The latter half of this week's City Council meeting was used to discuss and pass a new tax agenda, cutting taxes for Cantabridgians to a lower rate. Cambridge is one of the few cities in the country that has avoided large spikes in its residential property taxes, despite a weak economy. The coming year’s 3.9% tax rate is lower than was expected during the spring’s budgeting process. With this new tax rate, 72% of residential homes will see a decrease or increase of no more than $100 in tax payments, while 85% will see a decrease or increase of no more than $250. As many of us understand, our ability to keep residential tax rates so low is in part due to the large tax payments contributed by commercial interests in Cambridge, which account for about ⅔ of the tax levy.
Although the city is focused on decreasing tax rates, adjusting the tax rate to match inflation would generate approximately $5 million in additional revenue. There are important projects that other councillors and I feel could utilize these potential funds. Projects such as revamping community planning and engagement by the Community Development Department, bringing additional programming to our youth centers, and keeping our streets and sidewalks properly paved. These programs could all be improved by sensible tax adjustments.
In response to the idea of formulating the tax rate to match inflation, concerns were raised about long-term residents who bought properties before their values increased. Other mention was made of the likelihood that residents owning million-dollar homes could pay a slightly tax increase. In general, there seemed to be a consensus that further discussion about tax rates is appropriate. All related agenda items were passed unanimously and the council will continue discussions on adjusting the tax rate at a later point in time.
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