Assessors Presentation 11_19_15 — File 200210

City of Somerville FY2016 Classification Hearing November 24, 2015 Adoption of Tax Levy percentages for FY 2016 Somerville Board of Assessors Marc A Levye, RMA, MAA Chief Assessor & Chairman Michael Flynn, MAA Thomas J Mulhern, MAA Joseph A Curtatone Mayor

Recommendations 1. A motion that the Board of Aldermen adopts a minimum residential factor of 87.0237, the legal minimum for the City of Somerville for FY 2016. 2. A motion that the Board of Aldermen accepts the provisions of Chapter 59, section 5C approving a residential exemption of 35% of average assessed value for owner occupied properties for FY 2016. 2

Comparison of State Form LA-4 FY15 & FY16 USE CODE DESCRIPTION FY 2015 FY 2016 FY 2015 FY 2016 PARCEL COUNT PARCEL COUNT ASSESSED VALUE ASSESSED VALUE 101 SINGLE FAMILY 2,348 2,341 $1,237,078,300 $1,299,181,600 102 CONDOMINIUM 4,787 4,953 $1,846,089,700 $2,174,115,200 104 TWO FAMILY 5,213 5,178 $3,089,535,600 $3,210,889,500 105 THREE FAMILY 2,328 2,317 $1,562,788,700 $1,651,088,700 109 2 OR MORE RES. BUILDINGS/1 LOT 71 72 $58,371,400 $65,280,900 111-125 APARTMENTS 4+ 665 662 $866,245,200 $899,199,500 130-132,106 VACANT RES. LAND 184 179 $11,470,900 $12,173,400 300-393 COMMERCIAL 608 596 $960,494,300 $1,013,105,300 400-452 INDUSTRIAL 106 105 $311,627,700 $318,967,000 012-043 MIXED USE RESIDENTIAL 255 255 $237,607,064 $235,064,286 MIXED USE COMMERCIAL $95,219,536 $95,727,514 501-508 PERSONAL PROPERTY 1,305 1,312 $215,696,880 $223,981,370 TOTAL REAL & PERSONAL PROPERTY VALUE 17,870 17,970 $10,492,225,280 $11,198,774,270 900-990 EXEMPT REAL ESTATE 405 411 $1,303,502,600 $1,429,039,000 3

Parcel Count Changes FY15-FY16: • Added 166 condo units (111 from conversions & 55 new construction) • 7 less single family properties • 35 less two family properties • 11 less three family properties City Wide Valuations Changes FY15-FY16 *(includes market & growth) • Single family up 5% • Two family up 5% • Three family up 6% • Apartments 4+ up 4% • Condominiums up 12% • Commercial & Industrial up 5% (up from a 1% increase last year) • Personal Property up 4% 4

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Assessment Changes By Neighborhood: Single Family FY15 Value FY16 Value % Change 15-16 1001 West Somerville South & Cambridge Line 636,300 688,700 8.24 2001 Ward 2 Union Square South 547,100 584,600 6.85 3001 Ward 2 Cobble Hill n/a n/a n/a 4001 West Somerville 743,600 793,900 6.76 5001 Winter Hill North 356,400 364,400 2.24 6001 Ten Hills 428,900 466,900 8.86 7001 Winter Hill & Magoun Square 433,100 467,500 7.94 8001 Central, Spring & Prospect Hill 550,100 561,300 2.04 9001 East Somerville 340,200 348,000 2.29 City Average 526,900 555,000 5.33 6

Assessment Changes By Neighborhood: Two Family FY15 Value FY16 Value % Change 15-16 1001 West Somerville South & Cambridge Line 673,700 720,200 6.90 2001 Ward 2 Union Square South 601,200 635,900 5.77 3001 Ward 2 Cobble Hill n/a n/a n/a 4001 West Somerville 698,800 739,600 5.84 5001 Winter Hill North 412,300 420,300 1.94 6001 Ten Hills 478,100 514,700 7.66 7001 Winter Hill & Magoun Square 477,200 508,900 6.64 8001 Central, Spring & Prospect Hill 590,700 598,200 1.27 9001 East Somerville 412,900 422,100 2.23 City Average 592,700 620,100 4.62 7

