Everybody wants to live in Melrose, and that’s reflected in our property values: The value of an average single-family home has risen sharply, from $397,704 in 2011 to $500,780 in 2017.
This is evidence not only of our hard work but also that Melrose has the things people are looking for nowadays: We have good schools, beautiful parks, an excellent library, convenient access to transit, and most important, a strong sense of community.
At the same time, property taxes in Melrose are moderate: The average property tax bill for a single-family house this fiscal year is $5,909. That’s on a par with Wakefield and Stoneham, our immediate neighbors, and considerably lower than the average tax bill for communities such as Arlington, Belmont, and North Reading, which I would argue are a closer match to Melrose in terms of quality of homes and civic amenities.
This comes about because Proposition 2 ½ limits the amount that we can raise property taxes to 2 ½% of the total tax levy of the previous year, plus the value of any new construction. That means that the skyrocketing property values have not brought a substantial increase in tax revenues to the City. When property values go up, the tax rate must go down to maintain the balance required by law.
We recognize that a moderate tax rate is still not affordable for all our residents. We want our senior citizens to feel that they can stay here as long as they like, and for that reason, we offer an array of discounts as well as the tax work-off program, which allows seniors to reduce their tax bill by doing volunteer work for the city. In order to ensure that as many people as possible can access the benefits they are entitled two, we had two open-house events last year that offered “one-stop shopping” so seniors and others could sign up for all their discounts at once.
Melrose has a relatively small commercial tax base, about 5%, and that is not likely to grow much—nor do we want it to. We value our local businesses, but we also value our status as a primarily residential community, and I think we have the perfect balance between the two. Businesses do pay a higher tax rate, but again, that rate is moderate compared to those in surrounding communities.
Because of Proposition 2 ½, our revenues are capped, even as state and federal aid are declining. Communities with a lot of open space, or large business districts, can grow their budget by encouraging new development, but that’s not an option for Melrose—nor would we want it to be. The amount of land we have is limited, and any new development must be appropriate in terms of size and use, which limits the options even further.