LYNN — The City Council voted Tuesday to approve a $6.67 million budget increase for fiscal year 2021 and set a tax rate that would increase the average single-family tax bill by $162 next year.
While the council was in support of the majority of Mayor Thomas M. McGee’s $6.84 million supplemental budget recommendation, councilors voted to defund two positions that had been proposed by the mayor.
Rather than vote down those two positions, which would have eliminated the hires, the city council voted to decrease spending for each to $1, which resulted in an approximately $165,000 budget reduction.
One of those payroll deductions was regarding the creation of a diversity, equity, and inclusion officer, a hire that McGee said would include a salary range of $72,000 to $90,000.
The hire, which would be a first for the city and one that McGee said would align with its renewed commitment to ending systemic racism across all sectors, prompted the most discussion among the city council and was the source of the majority of public feedback that came in during Tuesday’s budget hearing.
While several city councilors expressed their support of the position itself, Council Vice President Buzzy Barton and Ward 2 Councilor Rick Starbard, said they were not pleased with how the process surrounding the hire was conducted.
“Nobody in this room wants to see diversity more than I do, but I don’t like the way this was handled,” Barton told McGee. “The first time I heard about it was reading it in the paper. You just can’t do business like that. (We) need to know more about what’s going on with this job.
“Do we need it? Absolutely, but I just think the way we got it wasn’t right.”
In response, McGee said his proposal for the position came out of ongoing meetings and discussions with the city council, adding that he had talked about the potential hire of a diversity, equity, and inclusion officer numerous times over the summer. In addition, he said the supplemental budget was made available to the council two weeks ago.
“If there was a miscommunication, I apologize for that,” said McGee. “I think this is the right position at the right time and if there was confusion related to it, I apologize for that.”
Starbard made a motion for the position to be defunded to $1 until more information was made available about the job description and what qualifications it would entail, which was approved by the council.
“I don’t think anyone here is opposed to the creation of this position but there’s a lot of unknowns,” said Starbard. “If we’re going to hire this person, create this department, this is going to be a first for the city of Lynn, and if this is where we’re going, we need to make sure we do it right.”
According to McGee, his proposal for a diversity, equity, and inclusion officer came out of discussions between his office, the city council, and members of the community regarding racial justice issues.
“While this position will be housed in the personnel department and report to the director, the DEI officer will be focused broadly on how we as a city government can be more inclusive and diverse on all levels,” said McGee, noting that would involve bringing more diversity city government hiring practices.
The city council also voted to defund McGee’s proposal to replace the city’s arts and cultural director, a position that was left vacant following the departure of Carolyn Cole earlier this year. The proposed allocation was $75,000.
Aside from those two positions, every other aspect of the mayor’s proposed budget amendment passed, which will increase city spending for FY21 to approximately $383 million.
McGee and the city’s Chief Financial Officer Michael Bertino said the additional funding that would be added to the budget stems from a higher than anticipated state aid allocation.
Although the state budget has not yet been finalized, McGee has said city officials are depending on Lynn’s new projected state aid allocation, $223 million, an amount that has tentatively been agreed upon by Gov. Charlie Baker, and members of both legislative bodies, the state Senate and House of Representatives.
“The majority of this supplemental budget is appropriating previously reduced line items necessary to balance the original FY21 budget in the spring,” said McGee.
The amendment includes $4 million to meet the city’s net school spending requirement and includes hires that had been previously placed on hold, such as an additional public health nurse, deputy building commissioner, and two information technology support positions.
The City Council also voted unanimously Tuesday night to set the lowest residential tax rate at $13.03 per $100,000 home assessment.
While the new rate is lower than last year’s rate of $13.40, the increase in property taxes is due to the increase in average single-family home values, according to Christopher Gaeta, director of assessing.
The assessed value for the average single-family home increased by 6.36 percent over last year, according to city tax documents.
The average single-family homeowner will pay $4,882 on their tax bill, based on an average single-family assessed home value of $374,650.
Last year, the average homeowner paid $4,720 on their tax bill based on an average-single family assessed home value of $352,253.
“It is a little bit higher,” said Gaeta. “The trend is that the residential values will continue to increase and with that increase comes an increase in taxes.”
In addition to rising home values, Gaeta said the trend over the past few years has included an overall shift toward a higher proportion of residential properties in the city, which, in turn, increases residential taxes.
Part of that trend is due to developers buying commercial properties and converting the majority of the property to residential units, with commercial or retail space on the ground floor, Gaeta said.
That development is reflected in the city’s new growth for fiscal year 2021, which, at $1.96 million, is the highest it has ever been in Lynn, Gaeta said.
“That’s a positive indicator that developers are taking note of the city,” said Gaeta, explaining that the $1.96 million in growth represents $118 million of value that was added to the city through new construction this year.
“I just think a lot of times people get focused on the tax increase, but what we’re seeing is really the city of Lynn is increasing in overall value,” he said. “That new growth figure represents a positive shift in terms of value.”
As the city council does every year, the panel also voted Tuesday to adopt a 175 percent Commercial, Industrial, and Personal Property (CIP) shift, which taxes commercial property at the highest possible rate allowed under state law.
The shift reduces the residential share of the tax burden from 89.45 percent to 81.5 percent and increases the commercial, industrial, and personal property share from 10.55 percent to 18.5 percent, according to tax documents.
Even with the shift, the residential share of the tax burden increased by 1 percent, and the commercial, industrial, and personal property share decreased by 1 percent over last year.
While assessed residential values grew by more than 8 percent, the assessed commercial values in the city increased by less than a percentage point over last year, Gaeta said, which is consistent with the trend that is being seen in Lynn and across the Northeast.
“The value isn’t there” for commercial and retail these days, Gaeta said, noting that even with the shift that was adopted, the average commercial tax bill is still decreasing next year.
The average commercial tax bill will be $9,314, a $38 decrease over last year, while the average industrial bill will be $10,470, a $251 increase, according to tax documents.
Gaeta said the city’s total taxable assessed value of $9.9 billion for FY21 is the highest in its history.
“We look at value,” said Gaeta. “So it’s good to have greater value in your home, greater equity, but the end result is paying more in your taxes. From our standpoint, it’s a good thing when values are strong. The end result is no one likes increased taxes. I think the strong values are good for the city as a whole.”
Tax bills are expected to go out on Dec. 31.
