Worcester Sets 2023 Tax Rates: See How Much Your Bill Might Increase

WORCESTER, MA — The Worcester City Council on Tuesday set property tax rates for 2023, picking the lowest rate possible under state law — but that doesn't mean bills will be going down.

In a 7 to 4 vote, councilors chose to continue with the traditional split tax rate between residential and commercial and industrial properties and personal property (CIP). Single family homeowners will pay a rate of $14.34 per $1,000 of assessed value, while the CIP rate will be $31.26.

By comparison, the council set the 2022 rates at $15.21 per $1,000 for residential properties and $33.34 per $1,000 for commercial and industrial properties and personal property (CIP).

According to the assessor, the value of all property in Worcester has risen to $20.3 billion, about 13.3 percent higher than last year. With property values rising, the new tax rate will mean higher tax bills for most property owners.

Residential properties — including single-family homes, condos and multifamily homes — may see the biggest increases due to a hot real estate market. The average single-family property rose in value about 16 percent over the past year, and triple-decker properties went up between 15 and 20 percent, Assessor Samuel Konieczny told the council. Commercial and industrial properties increased in value on average by only 0.60 percent.

Under the new 2023 rates, the owner of a home of average value — about $342,000 — will see an increase of about $431. The average commercial property valued at about $1 million will see a decrease of about $2,000, according to estimates. Actual increases will vary based on individual property values, however. You can look up your property and the 2023 tax value on the assessor's website.

Many councilors said picking the lowest possible tax rates was the only good option in a year with record inflation, plus rising utility rates — and the upcoming Community Preservation Act surcharge that will begin in July.

A separate proposal to set rates slightly higher at $14.64 for residential properties and $30.12 for CIP failed with only four councilors in support.

The Worcester Regional Chamber of Commerce sent an alert to its members ahead of Tuesday's vote urging them to contact councilors to ask for a rate increase that would be equal between homes and businesses at about 13.3 percent. The chamber has long advocated that Worcester get rid of the city's split tax rate and adopt a single rate for all property owners.

Alex Guardiola, a lobbyist for the chamber, told councilors Worcester needs a 10-year plan to transition to a single rate to reduce taxes for commercial and business property owners. He said that when Worcester instituted the single rate in the 1980s, about 35 percent of tax revenue came from CIP, but that's now down to about 21 percent.

"In short, we are eroding our commercial tax base," he said. "While businesses may not be doing big press conferences when they leave the city, they certainly vote with their feet."

If Worcester had set a single tax rate, it would've equaled about $17.87 per $1,000 of value.

In 2023, Worcester will raise about $362.9 million from property taxes to pay for city services. However, the city's levy limit — the maximum amount the city could raise under state law — for 2022 would be $384.2 million. That $21.2 million in excess levy capacity is about $1 million higher than in 2022, which was the highest in almost 40 years.