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Date: 12/5/2023
WARE — For fiscal year 2024, the single tax rate for all property classes is $16.34 per $1,000 valuations, marking a decrease from the previous year’s $17.29. The rate is part of a trending decline in tax rates since 2020.
The Selectboard approved the residential and commercial property tax rate, sticking with a single scheme. The process is vital for the distribution of third-quarter tax bills.
The hearing also explored potential tax impacts under various scenarios, from equal rates for all classes to shifts favoring residential or commercial/industrial properties.
Consultant David Burgess provided an overview and the recommended rate during the board’s Nov. 28 meeting. He reminded members that Ware has traditionally been a single-tax rate community.
The tax-setting procedure began with determining the property tax levy through the budget process. Afterward, property valuations were assessed and classified by the Assessors.
During the hearing, these classifications were presented to the public, followed by the Board voting on a tax shift factor.
The levy, representing the total property taxes raised, stood at $17.5 million for Ware. The levy ceiling, the maximum levy allowed, capped at 2.5% of the town’s property value, amounted to $26.8 million.
New growth revenue, which includes taxes from newly taxable properties, was reported at $128,361. Burgess said the figures declined due to weaker contributions from utility companies. “Hopefully that will change in the next year,” he said.
The levy limit for fiscal year 2024, also known as the ‘maximum allowable levy’, was a significant focus. Initially projected at $17.5 million, the amount was adjusted to $17.3 million, with an excess capacity of $23,000.
The figure accounts for the standard 2.5% increase under Proposition 2½, a law limiting property tax increases in Massachusetts, and the additional revenue from new growth.
Burgess said the board had to consider shifting the tax rate, placing the burden on commercial ratepayers. Almost 85% of Ware’s tax base is residential. The Selectboard holds the right to shift the residential to the commercial by 50%, which would have triggered a “negative impact” on the business sector.
For instance, single-family homes could see an average tax increase of 2.67%, while commercial properties might experience a slight decrease. The Board of Assessors recommended adopting a single tax rate for all property classes.
The Selectboard maintained the 1.0 Residential Factor, ensuring no shift in the tax burden between residential and commercial, industrial, and personal properties, pending approval from the Massachusetts Department of Revenue.
The average single-family home last year was valued at $250,000, resulting in a tax bill of $4,326. However, the average home value climbed to $270,00 for the current year. Homeowners can expect to pay $115 more in the coming fiscal year.
Two and three-family homes dropped in price by 10%. The town’s total value of all properties is over $1 billion.
Town Manager Stuart Beckley said Ware lacks a robust commercial scene to absorb a dual-tax rate. “Historically, it would be best for both residents and businesses if it were a factor of one,” he said.
The hearing concluded with a summary of property assessments in Ware, highlighting a significant predominance of residential properties, especially single-family homes. Despite the ongoing hike in interest rates, the real estate market has not cooled.