Property Tax Bills Are Out on Island: Edgartown Drops; Other Towns Rise
By IAN FEIN
Driven by ever-increasing municipal spending, average property tax bills in five of six Island towns rose yet again this year.
But while most Vineyard landowners will find higher tax bills in their mailboxes this week, the average property tax for a single family home in Edgartown dropped slightly - from $3,200 last year to $3,140. It marks the first time in at least five years that any Island town has seen a decrease in its average bill, and it puts Edgartown ahead of Chilmark for the title of lowest average tax bill on the Vineyard.
Edgartown officials were surprised to learn of the decline this week, and offered a range of explanations, including an increase in contributions for state-owned land and the timing of the town adoption of the Community Preservation Act.
Meanwhile, the other Island towns are all reflecting a statewide trend in Massachusetts, where local property taxes have risen steadily for more than a decade.
According to most recent numbers provided by the state department of revenue, the average single-family property tax bill in the commonwealth this year topped $4,000 - up more than 25 per cent from five years ago, when the average bill was roughly $3,200.
In that same time period, average property tax bills in all six Island towns have increased between 25 and 33 per cent.
There is a common misconception that average tax bills are related to rising property values, but in fact they have virtually no connection. Average bills are driven by the annual town tax levy, which is determined by municipal budgets and receipts. Taken together, the six Island towns this year needed to raise some $67.4 million in property taxes, up roughly 30 per cent from $52 million five years ago.
"As long as town expenditures continue to rise – for things such as health care, pensions, salaries and the general cost of running municipal governments - so will people's property taxes," department of revenue spokesman Lydia Hill said this week.
The average property tax bill for a single-family home in Chilmark rose five per cent this year from $3,080 to $3,250, while Oak Bluffs went up four per cent from $3,460 to $3,600, and Aquinnah up some nine per cent from $3,660 to $3,995.
The highest average tax bill on the Vineyard - as well as the entire Cape and Islands - remains in West Tisbury, where the average bill rose about three per cent from $4,500 to $4,615.
Tisbury homeowners saw the largest increase in average bills on the Island this year, up roughly 12 per cent. The town is gaining on its neighbor to the west, though the number comparisons are not apples-to-apples because Tisbury is one of about a dozen towns in the commonwealth that offers a property tax discount to year-round residents. The so-called residential exemption this year is $920, so while a non-resident owner of the average residential property in Tisbury will see a tax bill of $4,600, a year-round owner of the same property would pay $3,680 in property taxes.
The large increase in Tisbury is due in part because selectmen shifted the tax burden slightly this fall. Tisbury is the only town on the Vineyard that splits its tax rate between commercial and residential properties, and, after lobbying from business owners, selectmen in November decided to reduce the higher commercial property taxes this year.
Even though the median Vineyard real estate price dropped in 2006 for the first time in six years, overall assessed values rose about six per cent Islandwide this year. The discrepancy is because of a lag between assessment dates and tax bills. The fiscal year 2007 assessments are based on estimated property values as of Jan. 1, 2006, when real estate prices still were on their way up.
This year did bring an overall slowdown in property assessment spikes, however, as the assessed value of the average single-family home in Edgartown, Oak Bluffs, Tisbury and West Tisbury all increased between 50 and 70 per cent over the last five years.
The average single-family home in Chilmark this year is valued at $1.74 million, at this point still the highest average in the commonwealth – though assessors on Nantucket, which last year had the second-highest home prices, have not yet completed their fiscal year 2007 townwide revaluation.
Oak Bluffs still has the lowest property values on the Vineyard, though the average single-family home assessment rose seven per cent this year from $602,100 to $644,000. The average residential property in Tisbury rose slightly in value from $789,500 to $816,800, while the average single-family home assessment in Edgartown went up from $1.05 million to $1.1 million. Aquinnah single-family home assessments dipped this year from $991,500 to $991,100.
Overall property values in West Tisbury jumped about 11 per cent this year, and the average single-family home assessment in West Tisbury topped $1 million for the first time, rising from $943,000 to $1.05 million.
West Tisbury principal assessor Jo-Ann Resendes said that, based on 2005 sales data, prices were increasing for a large bulk of properties in the center of town. "The middle-of-the-road stuff is moving up to catch what had already gone up," Ms. Resendes said this week.
The shift is mirroring a trend across the Island over the last couple of years, in which inland properties are rising in value at a faster rate than waterfront properties, which saw their prices increase dramatically in prior years.
Property values do not impact the average tax bill, though they do determine how the tax levy in each town is divided among landowners. Because of the substantial increases in the middle of town, some waterfront landowners in West Tisbury will see their tax bills drop this year even though their assessments may have stayed the same.
The department of revenue spokesman said such changes will likely continue in the years to come.
"High-end parcels are beginning to lose some value," Ms. Hill said this week. "As the real estate market begins to stabilize, we'll probably see more and more of that."