Posted by Jeremy Shulkin
6:59: Internet’s already a little spotty so far. Still waiting for people to roll in.
7:11: Members of the public will speak first. I’m going to butcher their last names.
George Valeri is first to speak. He wants to speak in favor of the lowest res. rate. He says it’s a matter of survival — people are having trouble eating. Even if it’s only a $31 increase, when you make $500 a month and it takes $500 to feed a family, $31 is a lot. He says he owns 17 units on Wall St. that hasn’t made money in three years. He can’t raise rent because people can’t pay the rent he’s charging. He says this country is becoming a “socialistic country” because we’ve pushed jobs out.
7:16: Gary Vecchio, pres. of Shrewsbury St. Neighborhood Association. He’s here to speak in favor of the lowest res. rate. He says only 8 times in the last 20 years has the council voted for the lowest rate. “The most vulnerable people of our society…are the people that need to be protected.” He brings up the lack of COLA increases for those on social security for the second year in a row. Water and sewer and gas have all gone up, while pensions have declined. People are not working or working 2-3 jobs to make ends meet. “If you take more money out of our pocket, it’s less money that we spend in those businesses.” He also says new businesses look at affordability of the city for their employees when factoring what city to come to. He’s in favor of TIFs, DIFs, and other incentives to expand the tax base and attract business, rather than lowering commercial taxes as the expense of homeowners.
7:20: William Breault agrees with Vecchio. “For the last 20-25 years this is probably the worst for foreclosures and people living on the margins.” He says he sees people give up food for medicine. “If this is what you gave your word on, that is what you should do.”
Another woman (Edith) is here to ask the council to “consider us homeowners. Without us, there’s no city….they work for you and they’re voters.” She cites foreclosure rates, gas/electric rates. “We’re not asking for TIFs, we’re not asking for depreciation notices…if we do fix (up our houses) our taxes go up…I’m asking not to be taxed anymore. We end up with higher taxes in other areas.”
“We bear 80% of the tax burden in the city…and we generate most of the new ideas…we give money to all kinds of causes.” She says homeowners are assessed closer to market value than corporations in her neighborhood.
7:27: Michael Lanava from the Chamber of Commerce is here to advocate for sharing the tax increase between homeowners and business owners. “We are mindful this will result in an addition $7.75 per quarter from the homeowner, but this is a wise investment to make.”
He lists accomplishments that have “moved the city forward:” CSX, investing in streets, sidewalks and schools, CitySquare.
He’d like to see tax friendly zones in the city for gaming companies and biotech, and to push for large residential complexes (“much more than 4 units”) to change to commercial taxation.
7:30: Bradford Wyatt explains his view from the perspective of “a struggling Worcester business owner.” He’s the owner of the Osgood-Bradley building, and says it’s never full to capacity, and the companies that are there can’t afford any hikes in rent. He disagrees with the argument that commercial owners can just raise their rates to offset taxes. He says one solution would be to find a non-profit to take over his building, which would not have to pay taxes. “Would the city rather have 100% of nothing?” He cites the sale of the Crowne Plaza to MCPHS as an example of this.
7:36: Roberta Schaefer, head of the Research Bureau, says yesterday they published their survey of empty office space downtown. It says the city has lost 10.6% of its downtown office space in the past five years(?). “It’s clear from you heard from business owners tonight and our results that the current tax policy is not working for Worcester.” She urges for a tax rate that does not give commercial properties the highest residential tax rate.
7:39: Phil Lemos is here because he heard about making large commercial residences taxable as commercial property. He says his rent will probably go up. “At the end of the day I don’t live in a big box retail store or an office park. I live in an apartment building.”
7:41: John Giangregorio, pres. of the Canal District Business Association. He owns four commercial parcels. He says the Canal District has many family owned businesses that suffer because of the tax rate. He says the only cost that’s “out of control” isn’t his mortgages or elevators or alarm services, it’s the tax rate. “I think that the city of Worcester can do a lot more to expand the tax rate…I think the council should show some leadership and look at different ideas.” He mentions the Philly Plan.
7:46: Jim Jersey lives in Sterling, but wants the council to consider the tax rate “from the business perspective.” He has a biotech business here. ”The tax rate is very significant, and it’s something that we have to consider.”
