The Nov. 9 Newburyport City Council vote on the new $13.39 tax rate deserves more coverage than it got.
First it is worth noting that, for all the alleged public angst over taxes, not a single resident spoke at the meeting on taxes.
The first concern before the full council was whether to keep a single rate for residential and commercial properties, or charge commercial properties a higher rate. The Budget & Finance Committee, chaired by Councilor Tontar, recommended keeping a single rate. Tontar argued that raising the commercial rate could actually end up shifting more of the tax burden to residential properties by hurting business development and commercial property values. By a vote of 10-0, the council agreed to keep the single rate.
The main vote was then on how much of a tax rate increase to pass along to taxpayers. The mayor recommended a rate of $13.48, up from the current $13.34 per $1,000 of assessed value. Tontar proposed using about $345,000 funds from the city’s $2.8 million free cash account to lower the rate to $13.39, thus shaving about $47 off the tax bill on the average home ($520,487 value).
Councilors differed over the appropriateness of using free cash to lower taxes. The debate was a spirited one, with Tontar arguing that while the move would not save taxpayers a lot of money, it was the right thing to do. Cronin and Giunta agreed.
Eigerman argued against using free cash to subsidize taxes, suggesting the funds should be used for other purposes including the city’s stabilization fund. Herzog said he believes that using free cash for this purpose is inappropriate under state regulations.
The vote was 7-3 in favor of using free cash and the $13.39 rate. Those voting for it were Cameron, Connell, Cronin, Giunta, Kinsey, O’Brien and Tontar. Those against: Eigerman, Herzog and Vogel. (Heartquist was absent.)
On Nov. 11, Herzog, who is leaving the council, blogged: “I was usually the lone councilor voting against tax rate increases, two other councilors joined me this week in defiance.” He cited Vogel and Eigerman as the two voting with him. Herzog also urged newcomers to the council to vote against future tax increases.
At no time during the meeting did any councilor, not even Herzog, argue against raising taxes or for raising them less. The discussion and vote were about the use of free cash and the $13.39 tax rate.
Only Herzog can say why he voted the way did but his characterization of others’ votes as being against raising taxes does not hold up. Both Eigerman and Vogel confirmed that they were not voting against raising the tax rate; they were voting against using free cash to lower it.
On June 29 the full council voted 10-0 to approve the city’s new budget. That vote was in effect a vote to raise taxes. The Nov. 9 vote was to determine how to fund the already-approved budget.