Springfield City Council Sets New Property Tax Rates

Dec 16, 2014

New property tax rates have been set in Springfield, Massachusetts.  For the first time in many years, the rates for both homeowners and business property owners have been reduced, as property values continue to recover from the Great Recession

       The Springfield City Council by a 7-6 vote Monday approved the new tax rates that councilors said sent a message that the city is business- friendly while still affording homeowners a small savings. The tax bill for the average single family home in Springfield will go down by $11 next year, according to the city’s Board of Assessors.

      The tax rate for residential property was set at $19.67 per $1,000 valuation, a decrease of 4 cents, while the commercial property tax rate was reduced by 27 cents to $38.77 per $1,000 valuation.

      City Council President Mike Fenton called it great news for all city taxpayers.

      "The council has worked diligently over the course of the last five years to make sure we are right-sizing government."

      The new property tax rates approved by the city council are identical to what was recommended in a position paper issued by the Springfield Chamber of Commerce, which represents 500 business owners in the city.

        Chamber executive director Jeff Ciuffreda said he was pleased with the vote.

      "I think they did hear it is an economic development vote," said Ciuffreda. " It sends a signal to the business community that they are important to creating jobs and important to this city."

      The new rates maintain the same gap as this year between the residential and business property owner’s shares of the total tax levy.  Commercial property accounts for 27 percent of the city’s total assessed valuation, but the owners of that property pay 42 percent of the total property taxes the city collects.

   " We think the load right now is as big as it should be and we would like to remove a little of that," said Ciuffreda.

    Springfield Mayor Domenic Sarno had recommended the city council approve tax rates that would have meant a 10- cent rate reduction for homeowners and an 11- cent decrease in the tax rate for businesses.

          Council Finance Committee Chairman Tim Rooke, who made the motion for the tax rates that were approved, said under the mayor’s proposal 58 percent of single family homes would have a lower tax bill versus 55 percent as a result of the rates that have been adopted.

     " The difference is miniscule," said Rooke.  " The message is we will work with the businesses. I would rather have a resident working than sitting in his house."

     City Councilor Tom Ashe, who voted against the tax rates, said he was mindful of the impact on senior citizens and others on fixed incomes.

   " The gap is not huge, not a big number, but it did provide relief to that many more residents and that would have been my preference."

      Councilors held three sparsely-attended public hearings leading up to Monday night’s vote to set the tax rates.  Richard Allen, the city’s chief assessor said the new rates had to be set to keep a tight schedule to mail tax bills by the end of the month.

       The total assessed value of taxable property in Springfield is $7.045 billion, which is slightly higher than last year and still well below the record $7.8 billion in 2008. 

  Property values in Springfield plunged after the Great Recession as the city endured one of the highest foreclosure rates in the state.

       The city is looking to collect $176 million in property taxes next year, an increase of  just over $3 million from this year.