Southbridge Property Taxes – Explained?

Ken O’Brien

During Councilor’s forum on Monday night another eleven minutes were devoted to “clarifying” the tax bills received by residents.

Now, I want to begin by saying that my criticisms of this discussion are not directed against Wil Counoyer. He is essentially a technician using State laws to guide his obligation to determine a tax rate that will fund the budget as well as any subsequent additions thereto as set by the Town Council.

There may be criticisms that can be leveled as to how those decisions are allocated, but I am not in a position to evaluate that. Rather, my criticisms are directed at the aggregate consequences of the tax rate that was enacted as a consequence of the Council’s prior actions.

For those who missed that portion of the Council  meeting, let’s go to the video:

Now, like I’ve said, I don’t have the data to discuss the allocation of the tax increase.

However, as a first cut, I can look at the relative tax bill paid by Southbridge residents in comparison to other communities. 

As the accompanying chart shows, based upon 2015 figures of reporting communities from the Massachusetts Department of Revenue, Southbridge ranks in to bottom 2% in terms of average family home values.

However, using the same data, Southbridge ranks in the 15^th percentile in terms of the average tax rate imposed on these homes.

That would mean that, on average, there are some 46 communities in Massachusetts that have a lower tax burden on the average homeowner.

In addition to this is the matter of the allocation of the tax bill as discussed by the Council at Monday’s meeting. As Councilor Vecchia pointed out, the average tax increase of 5% is doubled. In essence, homeowners are paying the tax increase retroactively. This means that an average 5% increase amounts to an actual increase of 10%.

However, that increase doesn’t end after the May payment. Whereas the town operates on a July to June fiscal year, most taxpayers operate on a January to December year. As a result, from our perspective, we are paying a ten percent tax increase to which will be added whatever tax increase is imposed come next December.

Since the economic meltdown of 2008 many cities and towns, not only in Massachusetts, but around the country, have had to cut back on spending.

Not so in Southbridge.

We have benefitted from the influx of funds from the landfill royalty account. As a result, we have gone on spending while most other communities have experienced varying levels of austerity.

This is not to say that those economic factors have not affected individual taxpayers. Rather, in the aggregate, they have been insulated from the existing and increasing overhead to which most other communities have been subjected, and have had to eschew with no small measure of pain.

In the process a large number of residents have also been victimized by ever-increasing water and sewer rates.

Throughout all of this Southbridge has, on balance, managed to keep the wolf at bay.

Those days are rapidly coming to an end.

The landfill money’s end is in clear sight. Industrial and commercial properties are steadily shrinking. The town payroll has continued to expand as have the associated retirement costs which have absorbed a large portion of landfill funds. The profligacy of the School Committee has become almost legendary. Our remaining borrowing capacity is almost nil.

We need to seriously start to address our limitations now.

For example, do we need a ladder truck along with its maintenance costs and associated personnel in our fire department that is solely to service one building (the elderly housing high rise)? Are the newly expanded staffs in the school system along with their outside vendor contracts (i.e. Ombudsman) an absolute necessity?

Do the various town departments really require their current level of staffing (regardless of to whom they are related)?

A proposed 1% cut in the budget is perhaps a first step. But it is hardly adequate. Let’s see if that can at least be enacted as well as adhered to throughout the coming year. Beyond that, let’s have not merely more cuts in the obvious fat but some ideas on how to move forward beyond being a local punch line.

If you really want to celebrate the town’s bicentennial come up with a concrete plan to move forward. And, by the way, ACT ON IT!!!