7:48: Leonard Ciuffredo is in favor of the lowest res. tax rate. He talks about all the local businesses he’s a patron of. “The point is, I like many of you, support the local businesses. The last thing our residents want to do is hurt our local businesses.” He says keeping low taxes for residents is more advantageous than lowering taxes for businesses.
7:51: Beth Proko is here from Worcester Citizens for Business. She says the foreclosure issue is something everyone is trying to resolve. She says the tax burden falling on businesses is actually raising taxes on homeowners. “The highest commercial tax rate is a disincentive for businesses to come here, which only makes problems worse.” She says residents have seen their tax bill double as businesses have left the city. “Our business community is frustrated at the exponential cost of doing business in the city.” She brings up WCB’s “comprehensive online survey” which showed that a number of businesses polled are eyeing locations outside the city.
7:55: Stephen Buchalter is a business owner in Worcester. He talks about the pre-1984 split of the tax rate, when downtown was a “very vibrant” downtown. He says he is for lower residential taxes, “but what the council needs to consider is a long term plan on how we get our taxes down.” He says business owners want to operate in the city — a plan that shows Worcester is considering lowering the business tax rate over time. He says this would eventually bring down residential rates as well.
7:58: Carl says Rushford and M.O’Brien are “assets to the city.” He says he doesn’t belong to a club or an association, and talks about his 91 year old mother. She doesn’t have money to do things, no social security (COLA increases?) in the last two years. He says you don’t have to be a businessman to lose money, especially because of taxes. “People that live in the city of Worcester, 98 percent of them, purchase everything in the city…People live outside of the city want to raise my taxes…wrong. Dead wrong.” He doesn’t care about the street and sidewalk initiative because there’s no sidewalk by his house. “In the long run, it’s a benefit. That tax bill, that sewer bill, that water bill, it just keeps going up.”
“I don’t mind paying my fair share, but I’m not going to pay for somebody else who’s making money.”
8:05: John Carnegie is here not to talk to either side of the issue, but to help come up with a longer plan. He talks about a bill he helped sponsor that would attract companies to the entire state. He encourages city councilors to push for sponsoring/moving that bill forward. He’d also like to see incentives for businesses to fill in empty spaces downtown or in industrial areas, and to have newly in use parcels not taxed against them. He’d also like to have more involvement in attracting local college alumni. “I know it’s another election season coming up, and I’m going to be paying very close attention.”
8:09: John Reed, for the lowest res. tax rate, but he changes the subject to decreasing coast. He suggests building a power plant at the water treatment plant, for one. “I think we need to bring all three (business, residence, college?) together that doesn’t pit anyone against each other.”
8:13: Jo Hart says there’s “so many thousands of ways” to raise revenue as soon as Worcester “gets out of its little cocoon.” She says when the Museum of Russian Icons opened in Clinton, MA, the bus service cut it’s service to Clinton. “All I mean is you cut yourself off from a lot of things.”
That’s the end of public part of this hearing.
8:16: Rushton starts off by offering line 258 for the tax rate. “There was a lot of great testimony on both sides. If you look at the problem as a whole it’s a shared burden. A lot of what you heard was one side saying ‘I have a lot of pain,’ and the other side saying ‘I have a lot of pain.’” He says the mayor’s task force has influence items brought forward to “close the gap between commercial and residential to get back to where we were before 1984…probably the worst vote in city council history.”
“If you want to build a quality city, you have to recognize the error of the vote in 1984.” He calls it “Orwellian in many ways.”
8:21: Haller offers up line 270 – the lowest res. tax rate. She calls the speeches “eloquent and thought provoking,” but says her district representation calls for her to vote in the lowest tax rate. “Any increase in their cost of living is a decline in their ability to participate in the city of Worcester.”
8:23: Lukes says “many of the arguments we’ve heard today have been heard for many years.” She says “if we could take back the vote we all would. Unfortunately, we can’t.” She says, just like labor contracts, “once you get the benefit, see if you can take it out.”
“I have to congratulate everyone who came out. This is probably the largest audience we’ve seen in years.” (She’s referring to previous tax votes, I’m sure.)
“We need a long term plan. I don’t think anyone disagrees with that.”
