Monday night, the Board of Selectmen reluctantly approved a residential property tax increase of 1.75% for 2012. In a meeting characterized by frustration and disbelief, Selectmen repeatedly questioned Chief Assessor Daniel Dargon on his numbers.
Under Dargon’s report, assessed home values will go up 3.33% for the average residential homeowner, even as property values have fallen significantly. With a higher tax rate, Dargon projected the average homeowner could see their annual tax bill increase by $364.74.
"I'm just flabbergasted,” said Chair Jason Smith.
"People are going to get killed with a tax increase this year," Selectman Charles Sisitsky said, noting taxes on his own house will go up 7% next year. "How are we going to explain this to people?" he asked.
Dargon said he was surprised himself when he saw the numbers, explaining he's used the same process for determining tax rates every year. He said the town uses appraisal guidelines set out by the state Department of Revenue. He also noted 2010 was an artificial market year due to tax incentives and low interest rates.
However, Smith came back to the same point again on assessed home values.
"I would expect a decrease because if I put my house on the market right now, I would be losing my shirt," Smith said. "And a lot of residents are in the same situation." Shaking his head, he said, "I can't believe we're doing this."
Sisitsky held his head in his hands as he listened, and Selectman Laurie Lee said, "It almost seems like we have a double whammy going on here with both the tax rate going up and the assessments going up.”
Dargon said one major difference in tax rates is losing more of the town’s commercial tax base, which ultimately affects the overall tax rate.
Selectman Ginger Esty pointed out businesses get tax breaks residents don't.
However, Smith said he has voted in the past to lower commercial tax rates because Framingham needs to be competitive with other towns. He believes bringing in more business tax revenue could lower the overall residential tax rate.
Dargon said property assessments are based on more than 100 factors. Among the mix is home sales during 2010, which included 450 sales out of just over 13,000 homes in Framingham.
"That's a very small sample to base the increases on," Sisitsky said.
Massachusetts does not allow those sales numbers to include foreclosures or short sales. Selectmen asked how the numbers would change if those sales were included and asked Dargon to look into it and report back to Selectmen.
During public comments, town meeting member Peter Pleshaw said, "Shame on town meeting members for increasing our taxes every year. . . .Where will it stop?"
In the end, Sisitsky said they had no choice but to shift commercial taxes to the maximum allowable in order to give the least impact to residential property owners.
"We don't have any options,” he said as he proposed a motion to increase the residential property tax rate by 1.75%, resulting in a tax rate of $16.96 for residential property. “That's the best we can do," he said.
The motion passed unanimously, though Smith added, "I do think, from a commercial perspective, that Framingham has lost its game."
Businesses will pay $37.96, per $1,000 in assessed value, up from $37.11.