How would an override impact taxes?
And how do the Melrose tax rate and school budget numbers compare to our neighbor, Wakefield?
Mayor Jen Grigoraitis has asked the city council to vote on a $7.7 million override, with the city voting for this on Tuesday, June 18. The city council is deliberating this, with two meetings this week, and a final vote to be held on May 13. It will take a super majority of 8 votes for this to pass.
Some sobering news: These 39 towns and cities are all either making significant cuts or are putting an override question to their voters:
Stoneham, Andover, North Reading, Reading, Arlington, North Andover, Belmont, Acton, Braintree, Dedham, Hanover, Hingham, Harvard, Westford, Millis, Northampton, Gloucester, Easthampton, Boston, Brookline, Woburn, Worcester, Lennox, Lowell, Milton, Medford, Framingham, Marblehead, Westport, Eastham, Amherst, Pepperill, Townsend, Swampscott, Pittsfield, Grafton, Franklin, Billerica, Winthrop.
Melrose is not alone in our budget struggles.
There have been many comments about how this must reflect poorly on the fiscal management of Melrose, but I would like to take a different approach to looking at this issue. Specifically, I think it is important that we compare Melrose to two neighboring towns, Wakefield and Stoneham, to see how they approach residential taxes and school funding.
Stoneham and Wakefield are similar to Melrose in size and demographics. Wakefield is more closely similar to our size and receives approximately the same state aid and has very similar median house value and income. Both towns have a smaller commercial base and get most of their tax revenue from residential properties, although Wakefield’s and Stoneham’s are both lower than Melrose, with 82% of the tax levy coming from residential properties, versus 91.3% of tax levy being residential in Melrose.
The Stoneham FY24 tax rate is 10.59%, while the Wakefield FY24 tax rate is 11.25%. In comparison, the Melrose FY24 tax rate is 9.93%. This is amount you are taxed for every $1,000 of assessment of your property.
The total tax levy for FY24 was $76.8 million. Recall that the formula for tax rate = tax levy limit / total assessment valuation of the city. To add a slight level of complication, we will note that 91.3% of the total tax in the city comes from residential dwellings (compared to 8.7% coming from commercial, industrial, and personal properties, for a total of 100% of the taxes). This means that the 91.3% of the total tax levy, or .913 x $76.8 million = $70.1 million comes from residential properties (and approximately $6.6 million from the other three sources).
The total assessed value of residential properties in Melrose in FY24 was $7.1 billion.
Remember that tax rate = tax levy / total assessment value.
In this case, residential tax rate = $70.1 million / $7.1 billion = $9.9/$1000 of assessed value.
The average assessed value of a single family residential property in Melrose in FY24 is $794,000, and the average single family tax bill = tax rate /$1000 x assessed value.
The average tax bill = $9.9 / $1000 x $794,000 = $7,884.
A $7.7 million override means that the tax levy limit would be increased by $7.7 million, or $76.8 million + $7.7 million = $84.5 million. Given that 91.3% of this amount is levied by residential properties, the new tax levy used to determine residential taxes would be .913 x $84.5 million = $77.1 million.
This new tax levy is used to determine a new tax rate. New tax rate = new tax levy / total assessment value.
New tax rate = $77.1 million / $7.1 billion = $10.9/$1000 of assessed value.
Now, applying this to the average single family assessed value of $794,000, we get:
New average tax bill = $10.9 /$1000 x $794,000 = $8,655. This is a difference of $770, or 9.8%, from the previous amount of $7,884.
This is an increase of slightly more than $64 / month, or $193 on a quarterly tax bill, than what the actual FY25 tax bill was without an override. If your assessed value is less than $794,000, you would pay less than this amount and, while not inconsequential, for an average of approximately $64 extra per month, the city’s budget is increased by $7.7 million.
Notice also that the new tax rate of 10.9% is now slightly higher that of Stoneham’s 10.59, and still less than Wakefield’s rate of 11.25%.
How does Melrose compare to Wakefield in terms of enrollment, school budget, and taxes?
Let’s compare school districts, specifically looking at Wakefield. According to the Department of Education, for FY23-24 Melrose had an enrollment number of 500 more students than Wakefield.
The FY24 Wakefield school budget was $49.6 million. The Melrose budget was over $2 million less, at $46.8 million. Wakefield has proposed a FY25 school budget amount of $52.3 million, which is higher than Melrose’s proposed $51 million amount. The budget that was approved by the Melrose school committee, at $47.2 million, is a whopping $5million less than the proposed budget of Wakefield. This is not a trivial number for comparable school districts. With the override, the school budget would be increased by $4.2 million (of the total $7.7 million), which is still almost $1 million (~$900,000) less than the proposed Wakefield budget.
That is, Wakefield has 500 less students, yet they consistently budget more each year for their schools. As Wakefield’s numbers show, Melrose taxes are significantly lower than our neighbors and Melrose has been getting by with less for years.
If you believe that Melrose should fund their schools at an amount that is similar to Wakefield, it is worth asking what it would mean to do so. It means, as these numbers show, taxing like it.
References:
Tax Info for Melrose:
Override information:
https://dlsgateway.dor.state.ma.us/reports/rdPage.aspx?rdReport=Analysis.TaxImpactCalc
When I come across a term I don't know, and one that is used with regularity at school committee meetings, rather than assume that I'm being lied to, I ask people who know more than I do. The term language based learning disability is known to any special education teacher, school psychologist, and anyone who works in the field of helping kids who have a learning disability. When I just asked my wife, a special education teacher, she did not skip a beat when describing what it is, how it may manifest, and what common interventions are. Next, my google search got me this: https://www.landmarkoutreach.org/strategies/what-are-lblds/#:~:text=Language%2Dbased%20learning%20disability%20(LBLD,basis%20for%20most%20school%20activities.
Public education has changed. The needs of kids have changed. Assessments have changed. Interventions have changed. Federal laws have changed. Terminologies have changed. The argument of "back in my day" is, to me, a tired trope. When I suggest that you attend a school committee meeting, I mean it...please do. At most meetings, the school committee invites input from teachers and administrators, who are some of the most talented, hopeful, and hardworking people you will find. You might be surprised at what you learn!
Thanks for the time and research you devoted to this article. People need facts to understand the need for raising taxes and that's what you provided and well done. My dad was an assessor and I am quite familiar with the perils of emotions over-riding facts. Having been a teacher in a neighboring community for 34 years and spending hundreds of dollars of my own funds to support my curriculum was a realization of how tight school budgets can be. I am 100% behind supporting the best education Melrose can give our children. One aspect of our property values is based on what young families feel the city is willing to invest in their children's education. That was the #1 reason we moved here 50 years ago.