Editor’s note: The Town Manager’s tax workshop is being rescheduled with possible dates of August 11 or 12 at 6 p.m. at the Great Barrington Fire station. The Edge will announce the date as soon as it is confirmed.
Great Barrington — While glorious Berkshire summers do not typically evoke thoughts of tax rates and Excel spreadsheets, Finance Committee Chairman Michael Wise’s tax reform ideas for a progressive residential exemption combined with a split tax rate are still very much in the consciousness of some.
In light of ongoing tax reform talk, Town Manager Jennifer Tabakin is tentatively planning to hold a “informational workshop” at Town Hall next Monday (July 27) at 4 p.m. (see editor’s note) to explain the basics of property taxes and Massachusetts General Law, but not in the interest, she has previously noted, of pushing Wise’s agenda.
Wise says he may, at some point, hold his own workshop, to explain his proposals and illuminate the results of his number crunching.
Tabakin made an attempt to get a state Department of Revenue (DOR) official to attend the workshop, but she announced last week that the DOR was unable to come. Wise said that town assessor Christopher Lamarre will lead the discussion, and that the Selectboard and Finance Committee will be present. Tabakin said she would have more details about the workshop at the end of this week.
In an effort, Wise said last fall, “to make Great Barrington more affordable,” hepro posed that the town look into adopting a progressive residential exemption combined with a split tax rate and other “tax relief” programs. The residential exemption is a tax based on assessed property value.
In Great Barrington, Wise made calculations that estimated the residential exemption would cut 11 to 20 percent off the property tax bills of 80 percent of the town’s households. Homeowners with homes assessed below around $470,000 would see a progressively lower tax rate, and since three-quarters of residences in town fall below that “break-even value,” as Wise calls it, “the effect is clear,” and would be concentrated in Housatonic Village and Risingdale, where “most tax bills would drop by at least 20 percent.”
Tax bills of median-value assessments of $294,400 would be cut by 11 percent. Homes near the break-even point of $470,000 — which Wise told The Edge he now thinks may be closer $500,000 — would not see much of a change either way, but “for the 100 high-end homes valued over $850,000, half of which are second homes, the tax bill would increase by 7 percent or more,” Wise wrote in his analysis.
Wise says he is “redoing spreadsheets to calculate this year’s numbers,” and to “let people know how this will affect them” in the event the Selectboard — which alone makes this decision on behalf of the town — decides to adopt such changes. Wise says it won’t happen this year; the tax classification hearing is August 28, and there’s too much to consider and public input to be had, before the decision gets made.
Wise will also calculate the residential exemption’s impact combined with and without a split tax rate, which he says would involve a “nominally” higher property tax rate for businesses.
The combination, he says, could give needed assistance to homeowners who need it, and still fill town coffers so as not to cut town services.
Wise concedes that both reform proposals have sticky elements that he has anticipated and is attempting to dissect, mainly that of people whose homes are valued at more than they can afford, or those on fixed incomes. The proposals have engendered a lively debate in the news media as well as on street corners and coffee shops.
Wise’s ideas sprang at least in part from last year’s failed attempt — the second in two years — to get Great Barrington voter approval to renovate Monument Mountain Regional High School. The issue highlighted the most frequent reason for opposition: a hike in what already seemed like high property taxes. Wise says that property taxes “feel higher here because family and household incomes are lower,” and that “in relation to median income, are the highest in Berkshire County.”
Another reason for all the fuss over a hike in taxes for the high school renovation is that Great Barrington pays a larger share for its regional schools than the other two towns in the Berkshire Hills district, Stockbridge and West Stockbridge.
Yet it is likely that at any meeting to do with property taxes, the subject of Wise’s proposed residential exemption and split tax rate will come up, though Wise says the Monday meeting is simply a “nuts and bolts” session.
Wise said that several residents were working on their own analysis of the impact of a residential exemption. The theme, Wise says he hears from them, “is that raising the taxes on expensive places will discourage second homeowners and business creators from relocating here.”
Steve Picheny is one of those residents. “The future of the town is getting people to move here and spend money and start businesses here,” he said. “Anything that flies in face of economic development is not good for the future of the town.”
Picheny is a retired businessman who has had a home in the Berkshires since the mid-1970s, and is part of an informal group that is working “ to find ways to get young people to move here, start businesses and bring up children here.” He was also the co-founder of Volunteers In Medicine (VIM) in Great Barrington.
He says he worries that such tax structure changes might also send the “wrong message” to second homeowners, “who spend money, pay a lot of taxes, and take very little in return.”
He said a split tax rate sends the message that the town “doesn’t want businesses.”
He made the suggestion that one way to ease the property tax burden is to more equitably divide the amount of money paid to the schools from the three towns, something that still weighs on both the town and the Berkshire Hills Regional School District, and is still on the District’s agenda.
Picheny, who lives in Florida half the year, noted that the town “has a very low incidence of people not paying their taxes and a low incidence of people who say they can’t.” He pointed to property tax abatements — always available — as a solution rather than a wholesale change.
“I’m willing to have my taxes go up to help people who can’t afford it,” he said.
Wise says there will be plenty of time for discussion. “The consensus is that there will be no change for this year, but detailed discussions about changes for the next year.” He added that policy for following year’s budget is set in September, and “there might be a decision to plan the budget based on a change in tax structure.”
Newly elected Board member Bill Cooke wrote to The Edge in May, saying that the residential exemption “will provide needed tax relief to a great majority of the homeowners in town, and will provide the most help to those of us with the fewest resources. I believe that, as a community, we have a responsibility to help our neighbors when we can.”
Cooke, however, does not endorse a higher tax rate for businesses.
Board member Ed Abrahams said that he’s leaning towards supporting a residential exemption if Wise’s “numbers are right,” but says he needs much more information, especially about the split tax rate. “I’m waiting for all these discussions we’re not having. The Selectboard hasn’t brought it up yet, and the Finance Committee hasn’t.”
Abrahams is concerned that the board’s decision on behalf of the whole town is a lot of power in few hands. “It’s a shame that five people are making this decision,” he said. “In Massachusetts, you can’t spend a dime without consulting the public. But we can do this.”
Great Barrington Assessor Christopher Lamarre could not be reached in time for this dispatch.
