Cambridge tax rise averages $62 more per home in 2018

Cambridge residents will be paying approximately $62 more on their taxes and $35 more for water in the new year.

A a meeting Tuesday night, the city approved a 1.98 per cent tax rate increase for its operating budget, a 2.54 per cent increase for operating expenses related to capital projects and a 3.33 per cent increase for water rates.

Two reasons the capital projects budget went up: The new fire station on Boxwood Drive and the Old Post Office restoration project. The fire station is set to open next fall while the post office is expected to open in the summer.

The amounts of $62 for taxes and $35 for water are based on the average home being worth $323,000.

Coun. Jan Liggett questioned why the average home price was calculated so low — suggesting it should be closer to $400,000.

"Why are we not increasing the average household," she asked staff. "The prices have really gone up in this community."

Staff acknowledged housing prices have risen in Cambridge this year, but say their numbers reflect $323,000 as the average value of a home in the city.

Watch the council debate:

City's economy 'is strong'

Council debated dipping into a rate stabilization reserve fund to help keep tax rates down — using up to $800,000 of the money kept in savings —  but in the end voted against doing so.

Mayor Doug Craig reminded officials the last time they used the fund was 2008.

"Those were critical years," he said, noting the economy "tanked" not just in Cambridge, but globally.

He said Cambridge paid a heavy price for using the money, and the city wasn't in the same dire situation now.

City manager Gary Dyke noted the city is in a good place economically. Companies are expanding, there's residental growth and the city is expected to gain 1,300 manufacturing jobs in the next two years.

"Yes, we are dealing with some financial issues as a city from a timing standpoint, the economy as a whole within Cambridge is strong, we're going in a positive way," Dyke said.

Future taxpayers

Staff noted the water rates did not go up as much as expected — 3.33 per cent rather than the forecast 5.53 per cent.

This was largely thanks to efforts to reduce water loss in the city's distribution network, staff said.

Craig also said the city needed to be aware of what was best for taxpayers and the future of the city, even if it meant paying a little more now.

"We all care about taxpayers. Not a day goes by that any of us doesn't think about taxpayers and the implications of what we're doing and where we're going," Craig said.

"But we also have taxpayers in the future too that we have to pay attention to, what they're going to have to pay."