CLT UPDATE
Wednesday, January 17, 2007
Deadline for filing a property tax
abatement looms
The deadline for property owners to file for an
abatement of their property taxes in those 232 cities and towns of the
Commonwealth that require quarterly tax payments is February 1.
At a time when many Massachusetts homeowners are seeing their property
tax bills rise dramatically because of higher recent assessments and
increasing tax rates, Secretary of the Commonwealth William F. Galvin
has begun a program to inform homeowners about their opportunities to
seek tax abatements, that is, reductions of their bills.
Secretary of State William Galvin
January 16, 2007
Property tax abatement looms -- February 1
Property Tax Abatement Form
(a PDF form from the CLT website)
More than a few New Bedford property owners suffered sticker
shock last week when they opened their latest tax bills.
But skyrocketing tax increases in the city are not new.
Property taxes for the average single-family homeowner in the city of New
Bedford over the past 10 years have increased by an astounding 72 percent,
according a Standard-Times review of city records....
In fact, escalating property taxes were a major issue in the recent
gubernatorial campaign. Gov. Deval Patrick, a Democrat, argued that it was more
important for the state to provide property tax relief than it was to roll back
the state income tax from 5.3 percent to 5 percent, as Republican Lt. Gov. Kerry
Healey had suggested.
Mr. Patrick has yet to unveil his property tax plans ...
Twenty-six years ago, Massachusetts faced a property taxpayer revolt when
Citizens for Limited Taxation, through the initiative process, successfully
forced the Legislature to control the rate of property tax growth....
Barbara Anderson, the woman who led the CLT revolt, said she does not
believe the property tax situation is as desperate as it was in 1980. She noted
that the state is currently ranked 12th in property tax burden while 26 years
ago it consistently ranked between first and third.
Ms. Anderson said that citizens, through the initiative process, can
theoretically enact what's called a tax "underride." An underride would force a
municipal government to reduce the overall tax levy. A lower tax levy would mean
that less taxes would be raised and property tax bills would then decrease.
The New Bedford Standard-Times
Thursday, January 11, 2007
New Year, Same Tax Woes
Ballooning city budget behind homeowner bill hikes
Rising property taxes aren't just a Rehoboth problem. But out
of a population of 11,448, a total of 2,112 Rehoboth residents are senior
citizens, and they're feeling the effects of rising taxes, [Selectman] Berry
said.
The average property tax bill is $4,000 with an annual increase of $240. Berry
said that might not seem like much, but seniors on fixed incomes have to decide
between daily living expenses and their homes.
Property taxes are what mostly fund the school and public safety budgets. And
they may continue to rise even with the tax-limiting law, Proposition 2½, in
place.
The Attleboro Sun-Chronicle
Thursday, January 11, 2007
Seniors' burdens Rehoboth priority
Tax bills this year are higher than last year’s, and some
residents are confused, because real estate values have gone down.
According to Chief Assessor Maureen O’Connor, a big chunk of the tax bill this
year is going toward paying down the $2.9 million debt exclusion for school
renovations....
O’Connor and [Town Accountant] Buckley looked at this year's property
assessments that reflect values as of Jan. 1, 2006, and are based on 2005
activity, when the real estate market was much more active, and finalized the
exact tax rate. That rate is approved by the Department of Revenue, and the
residents get their bills.
The Pembroke Mariner
Thursday, January 11, 2007
Taxes explained
Gov. Deval Patrick is pushing for new local taxes on meals
and lodging that could allow communities to rake in millions of dollars from
residents purchasing everything from a morning cup of coffee to a dinner out for
the family.
During a speech yesterday in which he suggested that campaign promises to cut
property-tax bills and hike local aid will have to wait for another year,
Patrick said he will instead throw his political weight behind a local-option
tax....
Opponents of those taxes, which still need approval from lawmakers, seized on
Patrick’s comments as evidence that he will continually seek to tax and spend
heavily, regardless of whether Bay State families can afford it.
“People should not be surprised that he wants to tax them at their local Dunkin’
Donuts,” said Barbara Anderson, executive director of Citizens for
Limited Taxation.
“I guess this is what happens when (a governor) doesn’t take a no-new-taxes
pledge.”
