Fitchburg’s City Council took a historic step this past October, voting to close the gap between commercial and residential property tax rates by an unprecedented six points. This brought the business community’s share of Fitchburg’s property tax burden to 106 percent of the residential levy. Massachusetts allows two models for property taxes: single and dual rates. The single rate means that both residential and commercial properties are taxed at the same level. Meanwhile, a dual rate system dictates that one group – typically businesses- shoulders more of the burden and pays a higher share of taxes based on a property’s assessed value.
A single rate tax system has come to be recognized as a key indicator that a community is open for business, and the Council acknowledged this at their annual tax classification hearing. Through a spirited discussion, a number of councilors pointed out that that seventy eight percent of Fitchburg’s property fell under a residential use. If Councilors hoped to reduce the tax share carried by voters, the only responsible method would be to attract new commercial investment, as had been done with Great Wolf Lodge and GameOn Fitchburg. Maintaining a dual rate would only serve to discourage such efforts and perpetuate the root problem.
As always, the North Central Massachusetts Chamber of Commerce was present at the meeting and attested to the importance of this shift. In particular, they spoke to the impact felt by the types of small businesses which make Fitchburg unique. “Though some would argue that business owners can afford a higher levy,” stated Chamber President Roy Nascimento in his testimony, “these taxes can prove a serious hardship to the local businesses which typify Main Street.” He went on to argue that it placed an additional hurdle before investors who might otherwise take interest in the community.
Ultimately, the Council voted 7-3 in favor of reducing the burden on commercial property owners. Commercial property tax owners will still see modest increases, but at a lower value than if there had been no change. Overall, this reduced the tax burden on businesses by $702,836. The Chamber would like to thank Councilors Kushmerek, Green, Clark, Donnelly, Zarrella, Kaddy, Fleming, and Walsh for supporting this historic action.