Tisbury selectmen continue to shift tax burden to businesses, summer property owners
After hearing comments from several residential and commercial property owners during a tax classification hearing Tuesday, the Tisbury selectmen voted to continue the town's 20-percent residential exemption.
They also agreed to keep the town's split tax rate, which shifts an additional share of property taxes from residential to commercial properties, but to reduce it from 160 percent to 140 percent.
Selectman Jeffrey Kristal announced at the hearing's beginning that he had filled out a disclosure form stating that he is a commercial property as well as a residential property owner, but that he believed he could make an unbiased decision on the tax rate question.
Assistant assessor Ann Marie Cywinski provided an overview, noting that the tax levy for 2008 that will be raised by tax bills in 2009 is $16,700,000, a three-percent increase over last year. She also noted that the overall assessed value for all town property decreased by three percent in the residential class, while the commercial values did not change.
Ms. Cywinski said that the Tisbury selectmen have voted to a 20-percent residential exemption since 1988. The selectmen vote on the residential exemption each year, and the money is appropriated in an article at town meeting.
Tisbury is the only Island town to offer a residential exemption. Ms. Cywinski said 974 parcels out of a total of 2,918 residential parcels qualify for the residential exemption.
As the Massachusetts Department of Revenue (DOR) web site explains, a residential exemption reduces the taxable valuation of each residential parcel that is a taxpayer's principal residence. Granting the exemption raises the residential tax rate and shifts the residential tax burden from low and moderately valued homes to higher valued homes.
The residential tax exemption applies to property owners who have filed an application along with copies of documents proving they lived year-round as Tisbury residents as of January 1, preceding the fiscal year for which they are applying for an exemption, in accordance with criteria established by the DOR and assessors under the provisions of Massachusetts General Law.
For example, to qualify for a residential exemption for fiscal year 2010, a homeowner must have been living in Tisbury as of Jan. 1, 2009. The period to apply for the exemption is from January 1, 2009, to March 31, 2009.
The selectmen took up the issue of a residential exemption first. Don Amaral, a former Tisbury finance and advisory committee (FinCom) member, spoke in favor of keeping the exemption, which he said is meant to ease the burden of the cost of living for Island residents.
Selectman Tristan Israel agreed, noting that it is a helpful tool in keeping people on Martha's Vineyard. The se
lectmen approved his motion to continue the current 20-percent residential exemption.
Turning to the tax shift issue, several Tisbury business owners voiced objections. "My argument is the split tax policy the board adopted in 1988 has as one of its consequences contributed to the decline of Tisbury as the main business town on Martha's Vineyard," said Pat Gregory, owner of EduComp.
"Businesses are the economic engine, what helps create the fabric of this community," said Phil Hale, owner of Martha's Vineyard Shipyard. He noted that in an informal poll of four businesses in Tisbury, 22 fewer people are employed this year than at the same time a year ago. At an average salary of $33,000, that amounts to $726,000 missing from the town's economy, Mr. Hale pointed out.
"It sounds like the tendency is to take care of residents and take care of businesses in a good way, but the empty chairs here represent the non-voting, non-resident taxpayers," noted Dukes County commissioner Melinda Loberg, who also serves on many town committees. "I hope you keep a balance and remember they come here in the summer and support our businesses and reduce our taxes."
Other business owners expressed concerns about the uncertainties of the economy and the effects on their businesses in the year ahead. After weighing their requests for reduced commercial property taxes, the selectmen voted to approve selectman Jeffrey Kristal's motion to reduce the tax shift percentage from 160 to 140 percent.
In order to understand what the tax shift means in dollars, selectman chairman Denys Wortman provided a chart showing sample tax bill amounts using different shift percentages.
According to Mr. Wortman's chart, by reducing the tax shift to 140 percent, the tax on a residential property assessed at $500,000 will increase by $52.47 on a parcel with a residential exemption and by $80 for one without the exemption, while a commercial property of the same value will pay $590 less.