I see lots of smoke but little fire when it comes to talking about Amesbury's taxes and finances. So, let me take some time to explain how they look from where I stand.
For as long as I have lived in Amesbury, there has been a dedicated and vocal group of residents that have cried that Amesbury's finances are on the edge of disaster! Headed for bankruptcy! And that our financial situation is unique in all the Commonwealth, in terms of how dire it is and what is going on here. We heard it with the Split Tax debates in 2006 and 2008 and we heard it with the Under-Ride vote in 2007 (
http://nounderride.blogspot.com/). So, let's look at what the claims are and what the data says.
- Amesbury has the highest taxes in Massachusetts.
Not quite true. In 2013, our average single family residential tax bill ($5,984) was the 65th highest in the Commonwealth, which is up there. Our tax rate is in the top ten, at $20.24 per $1,000 of value. So, yes, we pay a lot of property tax here in Amesbury. We live in Essex County, one of the most expensive counties in one of the most expensive states in the country. In fact, 25 out of the 39 cities and towns in Essex County are in the top 1/3 in terms of average residential bill (including Amesbury). And Amesbury sits just above the middle of the pack for the county, with 14 communities having higher average tax bills and 20, having lower. Looking at our peers (and who we compete with to hire our employees), we're not that out of line.
- Amesbury's high tax rate is ruining our home values and keeping them low.
This fits in the 'pants on fire' category, though you will hear it repeated very often. It is no secret that Amesbury homeowners have lost literally millions of dollars in the value of their homes since housing market bubble burst last decade. But so did virtually any American who owned real estate. In fact, an estimated $6.5 to 7.5 TRILLION dollars in equity was wiped out in the crash. But maybe there is something to this claim, maybe we are even
worse off then our fellow citizens beyond the walls of our castle here. Fortunately, the facts don't bear this out. If you plot the rise, fall, and recovery of assessed value in Amesbury from 2006 to 2013, it tracks the fate of Essex County and of the Commonwealth as a whole almost to the percentage point. In fact, the Warren Group recently reported that Amesbury was among the 25 'hottest real estate towns' in the Commonwealth (
http://bit.ly/16AIMsT).
- Amesbury's taxes make it a bad value to buy into.
Remarkably, this claim is being made by at least one person who is actually a realtor here in town (note to self, don't hire them to sell my home). This is an easy one. Amesbury is an excellent community to buy into. Let's look at a simple comparison: Newburyport. We have almost the exact same population (about 17,000) and almost the exact same average residential tax bill. That should come as no surprise, since we are providing services to roughly the same size population (buyer beware: I've posted
previously about how shaky these town-to-town comparisons can be). The average single family home value in Amesbury in 2013 is $265; in Newburyport, it is $435,000. You would pay basically the same tax bill on each home. And on a 30 year mortgage at the current rate of 4.5%, you will pay over $256,000
more in principal and interest (about 50/50) to have the privilege of paying the same taxes as Amesbury. Is living 10 minutes closer to Plum Island and having a Starbucks in your downtown worth $256,000 more? The affordability of Amesbury was the very thing that brought my wife and I to Amesbury. We lived in a tiny condo in Newburyport, in fact, and could not afford to buy a home there. We found a lovely house in Amesbury and haven't looked back since. I can't tell you how many people I've met here had that same experience - what brought them here was the value they could get for their money. And maybe, if someone bought here at the top of the market and hoped to flip a home for a gain, then yes, Amesbury may not have worked out for you as planned, but that happened most everywhere in the last decade. But if you are here for the long haul, then Amesbury is an excellent value.
So, every conversation about TAXES is really a conversation about SPENDING and FINANCES. And every conversation about SPENDING is one about VALUES and PRIORITIES. I am of the conviction that our fiscal record has been pretty solid in the last years, especially during the tough ones in the last 5 years. During the worst economy since the Great Depression, our:
- bond rating has gone up, saving us big on interest payments (bond rating is basically our municipal 'credit' rating)
- our reserve account has soared from next to nothing to north of $1M
- our stabilization funds have grown
- our 'excess capacity' under the Proposition 2 1/2 Levy Limit has grown, meaning we have more room for absorbing future spending needs without resorting to an over-ride
- non-school costs have been tightly contained, if not reduced
But all that is material for another post, coming soon.
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