What I said...at the Tax Hearing
On Monday, September 11, the Williamstown Select Board held its annual Tax Classification Public Hearing. Each year at the hearing, the board votes on various property tax related issues -- Will we grant an open space discount or a small commercial exemption? Will we have the same tax rate for commercial and residential properties? And will we adopt the state's Residential Tax Exemption program? Much of the discussion at the meeting was related to the Residential Tax Exemption (RTE).
This was my opening statement to a packed room - (it's been slightly edited).
I want to thank you all for your active participation in Town government. I have spoken a lot on this issue in previous meetings so I’d like tonight to be about you. I deeply appreciate that you are here tonight, that you are writing letters, that you are watching from home, and that you have called and talked to me. Our government doesn’t work without you!
I must admit, some of emails that we (the Select Board) received were hard to read…but, in the end, I read each of them several times. I recognized these were data too. That you were telling me things I needed to know. I got out my spreadsheet. I parsed your comments. I categorized them. In the coming weeks, I hope to address each one individually with your help. But in the meantime, for me, the comments fell into 4 categories.
Category 1: Status Quo. There is no demonstrated need. The flat tax is a good one. Don’t change a thing.
If you think about it, tax policy is a reflection of our community goals. I’ve heard our community say over and over again, that we need to be more affordable; that we need to be more equitable and diverse. I assume that means economic diversity too. And even if we believe that a flat tax is a good thing, that it’s a fair approach, we have indications that it’s not.
We know that wealthier home owners pay a much smaller percentage of their income on property tax than do those of lesser means. And much a smaller percentage of their overall wealth is tied up in real estate.
How do we know that property tax is really flat?
There are national and county data that clearly indicate that lower valued properties are over assessed, and higher valued properties under assessed. And preliminary local analysis, Williamstown local, indicates that over the past 5 years properties in the lowest decile were over assessed compared to higher valued properties. (This is preliminary analysis, we need to review these data, and confirm that they are right before we state them as fact.) This over assessment results in low value homes paying a higher tax rate!
Category 2: Questions
The comments in this group were either actual questions about how the RTE works which we need to address. But also, misunderstandings about the data, and about the impact, which we need to correct. Some were based on an email campaign that relied on faulty data from the Massachusetts Department of Revenue that wildly overstated the tax increase impact and the breakeven point.
Some comments in this group pointed out potential shortcomings of the RTE, like increasing taxes on rental properties or other unintended potential consequences.
We need to understand these shortcomings and negative consequences and determine if the imperfections in the RTE are better or worse than the imperfections in our current methodology. And we need to try to find ways to mitigate those impacts; such as a home rule petition to expand the RTE to include rental properties as some Cape towns have done.
Category 3: – Solutions, yay!
You all were coming up with creative ideas to help those in need, to improve our tax policies, to make our town more equitable and to strive for more affordable housing.
Great job! Let’s do these too.
Some are already underway like the low income exemption for the community preservation act tax. We have to be careful though, about understanding the magnitude and scale of some of these programs. And the possibility of success. They may not reach far enough. We need all of the programs to work together. And we need all of you to be engaged.
Category 4: Shut it down! We don’t need more divisiveness in Town.
I’d like to suggest that investigating where and what types of inequities might exist in town is not the cause of divisiveness. It merely exposes where we have work to do.
I want to assure you, that I don’t feel that I have been given any kind of mandate because I was elected to this board. I know I work for all of you. But my work will continue to involve analysis, shining the lights on issues, asking as many questions as I can and listening to you.
As a board member, I’ve been asked to give an up or down vote on the RTE. In order to that responsibly, we have work to do to not only understand the impact of the RTE but also the impact of the status quo.
Watch the whole meeting look under Select Board, in Municipal Meetings on willinet.org
Read the iBerkshires coverage: Sept 11 meeting
Listen to WAMC reporting by Josh Landes: Williamstown Tax Meeting