EASTHAM — Select board chair Aimee Eckman said Monday that she has changed her mind about whether Eastham should enact a residential tax exemption. Only last week, the board had voted three to two against establishing the policy; Eckman and board members Gerald Cerasale and Robert Bruns had voted against it, while Jamie Demetri and Suzanne Bryan voted for it.

“This is going to be a bombshell to a bunch of people,” Eckman said at the board’s Jan. 13 meeting. “After that vote last Monday, it didn’t feel good.”

In August, she said, when the board will take its official vote at the fiscal 2026 tax classification hearing, she plans to vote for the policy.

“I’m sorry I didn’t come to that decision last Monday,” said Eckman. “I figured the sooner the better to correct it.”

The residential tax exemption (RTE) is a policy created under state law that allows towns to discount a portion of the assessed value of residents’ homes when calculating property taxes. The reduction is set at a percentage of the average assessed property in town — in Provincetown and Truro, the exemption is currently set at 35 percent of the average assessment, while in Wellfleet it is 32.5 percent.

The RTE is revenue-neutral, meaning it does not change the amount of money the town raises in property taxes. Instead, once the exemptions are tallied, the tax rate on residential property is recalculated and all remaining assessed value, whether owned by residents or nonresidents, is taxed at a slightly higher rate.

In Provincetown last year, the tax rate was 7.5 percent higher after the residential exemptions were applied: $5.60 per $1,000 in assessed value rather than $5.21. The tax rate went up 7.7 percent in Truro, from $5.74 per $1,000 to $6.18.

The higher tax rate resulting from the RTE washes out some of the gains from the residential exemption for all owners who claim it — especially the owners of high-value properties. Eastham Assistant Town Manager Rich Bienvenue told the select board last week that the resident owners of property worth more than $1.88 million would actually pay more under an RTE, the higher tax rate wiping away the entire value of their exemption.

There are only 59 such resident homeowners in Eastham, Bienvenue said. For the other 2,522 resident property owners, the RTE could save them from a couple of hundred dollars to more than $1,500, depending on the value of their home and the exemption percentage the select board chooses to adopt.

Board members did not discuss this week what exemption percentage they plan to support at the August meeting.

A Different Outcome

The Jan. 6 select board meeting included a series of arguments about who in Eastham deserved financial relief and how to give it to them.

Demetri and Bryan argued that the RTE was an effective way to provide financial relief to town residents — essentially all of whom need it, they said.

Cerasale and Bruns had said that relief should be “need-based” and given to households in true financial distress through the town’s new Residential Taxpayer Assistance Fund, which Cerasale wanted to fund with a $300,000 allocation at town meeting in April.

Beginning in July, the Residential Taxpayer Assistance Fund is set to offer $500 payments to households that can prove they need it; according to current rules, the payment can be received only twice.

Eckman had said on Jan. 6 that the RTE did seem unfair to her and that she wanted to wait until the town reaches the threshold the select board set in 2020: that the RTE would be adopted when 60 percent of residential property in town was owned by part-time residents.

Currently, 55 percent of homes in town are owned by part-time residents, Bienvenue had told the board on Jan. 6.

Eckman said that one reason for her change of heart was that percentage.

“So much has changed since we set that 60-40 policy,” she said on Jan. 13. Property values have increased, and “just because their house values have gone up doesn’t mean they have more money in their pockets.”

Eckman said the increasing number of short-term rentals in Eastham was another reason for her decision. “The use of second homes has changed so much,” she said. “I believe we went, in the last 10 years, from over 400 year-round rentals of single-family homes down to around 80 now. We lost all that inventory to short-term rentals.”

Bruns told Eckman he still believes the RTE is fundamentally unfair. “The qualification for something like this shouldn’t be part-time or full-time,” he said. “It should be needs-based. In my mind, it’s a question of financial and ethical fairness.”

Cerasale reiterated his belief that town funds should be used for financial relief.

“Unlike Truro and Provincetown and Wellfleet,” he said, “we have that great taxpayer fund. If we put $600,000 into that, we could give 600 families $1,000 with a net of $900 benefit.”

“I hear you,” said Eckman to Cerasale. The RTE alone would not provide all the relief some residents need, she said. “I think we’re still going to need other programs to help with that.”

Bruns said he thought the RTE was based on “assumptions.”

“What we’re assuming here,” he said, “is that most, if not all, of the full-time people need the money more than most, if not all, of the part-time people. With $1.8 million as the cutoff” at which the policy stops helping resident homeowners, “I don’t see a lot of people with million-and-a-half-dollar homes needing that money.”

“Housing values have gone up,” Eckman responded. “People’s incomes haven’t gone up.”

As to the issue of fairness, Eckman said, “It’s never going to be fair.”

“I’m much more of a needs-based — that’s just my philosophy on it,” said Bruns. “That said, I’m sure it’s going to help a lot of people. This is, as Gerry [Cerasale] would say, democracy in action.”

“I know the part-time resident group is going to be pretty upset about this,” Eckman said, “but I can’t imagine if it was 60-40, or higher than that, that they’d be any less upset.”