$4M Put Toward Taxes; City Left With $9M

Capone.jpg
(JOSHUA RESNEK PHOTO) 
City Councilor Fred Capone said the only way to achieve true tax relief is by cutting expenditures.

By Josh Resnek

If you watch council hearings on Everett Cable and wonder what has been talked about by officials regarding taxes, join the crowd.

Understanding the taxation situation here is like entering a maze that is impossible to navigate.

Monday night, the city council approved a measure asked for

by the mayor and the Board of Assessors and Chief Financial Of officer Eric Demas.

In the end, $4 million off the city’s free cash went to drop the taxes paid by homeowners.

Without spending cuts, as suggested by Councilor Fred Capone, putting free cash against a tax rate that is rising everyday is not good public policy.

Far better, Capone, said, to do something with the money that makes a difference.

Indeed.

The average homeowner will pay about $50 less next year on their property tax bill.

With values rising the way they have, this finger in the dam about to burst, will not stop the dam from bursting.

Councilor Rosa DiFlorio said she pays about $8000 a year in taxes for her home. While she was hesitant to take so much cash to put against rising taxes, she said: “I think its great. This is a tough year. Whatever we can give to the taxpayers they deserve.”

Capone echoed DiFlorio’s reasoning.

DiFlorio.jpg
(JOSHUA RESNEK PHOTO) 
Councilor Rosa DeFlorio said she is in favor of tax relief but would rather free cash be put to better use at Monday’s council meeting.

“It is our obligation to keep taxes lower…but, he repeated, “lower taxes will come only with less spending.”

The Board of Assessors led by Billy Hart explained the situation with a video presentation to the council at the beginning of the special meeting.

Assessor BJ Devereaux and Demas explained the ups and downs, and the ins and outs of the taxation scene in Everett.

Demas said with property values rising it was not easy to keep pace with the rising taxes that follow.

He did not at any time refer to cutting spending as the single most significant way the city can drop the tax rate for property owners without having to use free cash.

“Prices for an acre of real estate have reached $2 million,” Demas said.

“Commercial industrial values are going up significantly,” he said. “The increased value gives us flexibility with increased (taxation) capacity”

The city has a tax levy of $110 million. But with all the bells and whistles ringing, the city has a $136 million cap because of rising property values it can rely upon if it runs into difficulties.

“The bond rating companies look at this. They look at us the way a banker would look at an individual who has a $10,000 credit card but is carrying a balance of $9000,” he said.

He said the difference between the city’s tax levy and what it can tax to the maximum under the law reveals about $26 million that can be used if necessary.

The council passed the measures unanimously.

With the payment of $4 million put against the tax levy, the city has about $9 million remaining in the bank, according to Demas.

Councilor Mike McLaughlin asked Demas what would happen if the casino owner lost its license.

Council President Peter Napolitano tried to rule him out of order.

“Is this question relevant to the discussion about using the $4 million?” Napolitano asked.

“Yes it is,” said McLaughlin. “People don’t care what the levy is. They care about the payments of taxes coming out of their pockets. What happens if Wynn Resorts is thrown out of the city? “

Demas told Mclaughlin: “I have not looked into it.”

Hart said rates had gone down but values have gone up. ‘We try to bring down the rate, but there is a cost to that,” he said.

 

 

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