West Stockbridge — For a senior citizen in her 70s, who requested to remain anonymous, efforts by her town’s Select Board for financial help by way of a tax exemption can’t come too soon. “I have to take the money from my social security check to pay my taxes,” she said to The Berkshire Edge. “Now I don’t have money to pay my bills.”
The lifetime resident said her grocery bills are a problem, often relying on her adult children to sustain her. When she moved to West Stockbridge about 50 years ago, her annual taxes were $320, she said. Twenty years later, and in a new 980-square-foot home, those taxes were up to $620 per year, she said. Now, her property tax levies have skyrocketed to more than $5,000 annually.
If passed, the new exemption proposed at the January 22 West Stockbridge Select Board meeting would take $1,000 off her actual real property taxes, about 20 percent for this local senior homeowner. “It’s a help,” said the resident.
The proposal is the product of a group of four volunteers who found that the present-day property tax relief program for senior citizens is based on 2004 standards, the year it was adopted, said Sheila Thunfors, who spoke for the group via Zoom. That program only provides seniors ages 65 and up with a $750 exemption if the income levels for qualifying household members are less than $20,000 for single residents and $30,000 for a married couple. Since the program didn’t include increases allowing for rises in the cost of living, pursuant to the Consumer Price Index, the qualifying income ceilings have remained at 2004’s “really way outdated eligibility income level[s] of $20,000 and $30,000,” Thunfors said.
The group was tasked with researching other possibilities for senior exemptions. They returned with a proposed warrant for the adoption of an exemption of $1,000 off the actual property tax for 65-year-old residents, as a minimum qualifying age, and, currently, a $69,000 income eligibility level for singles or couples, the same income eligibility level as the 2023 Massachusetts “senior circuit breaker,” a state income tax credit offered to certain seniors over 65 years old who own or rent a home.
If the warrant providing for a $1,000 exemption for those 65 and up doesn’t pass in May, Thunfors proposed an alternative warrant item that would raise the tax exemption from $750 to $1,000 and start to add a cost-of-living increase each year for the threshold amount. “That would at least help a little bit,” she said.
Last month, Regional Tax Assessor Harald Schied presented information showing a spike in West Stockbridge home values of 5.2 percent for single-family homes year over year, with the average single-family home clocking in at $650,300 for fiscal year 2024, about $75,000 higher in valuation than the 2023 average value for the same home, resulting in a tax bill that is a little more than $300 above the previous bill.
According to Thunfors’s calculations, no more than 60 residents would qualify for the exemption that would create a loss of about $40,000 in the town’s coffers, with that calculation based on a state reimbursement average of $283 per taxpayer. Regional Tax Assessor Harald Scheid disagreed, however, and said state reimbursements for such exemption losses are around $500 per taxpayer, putting that shortfall at far less than $40,000. He said the town’s current overlay budget is around $30,000, funds that pay for resident tax abatements granted by the town and could be used to overcome the shortfall in income caused by the new exemption. Together with state reimbursements, Scheid said no additional monies would probably be needed to make up the difference between the proposed $1,000 exemption and the exemption that currently exists, with half of the proposed $1,000 exemption reimbursed to the town by the state.
Some folks don’t apply for tax exemptions, according to Scheid, either because they “lack [the] knowledge that [the exemption] is out there” or are intimidated by the application process. “We love our seniors and we’re very much behind any effort to support those on fixed incomes, aged people, folks that are struggling with their tax bills,” he said.
Promoting the new and existing senior tax benefits is the next step, Member Andrew Potter said, adding proposed state bills now in the legislature may provide extra help for seniors such as the Municipal Empowerment Act.
“In all my years, I’ve never seen a town meeting vote down one of these exemptions,” Scheid said.
Additionally, Potter proposed three warrant items including raising the local room, or excise, tax for hotels, motels, lodging houses, bed and breakfast establishments, and short-term rental units from four percent to the state-legislated ceiling of six percent. The last increase to the town’s room tax was in 1994, he said, with only West Stockbridge and Richmond remaining at the four percent tax rate out of southern Berkshire County municipalities, he said.
“I call this one, ‘clean up on aisle five,’” Potter said, adding that, if passed, the proposed Massachusetts Municipal Empowerment Act provides for a seven percent local room tax ceiling. “So maybe next year, we might be doing the same thing.”
The second proposal implements a three percent community impact fee on the total amount of rent levied on “the occupancy of a professionally managed unit,” otherwise known as a short-term rental. State law directs that at least 35 percent of the community impact fees collected must be dedicated to affordable housing or local infrastructure projects. However, the proposed warrant article provides for 50 percent of the community impact fees collected in West Stockbridge to go toward affordable housing or local infrastructure projects, with the other half of the collected fees dedicated to senior tax relief.
A third, and separate, warrant article makes the community impact fees applicable to short term rentals in a two-family or three-family home that also serves as the rental operator’s primary residence.
West Stockbridge’s Affordable Housing Trust provides for the creation of housing for low- and moderate-income households within its borders.
Essentially, should these articles pass, short-term rental owners could see their town payments more than double, from the four percent current room tax to nine percent, combining the proposed two percent increase in local room tax with the proposed three percent community impact fee.
“I don’t have the math in terms of the revenue that would come in [from the proposed warrants, if passed],” Potter said. “It strikes me as being fair.”
Town warrant articles will be finalized by the end of February before being submitted to town counsel for review and posted by the end of March or beginning of April, Town Administrator Marie Ryan said.