The Boston Herald
Sunday, January 14, 2007
Local-option tax talk irks Patrick foes
Chip Ford's CLT Commentary
Most quarterly property tax bills are due on February
1st -- two weeks from today -- and that's also the deadline for filing
an abatement with your city or town assessor, if you think you've been
over-taxed and wish to challenge your assessment.
For your convenience, I've posted the state
Department of Revenue's official municipal abatement form (State
Tax Form 128) on the CLT website. You will find instructions
on how and where to file it at the bottom of its second page. It
is in PDF format: you'll need
Adobe Acrobat Reader (free download) to open it.
For more information on abatements,
CLICK HERE.
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Chip Ford |
Secretary of State William Galvin
January 16, 2007
Property tax abatement looms -- February 1
The deadline for property owners to file for an abatement of their
property taxes in those 232 cities and towns of the Commonwealth that
require quarterly tax payments is February 1.
At a time when many Massachusetts homeowners are seeing their property
tax bills rise dramatically because of higher recent assessments and
increasing tax rates, Secretary of the Commonwealth William F. Galvin
has begun a program to inform homeowners about their opportunities to
seek tax abatements, that is, reductions of their bills.
Citizen's Information Service, a division of the Secretary's Office, has
available a brochure of tips that will assist those who wish to file for
consideration of an abatement.
"This brochure will make homeowners aware of their rights, especially
with the filing deadline only two weeks away in a majority of the
communities of Massachusetts," Secretary Galvin said. "To obtain a copy,
you should call toll-free 1-800-392-6090, or visit us online at
www.sec.state.ma.us."
The New Bedford Standard-Times
Thursday, January 11, 2007
New Year, Same Tax Woes
Ballooning city budget behind homeowner bill hikes
By Jack Spillane
More than a few New Bedford property owners suffered sticker shock last
week when they opened their latest tax bills.
But skyrocketing tax increases in the city are not new.
Property taxes for the average single-family homeowner in the city of
New Bedford over the past 10 years have increased by an astounding 72
percent, according a Standard-Times review of city records.
Steep yearly increases — in some cases more than twice the rate of
inflation — have occurred whether the mayor was Rosemary S. Tierney,
Frederick M. Kalisz Jr. or Scott W. Lang.
The biggest annual increases — 11.9 percent in fiscal year 2002 and 11.6
percent in 2003 — took place in the wake of the 2001 recession, and the
corresponding state revenue crisis when Mr. Kalisz was mayor.
But single-family homeowners also saw stiff increases to their property
taxes in fiscal year 1997 when Mrs. Tierney was mayor, 9 percent, and
this year, Mayor Lang's first year in office, 8.7 percent.
One far-North End homeowner, whose property tax bill will increase by
almost 27 percent this year, said he was stunned when he received the
bill.
"It makes me feel almost helpless," said Michael Smith, a retired
certified public accountant.
Though city officials have been quick to blame escalating residential
real estate values for the increased taxes in New Bedford, the biggest
factor driving higher tax bills is the rapid growth in the city's
spending over the past 10 years.
BUDGET BUSTERS
The city budget over the past decade has grown significantly faster than
the inflation rate, from $176.3 million in fiscal year 1997 to $269.2
million in fiscal year 2007, an increase of more than 65 percent. The
largest increases have occurred in line items that are governed by
collective bargaining agreements with municipal unions.
The proposed fiscal year 1997 budget for insurance, including life and
health, was $12 million. Ten years later, that figure has increased to
some $29 million in fiscal year 2007, the current fiscal year.
Over the same period, the city was unable to convince the police union —
long cited by municipal officials as the union that other New Bedford
unions follow — to adopt less-expensive health-maintenance organization
insurance plans.
Mayor Lang, during his first year in office, persuaded the police and
other unions to allow different types of health plans to compete for
city employees. That plan will be implemented later this year.
Though the mayor says he is confident that competition among health care
plans will result in savings to the city, it is not clear how soon, or
even if, it really will. Health insurance costs are increasing rapidly
even in the HMO managed-care plans.
Another factor driving the rapid growth in the city budget is the rising
cost of pension plans for retired city workers.
The proposed fiscal year 1997 budget for the pension plan has exploded
over the past decade, growing from $10.7 million a decade ago to $17.9
million in the current fiscal year.
Other parts of the city budget that grew far quicker than the inflation
rate over the past decade include the salaries and wages in the city's
largest departments — the schools, police and fire.
