When Harvard homeowners open their third-quarter real estate tax bills in January, they will likely see an increase of as much as 6 percent in the total amount they owe the town for the current fiscal year, in spite of a more than 5 percent drop in the town’s tax rate.
Lower rate, higher taxes? It’s not all due to spending but to a rise in the values of single-family homes in Harvard, which, according to a recent revaluation, have increased on average by 11 percent in the past year. In her annual appearance before the selectmen Tuesday, Nov. 14, associate regional assessor Rebecca Boucher reported that the value of an average single-family home in Harvard had increased from $563,315 in fiscal 2017 to $629,155 in the current fiscal year.
Based on these and other property valuations, including apartments, condominiums, and commercial properties, the Harvard Board of Assessors has recommended that all properties be taxed at $17.15 per $1,000 of value this fiscal year, a 5.2 percent decrease from the $18.10 of fiscal 2017. But at this new rate, the owner of an average Harvard home can expect to pay $594 more than last year, from $10,196 to $10,790 (see “How to estimate your own tax bill” below).
Property taxes are the primary means by which Harvard raises the money it needs to operate schools, police, fire, ambulance, and other departments that serve residents, as well as to pay principal and interest on outstanding debt. Owners of the town’s 1,690 single-family homes pay 92 percent of property taxes raised each year.
The total amount the town needs in any given year is the size of its annual budget, as approved by Annual Town Meeting, less revenue it receives from the state and motor vehicle excise taxes and other fees. The total amount required of taxpayers for fiscal 2018, which began July 1, 2017, is approximately $20,870,088, and that’s what taxpayers will be asked to fund. The maximum amount the town can raise in any given year, known as the levy limit (or maximum allowable levy), is determined by adding 2.5 percent to the previous year’s levy limit plus the value of newly taxable properties. This year’s levy limit is $20,897,900, or $27,811 more than needed. This is the second consecutive year the town has used less of its available levy than required.
Unused levy is not to be confused with free cash (available funds); free cash is money appropriated by Annual Town Meeting but left unspent at the end of the fiscal year. And as Town Administrator Tim Bragan pointed out at last week’s selectmen meeting, none of these numbers can be regarded as official until the Massachusetts Department of Revenue approves them.
How to estimate your own tax bill
Your fiscal 2018 property tax is the sum of two numbers: your real estate tax and a Community Preservation Act (CPA) surcharge that deposits money in Harvard’s Community Preservation Fund.
To estimate your own tax, multiply the most recently assessed value of your property by $17.15 and write down the result. Now multiply the assessed value of your property by 1.1 percent (0.011), the CPA surcharge. Add the two numbers together. The sum is your total estimated tax. The final amount, however, won’t be known until the state Department of Revenue does its own calculations and approves the rate recommended by Harvard’s Board of Assessors
