Coletta Zapata holds second hearing on mayor’s proposed tax classification plan

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BOSTON (June 3, 2024) – Boston City Councilor Gabriela Coletta Zapata (District 1) chaired a Government Operations committee hearing last Thursday to discuss a petition for a special law regarding property tax classification in the City of Boston. This Home Rule Petition was sponsored by Mayor Michelle Wu and is a temporary tool seeking to protect residents from property tax increases to mitigate potential revenue shortfalls from declining commercial valuations.

The proposal comes following recent reports highlighting a potential nationwide decline in commercial property valuations due to slow economic growth following the pandemic and shifting dynamics in downtown cores. The legislation would go into effect for five years and ensure that homeowners and residential property owner’s taxes would not increase by upwards of 30 to 40% in one fiscal quarter. 

During the hearing, councilors once again shared concerns about the success of the proposal, potential unintended consequences and asked for additional information and data on the tax assessment for Boston.

“I foresee the main beneficiaries of this proposal being individuals that own properties that are house rich, cash poor like many of our seniors and tenants renting small properties in Boston,” said Councilor Coletta Zapata. “However, I’m still concerned that increases in commercial property taxes, particularly on smaller commercial property owners and small businesses, will unintentionally stifle unnecessary economic growth in Boston and hurt our small businesses. We must consider the long term impacts of our changing economy and impacts the pandemic has had on workplace vacancies and tenancies. Boston must prioritize additional sources of revenue as part of a suite of solutions for a long term plan.”

In an effort to protect small businesses against any unintended consequences due to this proposal, Councilor Coletta Zapata has filed an ordinance to adopt the small commercial tax exemption as a local option in the City of Boston. This ordinance would provide financial relief for small businesses, valued under a million dollars or with 10 employees or less, that cannot afford the increased costs of operating in Boston.

The hearing began with public testimony from Boston residents. Councilors also heard from representatives of labor unions, Massachusetts Affordable Housing Alliance, Urban Edge and representatives of the Boston Municipal Research Bureau, Chamber of Commerce, Ryan, LLC, Back Bay Association, and Eastern Bank.

Members of the administration present included: 

  • Ashley Groffenberger, CFO of the City of Boston
  • Nicholas Ariniello, Commissioner of the City of Boston Assessing Department

Councilors in attendance included Councilors At-Large Ruthzee Louijeune, Erin Murphy, Henry Santana, Julia Mejia and District Councilors Ben Weber (District 6), John Fitzgerald (District 3), Brian Worrell (District 4), Ed Flynn (District 2), Liz Breadon (District 9), Enrique Pepen (District 5) and Tania Fernandes Anderson (District 7). 

A recording of the hearing can be found here: www.youtube.com/watch?v=mBwBaJ8UyP4 

The home rule petition first needs approval from the Boston City Council then it would be sent to the State Legislature who also needs to approve it before it can take effect. A working session has been scheduled for Tuesday, June 4 at 2pm. More information can be found at www.boston.gov/public-notices/16170741.

For additional information, please contact the Office of Councilor Gabriela Coletta by phone at (617) 635-3200 or by email at gabriela.ramirez@boston.gov.