The School Department budget — the majority of which is funded by the
state — nevertheless has increased from $82.4 million to $138 million
since fiscal year 1997. (That figure includes the cost of city support
services, such as accounting, computer services and short-term debt.)
The city contributed almost $31 million to the schools, mostly in city
services, last year. Ten years ago, it contributed just $11 million,
also in services.
The Police Department budget almost doubled during the past decade, from
$12.5 million to $20.6 million; and the Fire Department increased
sharply, up from $10.9 million to $14.7 million.
The increases to the city budget have occurred despite the fact that
state aid — notwithstanding a short-lived dip in 2002 and 2003 — remains
at roughly the same level it was 10 years ago. (Some 50.9 percent of the
city budget was paid by the state in fiscal year 2007, or $137.4
million. Ten years ago, in fiscal year 1997, 51.3 percent of the city
budget was paid by the state, or $90.5 million.)
PROPERTY VALUES
The growth in the city budget does not mean that escalating residential
real estate values — combined with sluggish commercial and industrial
property values — haven't played a role in driving up the taxes of
single-family home owners in New Bedford.
In fiscal year 1997, the average single-family home in New Bedford was
worth $99,000; today it is worth $247,000.
But during the same period, the average commercial property only
increased in value from $176,000 to $325,000, while the average
industrial property increased from $417,000 to $604,000.
As residential homeowners' property became a larger portion of the
city's total tax base, the homeowners have contributed a greater share
of the taxes.
So while the taxes on the average single-family home have increased by
72 percent over the past 10 years, the taxes on the average commercial
property have only increased by 42 percent and on the average industrial
property by a mere 18 percent.
Mr. Smith — whose Morton Avenue home went from an assessment of $177,000
to $237,000 in just one year — was frank when asked his reaction to the
escalating budget.
"They ought to get a kick in the (rear end)," he said of city employees.
Mayor Lang says he is aware of the problem with rapidly increasing
residential property taxes and said that the same phenomenon is
occurring in municipalities across the state.
"It's the most complicated problem I have because it has so many moving
parts," he said.
His first suggestion is for the city to grow its commercial and
industrial tax bases, he said, but he conceded that will take time.
The state and federal governments are going to have to help cities like
New Bedford out, the mayor said.
"This is a major problem with the way we're raising revenue in the
cities and towns in the commonwealth and across the country, and it has
to be changed," he said.
PATRICK'S PROMISE
In fact, escalating property taxes were a major issue in the recent
gubernatorial campaign. Gov. Deval Patrick, a Democrat, argued that it
was more important for the state to provide property tax relief than it
was to roll back the state income tax from 5.3 percent to 5 percent, as
Republican Lt. Gov. Kerry Healey had suggested.
Mr. Patrick has yet to unveil his property tax plans, but since he
announced the state is facing a $1 billion shortfall, he has backed off
a recommendation to boost local aid.
Michael Widmer, president of the Massachusetts Taxpayers Foundation,
said there is "a very close connection" between the levels of the local
property tax and the state income and sales taxes.
"The reality is, there's no easy way to provide property tax relief
without a major restructuring of the income and sales taxes," he said.
Mr. Widmer, however, said raising state taxes is a "non-starter"
politically.
As for Gov. Patrick's suggestion that increasing local aid could reduce
property taxes, Mr. Widmer said that will work only if the state
mandates reductions in the tax levies by the cities and towns.
The tax levy is the amount of revenue a city or town raises in order to
pay its bills. Unless the levy is reduced, the cities and towns might
use the increased local aid to simply spend more money, Mr. Widmer said.
"You'd have to lower the levy limit by the amount of the additional
aid," he said.
PROPOSITION 2½
Twenty-six years ago, Massachusetts faced a property taxpayer revolt
when Citizens for Limited Taxation, through the initiative
process, successfully forced the Legislature to control the rate of
property tax growth.
The result was Proposition 2½, which caps the rate that a community's
tax levy can grow in a given year by 2½ percent (with the exception of
any taxes generated by new development).
Barbara Anderson, the woman who led the CLT revolt, said she does
not believe the property tax situation is as desperate as it was in
1980. She noted that the state is currently ranked 12th in property tax
burden while 26 years ago it consistently ranked between first and
third.
