This week the Sun had a story titled: Tax relief won’t be felt in Lowell until end of fiscal 2013
In part it stated (Bold Mine):LOWELL — The city’s approved fiscal 2013 budget calls for a 0.2 percent average increase in property taxes rather than the typical 2.5 percent, but city taxpayers won’t experience the smaller tax hike in their first- or second-quarter tax bills.
Instead, taxpayers will see preliminary bills factoring in a 2.5 percent increase over the prior year’s total bill, said Lowell Chief Financial Officer Tom Moses and Chief Assessor Sue Lemay in interviews Monday. Those bills were determined before the adoption of the budget.
Over on His City Manager’s Blog the Manager has a post about the budget that includes this information (Bold Still Mine):
With the FY13 1st quarter tax bills arriving in mail boxes this week it is expected that some property owners will question the amount listed as the estimated tax due for FY13. Throughout the FY13 budget process there was a collective priority placed upon keeping the residential property tax increase at the absolute minimum. The Manager presented a budget with the lowest average tax increase since 2001 with the City Council ultimately adopting a budget of $312.1 million which decreased the tax crease further to an average increase of $4-5 per household.
The City prepares the first quarter tax bills prior to the adoption of the budget, so the calculation of those bills is independent of budgetary decisions. Like cities and towns across the Commonwealth, the City of Lowell tax bill is based upon the Massachusetts formula which divides the total prior fiscal year tax bill by four and allows an additional 2.5% as recommended by the state.
The final tax bills will indeed reflect a minimal increase that the Council voted but it still leaves this question – Why did the current tax bills go out with a 2.5% increase? The Manager on his blog is basically saying because we can and both the Manager and the CFO pointed out that the rate is set BEFORE the budget is presented.
That may be fact BUT my question is exactly when is it set? In April Councilor Elliot called for the City Administration to present a budget with Zero increase and I supoported that (his fellow councilors did not). I went on a rant and the City Manager responded and stated on April 12 in his response to me:
First and foremost, no one has said that taxes are going up, going down or staying the same in FY13. My goal as it is every year is to hold the line as best possible on taxes within the City.
On May 30th the Budget was presented with an expected Tax increase of $10-$12 dollars over last year’s bill.
So then again I ask why was the rate for this years tax bill set with a 2.5% INCREASE built in other than that the city could and wants to grab the cash up front? Why wasn’t the increase set at 1 or 1,5% knowing full well that there wasn’t going to be a full 2.5% increase? Is the rate set in April? In May the Manager knew has he was putting the numbers together that the increase was far less than 2.5%.
By making statements like – The Manager presented a budget with the lowest average tax increase since 2001 with the City Council and so the calculation of those bills is independent of budgetary decisions is the Manager jus doing the Texas SideStep?
How can you independently plan a raise in your tax assessments and not take that into budgetary decisions?
Instead of explaining again how great a shape Lowell is in,(we know and we appreciate it) how about really explaining to the citizens and taxpayers why the tax bills were mailed with a built in 2.5% increase knowing taxes were not going up that much, other than the city appears to want to stockpile the taxpayers cash!