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Medford council reluctantly approves property tax hike

Posted by Marcia Dick  December 21, 2011 10:04 AM

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Single-family homeowners in Medford will pay an average $155 more in taxes this year, but business property owners will pay $81 less than last year as a result of new tax rates approved last night by the City Council.

Medford councilors voted unanimously, 7-0, to set the new residential tax rate at $12.03 per $1,000 valuation, and the new commercial/industrial rate at $23.72 per $1,000 valuation.

The jump in residential property tax bills, and the drop in the commercial tax bill, reflect a change in property valuations for this year compared to last year, Chief Assessor Ed O’Neil said.

Although unanimous, the vote to set the new tax rates came after a heated 90-minute debate, during which councilors shouted at each other as they stressed the need for tax relief for Medford homeowners.

“For 25 years in a row, taxes have gone up,” said Councilor Robert M. Penta.

Councilor Breanna Lungo-Koehn said the council needed to “give our taxpayers the relief they so desperately need.”

At the current rate of $11.61 per $1,000 valuation, the owner of an average single-family home assessed at $346,547 paid $4,023 in property taxes in fiscal 2011.

Concern about the average $155 residential increase had prompted the council to delay by one week a final vote on the tax rate for fiscal 2012, which started July 1. Councilors had asked O’Neil to present figures based on a residential tax rate of $11.90, the estimate the councilors relied upon last June to approve this year’s city budget.

O’Neil said a $1 million revenue shortfall would likely result. The budget was based on estimates of property valuations and new growth, which have since changed, he said.

“You are not going to get exact [numbers] during budget hearings,” he said.

Lungo-Koehn asked if the city could offset the property tax increase by tapping into $2 million in free cash expected to be certified by the state Department of Revenue in coming weeks

City Auditor Anne Baker said that’s not possible. The state requires communities to set a new tax for third and fourth quarter tax bills. Only first and second quarter bills may be issued using the rates from the prior year, she said.

Without a new rate, the city would not be able to issue tax bills, and then would run into a cash flow problem, she said.

“We can’t spend money if our budget isn’t funded,” she said.

Councilors reluctantly approved the new rates, but also put the city on notice that it hopes to avoid steep tax hikes in the future. They voted 4-3 in favor of a resolution sponsored by Penta to have Mayor Michael J. McGlynn submit two budget proposals to the council in June.

One budget would be prepared the traditional way, using estimates of property valuations and new growth. The second would be based upon a zero increase in property tax bills, and would include an outline of cuts necessary to achieve that rate.

“We need to do something to stop these tax increases,” Penta said.

Kathy McCabe can be reached at

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