The economic recession is impacting Milford property values across-the-board. And the declining values of local real estate will mean an increase in tax rates, and taxes, for many property owners.
Milford Selectmen voted unanimously Monday to adopt a dual tax rate of $16.17 for each $1,000 of assessed value for residential property, and $27.84 for each $1,000 of assessed value for commercial properties.
The assessed value of three out of four classifications of Milford properties fell in 2010, according to Milford assessors. The only exception, industrial property, was an anomaly because a large property no longer qualifies for a tax incentive program.
The overall value of town properties fell $90 million, to $2.8 billion.
As a result of those falling values, tax rates will rise for most classifications so the town can which increased by 3.3 percent this year. The following represent average property tax changes:
- The tax bill paid by a Milford single-family home owner — based on a home valued at $267,330 — will rise by $86 this year, to $4,322. With more than 5,700 properties classified as single family, this is by far the largest group.
- Condominium owners will pay an average of $38 more this year in taxes, or $2,803. This is based on an average condo value of $173,349.
- Two-family, or duplex, owners will pay $22 less in taxes, on average, based on the new, average property assessment of $218,898.
- Three-family structures will get the biggest tax discount, a $61 decrease, based on their new average assessment of $234,850. Of all of the property classes, triple-families had the largest drop in value this year. Their average value fell by nearly 8 percent.
- Multi-family structure owners will pay $353 more this year in taxes, or $11,346. This is based on an average assessed value of $701,687.
- Commercial properties, including small retail and service businesses, will pay $1,136 more in taxes this year, or $21,735. This is for a business with a value of $780,743.
- Industrial properties will pay $2,955 more, on average, or $27,066. This is based on property valued at $1 million.
Milford Selectmen adopted the new tax rates, and maintained the dual rate for commercial and residential properties, unanimously. The residential rate of $16.17 for each $1,000 of assessed value is applied to all properties except commercial and industrial. The small businesses and large corporations in Milford are covered by the $27.84 rate.
Several small business owners attended the selectmen's meeting Monday, and asked town officials to create a new shift, one that would put less of a burden on the commercial taxpayers. If Milford were to adopt a flat tax rate, everyone would pay $18.81 for each $1,000 of value, an amount that would increase the average residential tax burden to $5,039.
The business owners asked Milford to approve a new shift that would have meant a rate of $16.23 for residential, and $27.66 for businesses. Several business owners told selectmen they have had significant business losses through the recession, and cannot afford more taxes.
"In our opinion, Milford businesses are subsidizing residential properties," said Rudy Lioce, owner of Milford Woodworking. "We are paying our fair share, and then some."
Lou Guerriere, an owner of the engineering company Guerriere and Hanlon, estimated business has dropped 40 percent over the past several years. "The bills keep coming. The taxes keep coming. We keep paying," he said. He told selectmen that anything less paid in taxes "would go to my employees, who haven't gotten a raise in three-and-a-half years."
Selectmen explained that they tried to strike a balance, between commercial and residential rates, that was fair. Many businesses are struggling, but so are many homeowners, said Selectman Brian Murray.
"Anything we do to reduce the business percentage increases the residential rates," he said.