Following approximately one year of inspecting residential properties, commercial buildings, and apartment complexes throughout Chelsea, the City’s Assessing Department has concluded its comprehensive property value assessment. The results indicate substantial increases in property values and corresponding tax bill rises.
During Monday night’s City Council session, City Manager Tom Ambrosino delivered a detailed presentation explaining the property tax system and Chelsea’s current assessment figures.
While property values have been finalized, the implications are troubling for residential property owners. The situation presents both positive and negative aspects.
According to Ambrosino, “fblikebutton_button” “Residential values have increased much faster than commercial/industrial values and there’s going to be a large shift from commercial/industrial taxpayers to the residential taxpayers. Residential taxpayers are going to pick up more of the burden than they did last year. That’s what’s happening out there. A similar scenario took place in the early 2000s. It was very painful for the residential taxpayers. I fear we’re in that same cycle. Anyone trying to sell a property in Chelsea will tell you it isn’t on the market long. That’s reflected here in these numbers…This is not good news for the residential property owner in Chelsea.”
Three-family homes face the most significant impact among residential properties.
Chelsea contains 951 three-family homes, which will experience average tax increases of $636 from the previous year, bringing bills to approximately $4,289.
Single-family residences rank second, with 842 properties averaging $431 in additional taxes, totaling $2,918 annually.
Two-family homes number 1,201 and will see average increases of $325, resulting in bills of $3,690. Condominiums face the smallest burden, with average increases of $107 and bills of $1,715.
The residential tax rate, to be finalized in November, is projected at $14.25 per $1,000 of value, compared to last year’s $14.40. The commercial/industrial rate is expected to reach $32.22 per $1,000 of value, down from the previous $33.45.
The following represent average assessed value increases:
- Single-Family, +16.8 percent
- Condo, +8.9 percent
- Two-Family, +10.9 percent
- Three-Family, +17.3 percent
- 4-8 Family, +5.8 percent
- 9-plus Family, +7.8 percent
- Commercial, +1.8 percent
- Industrial, +9.2 percent
State law requires the Board of Assessors to update property values annually based on comparable sales data. Every three years, values must be certified with the state Department of Revenue. A complete revaluation, including property inspections throughout the City, is mandated every nine years.
Over the past year, the Assessors have been conducting this comprehensive revaluation, inspecting approximately 5,000 properties.
Owner-occupants will continue to receive the 20 percent residential exemption.
While most residents must accept the tax increases, Ambrosino is urging the City Council to approve relief measures for elderly, widowed, and disabled residents who qualify for state exemptions.
One example involves a $175 exemption that has never been adjusted for inflation in Chelsea, despite state law permitting such adjustments. Ambrosino noted that “fblikebutton_button” “The rate of inflation was just never adopted in Chelsea and it has been at $175 forever. Other municipalities that have adopted it and have adjusted it for inflation have an exemption that is well over $200.”
Additional proposals include reducing the ownership timeframe requirement to five years and modifying asset limits for means testing.
Ambrosino also suggested doubling the $500 circuit breaker exemption to $1,000, lowering the qualifying age to 65, and raising income and asset thresholds.
He explained that “fblikebutton_button” “The bottom line is more seniors will be able to qualify and get the most out of these exemptions. I am going to propose you do these things.”
Councillor Matt Frank raised concerns regarding implementation costs and requested a specific dollar estimate.
Ambrosino indicated he could not provide an exact figure but anticipated that the $48,000 in exemptions granted last year would likely double.
According to Ambrosino, “fblikebutton_button” “In total, there were $48,000 in exemptions for these folks granted last year. I’m figuring that would double, but even if it triples that’s insignificant in a $168 million budget. If they quadrupled, it won’t be that much for us, but it will make a tremendous impact for these people.”
Ambrosino additionally proposed that the Council submit a Home Rule Petition to the State Legislature to increase the residential owner-occupant exemption from 20 percent to 35 percent. He also recommended expanding the senior citizen work-off program at City Hall from $500 to $1,000.
The City Council will hold a tax rate hearing on Nov. 9.