She says that even when the lowest residential tax rate wasn’t voted in downtown was still empty. “Nothing happened overnight.”
She warns that Worcester could start “invading our tax levy,” and tells the gallery that she hopes they all come back for that, ’cause those increases will be more significant than what’s happening tonight.
“We have to take seriously the needs of our citizens to be housed.” She supports Haller and wants to see the lowest res. tax rate.
8:29: Toomey says the definition of insanity is “doing something over and over and expecting different results.” She says she’s voted for the lowest res. rate for the past five years, but tonight she won’t because “I believe it is in the best interest of Worcester.” She says a raised res. rate effects her family too. “I want to see a Worcester with a larger commercial base. I don’t want to be responsible for it if business leaves…so homeowners don’t bear the burden…sometimes you have to spend a dime to make a dollar.”
“it costs more for people to renovate and deal with old infrastructure in our city than in the suburbs…we have the opportunity to become the center of new growth in the Commonwealth.” She cites Becker/the state leg’s work with bringing the video game industry to Worcester. “People who know me know this is not easy for me to do.” She’s supporting line 258.
8:33: Palmieri says everyone’s speaking so calmly. “I’ll try to follow. No promises.” He again references the crowd size, calling it the best they’ve had in the past 20 years. He knows the vote will already pass in favor of splitting new increases with business and residential, but he says the residents have “won the hearts and minds.”
“One of the things that has concerned me tonight is leadership, and this council has not shown leadership.” He talks about all the business happening in the city, and the college expansions. “It’s like what I’m hearing tonight is we’re not doing anything, or nothing is happening in Worcester. Far from it.”
He says he remembers 1984 and that the business community decided to “take a firm hand” and eliminate streets to build a mall. He says PILOT still seems to be an “afterthought.”
“We talk about expanding our tax base, getting more jobs, how important that is…Councilor Clancy and I put a proposal out that was part of the mayor’s task force (to tax residential property owners with more than 4 units as commercial).” He says rates, if this went in effect tonight, would go down $357 for residents, and commercial taxes wouldn’t rise. (Those numbers are based on last year’s.)
He brings up one of Winn’s buildings. They didn’t want 1st floor commercial because A) they got a TIF B) they only have to pay low residential tax rates.
He’s voting lowest residential tax rate, “but there are other ways to get this number down.”
8:46: Petty says he’s supporting line 258. “Nothing’s lost on me that was said tonight. We know people are hurting.” He says increasing both by 5.7% is “probably the fair thing to do…this isn’t an easy vote for any councilor to take.”
8:48: Smith says “this is never an easy discussion we have each year, but it’s a necessary one.” He points out that his family owns a business in the city, and he’s “seen both sides of it.” Points out that only 8 times in the past 20 years has the lowest res. rate been put in. “We realize both sides are feeling pain as we go through one of the worst economic crises in history.” He “strongly” supports the initiative that Palmieri and Clancy put forward. “I would also like to have new programs and new breaks available to provide breaks to small businesses…right now we can offer TIFs and DIFs but that’s about all we can do.”
“Ever since that 1984 vote it’s been a broken system. Right now people say businesses are flying out of the city. They can’t wait to get out of here. I don’t buy that.” He says many new businesses are opening and growing.
He says there’s no tools for residents to cut taxes — no TIFs available for them if they remodel or improve their house, which creates jobs for local tradespeople. He says he’s always supported the lowest res. rate. “There’s a reason population has been growing west from Boston, why the population in Worcester is growing: because it’s an affordable city.”
8:56: Paul Clancy clarifies to say there have been 9 votes for the lowest res. rate since 1984. “It has always been a volatile issue. You’re going to hear the arguments on both sides, and they don’t change.” He says there are going to be people in this city with a 20% increase on their taxes this year. He says Worcester will never be competitive with the ‘burbs. “They can afford much cheaper rates because they don’t provide the services we provide.”
He says Worcester is unique because it doesn’t tax to the limit. “We are a very large urban area. Just look at the numbers, the average incomes of people who live in this city as opposed to the ‘burbs we compete with. Those are the people I feel are most in need, the people who live in the city.”
