Many condominium boards are familiar with the process of amending their condominium documents. In its simplest form, a condominium board discovers a governance issue, then works with a condominium attorney, the amendment or amendments are drafted, and a percentage of the unit owners (and in some cases, mortgagees) must approve. Once the amendment is approved, for condominiums in 350 of the 351 cities and towns in Massachusetts, the next step is to record the amendment at the county registry of deeds. However, for condominium boards in the City of Boston, amending master deeds has an additional step: the so-called “Tregor” stamp, which must be obtained from the City of Boston Collector-Treasurer’s Office.

Most Boston condominium boards do not know about the Tregor tax requirements, and are surprised when we inform them that as part of the process of recording a master deed amendment, the association must obtain a Tregor stamp.

This City of Boston-specific requirement is an additional burden for Boston condominium associations, and can stall the recording of a master deed amendment. The Tregor stamp process is also complicated by the City of Boston’s current enforcement practices.

The Tregor stamp requirement was created by the Massachusetts Legislature by the 1982 Mass Acts Chapter 190, Section 9 (the “Act”). In 1982 the Massachusetts Legislature was responding to a City of Boston budgetary shortfall created by the ruling in a Massachusetts Supreme Court Case, Tregor v. Bd. of Assessors of City of Bos., 377 Mass. 602 (1979). Among other purposes, the intent of the Act was to allow the City of Boston to take out loans to help create additional sources of funding for the City.

One important part of that funding effort was allowing the City of Boston to collect an excise tax for each condominium unit created in Boston. The excise tax allows the City to collect five hundred dollars per new unit created (the first unit is free). The Act also states that the payment must be made to the Collector-Treasurer of the City of Boston prior to the recording of any master deed. No master deed or plan is accepted by the Suffolk County Registry of Deeds unless the City of Boston Collector-Treasurer has certified thereon that the excise tax has been paid.

This excise tax requirement became commonly known in the Massachusetts real estate community and in City Hall as the “Tregor tax.” In order to show that the Tregor tax has been paid as required, the City of Boston provides a stamp somewhere upon a master deed or master deed amendment, commonly known as a “Tregor stamp.” The Suffolk Registry of Deeds requires that all master deeds and master deed amendments have a Tregor stamp thereon before the Registry will accept and record a master deed or master deed amendment, no matter the amendment’s purpose, that is, even if it is not creating a condominium or adding any unit or units to a condominium.

The administration of the Tregor tax was granted by the Act to the Collector-Treasurer of the City of Boston. The Collector-Treasurer is specifically granted the ability to “prescribe regulations not inconsistent with law, to carry into effect the provisions of this section, which regulations when reasonably designed to carry out the intent and purpose of the provisions hereof shall be prima facie evidence of the proper interpretation of such provisions.” The Collector-Treasurer is to provide the city council and the Commissioner of Revenue with a copy of any regulation related to the Tregor tax and shall publish the regulation in the City of Boston records.

Most Boston condominium boards do not know about the Tregor tax requirements, and are surprised when we inform them that as part of the process of recording a master deed amendment, the association must obtain a Tregor stamp.

To obtain a Tregor stamp, you or your representative must visit the Collector-Treasurer’s collecting division at City Hall in person, where you provide the master deed amendment to a collecting division employee who reviews it and confirms that no units are being added, or, if units are being added, requests the payment of $500.00 per unit, in accordance with the Act.

However, the process employed by the city presently goes beyond that contemplated in the Act. When a request is made for a Tregor stamp, the collecting division employee checks the City records to determine whether any taxes are owed by any unit owner in the condominium, both current-year taxes and past due taxes. If taxes are owed by any unit owner, the collecting division will not provide a Tregor stamp on the master deed amendment. The City takes the position that the condominium association needs to ensure that every unit owner has paid their taxes before a Tregor stamp will be provided.

This Collector-Treasurer policy represents a significant burden for condominiums, both large and small. Particularly in a large condominium, there is simply no way to ensure that all unit owners are “paid in full” on their taxes at all times. In addition, condominium boards are not generally granted the authority to compel unit owners to pay their taxes. In fact, city property taxes are collected from condominium unit owners directly by the City of Boston with no involvement of their condominium association. Condominium associations have no immediately accessible means of determining whether unit owners owe past-due taxes. Lacking in the authority to compel the payment of City taxes, most condominium boards have virtually no ability to satisfy the requirements imposed by the city with regard to the issuance of the Tregor stamp.

What this means practically is that master deed amendments that have taken time, effort, and attention of the board and the unit owners, not to mention costs and attorneys’ fees, may be held up indefinitely. As most condominium master deeds require amendments to be recorded to be enforceable, the Tregor process presents a significant impediment to normal condominium operations when it is employed as outlined above.

The Collector-Treasurer policy that all unit owners must have paid on their taxes in full for a Tregor stamp to be provided is not authorized by the Act. This policy is also inconsistent with the Act’s intent, which was to collect a five hundred dollar ($500.00) excise tax payment for all newly constructed condominium units as a method of funding the City of Boston’s budgetary shortfall. The Act says nothing about the collection of overdue or past due taxes from condominium unit owners.

By enforcing the Tregor tax in this way, the Collector-Treasurer’s Office is preventing Boston condominium associations from operating as intended by G.L. c. 183A. It is also imposing a significant burden on condominiums in the City. This is a burden that is not faced by condominium associations in other cities and towns in the Commonwealth of Massachusetts. It is also a burden that, pursuant to the Act, is not justified or warranted.