Property taxes rise 9.2% in city

Property taxes in Boston are set to rise for the fourth straight year, city officials said yesterday, increasing the average single-family homeowner's tax bill to $2,750.

The average bill is 58 percent higher than it was in 2002.

Under the new tax rates that city officials are expected to present to the state Department of Revenue for approval next week, the average tax bill in 2006 will be higher than this year's by 9.2 percent, or $230.

It is the first time since 2003 that the increase for the average single-family homeowner will be less than 10 percent. The calculation is based on a house worth $368,459, city officials said, and includes a $1,344 reduction for homeowners who live in the property they own.

''It is a continuing struggle we have with tight budgets to keep taxes as low as possible," said Menino. ''Because of growth in our city we're able to give the taxpayers of Boston the lowest increase in four years. I will continue to fight for taxpayer relief at the State House."

The residential tax rate is expected to be between $11.10 and $11.15 per thousand of assessed value for residential property, up from $10.73 this year, according to city Assessing Commissioner Ronald Rakow. The commercial rate is expected to be between $30.65 and $30.75 per thousand of assessed value, down from $32.68.

Homeowners property assessments grew about 8 percent. Commercial values rose almost as much, by 7 percent, helping to prevent a larger increase in the average homeowner's tax bill.

In previous years, residential taxes have had sharp increases, in part because commercial values fell or stayed steady while houses increased in value.

As the commercial share of the city's overall tax revenue shrank, residential taxes had to increase to raise the necessary revenue.

Boston homeowners have absorbed a huge increase in their tax bills since 2002, the last time the average homeowner's property tax bill decreased over the previous year. The average property tax bill rose 13.4 percent in 2003, 14.4 percent in 2004, and 11.6 percent in 2005. The average bill in 2002 was $1,740.

Boston property owners who live in the buildings they own will also be able to take advantage of a residential exemption worth $1,344, up from $1,222 this year.

The growing tax bills became an issue in this year's mayoral election, with Menino rival city councilor Maura Hennigan accusing Menino of failing to do enough to keep taxes low.

''Sadly, we're seeing what I spoke about in the campaign come to pass," she said yesterday. ''People need to realize that the city doesn't have to tax people to the maximum."

''Given the extraordinary costs of heating, in addition to the tax bills off the charts, the city needs to think of a way to provide some relief, " she said.

Samuel Tyler, president of the Boston Municipal Research Bureau, said taxes in Boston are still considerly less than in most surrounding cities and towns. The average tax bill statewide, he said, was $3,589 last year.

''It's a reasonably good deal," said Tyler. ''The average residential tax bill is significantly less than the statewide average and certainly less than most of the communities surrounding Boston. Given the fiscal constraints, city residents receive a good array of services."

According to Rakow, the assessed value of all city property, $74.74 billion, increased 7.9 percent over this year. The values are calculcated as of January 1, 2005.

Three-family houses saw the largest increase, 8.6 percent, followed by two-families, which increased 7.5 percent. Single-family houses and condominiums rose 5.6 percent each.

The value of new construction is $1.34 billion, including $696.2 in new housing.

Rakow said the average residential tax bill would have been much lower if the city had been able to shift more of the tax burden to businesses.

In 2003, Menino helped push a bill through the legislature that gave businesses a bigger property tax share, but the law phases out over five years, gradually returning more of the burden to homeowners. If that phaseout didn't occur, Rakow said, the average homeowner's tax bill would have gone up less than 3 percent.

In addition, Rakow said, proposed legislation that would close tax loopholes for telecommunications companies has languished at the State House.

Had that bill been enacted this year, Rakow said, telecommunications companies would have paid an additional $42 million in taxes to the city and the average residental tax increase would have been only 2.5 percent.

The next quarterly tax bills will go out at the end of December, Rakow said