50 towns tackle property tax hikes

With little relief anticipated from Beacon Hill, 50 Massachusetts towns are considering property tax hikes to close budget holes brought on by increased health insurance premiums, special education costs, government salaries, and other local expenses.

Voters this month will be asked to approve property tax hikes ranging from $750,000 in Dartmouth to pay an injured officer's medical bills to $5.2 million in Saugus to save the library, 18 teachers, and four police officers from the budget ax.

The state's Proposition 2 1/2 law, passed in 1980, limits annual increases in a community's tax levy to 2.5 percent, requiring voter approval for property tax increases above that level. Across the state, the limit puts into focus two deeply contradictory themes: the steadily increasing demands of local governments to pay for services, and the weariness of property owners fed up with their taxes, which averaged $4,007 for a single-family home in the current fiscal year.

Last year, voters rejected 59 of 89 override proposals, marking the lowest approval rate statewide since 1999. The average override attempt was about $630,000 last year.

This year, the average request is $1.9 million among the 25 towns that have scheduled votes; a similar number of towns are considering votes but have not formally decided.

The average request does not include overrides used to pay off debt, formally called debt exclusions, which are as high as $20 million.

The property tax override requests follow what many local officials say were disappointing local aid figures in Governor Deval Patrick's proposed budget for the coming fiscal year, which starts July 1. With a long legislative debate over the state budget still unresolved, local officials say they can't wait on promises of property tax help from Beacon Hill.

"We're hopeful, but we need to take care of things ourselves," said Charles Clark , chairman of the Rockport Board of Selectmen. A Town Meeting vote is set there for April 7, followed by a townwide election May 8, on a proposed $782,000 override. "The state has promised a lot in the past and hasn't quite delivered. Cities and towns can't be held hostage to that. They have to get their own houses in order as best they can."

The override measures are dividing communities and often pit town departments against one another because some of the ballot questions allow voters to pick specific increases for areas such as schools or public works. A dozen or so community blogs and e-mail discussion lists have sprouted up, and advocates both for and against tax hikes have held protests and rallies on town commons and on Beacon Hill. "I have kids in the system, but I need to make sure I can pay for the roof over their heads and keep them fed," said one anonymous Walpole poster on a message board at walpolenews.com, in response to pleas that voters say "yes" to the $3.9 million override that was on the ballot yesterday.

Another poster suggested that an opponent of the override "won't be happy until all 3,800 of our school children are all huddled together in one unheated, unlit auditorium learning from 20-year-old textbooks supervised by one teacher who reports to one administrator."

Late last night, Walpole town officials said that voters had rejected a proposed $3.9 million override, primarily to fund school costs.

"Proposition 2 1/2 is failing us," Joseph Denneen, chairman of the Walpole Board of Selectmen, had said earlier in the day. "The increase that is allowed by Proposition 2 1/2 does not even cover the increases in medical insurance premiums for our employees. So right away, before you're even talking about funding a contract or giving someone a raise or buying a new pickup truck, you're in the hole."

In Scituate, voters approved two of the five override questions on their ballots and defeated another two. The results of the fifth question, to raise $3.5 million for a fire station -- were too close to call last night.

Also yesterday, residents in Harvard agreed to place two override questions on this Tuesday's ballot.

In Saugus, the $5.2 million override proposal on the April 24 ballot is likely to be the state's largest ballot measure this year. Peter A. Rossetti Jr., chairman of the Saugus selectmen, said unexpected increases in healthcare costs are the primary reason.

"We had some unusual situations where a number of employees had claims that far exceeded what had been budgeted," he said. "That dried up available funds and put us into a deficit situation."

In addition to state aid drying up, there are other local pressures adding to the strain communities are facing.

"Communities are telling us the slowdown in the housing economy is having an effect on local revenues," said John Robertson , deputy legislative director of the Massachusetts Municipal Association. In addition to stagnating property tax values, the slowdown means less revenue from building permits.

Some towns are returning to voters this spring despite recent override rejections. In Lexington, where officials are pondering an override as high as $4 million this spring, voters rejected a pair of overrides for schools totalling $3.2 million last year.

Randolph voters haven't passed an override in 25 years, and they saw no need to end the trend this year. They rejected a $4.1 million tax increase last week. Dartmouth, where officials say they need a $750,000 tax increase to pay for an injured officer's medical bills, is returning to voters after they rejected an identical request last year.

Fear of a political backlash led Natick officials to hold off on placing a $2.1 million override before voters this year. Officials will draw from reserve funds and put off capital projects to balance the budget, but the delay just means an even larger override measure likely will have to go before voters for the 2009 budget year, town officials said.

Voters in nearby Newton approved plans for a new high school this year, but its mayor is vowing to avoid a property tax override.

Some communities, swamped by new spending demands, are trying new tactics to make them more appealing to voters.

For example, in 2005, Arlington's override proposal included a larger fiscal plan that included a vow to control spending and a promise to not place another override on the ballot for five years. The effort passed.

This year, Amherst is making its $2.5 million override proposal part of a three-year financial plan, and officials in Shrewsbury, which is seeking a $5 million tax hike, also have vowed not to ask voters again for three years if the measure passes.

"You're going to see communities start to package these things, to make a commitment to voters that this isn't all about an override," Robertson said. "It's about constraining spending."

Other towns are hedging their bets, placing a "menu" of override proposals on the ballot, allowing voters to agree to pay higher taxes to fund school salaries but not, for example, additional police officers, rather than lumping all the town's needs into a single up-or-down vote.

Kingston officials have placed five questions on the April 28 ballot this month, splitting up elementary schools, the high school, police, public works, and general government expenses. The requests total $1.6 million.

During last year's campaign for governor, Patrick promised some relief from property taxes and help to cities and towns to raise more money in other ways.

As governor, he has proposed allowing communities to assess a $1 or $2 tax on meals and hotels; eliminating the exemption on property taxes enjoyed by telecommunications companies for their poles and wires on city streets; opening up the state Group Insurance Commission to local government employees; and changing the way pensions funds are invested and administered. For taxpayers, Patrick wants to expand a property tax credit for low-income seniors to include homeowners of any age.

Patrick has proposed a $312 million local aid increase, about 5 percent over this fiscal year.

"We've increased local aid, but not to the amount we would have liked," said Lieutenant Governor Timothy P. Murray . "We are working on a series of short-term efforts to get more money to the cities and towns."

Looking at the tax increase requests across the state, Michael Widmer of the Massachusetts Taxpayers Association said communities have little reason to expect a windfall in state revenue. "There is very little chance of any significant property tax relief in the near term," he said.

Some local officials say Patrick's measures would be helpful but the problems are more fundamental. They cite the Chapter 70 education funding formula, which they say does not send enough school money to towns and cities, and the sharp limitations imposed by Proposition 2 1/2 itself.

Robertson said that major changes in how local government is funded are needed to stave off the steady flow of tax hike requests. "Cities and towns do need something to make themselves more self-reliant and give them some tools to help themselves."

Barbara Anderson , executive director of Citizens for Limited Taxation and one of the state's leading proponents of Proposition 2 1/2, said towns seeking state tax reform are doing themselves a disservice by depending on overrides.

"It's so much easier to put an override on the ballot and whine about the fact there's not enough local aid, instead of fighting for reforms that will in the long run save the money," she said.

Christine McConville of the Globe staff contributed to this report. John C. Drake can be reached at jdrake@globe.com.