Friday, March 03, 2006

Right Numbers-Wrong Conclusion

In a letter in this week’s Milton Times an abutter to the DPW Yard suggests that we must be careful of commercial development if we wish to maintain our high real estate values. He offers as argument data on the 54 communities in Massachusetts with single family home values in excess of $500,000. He particularly notes that these communities average 7.6% of total assessments from commercial and contrasts this with those communities with single family home values under $500,000, which have 12.6% of assessments from commercial. He then asks: “With this evidence telling such a compelling story, why are some in town so desperate for new commercial development, …”.

My answer would be that the data tells a different compelling story. In fact the data supports what advocates of prudent, moderate commercial development have been saying all along, which is that modest commercial development is not incompatible with high home values. Indeed, the 54 communities cited have an average commercial assessment 2.5 times Milton’s 2.9%, and yet enjoy very high home values. Two thirds of the 54, in fact, have higher values than ours. At the same time, all but 5 of them have higher assessments from commercial. So it is simply not the case that this data supports the idea that a commercial development at the DPW Yard would create a commercial balance that would erode home values. For a town whose commercial base is smaller than all but nine communities in the state, we are a long way from the concerns raised in this analysis.

The writer then suggests that residential development would be better for the town. The Milton Landing Condos are offered as an example. They reportedly produce $400,000 in taxes, while the former commercial use on that site produced $40,000. Of course this is not a comparison of commercial to residential development. This is a comparison of a new, high value residential development with an old, low value commercial development. A commercial development of approximately half the value of the Wharf condos would have produced the equivalent taxes. And more importantly, it would have produced those taxes while reducing the town’s dependence on the residential taxpayer going forward.

This is why tax base diversity is important, and why simply bringing in some money with more residential development is shortsighted. Today the homeowner in Milton bears 95% of the property tax burden. If we continue to add residential development at a faster rate than commercial this burden will increase. How high will it go- 96%, 97%, higher? This would place us near the very top of communities in the entire state. This kind of a scenario has consequences. No one has said that developing a commercial tax base will lower our taxes, and suggesting that this has been said is disingenuous. What will be affected is the future tax burden. Tax revenues rise by 2 ½ % every year. On top of that we have periodic overrides. Based on our history, how many override votes will this town have in the next two or three decades? How much more will the homeowner have to pay going forward if the burden is 97% or 98% versus, say, 90% or 92%? Just as important, what would the likely outcome of those override votes be at a higher or lower residential share of the burden?

I volunteered in last years override vote for the Library. I made 100 to 150 phone calls urging residents to support the project. As many as half a dozen times I was told by residents that they were through supporting override votes until this town made an effort to foster some commercial development. Other callers told me they received similar comments. In another letter in the same issue of the Milton Times some senior citizens voiced their concerns about a potential, significant override for operational budgets this spring and their ability to afford such an increase. Unlike many of the 54 towns mentioned in the abutter’s letter, Milton has significant socioeconomic diversity, and a significant cohort of senior citizens. If you were to show many of our residents the tax bills paid by homeowners in most of those 54 communities, they would be terrified. We owe it to the substantial number of residents for whom property taxes are becoming onerous to do what we can to mitigate that burden. The day the residents of this town begin to reject proposition 2 ½ overrides is the day we’ll be unable to properly fund our schools, public safety and other vital services. Then you can worry about your property values.
Notice: On Monday the Planning Board will be hosting a public meeting at which 13 Experts/Volunteer Consultants from the Urban Planning Institute will be sharing their thinking on development of the Central Avenue Business District. The meeting will be at the Council on Aging, 10 Walnut Street. The meeting is at 7:00 pm.


Anonymous Anonymous said...

Once upon a time we had - oh, horors - a factory in Milton! This factory was near a trolley stop where workers could sometimes be seen sitting on the stone wall in plain sight for all to see! Now that same factory has been vacant for years - anyone remember Hendries? It was a few doors away from the ambulance company that's now mostly left Milton - Fallon.

I don't see why we want dozens of condos and apartments which put 24 hour a day demands on Milton's infrastructure instead of businesses where most people go home about 5 PM. Why can't we have an office buildings and more small businesses in the Central Ave. business district? Instead of several residential buildings have one. One is enough. Traffic is nasty enough already.

Then I wonder - why all this talk about parking? Why not capitalize on the area's proximity to public transportation? For example - Milton give a small tax break to companies who subsidize their employees' MBTA passes. Encourage local small business development - strive for businesses where at least some of the workers walk or take public transportation.

11:26 PM  

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