Boston city council questions Wu officials on property tax hike, ahead of vote

Boston City Councilors questioned members of the Wu administration over property taxes in a hearing Monday, as the mayor faces blowback from residents and Beacon Hill for rolling out a 13% tax hike on residents in January.

The Council appeared likely to max out the 35% tax break for homeowners whose primary residence is Boston, as it typically does. But with residential property taxes rising for the eighth year in a row —  $780 next year for the average single family homeowner — the mayor and the council are under pressure to do more.

“ People may look like they are doing alright,” said Lillie Bryan, a 78-year-old homeowner and Massachusetts Senior Action Council member, at a small tax protest outside City Hall on Monday. “But you don't know what they are doing to get by.”

The latest tax increase is largely a result of empty office buildings downtown, and declining commercial property values since the pandemic. Under the current plan, building owners will see a 4.4% decrease in their property tax bills, representing an average $210,000 savings.

The council must vote on the tax plan by Wednesday.

Wu in recent days has taken to social media to defend a proposal that would keep the residential hike to 9%, by shifting more of the burden to commercial property owners. But she needs the state Legislature to make that happen, and she’s been unable to seal the deal there in the past. She’s been in a war of words with state Sen. Nick Collins, whom she blames for stalling a tax bill she’s been pushing since 2023.

On Monday, state Senate President Karen Spilka weighed in, saying in a statement, "the City should have engaged with the Senate on these options well before now.”

“The Senate is deeply committed to making Massachusetts more affordable and there are many ways to provide meaningful relief — including proposals from Senators Brownsberger and Collins that would support the most vulnerable residents without placing burdens on small businesses that will ripple throughout the state," Spilka added.

At the hearing Monday, Boston city councilors asked questions of financial officials in the Wu administration about ways to cut city spending, find new sources of revenue, and to ultimately reduce the impact of falling commercial property values.

Councilor Erin Murphy asked why, with 70% of the city’s $4.8 billion budget coming from property taxes, the city hasn’t been working on budget cuts to avoid raising property taxes.

“ We didn't in the last couple of years because we had robust revenue growth that was supporting the budget and COVID money,” Chief Financial Officer Ashley Groffenberger said at the hearing. “But as I think we're all aware, the economy’s cooling, things are slowing down, and so we're making adjustments accordingly.”

Groffenberger pointed to new guidance issued across city departments to reduce budgets by 2% in the upcoming fiscal year.

After the hearing, Greg Maynard of the Boston Policy Institute, a research firm that has frequently fought the Wu administration on taxes, said the city needs to consider this a long-term problem.

“This commercial property value crisis is unlike anything that Boston has faced in the recent past and a solution like the tax shift proposal just isn't really equal to the task of solving this problem,” Maynard said.

Councilor Ed Flynn said the fight Wu is in with Beacon Hill lawmakers, specifically Collins, may not be helpful. Last week, Wu accused Collins of not understanding “the basic facts.”

“ In my opinion, it's not the time for a finger pointing between Boston and the State House,” Flynn said. “What is needed is to lower the political temperature in the room. Have coffee and work together, find common ground, move forward in a respectful manner, and listen to each other even if you disagree with them, and try to come up with solutions that work for everybody.”

But Councilor Sharon Durkan framed it differently, saying she felt “deflated,” given that the mayor and council have several times pushed for the temporary tax shift.

“ I think that anyone who's not upset about this and upset about the Senate, completely honestly, they are not representing Boston," she said.

Other councilors at the hearing took a pragmatic approach, asking how homeowners can apply for the residential tax exemption; what they can do if they believe their home was overvalued; and whether the decrease in commercial property values and increase in residential values is consistent across the city.

Councilor Gabriela Coletta Zapata asked why residential tax bills increased 10.4% last year, followed by 13% this year. Assessing Commissioner Nicholas Ariniello explained the “quick answer” is market activity.

“For a long time, residential prices were kind of on this very steep upward trajectory,” he said. “They're still going up. It's just the slope has kind of shifted to be more stable.”

On Monday, Wu took to the social site Reddit for an “Ask Me Anything" forum, and personally answered users’ questions on the tax hike. She said the city is trying to bolster commercial real estate values by working with Boston’s largest employers, recruiting new businesses, converting unused office space into housing, and among other moves.