Residential, Commercial Rates Rise as Council Hikes Tax Burden on Businesses

City Councilor Joseph J. Bevilacqua

Taxes for Haverhill homeowners and businesses will rise after City Council’s decision to increase, by the smallest amount possible, the share of the city’s tax burden carried by its commercial base.

City Council Tuesday night effectively set the tax rate for Haverhill homeowners and businesses by determining the share of the tax burden for each group. The owner of a median-priced city home will see his tax bill increase by about $138 this year. The tax bill on a median-priced city business will increase by $9.

Property values in Haverhill have gone up by 5.9 percent in the last year, making it inevitable residential tax rates would rise regardless of the council’s actions.

Before the council’s deliberations, Haverhill Mayor James J. Fiorentini said he favored increasing the share that the city’s commercial sector would pay.

“That shift would mean that everybody will pay, but the residents won’t pay quite as much money,” he said.

Councilors voted, 5-4, in favor of raising the tax classification factor from 157 to 158, increasing the share of the city’s property tax burden commercial businesses pay, after rejecting a move to shift an even higher burden to the commercial base.

Councilor William J. Macek offered a failing motion to increase the factor to 159, which would have meant a $130 increase for the average homeowner while raising the commercial tax bill by $108.

A shift to 160 would have increased the annual tax bill for the average Haverhill business to $207, while increasing the annual tax bill $121 for the average single-family homeowner.

Councilor Joseph J. Bevilacqua made the motion for the single-point factor increase, saying it’s important to encourage businesses to come to Haverhill now in order to reduce taxes on homeowners in the long run.

“The most important factor, in my opinion ... to help the residential tax rate, is to bring more business and more commerce to the city of Haverhill,” Bevilacqua said. “We have to create jobs that provide individuals with disposable income that they then can spend in the city of Haverhill and support the institutions that we need to support,” he added.

Councilor Andres X. “Andy” Vargas said he preferred to remain at the 157 factor, which would benefit businesses. However, if the city were to increase, it should not go higher than 158. “If we’re trying to attract businesses to the city, we’ve got to compete with the rest of Massachusetts, whether we like it or not,” he said. Ultimately, Vargas offered the second to Bevilacqua’s motion.

Council President John A Michitson supported keeping the current split to incentivize new business, saying that would have a positive effect on the residential tax rate going forward.

“We need to have as many incentives as we can get to get business into the city. To me, that is the biggest driver. That is the future of the city, to get jobs, to get new businesses, new buildings …  maybe some new industrial parks,” Michitson said.

“Our economic development performance over the last several years has not been very strong,” Michitson added. “I think we need to do everything that we can to bring businesses and jobs into the city.”

Councilors who sided with Macek on a higher commercial factor, including Mary Ellen Daly O'Brien, said that if the residents have more money to spend, businesses will still flourish. O’Brien said it would be “more pragmatic to share it more equally.”

“This is a residential city, and I believe if we give a break to the residents, they’re going to be the ones spending money in this city,” she added.

 

3 thoughts on “Residential, Commercial Rates Rise as Council Hikes Tax Burden on Businesses

  1. If residents have more money? Yeah retail businesses will get the money but what about manufacturing businesses? They wont see a dime. The large manufacturers that are left in Haverhill pay a huge brunt of the tax base and do not use the city services or schools.

  2. “Our economic development performance over the last several years has not been very strong,” –

    You folks better pucker up, with a Trump victory, Massachusetts is going to be treated ike the red-headed step-child that it truly is.

    33 state legislatures are now under Republican control, five short of an Article V Convention of States (frightening actually).

    Massachusetts, thanks to it’s endlessly increasing debt obligations and debt issuance is a top five contender for the worst fiscal states in the country. GDP for the country and Massachusetts have never fully recovered since the 2008 crisis, abet Massachusetts, thank to all that debt, has fared better than national.

    The years of political confirmation bias and cognitive dissonance will finally be catching up here, and no amount of theft, I mean taxation, in an era where evermore the fruits of our labor are legislatively stolen is going to fix it.