9:05: Eddy says the past few years he’s been “staggered by the adversarial nature” of pitting the business vs. homeowner. He “rejects that premise” tonight. “We simply are one community. We share our successes as one community, we share our burdens as one community.” Eddy says he’s voted in the lowest res. tax rate before, but last year it was a double digit increase on business. “We can stop the yearly spiraling of the disparity. That’s what I think this council is looking to talk about tonight…It’s about $31 in differential here…we’re talking about fairness.”
9:09: Germain says “this is usually one of the easiest votes of the year,” calling it emotional, but everyone knows they would vote in the lowest rate. “This year it wasn’t easy. I don’t know why. Maybe people thought we started going too far.”
“It’s a $31 argument. That $31 does cause a lot of emotion, but it is the right thing to do.” He says people called him, telling him to vote lowest res. rate. “I don’t want to do it, but I have to do it.”
He points to the unused $ in the tax levy — $10 million worth. “We don’t tax to the max. This could be a heck of a lot worse than it could be right now.”
Just to show his dedication to this, Germain says “keep in mind I always come in sixth, which means next year I’m probably coming in seventh” — in reference to how close he comes to not being re-elected.
9:13: J.O’Brien calls this the 3rd biggest crowd he’s seen since he’s been mayor. “This can’t just be about classification.”
“We need to grow our commercial industrial tax base.” He points back to his Task Force that would help companies locate here and stay here.
“I have moved on this position. I’ve been guided by data.” He says he not in favor of going to an even tax rate, but he wants to see “progress.” He also points to last year’s vote, which lowered taxes for many homeowners. “I am deeply concerned about our small businesses…I think we need to take some modest steps.”
He cites figures that show the average increase for three deckers would equal out to $1 per unit per month. “By voting the middle ground we’re not going to be voting poor people into the street…I think the tenor of this conversation has changed.”
9:25: Lukes wants to know about specific costs of things — notably upcoming court cases, veterans’ benefits, extra income from the clerk’s office (presumably from marriage ceremonies).
9:32: The tax rate vote is set at line 258. Here’s how they vote:
Clancy N, Eddy Y, Germain Y, Haller N, Lukes N, Palmieri N, Petty Y, Rushton Y, Smith N, Toomey Y, O’Brien Y.
9:47: The taxation of multi-unit rental properties comes up. Clancy sends it to subcommittee, and adds this was his suggestion to J.O’Brien when he came up with his task force. Haller says this “is being fast-tracked” and she “wants to put the breaks on it.” She goes through splitting the savings the city would gain from this, but she says there’s nothing in the chart provided that explains what happens to those who own these properties. She wants the report recommitted with a third line that would show who would “get hurt” — residential providers who are going to absorb this. She wants it broken down more — how many properties are four units, how many are ten, etc.
9:53: Rushton says he shares Haller’s concerns. “This has been done in other cities. The biggest argument you will hear from large property owners is it will raise rents. Studies I have seen do not share this conclusion.” He calls the numbers “very enticing.”
9:55: Eddy calls this discussion “very worthy.” “There is a section in state law that allows for a small business tax exemption. Worcester does not use this exception.” He says he and Palmieri would want a report on what the impact on tax classification would be on FY12 if the plan were implemented.
9:56: Petty shares Haller’s concerns too. Petty wants demographics of “who’s in these buildings,” like age, any government assistance, etc.
10:04: Haller wants to know about other communities that have done this, and if they’ve seen an increase in condo conversion.
10:11: Zone changes to Atlanta/Plantation/Putnam for CSX.
10:13: Haller says trial court crews are coming in less often and with less people now. She says when the sheriff’s and trial court crews come to town “they make our town look better” (in the sense that they clean it up). 72% of people asked if they thought Worcester was a clean city, said no. But she says 86% said they feel responsible for how the city looks.
10:20: Talk about the Botany Bay complex at 222 June St. Apparently, people aren’t against the project, but rather the driveway. Traffic studies have been done. The project is advertised.
10:25: Lukes wants to ban digital billboards on the highway. She wants it referred to Econ. Dev. rather than the planning board.
10:27: A supplemental item comes up regarding travel expenses. Clancy (and Haller) motion to hold it until the Jan. 4 meeting.
10:30: Adjourned! See you on Jan. 4.