By Dan Miller, Contributing Writer
WESTBOROUGH – Skyrocketing home sale prices are primarily to blame for a projected average single family residential tax increase of $1,290 in the 2023 fiscal year for Westborough, according to a budget preview by town officials to the Select Board on Dec. 14.
Town Manager Kristi Williams and Assessor Jonathan Steinberg both said they are hopeful that the tax increase can be reduced over the next several months through town and school budget cuts. They’re also hoping it can be reduced as more data comes in concerning commercial/industrial and personal property values.
But Steinberg said the final amount will not be close to the increases of $200 to $300 for single family residential properties that have been typical in recent years.
“What you have now hopefully will change as we get more information, but it is not going away,” he said. “We are not going to bring it to $300 or even to $500.”
Town examining ways to limit increase
Williams said that the town cutting $2.5 million from its budget for FY 23 would reduce the average residential tax increase to $964.
She and Select Board members also hope that school officials will make cuts in the school budget, and that town officials will also work with school officials toward that end to further reduce the tax increase.
The projected tax increase is largely driven by updated assessment figures on residential properties, which, in turn, are being driven by what Steinberg characterized as home values “going up in insane ways” over the past year.
Typically, commercial/industrial and personal property values account for at least 30 percent of the total tax in Westborough, Steinberg said.
But, in the past year, residential values driven by home sales have been “far outpacing” everything else, to a point where commercial/industrial and personal property values have dropped to 28.5 percent of the total, according to Steinberg.
He acknowledged that, at present, he has much more solid data related to residential values, as home sale and residential transactions are easier to track as public records throughout the year.
In comparison, much of what Steinberg knows so far regarding commercial/industrial and personal property values is based upon income and expense reports that companies are required to submit to the town, he said.
Steinberg expects to be gathering more data to provide a more accurate picture of true commercial/industrial and personal property values.
“My hope is when I get the data, that 28.5 percent will come up,” he said.
That would defray some of the projected tax increase to the average single residential family, Steinberg said.
But even with no increase at all in the town’s budget for FY 23 the average residential single family tax bill is still projected to go up by $515, Williams said – due solely to the shift in value from commercial/industrial and personal property to residential because of those rising home sale figures.
At present the town’s budget for FY 23 is projected to go up by 4.49 percent, accounting for $114 of the increase in the average residential single family tax. The school budget is currently projected to go up by 5.80 percent, accounting for another $415 of the increase.
Williams listed ways to potentially reduce the tax on the town side, including FY 23 budget reductions and deferrals, recognizing savings through unknown budget numbers, reviewing alternative funding sources, and using free cash to provide tax relief.
Select Board members react
The $1,290 average residential single family tax increase number is “unprecedented,” Select Board member Sean Keogh said.
He and others on the board agreed with town officials that getting the number out publicly this early in the process is a good thing in terms of transparency.
Achieving significant reduction in the tax “will require a lot of creativity,” Keogh added. “We are going to do our best and turn over every stone. We have time to do whatever we can regarding it.”