Ten O'Clock News

[Reporter] Ray Flynn ran for mayor on the housing issue. He said he'd leverage the business boom to create more affordable housing and he said he'd protect tenants from unscrupulous landlords and condo converters. And along the way he said he'd empower neighborhood people politically. Those are still his goals. But what this report doesn't mention are some of the serious setbacks the Flynn plan has suffered. [Flynn] Our housing strategy has policies as well as programs in it. [Reporter] The programs that produce actual new housing units are working well. It's Flynn's radical sweeping housing policies that are in trouble. Both linkage tying neighborhood housing to downtown construction and controls on condominium conversions were found legally flawed by the state Supreme Court. In addition, Flynn's tough rent control bill emerged from the city council less tough. [Mel King] He needs the council. And he also needs the legislators. [Reporter] Mel King was Ray Flynn's opponent in the mayor's race and both served together in the legislature. King thinks Flynn still needs to build consensus on his policies before going public.

[King] One of his first mistakes in dealing with the council was that he did the thing in the press instead of going and meeting with them. It requires him to say "hey gang, come on in, let's sit down, let's see how we can put our heads together in the interest of what I know we all want to make happen." And he's got to be able to and willing to do that. [Flynn] I think we're receiving that kind of level of cooperation with the city council and the state legislature. [Reporter] But Boston is in an enormous structural bind. The bind is Home Rule: without a new state law each time, Boston can't levy taxes or manage the city's real estate. That's why, according to the court, condo conversion controls need legislative approval as well as linkage, which the Court ruled is really a tax on development. [Flynn] -- established on the fundamental principle of self-governance, yet at the same time any kind of major kind of policy we want we have to go to the legislature for approval. That's rather unfair and archaic. [Reporter] The dilemma worsens in a way because of the city's economic boom. True, property

values are going up, but so are tax assessments and down the line that could mean your children won't be able to afford the triple decker next door. [King] He's got to deal with the problem that comes from the increase in the tax payments that people are going to be making. And he may have to cut the revenue. [Reporter] The simplest solution of all is politically inconceivable: rewrite the state constitution so Boston can govern itself. [Flynn] Yeah, I mean sure I support it. [laughter] I've been carrying it around with me, but I'm not sure we'd get that kind of support because it's in the legislature's-- state house's best interest to keep cities and towns in Massachusetts always coming up with their hat in their hand. [Reporter] For the 10 O'Clock News, I'm Christy George.