5 Things to Know: Property Taxes & the School Project
You are going to pay about $200 less a year than previously estimated.
The average annual tax increase by household has dropped across the board by at least $200 in each town. The district has based the average household impact by calculating the expected property tax increase for the average assessed home value in every town. For example, the average home value in Merrimac is $375K, which would carry a property tax increase of $734 a year. Homes with a lower assessed value would pay less, etc.
In the fall, the average Merrimac household was paying more than its West Newbury or Groveland counterpart. Why have the proportions changed?
It’s a great question! A few variables changed since the first estimates came out in the fall. Notably, these include:
Tax rates changed: Once we hit the New Year, the tax levy numbers changed in every town to correspond to the new approved tax rates for Jan. 1, 2019.
Home values increased: The average assessed home value stayed the same in Merrimac ($375K) but has increased in Groveland (from $400K to $425K) and in West Newbury (from $550K to $575K).
Why does each town pay a different proportion of the total building cost?
Not every town sends the same number of students to Pentucket. West Newbury, for example, has the lowest enrollment numbers, whereas Merrimac sends the highest number of students.
Everyone will pay about the same per month.
For some homeowners on a fixed or limited income, any annual increase is an important consideration. The increase is an investment in your community that will build a brand-new school expected to stand for at least 50 years (in fact, it has to, as part of the MSBA approval process).
Most importantly, these decreases are because the total project cost has dropped to $146.3 million.
In the fall, early estimates based solely on square footage put the project cost at $155.4 million. Unfortunately, many residents misunderstood that this preliminary estimate was the final number, when in fact the architects simply multiplied the total square footage (the only solid number at the time) by $500 (average cost per square foot for school construction in Massachusetts). Now that we have an actual schematic design with real details like a floor plan and site map, the district has been able to more accurately determine cost, which has dropped to $146.3 million. * This number assumes borrowing is based on a 30-year term at a 2.75 percent fixed interest rate.