Published November 28, 2018
By DAN TOMASELLO
LYNNFIELD — Ten minutes.
That’s all it took for the Board of Selectmen to unanimously approve a shift in the town’s tax classification on Monday. The unanimous vote will raise the average single-family homeowner’s property tax bill around $160.
The shift approved by the selectmen means the tax rate will be $13.91 per thousand valuation for residential property for FY’19, representing a 15 cent increase from FY’18’s tax rate at $13.76 per thousand evaluation. The commercial, industrial and personal property (CIP) tax rate was set at $17.95 per thousand valuation, which is higher than FY’18’s rate of $17.08.
“Residential values are up a little more than 2 percent this year,” said Assessing Manager Ray Boly. “Commercial values are up less than that at 0.3 percent. Shifting the tax rate moves the tax burden to be raised from the residential and open space classes to the commercial, industrial and personal property classes.”
Boly said the average tax bill increase for a single-family home will be around $160 or less. He said the valuation for condominiums has increased for the second straight year. He said the average tax bill for condo owners will vary.
The Board of Assessors recommended using a 1.24 shift for the residential and commercial tax rate, Boly said.
“It’s a little more than 2 percent on both sides,” said Boly of the coming increase.
Boly noted the Department of Revenue is required to approve the tax rates.
MarketStreet criticizes rate
Similar to the tax classification hearing two years ago, two MarketStreet Lynnfield representatives urged the selectmen to lower the proposed commercial tax rate.
WS Development Executive Vice President Tom Desimone, whose firm manages MarketStreet, said the outdoor mall “is the largest commercial taxpayer in town.”
“I would ask the board on behalf of my tenants to leave the ratio at 1.20,” said Desimone. “My tenants don’t pay all the taxes. MarketStreet, the entity, pays some of the taxes that are not billed to the tenants. We are looking at a tax rate increase for commercial of about 70 cents. When I look at a 4 percent increase, we are already paying over $10 a square foot in taxes. That will mean our taxes will go up 40 cents a square foot. For the average 2,000 square foot tenant, that is about $800. That might not seem like a lot, but that requires the tenant to do more in sales. In order to do that in this environment and what they are competing against, it’s a very difficult challenge on top of the other costs that they have that are going up.”
Desimone noted MarketStreet was projected to generate $1.8 million in tax revenue when the development was first proposed. He said the costs associated with police, fire and education was projected to cost between $700,000 and $800,000.
“In fiscal 2019, we are going to pay somewhere between $4.5 million and $5 million in taxes to the town of Lynnfield,” said Desimone. “Your costs relative to police, fire and education are still $700,000 to $800,000. So instead of netting $1.2 million, you are netting somewhere in excess of $3 million. It could far exceed that number. We are paying those taxes, we get it. But I would ask you on behalf of my tenants for some consideration at keeping the rate at 1.20.”
Kings Bowl co-owner Patrick Lyons noted the bowling chain also has locations in Boston, Burlington and Dedham.
“On a 2,000 square foot place, the tax increase equals $800,” said Lyons. “We are a 20,000 square foot place. It may seem like Kings is always busy, but the reality is with the adjustments in wages and the competition that we face, including our place in Burlington, the impact on us before this rate increase is about 30 percent higher in Lynnfield compared to our other comparative spaces.”
Lyons said Kings will be unable to offset the tax increase by raising prices because of the “competitive environment that we need to exist in.”
“I would urge you to consider the words of Mr. Desimone,” said Lyons. “Thank you for your time and we are happy and proud to be in Lynnfield.”
After Desimone and Lyons concluded their remarks, the selectmen voted unanimously to approve the tax rate for FY’19.