Three of the councilors-elect attended the meeting as did Mayor-elect Thomas Bernard.
NORTH ADAMS, Mass. — The owner of an average home will see her tax rate rise about $123 based on the City Council's approval of a fiscal 2018 tax rate of $18.38 per $1,000 assessment.
The council approved the split tax rate that will see the residential rate rise about 4 percent, up from $17.67; the commercial rate will rise about 3 percent, from $38.54 to $39.85 per $1,000 valuation. A single family home assessed at $138,300 would see another $123 on the tax bill.
The tax rate represents a reduction in the commercial shift from 1.73 to 1.71 to prevent the rate for businesses to rise above $40.
Mayor Richard Alcombright had recommended the slight shift, saying he had hoped to begin bringing the residential and commercial numbers closer when he was elected eight years ago.
"It's not big, it's more of a gesture," he said, echoing a statement by City Councilor Joshua Moran. "The unfortunate part is we're not seeing the growth that any of us had maybe hoped eight years ago, but we are seeing growth, and with that growth, we need to send a message to the business community that those who invest and who want to invest that we as a government are trying to make strides to help that out."
The fiscal 2018 budget is $39,955,755, up $501,072, or 1.27 percent. The tax appropriation, or levy, to fund the budget will be $16,906,230, an increase of 4.6 percent; the balance of the budget will be made up with revenues and state aid.
The shift determines how much more of the tax burden is carried by the commercial and industrial base up 175 percent.
If the shift was to remain the same, at 1.73, the tax rate for residential and commercial would be $18.24 and $40.32, respectively. The cost to the average homeowner would be $104. A single tax rate would be $23.30.
Total new growth was about $7.2 million, generating about $270,000 in taxes. Nearly $5 million was in personal property and another $2 million in industrial and commercial.
"A lot of what you see in the industrial is the solar arrays coming in, so we saw growth on the land side because its commercial and it gets taxed as personal property," Auditor Ross Vivori said.
In response to questions, he said he anticipated the projects along Route 2 and other ventures to contribute growth, particularly once those with tax financing agreements expire and they begin to operations.
North Adams had the fifth highest commercial tax rate in the state in fiscal 2017, with only Pittsfield ($39.78), at No. 2, the closest in the Berkshires. The next closest Berkshire town was Florida, at 46th with $27.53. North Adams was 95th lowest of the state's 351 communities in residential rates at $17.67.
Adams just set a commercial rate of $25.52 per $1,000 valuation. The mayor noted a business could buy a comparable building in the Mother Town and pay third less in property taxes.
The mayor said the city is about $90,000 under its levy capacity (the amount of taxes it can raise) and $1.3 million under its levy ceiling, or 2.5 percent of a community's real and personal property values.
City Councilor Keith Bona said he'd never shied away from the supporting the shift but residents shouldn't think that its just the Walmart-sized businesses being hit.
"There are a lot of mom and pops from the small manufacturers to the small retail, those are commercial buildings," he said. "The commercial rate is increasing far more than the residential rate."
Residential rates had increased about $6 over the last decade while at the same time, the commercial rate had jumped $12, Bona said.
Councilor Eric Buddington, however, said his approach to the tax rate was that "it should reflect people's ability to pay and I've looked at ways for the city to have progressive tax."
There wasn't an option for that, he said, and the property taxes as they are now greatly affect those with the more modest homes who are least capable of affording them.
Vivori said there are exemption programs of a few hundred dollars to help eligible veterans and senior citizens, and one for hardship, although he has had only one homeowner in the last eight years who truly qualified as a hardship.
"Those were probably developed in the '80s and those qualifiers haven't changed," he said.
Councilor Robert Moulton Jr., who noted as a local businessman he pays both rates, said his feeling was that seemed the shift was more to keep it off the $40 number.
"Most [businesses] can afford it," he said. "I think it's something that should be addressed but it's only a few dollars."
Larger businesses have gotten breaks through tax financing incentives, said Councilor Moran, adding he supported the shift at 1.71.
"The TIFs aren't going to small businesses, this is a chance to give them that break," he said. "We're trying to grow commercial business in the city at least it's in the right direction."
Buddington sought to amend the order to revert it to the shift to 1.73 but it was determined the order would have to be defeated so the mayor could submit a new one. Alcombright said he had come prepared with an order detailing the tax rates with the 1.73 shift.
But only Moulton joined Buddington in voting against the order; it passed on a roll call vote 6-2.
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