Property tax growth
Due to the strength of Boston’s property tax, growth exceeds the average annual growth of 3% that Boston has seen over the past decade and is able to support the growth in fixed costs and the City’s investment in education. Property tax growth strength is expected to continue in FY18, primarily due to the unprecedented strength of Boston’s development climate.
Declining State revenue
Taxes paid by new construction is added onto Boston’s property tax levy, which can otherwise increase by a maximum of 2 ½ percent, annually. Thus while the City is projected to experience robust property tax growth in FY18, that growth is offset by sluggish and unpredictable state revenue growth.