549) that "the Legislature had the power . . . to bind the Commonwealth by a contract . . . embodied in St. 1897, c. 500, that the [railway's] Atlantic Avenue location should not be revoked without payment of compensation therefor," and that revocation of the location by St. 1939, c. 482, if "considered . . . as a revocation at the pleasure of the
Legislature," would impair the obligation of the earlier statutory contract (p. 554). This court pointed out (p. 553) that the term "police power" has two meanings. In a broad sense, it is used as "embracing in substance the whole field of State authority." It also "has a narrower signification" (see pp. 552-553) encompassing only the fundamental power to establish regulations necessary to secure the health, safety, good order, comfort, or general welfare of the community, defined "with some strictness, so as not to include everything that might be enacted on grounds of mere expediency." The principle (see p. 553) "that the police power cannot be bargained away does not wholly preclude the Legislature from dealing with public rights by contract so as to prevent subsequent legislative action in violation of such contract" in matters not within the "narrower signification" of the police power.
It is hard to draw precisely the line of demarcation between (a) those contracts binding upon the Commonwealth which preclude future legislative change impairing their obligation without the payment of compensation, and (b) contracts which invalidly purport to bind the Commonwealth not to exercise its police power. The opinions already cited give general indication of where the dividing line lies.
In the light of all these principles, to avoid serious constitutional doubts (see Ferguson v. Commissioner of Corps. & Taxn. 316 Mass. 318 , 323-324; New England Tel. & Tel. Co. v. National Merchandising Corp. 335 Mass. 658 , 664; Worcester County Natl. Bank v. Commissioner of Banks, 340 Mass. 695 , 701), we are constrained to interpret the second sentence of the proposed Section 6A sufficiently narrowly to ensure its constitutional validity. We think that this sentence, if enacted, would authorize cities and towns to agree that, for a reasonable period, the project will not be affected by amendment of those provisions of c. 121A (and of the rules, regulations, and standards) which, to furnish a sound basis for proceeding with the necessary investment, are proper and natural for inclusion in a contract for
major construction affected with a public interest. We would not interpret this sentence as granting power to make inviolable by later legislation those provisions of this chapter, and of applicable rules, regulations, and standards, which deal with matters of general regulation of the community in a manner closely related to its health, morals, safety, and fundamental welfare. For example, a city or town could under this provision agree (a) that for the forty year period mentioned in c. 121A (as amended by the bill) the project would be subject to State and local taxes and excises only in accordance with the contract and the provisions of c. 121A in force at the time of the contract; and (b) that for a reasonable period the statutory provisions for determining the project owner's income return and dividends would not be altered. We think that the period not exceeding forty years stated in the bill as the period of tax exemption would be a reasonable period to designate as the period of such a contract. A longer, precisely defined period might be reasonable in appropriate circumstances and as to designated matters.
On the other hand, the Legislature could not authorize a city or town to agree (1) that the project would be free from subsequent legislative regulation within the strict or "narrower signification" of the police power, already mentioned, for example, legislation prescribing precautions against new health hazards, generally applicable to all persons in the community similarly situated; or (2) that no changes would be made in the governmental structure (e.g. membership, method of selection of members, duties, etc.) of the various municipalities and public bodies or officers exercising regulation over such projects.
Questions 7 and 9 are each answered, "Yes," subject to our interpretation of Section 6A.
Question 8 asks with respect to the new Section 6A of c. 121A, as provided in Section 5 of the bill, whether the Legislature may authorize a city or town to obtain, by contract with a corporation, bank, or insurance company undertaking a project, an agreement that it will pay to the city or town each
year a specific amount in addition to the excise prescribed by c. 121A, Section 10, in effect as additional taxes. Such a contract would enable a city or town in effect to limit, consistently with the standards set out in c. 121A and in the bill, the extent of the authorized tax exemption (see c. 121A, Sections 10, 15) to the minimum amount needed to permit and induce the undertaking of the project. An additional payment of this type would be a factor, along with other proper factors, which the housing board or the Authority should take into account in passing upon applications for the approval of projects and in applying the statutory standards. Because the additional payment under Section 6A would be obtained by contract, whoever is undertaking the project would have no ground for complaint. See Vance v. Burke, 267 Mass. 394 , 397, and cases cited; see also Interstate Consol. St. Ry. v. Commonwealth, 207 U.S. 79, 84; International & Great No. Ry. v. Anderson County, 246 U.S. 424, 433.
We answer question 8, "Yes."
