Painstakingly, Worcester Sets 2020 Tax Rates

WORCESTER, MA — One Worcester Councilor called it a constant "thorn in our sides." Another Councilor likened it to splitting a baby in half. Another said it's always "polarizing."

Whatever the comparison, the Worcester City Council succeeded in choosing the fiscal year 2020 tax rates on Tuesday night. As usual — and to the chagrin of the Worcester Regional Chamber of Commerce — the Council split the tax rate, setting a higher rate for commercial properties compared to residential properties.

But both types will see a tax increase, according to city estimates, due to a bigger city budget and rising property values.

In a 7-4 vote, the Council approved rates of $17 per $1,000 for residential properties and $35.16 for commercial properties. Compared to fiscal 2019, the average residential owner will see a 3.78 percent increase ($154) and the average commercial property owner will see a 5.07 percent increase ($1,660). Those estimates are based on an average assessed value in Worcester of $248,697 for residential properties and $978,340 for commercial properties.

Rates will vary based on individual assessments, which grew by 10.2 percent for single-family homes, and apartment buildings by almost 15 percent.

Had the Council not approved a split, Worcester's single tax rate would be $21.58 per $1,000 of assessed value. The Council also unanimously approved an elderly tax exemption. About 239 elderly residents will be able to abate tax bills by $1,400.

Other Councilors offered a split less favorable to residential property owners, but those failed on roll-call votes. District 5 Councilor Matthew Wally sought a residential rate of $17.52 for residential and $33.62 for commercial. Mayor Joseph Petty supported Wally's rate, and said he doesn't want the public to perceive the Council as "anti-business."

"We're not anti-business when it comes to a lot of things," Petty said. "So that shouldn't be the message that's left here always."

Several business owners spoke during public comment to ask the Council to keep commercial rates low. Worcester Chamber government affairs director Alex Guardiola spoke too. He urged Councilors to eliminate the split tax rate completely like Fitchburg and Auburn have.

"This vote has a direct impact on Worcester small businesses," Guardiola said. "The small business owners have very small profit margins and these votes can often make or break a business."

In lieu of eliminating the split, the Chamber had asked for rates of $17.73 for residential and $32.99 for commercial.

But a majority of Councilors wanted to keep rates lower for residents due to issues like gentrification and rising rents.

"We all want to retain businesses, but we want to do the same thing for homeowners too," At-Large Councilor Gary Rosen said. "I don't think anyone from the business community got up and said, 'Oh, those residential property owners, their taxes are so low."

One of the last Councilors to speak on the matter was retiring 30-year At-Large Councilor Konstantina Lukes. She voted with the majority of Councilors to keep the residential rate as low as possible.

"I have to come down on the side of folks who need somewhere to live," Lukes said of her vote, highlighting that she began her career as a lawyer advocating for renters.

Correction: An earlier version of this article gave an incorrect rate for commercial taxes.