Businesses and Residents Face “Higher Property Taxes Than Necessary”
With property tax and mayoral election debates already underway in Boston, a top business leader plans Tuesday night to urge Mayor Michelle Wu and the City Council to slow spending growth and tap reserves for strategic priorities without implementing budget cuts.
The order authorizing the Ways and Means Committee’s budget hearing states that Wu is expected to announce the fiscal 2026 budget on April 9, with final council action on it expected June 25. The city budget this year weighed in at more than $4.64 billion.
In testimony released Tuesday, Greater Boston Chamber of Commerce President James Rooney said he was offering an “employer perspective” and listed three themes that he said would constrain the budget this year: “fundamental changes” to city revenues, uncertainty over the availability of federal funds, and “lack of new commercial sector growth.”
City spending grew 8.1%, 6.8% and 5.9% in the last three fiscal years, Rooney said, calling those rates “unsustainable” and asking for a 3-4% increase.
Businesses and residents face “higher property taxes than necessary,” and spending levels are increasing pressure for the city to raise new revenues and forcing it to turn to the state for help, Rooney said.
Citing shifting work patterns, high interest rates and “burdensome” regulations, Rooney urged the city to “refocus on encouraging commercial development and downtown vitality,” noting that budgeted city revenue from property tax collections increased from 55.9% in FY 2006 to 71.1% in FY 2025.
“In many years over that period, new property tax growth fueled by commercial development helped offset the impacts of this reliance on property taxes on residents,” Rooney said. “However, recent trends show that our commercial development market growth has slowed, while commercial property values have overall decreased. The downtown office vacancy rate sits at 20.2% in the Financial District, reflecting changes in office demand due to remote work options and new workforce preferences.”