Assessment Changes By Neighborhood: Three Family FY15 Value FY16 Value % Change 15-16 1001 West Somerville South & Cambridge Line 789,200 859,700 8.93 2001 Ward 2 Union Square South 714,500 775,800 8.58 3001 Ward 2 Cobble Hill n/a n/a n/a 4001 West Somerville 790,900 839,400 6.13 5001 Winter Hill North 528,300 558,500 5.72 6001 Ten Hills 525,400 571,700 8.81 7001 Winter Hill & Magoun Square 571,100 614,700 7.63 8001 Central, Spring & Prospect Hill 685,200 710,300 3.66 9001 East Somerville 496,000 516,700 4.17 City Average 671,300 712,600 6.15 8

Assessment Changes By Neighborhood: Condominium FY15 Value FY16 Value % Change 15-16 1001 West Somerville South & Cambridge Line 467,100 517,900 10.88 2001 Ward 2 Union Square South 387,400 435,200 12.34 3001 Ward 2 Cobble Hill 345,600 353,200 2.20 4001 West Somerville 459,900 516,300 12.26 5001 Winter Hill North 283,400 307,300 8.43 6001 Ten Hills 351,200 396,800 12.98 7001 Winter Hill & Magoun Square 303,000 342,200 12.94 8001 Central, Spring & Prospect Hill 394,600 442,900 12.24 9001 East Somerville 303,300 340,100 12.13 City Average 385,600 431,500 11.90 9

FY16 Growth Use Type Market Change (w/o growth) New Growth Valuation Tax Levy Growth Single Family 4.8 7,355,300 Condominium 9.7 48,078,648 Two & Three Family 4.7 33,053,700 Four+ Units 3.5 13,063,000 Mixed-Use Residential & Other 4.8 28,472,468 Total Residential 5.7 130,043,116 1,639,844 Commercial 2.8 42,911,407 874,534 Industrial 3.2 6,232,000 127,008 Personal Property n/a 33,638,400 685,551 Total Real & Personal Property 212,824,923 $ 3,326,937 10

Major Contributors to New Valuation Growth 445 Artisan Way (Block 4 ASQ - DIF) $22.6M 430 Artisan Way (Block 2 ASQ) $20.7M 399 Revolution Drive (Partners / FRIT) $ 8.5M 333 Great River Road (Block 1 ASQ - DIF) $ 7.3M NSTAR Gas $ 2.9M United Healthcare $ 2.2M 9 Medford Street (Apartments) $ 2.1M NSTAR Electric $ 2.1M 611 Assembly Row $ 2.0M u/vanhoosear on Flickr 11

FY16 Tax Levy & Classification FY16 Levy Limit: $129,440,163 FY16 Levy: $129,135,251 FY15 Levy: $122,165,461 Tax Levy Change: $ 6,969,790 Excess Levy Capacity: $ 304,912 Percent Change: 5.7% Commercial Levy: $33,332,391 Residential Levy: $95,802,860 As Assessed With 175% Classification Commercial Value Percentage 14.7497 25.8120 Residential Value Percentage 85.2503 74.1880 12

Tax Levy Share: FY16 74.2 17.3 5.0 3.5 Residential Commercial Industrial Personal Property FY15 Tax Levy Share (For Reference) Residential: 73.6% Commercial: 17.6% Industrial: 5.2% Personal Prop: 3.6% 13

