Quincy city councilors on Monday voted to increase the average property tax bill on a single-family home by two percent, a number in keeping with Mayor Thomas Koch’s promise to keep any increase under $100.
Overall, they city's property tax revenue is expected to rise from approximately $168 million to $174 million, well below the Proposition 2 ½ threshold, which would have allowed the city to increase the levy by another $20 million this year.
The city will also keep the tax split of 175 percent burden on the commercial base. With a slight increases in commercial values and slight decreases in residential values, that shift will ultimately save the residential taxpayer $2.63 per $1,000 of assessed value.
“The effectiveness is you’re taken the burden of the residential tax owner. We’re maximizing the benefit of the homeowner at the expense of the commercial landowner,” Council President Kevin Coughlin said.
Under the figures approved last night, property tax rates will rise to $13.75 per $1,000 assessed valuation this fiscal year from $13.42 last year for residential taxpayers, and to $28.66 from $27.85 for commercial properties.
For the average single-family home, the resulting tax bill is expected to rise to $4,469 from $4,372.
The limited tax rise comes after two years of no tax increases, a fact “unprecedented and unmatched” in the commonwealth, said mayoral spokesman Christopher Walker.
Quincy is also among the top three towns in the state with the largest excess levy capacity – or the unused amount of taxes that the city could have levied under Proposition 2 ½.
Only Cambridge, with an excess levy of $99 million, beats Quincy’s $20 million. Marlborough was a close third.
Although the excess levy means that the city government can increase taxes up to that $20 million mark going forward, city officials said residents shouldn’t be worried.
“We want to make sure [residents] don’t think of it as an implied threat,” said Chief of Staff James Fatseas. “If we wanted to, we could raise [taxes that much]…that’s not the intention. But should there be a catastrophic issue, should there be a reason…we are not up against Prop 2 ½ or pressed up against levy capacity. That is a favorable situation when our bonding agencies come to take a look at us, and it helps with our credit rating.”
Although the city said the budget is still well below the levels of two years ago, the cuts made this year to sustain the limited tax increase will not affect services.
Most notably, the city has been able to save money by switching to GIC insurance, Walker said.
“I don’t think we’d be able to make this happen without such a substantial thing [as the GIC],” Walker said. “If you look nationwide, cities and towns are fighting over this thing. But here in Quincy, we sat down at the table and came up with a plan savings tens of million of dollars. It’s a large part of where we got here today.”
Elsewhere, the city reduced the budget for long-term debt interest by $54,844, reduced department budgets by a total of $617,337 (all reduced by the number of money not used in the year prior), and reduced health insurance expenditures by $1.4 million due to the EIC.
Additionally, the city took $908,740 from unappropriated hotel/motel tax dollars and put that towards debt service, and used $4.5 million of Free Cash from FY11 to pay off majority of the Snow and Ice deficit accounts from the same fiscal year.
All council orders and budget changes received unanimous approval by the council.
Coughlin congratulated the administration on their financial vigilance, but cautioned that state aid is projected to go down yet again.
“All towns are looking at cuts, including local aid. It’s a ritual we go through every year, but it’s a good time to have an excess levy capacity,” he said.
Overall, however, Walker said the new system of doing the budget, which now occurs simultaneously to setting the tax rate, has enabled more transparency in regard to municipal finances.
“What we’ve done is change that to the best of our ability. There is still some inherent backwardness when it comes to municipal finances, but we’re doing it more transparently and more clearly now than we were a few years ago,” Walker said.