EASTHAM — For the fifth year in a row, the select board voted 3 to 2 on Monday against adopting a residential tax exemption (RTE) for the coming fiscal year. Select board members Aimee Eckman, Gerald Cerasale, and Robert Bruns voted against the policy while Jamie Demetri and Suzanne Bryan voted for it.
The discussion lasted about 90 minutes and was often tense, centered on whether the town’s Residential Taxpayer Assistance Fund, which will offer two $500 payments to residents who can prove financial need, would be preferable to the RTE.
The RTE is authorized by a state law that allows towns to shift the residential property tax burden by allowing property owners whose primary residence is in Eastham to exempt a certain amount from the assessed value of their home, thus lowering their tax.
The exemption amount is calculated every year as a percentage of the assessed value of the median residential property in town. Since the current median value in Eastham is a little over $782,000, according to Assistant Town Manager Rich Bienvenue, a 10-percent RTE would mean that residents could reduce the assessed value of their homes by $78,200.
Under state law, the RTE must be revenue-neutral, so to make up for the exemptions all taxable residential property — whether owned by residents or nonresidents — is taxed at a slightly higher rate.
For the resident owners of properties worth more than $1.88 million, that higher rate would eliminate their gains from a residential exemption, Bienvenue said.
There are only 59 such properties owned by Eastham residents, Bienvenue said. For the other 2,522 resident property owners, applying an RTE to their property would save them a significant amount of money.
How much they would save depends largely on what percentage the select board chose to adopt. Until very recently, 35 percent of the median property value was the legal maximum for an RTE, which could be worth $1,500 to the owners of a $500,000 property.
A 20-percent RTE would save the owners of a $500,000 property $966 per year, Bienvenue said.
Truro and Provincetown have already adopted a 35-percent exemption, while Wellfleet’s select board chose 32.5 percent. Orleans does not have an RTE.
The state’s Affordable Homes Act, which was signed last August, will raise the maximum RTE to 50 percent in state-designated “seasonal communities,” including all the towns of the Lower and Outer Cape.
Public Comment
Tom McNamara, president of the Eastham Part-time Resident Taxpayers Association and a resident of Weymouth, argued against the RTE.
He said that the program is not sufficiently targeted and would create division between year-round and part-time residents. In a letter to the select board, McNamara said that votes by Provincetown and Truro to raise the exemption to 35 percent were “evidence that the program doesn’t work.”
McNamara said that the RTE was unfair to part-time residents, who he said “are full-time residents of this community. We may not live here full-time, but we participate year-round.”
Joan Lockhart, a full-time resident, spoke against the RTE as well, saying that it is not based on need and could sow division.
“There’s a lot of us who are retirees, I am one, who don’t need this 10 percent,” Lockhart said. She said that money should be distributed to those who prove they need it through the Residential Taxpayer Assistance Fund.
Three residents spoke in favor of the RTE, including two parents of young children. “There are a lot of challenges in the town and in the Outer Cape for families with small children,” said Scott Sebastian. “Anything helps. We don’t have a large Band-Aid, so small Band-Aids will have to do.”
Brigid McKenna, a parent of twins, said that because the RTE has to be reauthorized every year, this could be a trial year. “It’s not this infinite decision,” McKenna said. “We can try it out.”
Laura Sullivan said that the high price of housing meant that all but one of her children have left Cape Cod. “I don’t have to have [the RTE], but I’d like younger people to have it,” she said.
Select board member Jamie Demetri said this was the first select board meeting where she had seen such a young audience.
The Board Debates
Demetri said that the RTE is an effective way to direct financial relief to residents. “Right now, pretty much all working-class people who work in this town need it,” she said. “They don’t need to pay more in their taxes right now.”
Bryan disputed the notion that the RTE is unfair. “My only chance of owning a house in this town is if my one remaining parent dies,” she said. “There are people without houses, and you have more than one house. That doesn’t seem fair. Just say you don’t want to pay more taxes.”
Bryan also said that need-based programs put too much onus on people in need to ask for help. “That’s labor, that’s time, and that’s mental load to have to do all that,” she said.
Cerasale said he strongly opposed the RTE and that year-round residents should fund programs to make housing more affordable. “We don’t shove it off to others,” he said.
Cerasale also said that even if 99.9 percent of Eastham’s properties were owned by nonresidents he would still oppose an RTE. Instead, he said, he will advance an article at town meeting to add $300,000 to the Residential Taxpayer Assistance Fund.
Eckman said the RTE seemed unfair to her and that the town should wait until 60 percent of its residential properties are owned by part-time residents to implement an RTE — a threshold that the select board had endorsed in January 2020.
According to Bienvenue and principal assessor Colleen Mercurio, about 45 percent of Eastham’s properties are currently held by full-time residents and 55 percent by people whose primary residence is elsewhere.
That “doesn’t mean it’s off the table forever,” Eckman said.
Select board member Robert Bruns said he agreed with Eckman and Cerasale. “I don’t ethically get on board with pulling money from one group to give it to another,” he said.
To Bryan’s concern that need-based aid was insufficient, Bruns said, “I don’t buy the argument about too much paperwork. Wait until you buy a house. Then the paperwork — it’s endless.”