Ms. Anderson said that citizens, through the initiative process, can
theoretically enact what's called a tax "underride." An underride would
force a municipal government to reduce the overall tax levy. A lower tax
levy would mean that less taxes would be raised and property tax bills
would then decrease.
Though Springfield and Newton have tried unsuccessfully to pass
underrides, no city or town has passed one.
Peter Barney, the manager of the city Assessors Office, said communities
fear that it would cause a fiscal disaster.
"You would lose your opportunity to take care of emergencies or anything
else," he said.
Ms. Anderson said the revenue problems in Massachusetts go beyond
property taxes.
She said the Legislature has refused to implement the voter's
instruction to reduce income taxes and that Gov. Patrick has expressed
support for new spending programs.
"I think we're looking at a major disaster, and property taxes will be
just part of it," she said.
The Attleboro Sun-Chronicle
Thursday, January 11, 2007
Seniors' burdens Rehoboth priority
By Jon Alexion
REHOBOTH - One selectman becomes both angry and sad when discussing one
of the many issues facing Rehoboth residents.
And that is the inability of senior citizens to continue to afford
rising property taxes, Selectman Albert Berry says.
Many senior citizens own property in town, but rising taxes are forcing
many to move into low-income elderly housing, Berry said.
"That's a tragedy," he said. "And these are the seniors who supported
the town and school with their tax dollars."
Rising property taxes aren't just a Rehoboth problem. But out of a
population of 11,448, a total of 2,112 Rehoboth residents are senior
citizens, and they're feeling the effects of rising taxes, Berry said.
The average property tax bill is $4,000 with an annual increase of $240.
Berry said that might not seem like much, but seniors on fixed incomes
have to decide between daily living expenses and their homes.
Property taxes are what mostly fund the school and public safety
budgets. And they may continue to rise even with the tax-limiting law,
Proposition 2½, in place.
"Proposition 2½ has caught up to us," Berry said.
In response to the fiscal bind, selectmen agreed in the fall to petition
the Legislature for more aid. Berry said the letter is drafted and he
plans to discuss it at a future selectmen meeting.
Included in the petition will be information on how many towns and
cities in the state can't function under the constraints of Proposition
2½, Berry said.
The town's budget has grown from $8 million to $20 million a year over
the past two decades, he said, but many of these expenses are
non-discretionary, such as employee health insurance.
Also federal and state requirements for building inspections after the
2003 Station nightclub fire in Rhode Island are "far more
sophisticated," Berry said.
Another issue facing the town is the condition of its municipal
buildings. Both the public safety complex and town hall are in need of
renovations.
One of the reasons that residents twice voted down an increase in taxes
to fix the public safety building is because of older buildings projects
that went awry, Berry said.
"Taxpayers remember the school and senior center projects. They're
saying, 'Is it going to be done right this time,'" Berry said.
After the senior center was built, many things, including lighting and
refrigerators, didn't work.
Local education performance is another issue.
Beckwith Middle School has four years to improve its math MCAS scores.
And Palmer River has four years to improve its English language arts
MCAS scores.
If, in 2010, the MCAS scores are still in the "needs improvement"
category, the schools faces intervention under the federal No Child Left
Behind Act.
Another issue facing the town is its water supply.
Bristol County Water Supply, serving Rhode Island, takes Rehoboth water
from Anawan Reservoir, but the town isn't compensated.
The town's water commissioners are closely watching the amount taken.
The Pembroke Mariner
Thursday, January 11, 2007
Taxes explained
By Sarah B. Wolfgang
Tax bills this year are higher than last year’s, and some residents are
confused, because real estate values have gone down.
According to Chief Assessor Maureen O’Connor, a big chunk of the tax
bill this year is going toward paying down the $2.9 million debt
exclusion for school renovations. For the average Pembroke home that’s
valued at $400,000, the owner will pay $4,164 in property taxes — $448
of which will go toward the debt exclusion.
“That’s the bad news,” O’Connor said. “The good news is that we’re
working toward paying it off. We thought 2008 would be the big year, but
this year is, and next year the debt exclusion will be less. But that
doesn’t necessarily mean that taxes will go down.”