Option 1: No Classification & No ResX • Single Tax Rate: $11.53 USE FY15 AVERAGE VALUE FY16 AVERAGE VALUE FY15 AVERAGE TAX FY16 AVERAGE TAX TAX CHANGE FROM FY15 CONDO 385,600 431,500 $2,384 $4,975 $2,591 1 FAMILY 526,900 555,000 $4,164 $6,399 $2,235 2 FAMILY 592,700 620,100 $4,996 $7,150 $2,154 3 FAMILY 671,300 712,600 $5,988 $8,216 $2,228 4-8 FAMILY 855,100 897,300 $8,304 $10,346 $2,042 9+ APTS 2,973,200 3,084,500 37,504 $35,564 -$1,940 COM/IN 1,781,700 1,900,200 36,312 $21,909 -$14,403 NOT RECOMMENDED 14

• Residential Rate: $10.03 • Commercial Rate: $20.18 USE FY15 AVERAGE VALUE FY16 AVERAGE VALUE FY15 AVERAGE TAX FY16 AVERAGE TAX TAX CHANGE FROM FY15 CONDO 385,600 431,500 $2,384 $4,328 $1,944 1 FAMILY 526,900 555,000 $4,164 $5,567 $1,403 2 FAMILY 592,700 620,100 $4,996 $6,220 $1,224 3 FAMILY 671,300 712,600 $5,988 $7,147 $1,159 4-8 FAMILY 855,100 897,300 $8,304 $9,000 $696 9+ APTS 2,973,200 3,084,500 37,504 $30,938 -$6,566 COM/IN 1,781,700 1,900,200 36,312 $38,346 $2,034 Option 2: With Classification & No ResX 15 NOT RECOMMENDED

• Residential Rate: $12.53 • Commercial Rate: $20.18 RECOMMENDED Option 3: With Classification & ResX USE FY15 AVERAGE VALUE FY16 AVERAGE VALUE FY15 AVERAGE TAX FY16 AVERAGE TAX TAX CHANGE FROM FY15 CONDO 385,600 431,500 $2,384 $2,783 $399* 1 FAMILY 526,900 555,000 $4,164 $4,330 $166 2 FAMILY 592,700 620,100 $4,996 $5,146 $150 3 FAMILY 671,300 712,600 $5,988 $6,305 $317 4-8 FAMILY 855,100 897,300 $8,304 $8,619 $315 9+ APTS 2,973,200 3,084,500 37,504 $38,649 $1,145 COM/IN 1,781,700 1,900,200 36,312 $38,346 $2,034 ResX Value Reduction: $209,403 Tax Savings of $2,623.82 16 (ResX included for condo, 1, 2, 3 & 4-8 family) – Excess Levy Capacity = $304,912 *removing 3 large apartment buildings classified as condo units reduces change to approximately $370

Recent City Initiatives to Ease Tax Impact • Residential Exemption amount increased to 35% • Clause 41C for seniors increased from $750 to $1,000 • Asset & income limits increased for 41C recipients • Senior work-off income limits increased • Interest rate lowered & income limit raised for tax deferral program (41A) • Additional real estate exemption up to 100% allowed • Tax deferral on property and auto excise for National Guard members and reservists 17

Future development will build commercial tax base and lower residential tax liability New commercial space projected in the next 10 years: Assembly Square 2,800,000 SF Union Square 1,400,000 SF Brickbottom 300,000 SF Inner Belt 1,200,000 SF Davis Square 150,000 SF Gilman Square 44,400 SF Boynton Yards 1,000,000 SF North Point 410,000 SF Total 7,304,400 SF *Projections provided by OSPCD Current Estimated Square Footage Citywide Retail: 5,000,000 Office: 1,600,000 Industrial: 3,100,000 Total: 9,700,000 18

City of Somerville FY2016 Classification Hearing November 24, 2015 Adoption of Tax Levy percentages for FY 2016 Somerville Board of Assessors Marc A Levye, RMA, MAA Chief Assessor & Chairman Michael Flynn, MAA Thomas J Mulhern, MAA Joseph A Curtatone Mayor