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Editorial - Annual bad tax policy review
Tisbury selectmen have begun their annual consideration of real estate tax rate options. Unlike other Island towns, Tisbury's approach to sharing the burden of municipal expenditures has for years included shifting an extra bit of the municipal spending burden from year-round, property-owning residents to the already disproportionately burdened, undemanding, non-voting, non-resident seasonal property owning class, and shifting a further bit of the load to the commercial property owning business class, some of whose members live in town, while others don't. The tax rate decision will not be made for a few weeks, so there is time to consider the issues this practice raises and overturn this appalling practice.
The dollar impact of Tisbury's scurrilous practice on the disfavored classes is significant. For instance, using the example of real property valued at $500,000, commercial or residential, seasonal owner or year-rounder, if everyone paid the same rate and no portion of the assessed value were forgiven for year-round residency, each $500,000 property owner would pay $2,560 in taxes, at a $5.12 per thousand rate. If the selectmen choose the tax rate differentials most favorable to year-round property owners, the tax bills for these same $500,000 properties would be $2,845 for a residential property owner who does not live in town year-round and qualify for the resident exemption of a portion of his assessed value, and $4,575 for a commercial property owner. The qualifying year-round resident would save $225, the commercial property owner would be speared $1,505 extra.
Even in its less extreme dimensions, it's a filthy, shortsighted political business, driven at least in part by a fundamental misunderstanding of how municipal taxing and spending works, as well as a political willingness to take advantage of the voiceless and play to the voters. Obviously, seasonal property owners cannot vote, not in town elections and not at town meeting. These part-time Tisbury residents, although they demand less of the town than many year-round residents do, can have very little influence over the decision makers, who do not regard them as constituents at all, or at least not in the narrow sense of the word.
It is undeniable that real estate values have risen dramatically in Tisbury as well as elsewhere on-Island and in the nation. The rise has been driven in large part by demand from wealthy and sort-of-wealthy mainland members of the Boston-Washington megalopolis for seasonal Vineyard properties. Plus, large lot zoning, stiff development regulation, and the expansion of acreage protected from development have all spurred rising real estate values. But sky high real estate values do not by themselves hike real estate tax bills or make it impossible for longtime Islanders to hold on to their houses. Town voters and their leaders, by their management efficiency and spending decisions at town meetings, propel real estate tax bills. Seasonal property owners don't vote. But, they do pay the largest share of the bill for the spending done by year-round residents.
And, as real estate prices have risen, and wealthier buyers have focused on prime Vineyard property with private waterfront and expansive water views, the rate at which the most valuable property has appreciated has increased more sharply than the rate of appreciation for more modest property, thus enlarging the share of each Island town's tax burden paid by the wealthy owners of the fanciest properties, few of which qualify for the residential exemption favored by the Tisbury selectmen.
The commercial sector in Tisbury - small when compared on the basis either of geography or dollar value with the town's residential property - is also victimized by the town's tax shifting. Its small size, and the fact that some Tisbury business property owners live elsewhere, means that the business sector has only a limited ability to influence tax and spending decisions or defend itself against the imposition of damaging tax premiums. A vigorous and growing commercial sector is indispensable to a community such as Tisbury. Investments in business district infrastructure, which Tisbury has wisely made in recent years, spur spending by business owners on their properties. Where this spending has been focused, in and around Main Street for instance, the public-private extent of the refurbishment is obvious and enjoyed by all - resident, business owner, and seasonal visitor alike. On Beach Road, where public investment has been neglected (except for sewering), and limits on business uses are hobbling in the extreme, the economics in support of private owner investment don't add up, so economic growth flags. Where business owners are encouraged to prosper, the benefits, in the form of the goods and services they offer, the pay and benefits they extend to their employees, and even the size of the workforce, accrue to the community as a whole. Unfairly shifting the tax burden to non-voting seasonal property owners, because they may be wealthier than some other taxpayers and are in no position to protest, or to business owners who are too few in number to be politically influential, is destructive politics that works against community cohesion and success.
