In attempt to control increases, Pittsfield city council hits pause on tax rate vote
At its meeting this week, the Pittsfield, Massachusetts city council debated where to set the tax rate for 2022.
At Tuesday night’s meeting, Assessor Paula King reported to the city council that Pittsfield’s stock is trending upward for fiscal year 2022.
“So our total valuation is right around $4 billion for the entire city,” said King. “And this is an increase of about 6.6% over all of our classes.”
A booming housing market contributed to the appreciation.
“In the single family, the class 101, we’re up $207 million, and this is a 9% increase overall,” said the assessor. And this is due primarily to the increased housing market sales.”
With a higher assessment for the city, so grows its ability to tax.
“This year's levy ceiling is $102,378,780,” explained King. “So this is the first time since fiscal 2015 where we see the ceiling actually exceeding our levy limit which allows us to have greater excess levy capacity. And as you can see, here, we have the excess levy capacity for fiscal year ‘22 in the amount of $5,318,635. And the difference, the way that you see that is through the actual levy, which is what we need to raise, and the levy limit. And as you see in fiscal year ‘21, that excess levy was at $4,255,933.”
That means Pittsfielders will see their taxes go up accordingly.
“The tax bill for fiscal year 2022 would be $4,121.67 for the average single family,” said King. “This is an increase of $196.57 or a 5.01% increase. If you want to kind of think about budgeting, you're looking at an additional $16.38 a month, or even taking it down to the week, it would be $3.78 additional a week.”
Talk of raising taxes prompted resistance from some city councilors, like Ward 4’s Chris Connell.
“In my opinion, the better solution is to use some more free cash, right, to reduce it in total,” he said.
Ward 2’s Kevin Morandi agreed.
“A lot of people are struggling and especially during COVID,” said Morandi. “Talk to some of the businesses and see how they're doing, and their employees that they had to let go or closed their place. And then we add in water and sewer rates- They've doubled.”
“I'm hard pressed to hear this argument that costs are skyrocketing and we have to do something. That doesn't make any sense given the items that are going up annually are totally out of our control,” said Ward 3 City Councilor Nicholas Caccamo. “These arguments that we hear tonight are broken records, they're hollow, they're tired, and they totally negate the reality of providing government service. And if all night we're just going to hear this idea of a 5% increase on the tax bill- That's not across the board, and that'll impact people differently at all ends of the socioeconomic spectrum. So this is a fair assessment given our obligations to this process and as the financial oversight for the city.”
Councilor Anthony Maffuccio of Ward 7 asked Pittsfield Finance Director Matt Kerwood if dipping into the city’s free cash – which Kerwood estimated stands around $3.3 million – would impact the rate.
“If we use a million dollars, would that reduce the tax rate by a percent?” asked the councilor. “Or would it-“
“It would,” responded Kerwood. “I'd have to run the numbers and see what it would what it would look like. I can't give you- it would reduce it by, you know, 44 cents. I just don't know the answer to that off the top my head. We'd have to run that analysis.”
Kerwood said that while dipping into free cash wouldn’t harm the city, it would offset long term plans to build reserves. Maffuccio wasn’t deterred.
“We should have some type of hard numbers in front of us on a hypothetical what 1% would cost,” said Maffuccio.
“I understand councilor, and I don't mean this to be disrespectful, but making us try to do this stuff on the fly is not helpful either,” said Kerwood. “If we had some idea of a conversation about a number, we could have prepared some scenarios.”
“Why, you could’ve prepared scenarios, because you knew we had 5% going up,” responded Maffuccio.
“No, don't, no, no, no, no, no,” said Kerwood. “I understand what you're saying, but again, communication is effective when it works both ways.”
“Somebody was going to ask the question about use of more free cash tonight,” said Maffuccio. “There could have been some hypothetical- no, actually, there should have been some factual numbers. I say that we vote to take a recess and see how much 1% would cost us in free cash.”
After the recess, the city returned with estimates for how much spending an additional million dollars in free cash would impact tax rates for single family homes. Spending $1.5 million in free cash is already baked into the city’s budget for fiscal year 2022.
“The scenario that's in front of you, with the additional million would take the increase from 5.1% to 3.88%, which is 1.2%- or 1.12%, excuse me- reduction in the percentage. So kind of right in the mark of where you were, councilor,” said Kerwood. “From $196.57 to $152.16, or a difference of $44.41 for using an additional million dollars in reserves.”
The tax rate vote was tabled until the council’s next meeting on November 23rd so that the city could provide a certified free cash number.