Tax bills were issued Dec. 31, so as many people now know, the uniform
tax rate is $10.41 for each $1,000 of assessed value, and $1.12 of that
is for debt exclusion — 10.8 percent. Last year, the rate was $10.24 for
business owners and residents, and the price tag for debt exclusion was
$1.9 million.
How it all works is that at Town Meeting, voters determine the level of
property taxation, as the assessors do not determine taxes. Town Meeting
decides how much money it wants to spend, which was approximately $50
million this year, and O’Connor and Town Accountant Mike Buckley figure
out from where that money will come. This year, funds totaling $23
million came from excise taxes, dog license and other fees and state
aid.
There was talk while Gov. Deval Patrick was on the campaign trail before
being elected that he would find ways to help cities and towns reduce
property taxes by providing more local aid and allowing communities to
raise revenue through measures like local meals taxes, but an aide for
Sen. Therese Murray (D-Plymouth) said that is not a definite yet and
will be discussed during a hearing at the end of February.
So the rest of the money — the levy — has to be raised somehow, and
that’s through real estate taxes.
O’Connor and Buckley looked at this year's property assessments that
reflect values as of Jan. 1, 2006, and are based on 2005 activity, when
the real estate market was much more active, and finalized the exact tax
rate. That rate is approved by the Department of Revenue, and the
residents get their bills.
The money from taxes then goes toward funding schools, paying for police
and fire services, maintaining roads, and funding other municipal
services.
Some residents have objected to the tax increase. O’Connor said they
come into the office to complain that high taxes chase people out of
town or that municipal workers are spending money foolishly or that
residents without children shouldn’t have to pay for the schools, since
they don’t have children in the schools.
That’s what belonging to a community is all about though, she said.
“We’re all chipping into one pot,” she said. “I don’t have anybody in
school now either. My daughter’s been out for 18 years. But thank God
when I did have my kids in school, people were paying their taxes. You
just can’t put that burden on the people who are using it. They can’t
afford it. It’s not a user’s fee; it’s a real estate tax.”
She said if people have questions, they should go to the assessor’s
office in Town Hall.
“I love my job, and don’t mind people coming in,” she said. “We’ll
explain it. We’d rather that we get the chance to explain it than they
talk to neighbors and maybe get the wrong idea.”
Tax payments are due Feb. 1. Right now until Feb. 1 is the period for
filing overvaluation applications.
The Boston Herald
Sunday, January 14, 2007
Local-option tax talk irks Patrick foes
By Casey Ross
Gov. Deval Patrick is pushing for new local taxes on meals and lodging
that could allow communities to rake in millions of dollars from
residents purchasing everything from a morning cup of coffee to a dinner
out for the family.
During a speech yesterday in which he suggested that campaign promises
to cut property-tax bills and hike local aid will have to wait for
another year, Patrick said he will instead throw his political weight
behind a local-option tax.
“I didn’t come here with a big bag of free cash,” Patrick said to
Massachusetts Municipal Association members at the Hynes Convention
Center.
Patrick yesterday outlined a broad array of initiatives to help local
communities pay for city services, including a plan to impose a “safety
fee” on convicted criminals to help pay for more local police officers.
The size of the fee has not been determined, but Patrick said he is
seeking to raise at least $10 million from the fee.
During last year’s gubernatorial campaign, Patrick promised to put 1,000
more cops on local streets, but yesterday he said that goal would take
several years.
Patrick also said he foresees only a modest monetary hike in state
assistance to cities and towns next year, with much of the increase
headed for local schools. That could mean an extremely tight budget year
in which many communities would need to seek assistance from the
local-option tax the governor is supporting.
Opponents of those taxes, which still need approval from lawmakers,
seized on Patrick’s comments as evidence that he will continually seek
to tax and spend heavily, regardless of whether Bay State families can
afford it.
“People should not be surprised that he wants to tax them at their local
Dunkin’ Donuts,” said Barbara Anderson, executive director of
Citizens for Limited Taxation.
“I guess this is what happens when (a governor) doesn’t take a
no-new-taxes pledge.”
But Patrick said his critics are oversimplifying his policies. He said
communities would be able to decide for themselves what goods and
services to tax and how heavily to tax them.
“A key point here is that this is not about (state government)
undertaking to raise anybody’s taxes,” he said. “This is about enabling
local communities to make judgments that are in their best interests
about how we create other revenue streams.”
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