How does Prop 2 1/2 really work?

GM-GUY

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I just got my tax bill for 2011 [crying]

The rate has gone up 6% and the valuation has gone up 8%. I know there were some over-rides that passed in 2009 and before but those should have already been accounted for as the 2009-2010 rate went up 14%. [shocked]

So what's the deal I have looked at the state text and it appears to give alot of outs - thoughts?
 

pdm

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I understand the tax rate going up but how did your house value go up?
The town reassesses. It's like a stealth tax. They can't get all the $$ they want in town meeting, so they magically increase your valuation. Walla!
 

Rob Boudrie

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Several tactics:

- Games with assessments - though there are checks (they can't increase to total take over 2.5% unless the town tax base increases) if someone has the money to bring a legal challenge, so towns try to keep these to a non-absurd level.

- Burden shifting by differential increases in assessments, targeting groups least likely to be able to fund effective legal counsel.

- Charging to things traditionally covered by taxes - garbage; school bus; school sports; etc.

- Ignoring Emerson v. Boston and embedding transfer payments in fees (boosting student parking fees so students can't steal from the school by buying a parking pass for a small fraction of the cost of a bus pass; including plowing of the faculty lot in the cost basis for the student passes; etc.)

- Taking multiple votes until the people vote correctly. This is the big one. If you don't like the fact that an override won, tough!!! If it loses, they'll trim the requested $10M to $9M and have a new vote - and keep making trivial non-substantive changes until you vote correctly.

- Bundling popular and unpopular services in a single vote. Why separate Police, Fire and Teacher into three votes when bundling might allow the popular ones to drag along the less popular.

Note that "Tell public employees that current contracts will be honored, but once they expire, the town is going to private sector style 'employment at will' is never on the table".
 

radioman

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The majority of the sheep in Ma voted to keep the 6.25% sales tax so property tax would no go up. I'm glad it worked out so well for them.

Oh wait?????
 
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My bill went up aprox 50%. It went from like $450 a quarter, to $670! (I know people pay a lot more, but my house/taxes are what I can afford). My valuation peaked before I owned the property in 2006 @ 166,000. Since then it has been going down. $148K when I first purchased, down to $133K last year. This year it went back up to $147k! So in addition to a rate increase of over $2, my valuation went up 10%, when all the values in my complex have still done nothing but drop! They always use the excuse that valuations are two years old, and that since I bought a foreclosure, the value cant be accurate. I dont expect my house to be assessed at what I paid, I know I got it at a steal, but my assessed value two years ago, was $125K, I cant wait to see how they try and discount an assessment actually done when they claim the assessments to be from. My other favorite argument is when they say "We'll the valuation is inline with your neighbors" All that means is everyone is getting ripped off! Their problem, not mine! At least both the lady in the assessors office, and the tax office seemed to think something was off. Abatement here I come!
 

Pilgrim

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my valuation has gone down over $100k (not TO $100k, but DOWN $100k) in the past 5 years. It's been dropping every year. My taxes are going UP every year. This year it was $400 more than last year.

Prop 2.5 is crap.

Want to bet what happens when my valuation starts going up again? I figure I'll have to sell my house in 5 years just to pay the increasing taxes.

It went from like $450 a quarter, to $670!
I wish! I'm up to almost $4800/yr. It was at $3300 about 10 years ago.
 
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center442

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lord1234 summed it up pretty well. If your city or town passed any bond projects, than these will be excluded from the 2.5% limit and added onto the total tax load. Under this scenario it is possible for a town's tax rate to exceed the 2.5% limit. Has your city or town passed any large bond projects in the last year? Has there been much new construction going on in your town?

Since the 2.5% limit is based on a town's total tax base plus any new growth, there's a built-in incentive for municipalities to keep property value assessments high. Higher assessments = more tax revenue without violating the 2.5% increase law. The homeowner has one avenue to fight this and that is by filing for an abatement. If you are pretty confident that your property is being assessed at an amount higher than "full and fair market value" it may be worth your time to seek an abatement.

You may have to spend some money for an independent appraisal to make your case. I have known people who have successfully filed for abatements. Once you get the appraisal you will have a better idea if it will result in a significant tax savings to you. The downside is that you'll have to pay for the appraisal to make the determination.

If the town has assessed your property at 500K, and you're reasonably certain it's only worth 300K, it is worth going after it. If there's only a 10K difference you'll have to decide if it's worth your time and effort.

Note that an abatement doesn't change the actual tax rate for the town, it only challenges what the town thinks an individual property is worth.
 
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The towns are corrupt, Prop 2.5 is abused like a red-headed stepchild. My taxes are up 20% in 5 years through assesment increases while the value is down 20% at least. The solution is to leave this state and I am going as soon as I can afford it. I live a stone's throw from NH and I know I will pay more in property taxes there, but I just cannot take the lies and deceit of Mass. I cannot take the Governor appointing Parole Boards that lead to a criminal with 3 life sentences getting out and killing a cop. I can't take the new GHG regulations coming that will charge insurance rates based on how many miles we drive, I cannot take the insulent and ignorant commies that re-elect the same theives and criminals to the state house every year. GTF Out of the state as soon as you can. Your mental health will improve and your quest to understand the insanity of liberalism will not be necessary.
 

GM-GUY

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UPDATE:
I called the assessors office and got a rolling kind of response, but was given info where to download the abatement form. Do in my travel to the form I found a place to look up property values (the whole town is open to view) anyway i found that everyone on the street went down last year and this year EXCEPT FOR ME this year only.

It has to be a screw up, I'm going to the office today and get it sorted out. By my calculations, this screw up is costing me $850 this year if I don't get it fixed.

PS: Dont tell anyone about the bunker - it's a secret!
 
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