In question 10, we are asked whether the Legislature, in view of art. 2 of the Amendments to the Constitution of the Commonwealth, and of the provisions of G. L. c. 121, Sections 26KK and 26ZZ, and c. 121A, Section 7A, may abolish the planning board of Boston and transfer its powers and duties, and those relating to Boston of the State Housing Board, to the Authority subject to the approval of the mayor, all as provided in Section 14 of the bill. [Note p787-1]
Article 2 of the Amendments gives to the Legislature "full power and authority to erect and constitute municipal or city governments, in any corporate town or towns in this commonwealth, and to grant to the inhabitants . . . such powers, privileges, and immunities not repugnant to
the constitution as the general court shall deem necessary or expedient for the regulation and government thereof." Chapter 121, Sections 26KK and 26ZZ (as amended, respectively, through St. 1957, c. 613, Section 4 and Section 5), impose upon the State Housing Board and upon local planning boards certain administrative duties with respect to the consideration and approval of redevelopment and urban renewal projects. G. L. c. 121A, Section 7A (as amended through St. 1955, c. 654, Section 4A).
Reference already has been made to the Legislature's broad power to revise the structure, powers, and duties of State and municipal administrative departments, agencies, and boards and to redistribute the powers and duties of such bodies. See Commonwealth v. Hudson, 315 Mass. 335 , 344-345, and cases cited. See also Commonwealth v. Plaisted, 148 Mass. 375 , 386-387; Commonwealth v. Theberge, 231 Mass. 386 , 390; Mayor of Gloucester v. City Clerk of Gloucester, 327 Mass. 460 , 464; Atherton v. Selectmen of Bourne, 337 Mass. 250 , 255-256. We perceive nothing in art. 2 of the Amendments, in G. L. c. 121, Sections 26KK and 26ZZ, as amended, or in G. L. c. 121A, Section 7A, as amended, which would deprive the Legislature of power to enact Section 14 of the bill.
We answer question 10 in the affirmative.
In question 11, inquiry is made whether the Legislature, under art. 60 of the Amendments to the Constitution of the Commonwealth, may authorize the Authority, subject to the approval of the mayor, as Section 15 of the bill proposes, to grant permission for deviation from a zoning law.
Article 60 of the Amendments provides that the Legislature "shall have power to limit buildings according to their use or construction to specified districts of cities and towns." "The power of the General Court over the subject of zoning" has been said to be "supreme" (see Bennett v. Board of Appeal of Cambridge, 268 Mass. 419 , 422; Attorney Gen. v. Dover, 327 Mass. 601 , 604-605). This power, together with the broad legislative power to revise the governmental structures of cities and towns and the
powers and duties of municipal bodies and boards, amply warrants delegating under appropriate standards to the Authority, subject to the approval of the mayor, the power to grant zoning deviations in respect of Boston projects. It is not fatal to validity that different or fewer standards and procedural safeguards are provided in Section 15 with respect to deviations affecting Boston projects than are imposed in respect of a variance granted in other communities in the manner contemplated by G. L. c. 40A, Section 15 (as amended through St. 1958, c. 381), or in respect of an exception (see c. 40A, Section 4, inserted by St. 1954, c. 368, Section 2). What has been said in our answer to questions 5 and 6 with reference to the reasonableness of separate legislative classifications applicable to Boston is equally applicable here.
We answer question 11 in the affirmative.
RAYMOND S. WILKINS.
JOHN V. SPALDING.
HAROLD P. WILLIAMS.
EDWARD A. COUNIHAN, JR.
ARTHUR E. WHITTEMORE.
R. AMMI CUTTER.
[Note p764-1] The phrase "sound growth of the community" has always been in the definition of "blighted open area." C. 121A, Section 1, inserted by St. 1953, c. 647, Section 1.
[Note p767-1] General Laws c. 121A, Section 18, as amended by St. 1953, c. 647, Section 8, excepts, as to insurance companies, certain requirements of c. 121A. One of these is found in Section 18 (e), where this part of the quoted sentence "shall be construed to mean `Every such project shall be deemed to have been undertaken to serve a public purpose.'"
[Note p778-1] These sections are made applicable "except as herein provided." We are unable to identify any contrary provision to which reference is intended.
[Note p787-1] Section 14 of the bill itself contains a provision (and is supplemented in some respects by a similar provision in Section 16) that, as to any Boston project the Authority shall act in place of the abolished planning board "notwithstanding that it [the Authority] may have made a contract directly or indirectly affecting the project." No inquiry is made, and we have not considered, whether this provision would permit the Authority to exercise administrative functions and apply legislative standards in any matter in which it may be materially affected by interest or bias by reason of former action or commitment.