Bob Roemer, Brian Boyle and the members of the Bolton Masterplan Steering Committee
This document answers some frequently asked questions about taxes in Bolton. If you have any further questions, please send an email to firstname.lastname@example.org. Our goal is to provide useful information to Bolton residents and taxpayers.
Q1. What taxes does Bolton have?
Bolton is able to collect taxes based on the full and fair cash value of all real estate and personal effects in the city. Bolton will tax residential, commercial and industrial properties using the values set by our Board of Assessors. We also tax personal property such as computers or similar devices owned by companies.
In addition, Bolton levies a motor vehicle excise tax based on the values of local residents’ vehicles. We also collect room and board taxes for applicable Bolton businesses.
Overall, the city’s source of property tax is property tax. Of these, residential property is by far the largest segment. This tax revenue, along with some government grants and some revenue from fees and fines, is used to help meet our annual city budget.
Q2. What do our taxes pay for?
For more information on the city’s current operating budget, see the Fiscal Year 21 Budget, which was approved at the city’s annual meeting.
The division is:
• Government: 5.5%, $ 1,396,325;
• Public Safety: 10.0%, $ 2,525,023;
• Education: 64.9%, $ 16,459,965;
• Public Works: 5.8%, $ 1,477,835;
• Human Services: 0.7%, $ 187,612;
• Culture & Recreation: 2.0%, $ 500,100;
• Debt Service: 5.2%, $ 1,318,285;
• Employee Benefits: 5.4%, $ 1,373,477;
• Other Insurance: 0.5%, $ 116,022.
TOTAL: $ 25,354,643
Most of the budget goes to Bolton’s two regional school districts: Nashoba for grades K-12 and Minuteman for vocational and technical training in grades 9-12.
Q3. What are the different property classes in Bolton and how are they taxed?
The vast majority of properties in Bolton are classified as residential or open space (93.5%), with commercial, industrial and personal ownership 6.48%:
Residential: $ 1,054,171,449 (estimated value);
Commercially: $ 38,099,651;
Industrial: $ 11,613,500
Personal property: $ 22,685,610.
TOTAL: $ 1,126,570,210
Bolton taxes all property classes with a single tax rate (see Q5 for the tax rate calculation). Some municipalities are choosing to shift some of their tax burden from the residential and open space class to the commercial, industrial and personal property classes. This is known as a “shared tax rate”.
The Board of Assessors holds a hearing on tax classification with the Board of Selectmen every year. This meeting is open to the public, and then the city decides whether to split the tax rate. You can watch this year’s tax classification hearing online (https://www.youtube.com/watch?v=x4Xw0t8xWLY) from 9:39 a.m.
The Board of Assessors has never advocated an apportionment rate in Bolton for two fundamental reasons:
• Much of Bolton’s agricultural land is classified as commercial and higher farm taxes would adversely affect these businesses and landowners. The Board of Assessors and the Board of Selectmen have always endorsed a single tax rate to support our community’s farms.
Bolton currently has a very low percentage of CIP properties. Even if we opted for a shared tax rate, it would not significantly detract from the reduction in the tax burden on residential property.
Q4. What is theorem 2½?
Proposition 2½ is a law that was passed in the early 1980s. It limits the amount by which total property taxes can increase from year to year to 2.5% of the previous year’s taxes (this is known as the “tax limit”). It also sets an overall cap on the total amount that the city can raise (this is known as the “tax cap”).
For reference, Bolton’s total tax levy for FY 21 is $ 23,500,254. Our tax limit for Fiscal Year 21 is $ 22,421,921. However, if we factor in excluded debt, our maximum levy is $ 23,664,958. Our tax cap for Fiscal Year 21 is $ 28,164,255 (or 2.5% of our total estimated value).
Proposal 2½ also provides two mechanisms by which taxes can be increased through voting. These mechanisms allow either: (1) a permanent increase for general budgetary purposes (a general “override” last implemented in Bolton in 2005); or (2) temporary tax increases to finance debt for projects such as school buildings, community buildings, or nature reserves (so-called “debt exclusions”). Debt exclusions disappear after the debt is paid off.
The Massachusetts Department of the Treasury has produced a series of videos explaining how Proposition 2½ works.
Q5. How is the tax rate calculated?
Every year, the city’s residents vote at the city assembly to approve an annual operating budget. The operating budget covers the cost of all city services (including salaries and benefits) as well as the assessments we pay to the regional school districts.
At the city assembly, residents also vote on other expenditure items such as capital inquiries (e.g. vehicle purchases and building repairs). When we combine the operating budget with all other approved expenses, we get a “Total To Be Raised” amount. In Fiscal Year 21, that total is $ 25,341,643.
We deduct all income and other sources of income from this amount. That leaves us with the entire tax levy – the amount that the city has to raise through taxes to cover its funds. For Fiscal Year 21, the required tax levy is $ 23,500,254.
To calculate the tax rate, we divide the tax levy by the total valuation of all property classes in Bolton ($ 1,126,570,210) and then multiply by 1,000: ($ 23,500,254 $ 1,126,570,210) 1,000 = $ 20.86 for fiscal year 21 .
Q6. What is Bolton’s Average Tax Charge?
As shown above, the tax rate for Fiscal Year 21 is $ 20.86 per $ 1,000 assessment for all property classes. The Board of Assessors determines the property valuations based on the market values in the region and the size of the property, apartment and outbuildings. The estimated value of an average single-family home in Bolton is currently $ 549,200, and therefore the average single-family home tax charge in fiscal year 21 is $ 11,456 (i.e., $ 20.86 x $ 549.2). Higher value properties pay higher taxes, while lower value properties pay less tax – but all properties have the same tax rate.
For fiscal 18, Bolton had the 22nd highest average single-family home tax rate (rankings for recent fiscal years are incomplete). The communities with higher average tax rates were: Weston, Lincoln, Sherborn, Wellesley, Carlisle, Dover, Concord, Lexington, Wayland, Winchester, Manchester by the Sea, Cohasset, Belmont, Newton, Wenham, Westwood, Acton, Medfield, Harvard, and Needham. Stow was in 29th place and Lancaster in 87th place.
Q7. Is Bolton “expensive”?
This is a loaded question. On the one hand, it is correct that Bolton’s residential tax burden is high compared to the rest of the state (see Q6). However, this largely depends on our tax base being over 90% residential. Bolton, on the other hand, isn’t a particularly expensive community. Bolton is in the middle of other comparable cities if one considers the dollars spent per inhabitant of these cities (see table opposite).
Compared to most cities and many other cities, Bolton receives relatively little state aid, which increases our reliance on property taxes to pay for expenses. Our minimal state aid is due in part to the relatively high incomes of Bolton residents. For example, the median household income in Bolton is $ 155,093, compared to $ 145,967 in Stow, $ 103,071 in Lancaster, $ 87,806 in Hudson, and $ 66,094 in Clinton.
Members of the Steering Committee for the Bolton Master Plan are: Bob Roemer, Brian Boyle, Kenneth Troup, Mark Sprague, Paul Tesini, Ed Sterling, Molly Myers, Cia Ochsenbein, Panny Gerken, Stacia Downey, Mary Ciummo and Christopher Rogers