Hub's none too taxing

17 December 2004

Furious at news of yet another exorbitant increase in property taxes, I resolved to move out of Boston.

How about Framingham? That sounded good. But a $300,000 home there pays about $5,000 in taxes, while in Boston it's $3,045.

OK, scratch that.

Quincy, then. Borders Dorchester, has a nice urban feel, and you even get your own city councilors.

And pay $1,700 more each year.

Medway? Newton? Chelsea? Brockton? All have tax rates higher - some much higher - than Boston. Moreover, because Boston is one of the few municipalities to cut homeowners an extra break (the residential exemption saves another $1,110), its taxes can be even lower.

In fact, when it comes to property taxes, Boston is the Costco of the state's cities and towns - 90 percent of which have higher rates. Living here is a bargain.

Of course, when you're accustomed to shopping at Costco and the prices jump, you'll complain. And that's the problem that Mayor Tom Menino faces right now.

The city expects that the average residential tax bill will rise slightly more than 10 percent next year. That's on top of last year's increase of 14 percent. It could have been worse. Absent state legislation earlier this year that temporarily shifted a higher tax burden onto businesses, homeowners would have seen increases of 40 percent.

Menino worries that such dramatic hikes could drive out the middle class. But where would they go?

The real issue, of course, is political. No one likes tax hikes, and when they happen, they blame the guy in power. There's an election next year and Menino's likely challenger, Councilor Maura Hennigan, is sure to attack.

Menino knows well the power of taxes and fees to move votes. His handlers still recount with glee the summer of 1993, when then- acting Mayor Menino faced a crowded field. Water and sewer rates were due to go up 11 percent. Menino dramatically imposed a "freeze." The press was laudatory; residents were thrilled. Other candidates then erred by questioning whether he had the authority to freeze rates. That, of course, only helped Menino, casting him as the defender of the people.

From that perspective, this year's tax rise seems strikingly ironic. Indeed, Menino just quashed a proposal by Boston's water and sewer commission to raise rates. But when it comes to property taxes, things aren't as easy. The tax formula is governed by state law and the assessing process is largely immune from political pressures. As the values of commercial properties have fallen, residential values have risen, meaning that homeowners see higher taxes even as businesses are paying less.

Of course, Menino could reduce the burden on residents if he spent less. He has bought some measure of union peace in the last few years through hefty increases for city workers. Those - combined with state aid cuts - have already forced him to trim departmental budgets. The prospects of finding new, short-term savings are decidedly slim.

The prospects for new revenues are also slim. City Hall again this year has raised a cry for higher payments from Boston's nonprofit institutions (which are exempt from property taxes) and argued for a local meals tax. There may be some money there, but not enough to make a difference.

All of which means that property taxes will go up in 2005 and people will be upset. How upset? If they had doubled, Hennigan might well be measuring curtains for her new offices. Even with a smaller hike, she may want to make a freeze proposal of her own - and put Menino in the same position he put his opponents in 1993.