Boston property tax changes stall in Mass. Senate again as Wu seeks relief for homeowners
Boston homeowners are set to see a major increase in their property tax bills for the second year running as Mayor Michelle Wu continues her battle with the state Legislature over making changes to the tax structure.
City officials said last week that tax bills for single-family homes are expected to go up by an average of 13%, on top of last year's average increase of 10.4%.
Wu has spent almost two years advocating for some of that burden to be shifted to commercial property owners, but with the first year of the two-year legislative session in the books, state legislators still appear unwilling to grant the necessary approval.
"At a time when the federal government is cutting back on services or even outright attacking local communities and creating more need for local protections, we can't accept the false frame that we need to choose between a thriving economy or excellent public services—each reinforces the other and both are necessary to make our community safe, beautiful, and welcoming for everyone," Wu wrote on Reddit during an "Ask Me Anything" session that started over the weekend.
Wu first proposed the tax shift in the spring of 2024, in response to declining commercial property values in the wake of the pandemic, as fewer people traveled to the office for work.
Two versions were approved by the City Council and the state House of Representatives before dying in the state Senate.
Real estate and business groups largely criticized the idea, saying it would hurt commercial property owners at a time when they are already struggling.
Though the second version of the proposal was drafted with the input and approval of some business groups , they rescinded their support when the city's final tax assessment data was released, saying the increase in homeowner tax bills was not as bad as the Wu administration had originally projected.
State Sen. Nick Collins, D-1st Suffolk, used a procedural maneuver to block the Senate from voting on the bill multiple times, eventually moving past the deadline for the city to incorporate any changes into January tax bills.
In February, the City Council once again sent a home rule petition to the State House , where it has languished all year.
The House of Representatives sent it to the Committee on Revenue in March. But the Senate has not even assigned it to a committee, a prerequisite for a hearing to be held and the bill to move forward, according to State House News Service .
Senate President Karen Spilka, D-Middlesex/Norfolk, told Politico Monday night that time was essentially up for the bill and that the city should have begun discussions about the proposal earlier.
"The Senate is deeply committed to making Massachusetts more affordable and there are many ways to provide meaningful relief, including proposals from Sens. [William] Brownsberger, D-Suffolk/Middlesex, and Collins that would support the most vulnerable residents without placing burdens on small businesses that will ripple throughout the state — and the City should have engaged with the Senate on these options well before now," Spilka said.
Collins said in a statement that Wu's push for the bill this month was too little, too late, and called for the city to release property value assessments for the year before any action was taken to set tax rates.
"That timing does not show a serious effort to advance legislation. It looks like setting up a fight and preparing to point the finger when tax bills go out in January," he said. "I stand ready to work with the Mayor to deliver relief to taxpayers. It is time to focus on viable solutions, not manufactured conflict."
Wu pushed back on this assertion, telling reporters at an unrelated event Tuesday that she had been "waiting for a vote for nearly two years."
"If someone is opposing a relief measure that would help every single constituent in their district and going against the interests of their own neighbors and voters, we're not the ones at the city stopping them from doing their job," she said. "They've had information, we've continued to send it. We will continue to meet with and provide any other information possible. But this is clear what needs to happen and every other entity has done what they need to do, especially the City Council."
Assessing Commissioner Nick Ariniello told city councilors at a Monday hearing that without the tax shift, next year's rates will be around $12.40 for residential and $26.96 for commercial property.
In municipalities with split tax rates, like Boston, state law allows commercial taxes to be as high as 175% of what the unified tax rate would have been. Boston has consistently met the maximum 175%, but the home rule petition would raise that threshold to 181.5% for next year , followed by 180% in 2027 and 178% in 2028.
Ariniello said at 181.5%, the residential tax rate would be $11.86 and the commercial rate would be $27.96. This would mean tax bills would still go up, but by an average of 9%, not 13%.
One of the most common criticisms by opponents of the tax shift is that the city should consider cutting its budget and keep tax rates flat for the next year. Wu and members of her administration, however, say it wouldn't be that simple.
The mayor explained Tuesday that reducing the tax levy would provide much more savings to commercial property owners than homeowners.
She said a $2 million budget cut would translate to an average savings of $5 for the year for homeowners, while commercial buildings would see savings of up to $8,000.
"We are not allowed by state law just to give tax relief to residents," Wu said. "That's why we're asking for their special permission to this balanced proposal that would protect everyone."
City CFO Ashley Groffenberger said during Monday's hearing that to give homeowners the same amount of relief that the home rule petition would accomplish, the city would have to cut $232 million from its budget. Because so much of the budget is non-discretionary expenses, such as pensions, employee health insurance and debt obligations, almost that entire reduction would go to city services, she said.
"Hundreds of millions of dollars of reductions to city services in a time when we're hearing that they are already stretched really thin would be devastating and I think would do irreparable harm to the services that we provide to residents and businesses," Groffenberger said.
Wu has instructed city departments to cut budget requests for 2026 by 2% in an effort to constrain spending. Last year, the city cut the equivalent of 500 jobs by eliminating vacant and redundant positions.
"The mayor is again targeting the beleaguered business community struggling for years with high taxes and increasingly empty office and retail spaces," said Amir Shahsavari, vice president of the Small Property Owners Association. "Mayor Wu's tax plan will only slightly lower the city's residential tax rate, just like her failed plan last year. While offering minuscule savings on the residential side, her plan would devastate small businesses and property owners who will continue fleeing Boston because of its high taxes and hostile attitude toward business."
The City Council is expected to vote on setting tax rates at its weekly meeting on Wednesday.
MassLive Politics Editor John L. Micek contributed additional reporting.
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