Boston Mayor Michelle Wu’s tax shift bill blocked for third time in Senate, where top lawmaker suggests killing the plan
A South Boston Democrat bashed the city’s “campaign of fear and manipulation” while blocking Mayor Michelle Wu’s bill to hike commercial tax rates for a third time in the Senate, and a top senator suggested it was time to formally kill the plan.
State Sen. Nick Collins for the third time used a procedural tactic Monday to delay action on the mayor’s controversial bid to tax businesses beyond the state limit, saying that the final state Department of Revenue-certified data released by the city last week shows homeowners aren’t facing the steep tax increase that has been cited by city officials for the past seven months, and served as the reasoning behind the bill.
“Now we know the sky isn’t falling, and the campaign of fear and manipulation that took place and continues to take place is a farce,” Collins said. “I am fully in favor of tax relief for homeowners in Boston. I think the City Council should cancel their planned three-week vacation and get this matter right before the end of the year. I stand ready to support a home rule petition to do just that.”
Councilor Ed Flynn, an ally of Collins who was the lone councilor to vote against the mayor’s plan, filed a resolution to schedule an additional weekly city council meeting on Dec. 18 to discuss property taxes. The Council’s last weekly meeting is scheduled for this Wednesday.
While Collins made the move to delay action on the plan, another Boston Democrat, Senate President pro tempore William Brownsberger, took the matter a step further, by saying the chamber should move to formally set the bill aside, to end uncertainty as the city prepares to set tax rates on Wednesday.
“Numbers matter,” Brownsberger said. “Now that we fully understand that Boston taxpayers are not looking at a 33% tax increase, but rather a 10% year-over-year increase, it is clear that we should lay this proposal aside.”
Brownsberger added that he’s “always had strong reservations about this proposal to alter” local tax classification rules “in an ad hoc manner.” He also cited the “difficult adjustment” that is occurring in Boston, where the days of robust downtown growth that have allowed for a steady increase in municipal spending without burdening residential taxpayers now “appear to be coming to an end.”
Referencing the economic factors that sparked the mayor’s plan, and fueled its criticism, in terms of falling commercial property values and vacant office space pushing more of the city’s tax burden onto homeowners, Brownsberger said, “this year’s relatively modest proposed tax increase, or necessary tax increase, appears to be in light of what’s coming, a reasonably phased step in a painful process.”
“Boston needs to set its tax rates for fiscal 2025 and I feel that we should end any uncertainty and formally set this bill aside so that the city can move forward and know that they have to set their tax rates without it,” Brownsberger said.
State Sen. Peter Durant, a Spencer Republican, said he supported the motion to delay the bill, stating that while his district is far from Boston, the plan will have “wide-ranging effects” on the state’s economy.
Boston Democrat Liz Miranda spoke favorably of the bill, however, saying that it was necessary “to protect residential property owners and tenants from what I believe is a property tax increase that to some feels like the sky is falling, and to protect our low-income seniors and our most vulnerable homeowners.”
The latest delay comes as the Boston City Council is expected to vote to set tax rates for residential and commercial property owners on Wednesday, following a hastily scheduled second hearing on tax classification.
City Assessing Commissioner Nicholas Ariniello told councilors at last week’s hearing that he would recommend they set a tax shift at the standard state maximum rate of 175%, should the Senate not approve the mayor’s plan on Monday. The bill seeks to give Boston the authority to tax businesses beyond that max rate for three years.
This past week’s drama over the mayor’s bill has centered around the release of city valuation data following certification from the Department of Revenue last Wednesday, that shows homeowners won’t be hit with as much of a dramatic tax increase as originally estimated by the city. Ariniello had refused to provide councilors with the data last Tuesday before it was certified by the state. Collins cited the lack of that data as his reason for blocking the bill a day before in the Senate.
The finalized data, released Wednesday night, prompted the four business leaders who withdrew their opposition to broker a compromise with the mayor — at the direction of Senate President Karen Spilka — to consider pulling out of the deal. The compromise was contingent upon the bill’s passage resulting in a tax increase for homeowners that was in line with the average hike of 9% over the past five years.
Rather, the latest city valuation data, which tax rates are dependent upon, show that the annual tax increase with the legislation would be about 5%, while the average single-family homeowner would see a roughly 10% year-over-year increase should it fail, or a hike in line with the past five years.
In October, the city had been projecting a 14% annual increase for homeowners and 28% quarterly hike in January, the latter of which now stands at 21%.
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Mayor Wu countered a statement from the four business leaders by saying that she was “in disbelief that some may be looking to negotiate or walk away from a deal that was settled a month and a half ago,” while arguing that the finalized data shows valuations and tax hikes that were with the city’s original range of estimates.
The mayor made a last-ditch effort over the weekend to drum up support for her tax plan, and was bolstered by a letter circulated by a number of Democratic ward committees that urged senators to approve the bill, to provide relief to homeowners. Those efforts appear to have failed.
Wu wrote a letter to the four business leaders from the Greater Boston Chamber of Commerce, Boston Municipal Research Bureau, NAIOP and Massachusetts Taxpayers Foundation on Sunday, doubling down on what she sees as the drastic need for the bill — which she says is proven by the latest numbers.
“The certified numbers confirm the need for this stabilization,” Wu wrote. “Without legislation, the annual increase for the average single-family home would be the second-highest annual increase since 2010, and the jump in the residential share of total taxes would be the highest single-year increase since 2007.
“This would be a significant burden of compounding high tax increases for families and especially seniors struggling to afford to stay in Boston,” Wu said.