Danvers Residential, Commercial Taxes To Rise More Than 3 Percent

DANVERS, MA — Property taxes for both residential and commercial properties are on the rise in Danvers after the Select Board voted on the new tax rates Tuesday night.

The Select Board chose to keep the split tax rate that taxes commercial businesses at a higher rate than residential properties. In an effort to spread the tax increase out evenly between businesses and residents amid the coronavirus health crisis, businesses next year will be taxed at 1.407 times the amount of residential properties.

That is below the maximum difference of 1.5 times the town is allowed, with the Select Board determining that rate allows the most equitable rise for both classifications. The adopted rates are $13.36 per $1,000 of assessed value for residential properties and $21.39 per $1,000 of assessed value for commercial properties.

The average single-family home property tax in Massachusetts in 2019 was $15.48 per $1,000 of assessed value.

The tax increase for single-family homes will rise about 3.38 percent — or an average of $218. The tax increase for commercial or industrial properties will rise about 3.4 percent — or an average of $1,132.

Select Board member Gardner Trask proposed the approved rate.

"There is no right answer here," said Trask, noting that many other cities and towns charge businesses and residential properties at 1-to-1 rates, while Danvers has a tiered system that charges businesses more. "There is absolutely no correct thing to do. There is our best effort.

"We have, fortunately, a healthy split of business and residential (tax base) in the town. ... If we tried to apply a flat rate we would increase the residents' (tax bill) by over $1,1oo and decrease businesses by over $8,800. We're not going to go in that direction."

Trask said keeping residential taxes at the $13.06 rate it was at for 2019 would overburden the businesses that have to make up the difference for the estimated $83 million town budget.

"Your residential tax rate would only go up $68 but your business, the average, would go up over $2,700. So we're trying to be equitable," he said. "Businesses aren't nameless entities in this town.

"Of 37 businesses in towns that have liquor licenses, 30 of them are local-owned. They are not chains. ... (Some say) we should ask the businesses to pay more. Well, no one can adequately explain why. But we've (historically) gone that route. ... The fact is that businesses make up 23 percent of the (valuation) of the town, yet we charge them 33.3 percent when when do the one-third, two-third (tax rate) breakdown. There is no specific reason why we should ask businesses to pony up, but again the horse has left the barn (on that)."

Trask said taxing businesses at the maximum rate of 1.5 times residential businesses would mean residential taxes went up about $3 and businesses taxes went up about $3,300.

"So you try to find something in the middle," he said of fair difference between a 1-to-1 rate and the maximum allowable 1.5-to-1 rate. "Especially in COVID times, everyone should pay the same (percent of increase). The tide should rise the boats equally."

The full Select Board meeting can be viewed here.