Mayor to offer tax tradeoff

Putting pressure on the Legislature to act, Mayor Thomas M. Menino today will introduce a proposal to reduce Boston's property taxes $200 a year for the average homeowner if the Legislature gives the city the ability to impose a 1 percent meals tax and a tax on telecommunications companies.

Two Menino administration officials said yesterday the mayor will disclose his initiative today at the 75th annual meeting of the Boston Municipal Research Bureau, an event Menino often uses to unveil major proposals. Last year, Menino said at the luncheon that he wanted to build a 1,000-foot tower on the site of a city garage downtown.

Governor Deval Patrick has thrown his support behind giving Boston and other municipalities the option of both a local meals tax and a telecom tax as a way to reduce property taxes, a centerpiece of his campaign last year. Menino has long favored both, but House Speaker Salvatore F. DiMasi, a Democrat who represents Boston, has consistently opposed the idea because he doesn't want to increase taxes. Such local-option taxes need the approval of the Legislature, which has traditionally been loath to share its taxing authority because it fears fiscal imprudence by cities and towns.

Menino's proposal, however, will put added pressure on the Legislature by designating the entire revenue from a meals tax and a telecom tax -- estimated at a total of $35.5 million for Boston -- to go toward cutting property taxes. Single-family homeowners's property taxes in Boston have soared 78 percent since 2002 as healthcare and pension costs for municipal employees have risen. Last year alone, the average single-family tax bill rose 12 percent to $3,091. A $200 cut would represent a 6 percent decrease for fiscal 2008, which ends June 30.

A city spokeswoman declined to comment.

Menino has unsuccessfully lobbied Beacon Hill for years to broaden Boston's revenue base by allowing local-option taxes. The city gets 57 percent of its revenue from property taxes, far more than other big cities around the country. A report by the Boston Foundation released this month found that Boston is at a competitive disadvantage compared to cities such as New York, Chicago, and Atlanta, which have more diverse income streams that give them greater flexibility to make investments and support economic development. In the six other cities cited in the Boston Foundation study, the percentage of revenue coming from the property tax is less than half that in Boston.

A 1 percent meals tax, as recently proposed by Menino, would raise an estimated $20 million a year, one city official said. A tax on telecom companies such as AT&T and Verizon would end a longstanding tax exemption for property such as telephone poles, lines, and other network equipment and raise an estimated $15.5 million for Boston and $140 million statewide. The restaurant and telecom industries have both long opposed both taxes.

If Boston can apply the new revenue to property taxes, it would be the first time since Proposition 2 1/2, which limits the increase in a community's property tax revenue to 2.5 percent a year plus revenue from new construction, was approved in 1980 that the city would not raise property taxes the annual maximum, the city official said.

Menino is also expected to unveil an initiative today to recruit national and global companies to Boston. A city official said the new, nonprofit recruitment effort will be privately funded and be headed by Mark Maloney, who recently stepped down as head of the Boston Redevelopment Authority. The new office will be empowered to offer companies below-market loans of up to $2 million, the official said.

Steve Bailey can be reached at bailey@globe.com.