The Cambridge City Council, including Cambridge Mayor Denise Simmons, voted unanimously to increase property taxes starting in the next fiscal year to help pay the city’s bills.
The increase raises the commercial tax rate approximately 22 percent to $14.07 per every $1,000 in assessed property value, up from $11.52. It will also increase the residential tax approximately 5 percent, to $6.67 per every $1,000 of their property’s assessed value, up from $6.35.
City leaders said they spend millions on sheltering the homeless, and have plans to install a universal Pre-K for children, on top of its regular funding of schools, public safety, and the Department of Public Works (DPW).
“This is really part of the broader budget process,” said City Manager Yi An-Huang.
The city’s nearly billion dollar budget had already been passed, with an increase of nearly four percent. City leaders said that’s partially why property taxes are going up, but there are also other factors.
“The stark increase, that very high increase, is really more related to value decline,” said Claire Spinner, Assistant City Manager for Finance in Cambridge.
For years, the city had significant property tax revenue coming in from owners of office buildings and research labs in Kendall Square, but vacancy rates have gone up, so these buildings are now worth less. Cambridge officials said the city has to make up that money elsewhere.
Cambridge finance leaders said while the commerical tax is increasing across all sectors, the median tax bill increase for many stores and restaurants will be less.
“Those tax increases are really somewhere, you know, 10 percent and less for most of the property owners,” said Spinner.
People who live in the city said they are concerned that property taxes are raising significantly, especially on commercial real estate, which impacts small businesses.
“After COVID, a lot of people are working at home now so these stores, they’re not making the money,” said Clifton Fitzgerald, who lives in Cambridge. “Most likely they’re going to go out of business.”
Kari Kuelzer, the owner of bar and restaurant The Sea Hag in Harvard Square, said she’s also concerned.
“I sort of liken it to being the butter on the bread, but we get dropped face down,” said Kuelzer. “I think that they’re forgetting how much the value all of the properties are driven by the actions and the business activity that we provide.”
Cambridge says even with these property tax hikes, the city’s rates are still less than many of the surrounding communities, including Boston.
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